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Riot Games Beware: One-Hit Wonders Flame Out

Riot Games, maker of the popular League of Legends computer game, is emerging as a gaming company to watch thanks to its free-to-play business model that offers hope for the dim PC gaming industry. But the company should take a lesson from gaming giants of the past and be quick to diversify. Timeless money-making hits are rare to non-existent in the gaming world.

Unlike many video game companies that charge around $50 for their games, Riot offers League of Legends for free and charges users for in-game currency which can be spent on new characters. Teams of five players fight against each other, casting spells and wielding swords to destroy their opponent’s home base, called the Nexus.

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Mr. Beck says deciding how quickly to grow the team is “one of the things that certainly keeps us up at night” and something the company pays a lot of attention to.

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“I think that PC gaming actually has a ton of mileage as demonstrated by Riot and others," says Kristian Segerstrale, a venture capitalist