As esports continues to grow and change, fewer people have a more holistic long-term perspective than compLexity’s Jason Lake.
He’s been the staple of the organization — and esports — since founding compLexity in 2003. CompLexity has teams in Counter-Strike, Dota 2 and Overwatch and had two previous stints in League of Legends.
Lake is active on Twitter in following esports’ growth and all that has come with it. Slingshot’s Vince Nairn had the chance to talk to Lake for an extended two-part interview. In Part 2, Lake talks about where the Professional Esports Association went wrong, how Overwatch League has caused a bit of limbo period for teams, and why he loves Dota 2. Check out Part 1 of the interview, and catch the entire audio version of the interview (also available for download) below:
Vince Nairn: We’re a couple months removed now from everything that transpired with PEA, but reflecting on it now, where do you think things kind of took a negative turn?
Jason Lake: PEA was seriously and sincerely formed to be something very good for the scene. We had vastly altruistic motives. Obviously we’re (also) business people. We’re team owners in an environment that is becoming quite crazy. You’ve got tournament organizers on one side and developers on the other side, and often team owners are caught in the middle. We’re bulldozed over and under. We’ve got all this money and all these sports teams entering the space. If we don’t band together and form some type of leverage and start building something like the NBA, then we’re just gonna become dinosaurs. We’re going to be pushed out of an industry that we built.
Of course there was that thought there that we have to look out for ourselves. We have to look out for the team-based business model. We have to group together. We have to build something that is bigger than any one team. We have to build something collectively. But while we were doing that, voices were always very loud — and I mean this very truthfully — that we want to do right by the players. We want to do right by the casters. We want to create something special where there’s profit sharing or there’s health insurance for the first time or casters are brought in on rev sharing for the first time — to my knowledge — ever. We’re trying to build a program and a league that was different, that raised the bar, that created the next level of esports for many, many people — not just ourselves.
I’ve always been a big believer that if you do what’s right and you treat people right, it’s going to come around. You’re gonna make more money at the end of the day, even if you sacrifice short-term profits. And that was very much the tone throughout the PEA meetings. The one thing we all failed on was we’re all super busy, and we did not do a good job as a group of properly communicating all this with the players. When we sat down with them and I famously tweeted out the picture, “We’re making history right now,” I sincerely believed it, and so did everyone in the room. And then we all went and got busy, and we’re all wearing 15 hats a day, and we have multiple games and there’s a lot going on. We had a commissioner (Jason Katz) who was in charge of setting everything up, but at the end of the day, it was our responsibility to communicate this vision to our own players, and that is where we, as a group, failed.
The players started believing PEA had different motives. The players started believing it would be best for them to play in three online leagues: FaceIt, PEA and ESL, which the owners strenuously disagreed with. We felt the online space had become greatly over-saturated and it would do a disservice to North American Counter-Strike to have three online leagues running at the same time. And there was things said and people got heated and Reginald, that whole situation, which was really super unfortunate. And I will tell you behind closed doors, the owners do give a shit. We were depressed about it. It was right around the holiday season, and these guys are my friends as well as my colleagues. People were sick to their stomachs. This is not what we wanted. We wanted to do something better. We wanted to raise the bar. We wanted to work hand in hand with the players and casters.
Of course we had some self interest in this. We’re businessmen. We have families. We have companies to run. They need to be profitable. Many of us have investors to answer to. So we’re not denying that. We’re not saying “Oh, we’re just saints falling from heaven to save the players.” It’s not like that. But we believe there’s a win-win-win that could be had, and that’s what we were trying to build. And when it all blew up in our faces, sometimes you try not to get too emotional in this business because you have to be objective and scientific to run a business, but it kind of stunk. I respect the players and what their opinions were.
I think there was a lot of misinformation, and perhaps we chose the wrong game. Frankly speaking, Counter-Strike has a history in North America with some of the teams, and there was some bad blood and hard feelings. Maybe it would have been better to start in a game where that animosity didn’t run that deep. I don’t think the PEA’s seen its last and final stand. It’s still an operating entity. It’s just kind of circling back around to see what we’re going to do in the future. A lot of people are still kind of stung by the wounds we took during at that time because at the end of the day, we’re just people. When you’re getting blasted on Twitter or in some article about being cold-blooded bastards, and people are making comments about your family and how evil the owners are. The players are always right, the owners are always evil, and this ridiculous narrative, it gets tough. We’re all very busy people and everyone is trying their very best to run their businesses, but the theory and the structure behind the PEA still makes sense.
