Flashpoint dead as members walk away from competitive Counter-Strike

Nine months after the sports world shut down amid the coronavirus outbreak in March 2020, a series of top esports players, commentators and staff flew to London. 

That November, with the virus outlook improving, the crew behind Flashpoint hoped that they could get back on track. Within two weeks, their worst fear became a reality: A series of COVID-19 infections sidelined them in their final week of competition, postponing a playoff bracket match and bringing the competition to a halt.

It was another hurdle in what seemed like an endless run of COVID-19 issues, which by then had affected an estimated 70 million people and caused more than 1.7 million deaths worldwide. While the NBA and other sports leagues successfully pulled off a bubble environment for their seasons, the much-less experienced Flashpoint continued to struggle. 

Launched as a “revolutionary league” for North American “Counter-Strike: Global Offensive,” Flashpoint set itself up to cut out the middleman, fix loudly-expressed economic issues within the game and bring a new style of content to one of the West’s oldest esports. 

Instead, amid an unforeseen set of pandemic-related circumstances, the league found itself—like everyone else—struggling to organize solely online, with teams locked down in their apartments or team houses, commentators broadcasting from home and a custom-built Los Angeles-based studio dormant for most of the year.

What looked like a good bet in 2019 among some of North American esports’ most successful teams now seemed like it would easily lose the $16 million invested. The teams involved no longer questioned when the league could safely return to offline competition. But if. 

Less than two years later, Dignitas withdrew from “Counter-Strike: Global Offensive,” making six of the eight original partner teams for Flashpoint no longer participants in the game. Only one of those teams has retained roster pieces that they competed with in the league throughout 2020. 

While Flashpoint’s parent B Site isn’t legally defunct yet, its board contains just two members—representatives from MIBR owner Immortals and Dignitas—and it laid off its remaining staff, including former commissioner Christopher “MonteCristo” Mykles, in January, sources familiar with the company told The Jacob Wolf Report. 

Functionally following its fourth event in May 2021, its member teams have stood at an impasse, unsure of how to proceed, with many giving up on the league altogether. For the second time, the power play to shake North American Counter-Strike has failed, and this time it’s unclear if a third act will ever be in the cards.

Many in the league blame COVID-19’s impact on its ability to run tournaments, but several also feel jaded by the financial model of the current North American “Counter-Strike” team, according to sources. Their other team peers and critics argue otherwise—that the Flashpoint teams bit off more than they could chew out of arrogance and greed to usurp their competitors.

The economics are a problem Flashpoint promised to address, allowing for teams to better partake in the riches generated by tournament organizers, while cutting out the middleman that exists in its biggest competitor, the ESL Pro League. 

“As awesome as the esport is, the business of ‘Counter-Strike’ is really bad,” former Cloud9 president and Flashpoint founding board member Dan Fiden told me in a March 2020 interview. “It’s been one of the worst. So as the entire industry changed and the team side of the esports industry changed, we felt like—and we weren’t alone, there were some other teams—there was an opportunity to do something different. We had the access to the money to try and find something ourselves that had structurally different economics.”

Since summer 2016—when SK Gaming signed the reigning Major championship roster from Luminosity for $10,000 per month in salary—the cost of a “Counter-Strike” team has continued to climb. With “League of Legends” salaries entering the millions of dollars per year and “Counter-Strike,” to many, scoring as the second-biggest esport game on the eye test, its salaries have followed. But unlike “League,” where teams are franchised in leagues run by its developer, Riot Games, “Counter-Strike” offers fewer revenue streams, and outside of the top teams, many often fail to recoup their costs, including most of the Flashpoint teams. 

In the short term, costs have been offset by unregulated sponsorship categories—be it gambling, cryptocurrency, alcohol or others that carry restrictions in other titles. 

The game gets minimal developer support, with Valve offering revenue-share opportunities on in-game stickers a couple times a year for the best teams in the game (the ones who qualify for the biannual Majors). Since 2020, third-party leagues, like ESL and BLAST, began offering some revenue incentives too, partly thanks to the Flashpoint teams’ pressure to reform and their short-lived, but effective holdout from their competitors.

But long term, the problem remains: outside of those leagues, few teams can turn a profit on competing in the wildly-popular first-person shooter. 

Ultimately, Flashpoint did not change that economic model enough, despite offering its teams a primary seat at the table. No middleman existed—the league hired tournament organizer FACEIT to operate the league, but that organization did not run the organization like ESL or BLAST.

Flashpoint cost each of its member teams $2 million, which is all but gone. Cloud9, c0ntact Gaming, Dignitas, Team Envy, Gen.G, MAD Lions, MIBR and FunPlus Phoenix collectively invested $16 million upfront in the league and saw no return.

Flashpoint had just two sponsors across its four events in 2020 and 2021, both sportsbooks, Pinnacle and Unikrn. Since it ran its third “Counter-Strike” event in May 2021, it has generated almost no revenue. And with Mykles’s termination, it no longer owns “Insight on Esports,” the well-viewed YouTube channel he creates content for with co-founder Duncan “Thorin” Shields.

Behind the scenes, many of the Flashpoint teams were checked out long before it shuttered in January 2022. Outside of those who held board positions over time—namely Cloud9, Dignitas, Envy, Gen.G and MIBR—the other three were not actively participating in planning. 

And over time, those five rotated in and out of power, with Fiden, Gen.G co-founder Kent Wakeford and Envy investor Randy Chappel leaving the board and rejoining it at various points through 2020 and 2021, according to sources. The board also fired behind-the-scenes CEO Michael Lipman, a former European soccer staffer whom it hired using an outside recruiter, in late 2020.

Several sources describe the founding members as “dysfunctional,” unable to agree with one another on many high-level decisions, to the frustration of their peers. Unlike ESL or BLAST, where teams provide input on decisions, there was no final decision maker at Flashpoint, and the product sustained damage as a result.

It’s also the second time a conglomerate of top North American teams tried and failed to grab power in the “Counter-Strike” ecosystem.

In late 2016, seven esports teams headquartered in North America founded the Professional Esports Association (PEA). Several of those involved later founded Flashpoint, including Cloud9, Dignitas and Immortals, who would go on to acquire MIBR. 

The PEA promised to run its own esports leagues and forbade their players from participating in ESL events, which drew intense scrutiny from both their players and the public. Four days before Christmas 2016, former Evil Geniuses executive Scott “SirScoots” Smith published an open letter deriding the teams, with support from many of those teams’ players, including TSM in-game leader Sean “sg@res” Gares. 

Two days later, Gares announced that the team had fired him, causing a bigger uproar around players’ rights and setting the foundation for the Counter-Strike Professional Players Association, a first-of-its-kind labor association for the industry.

On Jan. 5, 2017, five of the teams recanted, allowing their players to compete in ESL events again and effectively turning the PEA into a group of teams who would regularly meet, but no longer the tournament organizer it promised to be. 

Between the PEA teams, though, two—Complexity Gaming and Team Liquid—rejected participation in Flashpoint and instead joined ESL’s reworked Pro League as founding partners. Both teams are still active in “Counter-Strike,” while many of their PEA peers are not. Take that as you will, for how they justify the economics of the game.

It all leaves Flashpoint dealing with the familiar problem of an uncertain future.