I agree with you, Riot loses money even after making hit series like Arcane while Valve has infinite money printing machine Steam. Also Riot spends significantly more money marketing their games while I don't even think Valve has a marketing team. Even in league, I heard that Riot took away f2p progression and cosmetic stuff because it couldn't generate them money. Riot has to find ways to profit and unfortunately franchising the esports scene falls into this.
But still, Riot are control freaks and franchising stuff aside, they could have added support for user generated content like modded servers and workshop content with custom maps.