If teams don’t come together and work together to build something better for us and hopefully for some group of players in a game yet to be determined, I don’t think that’s best for the future of esports. I think the NBA, the NFL, FIFA leagues have shown teams have a vital place in the ecosystem. Esports is a strange little world where the developers own the actual games we play — nobody owns the game of soccer — but that nuance only even makes my argument that much stronger. In the team based business, if we don’t band together, we’re the fools, and we’re the ones who will ultimately pay the price.
VN: One last Counter-Strike question: The open letter you wrote to Valve a while ago about Braxton Pierce has become relevant again. He was able to play in the CS Summit and Richard Lewis made a video about the banned players. What do you make of this entire situation with the iBUYPOWER players? And what do you think it would take for that ban to ever be overturned.
JL: Yeah, I wrote that almost a year ago and it’s still coming up. I still get people retweeting it a year later. The funny thing is the most heat I’ve taken about the letter is not that people disagree with the letter. It’s that people were like “Why didn’t you include everybody?” It’s a simple answer, really. No. 1: Brax came to me and in a heartfelt way we had a conversation. He asked me if I would go to bat for him. And after thinking it over, I said, “Hell yeah I will.” The others didn’t.
I didn’t feel it was my place to become crusader for all the iBUYPOWER guys. He was a young guy who wasn’t even 18 when this happened who asked if I could help him out, try to get something done. And that was one of the things I did to try to help him. It wasn’t meant as a slight against the other iBUYPOWER guys. But coming from a legal background, I do think he has the strongest argument of any of the guys because he wasn’t 18. People might not like the fact that when you turn 18 you assume many more responsibilities and the law views you differently in the United States, but that’s a fact. If I’m his attorney, one of the things I would argue absolutely is that he wasn’t 18. He was a minor. Some of the other guys were above 18 and thereby were not minors. That argument doesn’t hold much credence on Reddit, and I get that. That’s fine. But as a lawyer that’s something you should always try to use all the bullets in your gun, right?
But that’s why I did that because he asked me to. And if I was called to Valve headquarters, I would be glad to lobby on his behalf and on behalf of the other guys. In my opinion, what they did there was no excuse for, but there was also no precedent, either. I think they should be given a second chance. But at the end of the day, that’s a great example of how the developers hold an inordinate amount of power in esports. Judge, jury and executioner with no appeals process. I totally understand why Valve would come down with the heavy hand, and I respect it and applaud it. But as I said in my letter, sometimes situational clemency is appropriate. And I think fans and observers agree this is one of those cases with the iBUYPOWER guys.
VN: You picked up an Overwatch team in August. What made you decide that was the right time, and how long had you been monitoring the Overwatch scene before deciding you wanted to enter?
JL: Overwatch, it didn’t take a brain surgeon to realize it was gonna make a big splash. They were selling copies like crazy. Blizzard had been hyping it with all sorts of creative marketing campaigns for some time, so we had been watching it since the beginning. The team we were looking at had been doing very well, and the roster’s changed a bit since that time, and it might change again before the Overwatch League. But we’re big fans of Overwatch. The game’s incredibly fun to play.
My concern with Overwatch is also no secret to most observers. It’s incredibly fun to play but incredibly hard to watch at times. You don’t have hero moments with Counter-Strike, like this 1-v-3. (Instead) everybody ults, and you’re not really sure who contributed to it, and it’s like “OK, they won. Now we need to wait for a cool down,” and it’s just rinse and repeat. So I do think they’re gonna have some challenges and they might have to make adjustments to the way the game’s played. I worry it’s a TF2, where it’s a really fun game to play, and the viewership never took off. But I know Blizzard’s hell bent on making it a competitive esport, obviously. And they’ve got all the resources in the gaming world at their disposal and some super smart, passionate people over there.
I’m bullish on it and I’m hopeful they can turn Overwatch into a global esport that rises to the likes of Counter-Strike, Dota, League of Legends. But if we’re all being honest with ourselves, it’s remained to be seen if they can do it. They had mixed results with StarCraft 2 after they took it in house. They’ve had mixed success with Heroes of the Storm. Great game. Fun. But it’s had mixed success as an esport. Call of Duty has really seen some interesting changes over the year. Activision’s supported it, and the MLG guys put a lot of work in and really do a good job with that. But can Blizzard turn Overwatch into a Tier 1 esport? Probably. And there’s gonna be people betting millions of dollars that they can, if the rumors are true about these franchise prices.
