Esports Contracts 101

A primer to help aspiring esports players to make better decisions

Information asymmetry is a concept in contract theory and economics that has to do with decisions in a transaction where one party has more or better information than the other. Most new players don’t know who to ask for help and go into contract negotiations without knowing their own true value and industry standards. This asymmetry leads to one-sided contracts that heavily favor the teams. The purpose of this video is to even the playing field and empower players, especially new to the industry, to make better decisions.

In the video, I break down the most common terms and the basic structure of a contract. I show how players with different priorities can translate what they want into basic contract structure. Then, I explain how teams value players and how they manage cost and risk and show some examples of how players can approach compromises. I then look at the role agents and lawyers play in the process and what factors to consider if players want to hire them. Finally, I offer advice on how different players can prepare for the off-season.