We’re definitely interested. I wouldn’t be spending what I’m spending every month for an Overwatch team that barely has anything to play in — they have some weeklies here and there. There’s no LAN events. There’s no Majors. There’s not a whole lot of compelling competition going on around the world in Overwatch right now, but teams like mine have to write a check each month to support these guys and the houses because we believe in Blizzard and we believe in the game of Overwatch. But it’s definitely not a slam dunk. This is not a 100 percent closed case that just because Activision wants to sell franchises, does not mean this game is gonna be a successful esport.
The community is always what decides whether a game or not will be a successful esport. Developers can try. They can beg, plead, plow in millions of dollars, but it’s passionate gamers all around the globe that are gonna decide if this game is successful. As long as Blizzard remembers that, I’m confident they’ll make a really successful esport. But right now, it’s a difficult kind of waiting game for a lot of teams, lot of players. We saw Seagull step down because you make more money streaming than you do playing competitive.
There’s just a lot of us that are really putting our faith in Blizzard and hoping they come to the table with something exciting that includes endemic teams, that includes a lot of people who have put their blood, sweat and tears into this space, and not just the BBC, the Billionaire Boys Club, that can write Bobby big checks over to Activision. I believe they’re gonna do the right thing, and I’m looking forward to seeing what that’s gonna be.
Overwatch League kind of comes into my next question: As an owner, how do you handle this limbo period? As you said, there’s not really any tournaments to play right now and everyone is kind of waiting for details about Overwatch League. How are you handling this limbo period?
JL: It’s a bit frustrating, to be honest with you. Like I alluded to earlier, I’m currently very much in negotiations with investors and professional sports teams and trying to find the right fit for us. Because money is pretty easy to get, honestly. But the right relationship, the right corporate marriage, as I like to call it, is not easy. It’s incredibly important. But during a lot of these talks, a lot of people are like “Let’s wait and see what the Overwatch deal is.” Because you want funding for an Overwatch franchise spot, but we don’t know how much they are. Where they are. What the contract looks like.
So it’s hard from a corporate side to kind of take this next leap when part of my corporate pitch is we’re very interested in Overwatch, and buying a franchise, but I don’t know how much it is, and I don’t know what the details are, and I don’t know where it would be. So everybody is like, “It makes sense to wait.” Yes it does. And now wow, holy shit, it’s April and there are no details. It’s getting a little frustrating.
And then you go to the team side, as I mentioned earlier. These gamers are working their butts off. They’re training super hard, and teams are trying to get positioned to have compelling, competitive squads by the time the game comes out. And teams are paying them $20,000, $30,000, $40,000 a month to maintain these teams and houses and to train these gamers while there’s very little competitive activity going on. So there is a level of frustration across the ecosystem going on, and everyone’s just hoping and praying that the wait pays off and that the league comes out soon and there’s compelling and competitive activities in the interim.
VN: Yeah, it’s kind of crazy and not like anything I’ve seen in esports before. Some people I’ve talked to are in the camp that this can determine how well the next five years of esports goes as a whole. Do you buy that at all?
JL: I don’t think any one game coming or going can pop the esports bubble — and I do believe we’re in a bubble. And I think we’re gonna see that bubble deflate a little bit, but I don’t think it’s gonna pop. We’re way too diversified now. There’s multiple compelling and exciting titles across the ecosystem with millions of fans. If Overwatch League were to flop, it would definitely hurt the scene because Activision has spent a great deal of effort selling this league to very wealthy, influential people. If those people see this thing fail, their conclusion of the industry could be, “Esports failed.” That is a great concern of mine.
A great concern of mine is Overwatch is being pitched as the future of esports, and Activision would be intelligent as a publicly traded company to only behave in its own self interest and not in the interest of esports as a whole, because that’s not what they’re paid to do. That’s not the fiduciary duty they have to their shareholders. So Activision, if they are behaving in their own best self interest, is out there pitching Activision games and Activision properties and leagues as the only place to be, the best place to be, right? So I do have a sense of concern should the Overwatch League fail, we would lose a lot of high net worth individuals at the top.
But the heart and soul of esports, what makes esports really tick, the community and the fan base and the ecosystem, the casters and the press, the owners and just the passion we all share, that’s not going anywhere. Overwatch could completely bomb. It could be a nice little speed bump on the speedway, and we’d just keep chugging along.
VN: I think the Dota scene is one of the more fascinating ones in esports. What do you kind of make of it, as an executive from one of the few (multi-team) orgs to stay with Dota, even as others left?
JL: I’m a bit baffled by why so many top tier orgs stopped supporting Dota. I think Dota’s freaking awesome. It’s really fun to watch. It’s got a huge player base. It’s arguably more difficult to pick up than League, but to me that makes it even more exciting. Back in the days where TI was the only thing Valve was really getting behind, I think that hurt the game a little bit. Because everyone was focused on one event, and afterward the teams would just always dissolve and go their own way.
It was just kind of hard to follow and hard to get excited about for many people. But that’s changed, man. The last couple of years with the Majors, they’re really exciting. They’re all around the world. I love Dota. I think it’s an amazing game, an amazing scene. I’m always shocked when I get to speak with new entrants in the scene sports teams or investors, and they’re just not really aware of Dota. This is a gigantic scene with huge viewership. So I don’t know. I’m starting to get whispers and scents here and there that more people are starting to feel there’s great value in Dota. Just the other day, the Immortals CEO, Noah Whinston, was alluding to bringing his group into Dota. Cloud9 recently came back to Dota. TL, Team Liquid, has remained in Dota as we have. We’ve got our guys in a house in Miami, and we have our awesome chef, Josh, who lives there.
But we love the space. We’re gonna continue to support the space as long as it’s economically viable. It’s not the cheapest game to be in, and it’s not the most recognizable game, but I think it’s a dark horse for esports. It doesn’t get enough credit. It doesn’t have enough fans, and maybe that’s just because of League of Legends vs. Dota fans or whatever, but I’m a big believer in the game, and we hope to be involved in it for years to come.
VN: Why do you think it is that it’s struggled to gain traction or that teams are just now starting to come back to it?
JL: I think there’s a plethora of reasons, to be honest with you. Players at the top echelon of the game make so much money in prize money, they don’t really need teams. When there’s no symbiotic relationship between the team and the player, relationships break down quite easily. Players just kind of come and go at a whim, and it created a great deal of instability.
And then in the game, for whatever reason, in many circles it just hasn’t been seen as glamorous as League of Legends and CSGO, despite the fact the viewership and the interaction with the game is significant. Like I said, when I speak to people that are coming into esports, I always like to get their opinions. Dota is never mentioned. It just blows my mind. How can these people see no value or worth in Dota that it’s not even in presentations, it’s not in the decks or conversations. Why exactly that is could probably be debated, but I do believe Dota not only is an incredibly valuable part of the esports ecosystem, but it will remain that way for years to come.
VN: Last one for you: This has been an issue that mainly comes up in Counter-Strike but also applies to the industry as a whole where there seems to be just rampant conflict of interest. If we look at WESA and the way they’ve just now handled the fact that ESForce has shares in three major orgs, or RFRSH saying they could own shares of multiple teams they represent. ECS telling us that they don’t have a rule that outright bans multiple team ownership. What do you make of the conflict of interest that seems to exist at a lot of levels? And the general indifference to it by the community?
JL: Yeah, I want to touch on the latter part of your question, which really baffles me sometimes. When I did get a chance to peruse the Reddit forums, there’s so many people who are like “What’s the big deal if the same company owns three esports teams?” Maybe it’s because I’m older. Maybe it’s because I have a legal education. But I didn’t think I’d need a legal education to understand that in any competitive activity, even the hint of potential of collusion completely destroys the integrity of the activity.
Eventually, there’s gonna be situations where if you own three teams, a couple of those teams are gonna play each other in an event that affects other players. There’s politics. There’s money. There’s gambling. There’s betting sites — all this stuff going on. If we’re truly a competitive activity and not more a production or show, say wrestling or WWE or whatever, then we have to maintain separate ownership. It’s like Conflicts 101. Sometimes I get so flabbergasted I don’t even know how to explain this because it’s so blatant. You can’t own multiple teams in a league if it’s going to truly be a competitive league.
We’re trying to have integrity. If you look how other leagues around the world have dealt with this, particularly in North America, you can’t own a percentage of more than one NBA team or NFL team. There’s very strict rules. Even in PEA, one of the things we made damn sure to set up in our operating agreement was protections against conflicts of interest. Because as soon as that starts coming in, which is exactly what’s happened in Europe, competitive integrity is greatly, greatly undermined.
Whether or not it ever happens in reality — like “Hey you gotta throw this game,” etc. — it doesn’t matter. It’s just the treat of that happening. It’s the potential of that happening. And your competitive integrity is gone. The bottom line is I think people in Europe are finally starting to realize this is getting out of hand. There’s rules implemented, you mentioned, by different groups. I don’t think they’ve gone far enough or are moving fast enough, but at least it seems they’re aware now that this isn’t OK. And it’s not a cultural thing. It’s just common sense. If we want to build a legitimate, competitive activity, a competitive sports entertainment property, we can’t have ownership across entities that compete with each other like that.