Sorare Raises $680M to Expand Fantasy Sports NFT Game

Sorare Secures $680 Million Funding for NFT Fantasy Sports Platform

A substantial investment has been made in the French startup, Sorare. A Series B funding round of $680 million has been completed, with SoftBank’s Vision Fund 2 taking the lead. This valuation places the company’s worth at $4.3 billion.

The Core of Sorare: NFTs and Football

Sorare has developed a fantasy football platform leveraging the technology of NFTs, or non-fungible tokens. Each digital player card is uniquely identified and registered as a token on the Ethereum blockchain. Users are enabled to both purchase and sell cards directly from one another.

All transaction records are permanently stored on the Ethereum blockchain, ensuring transparency and security.

Strategic Partnerships as a Competitive Advantage

A key differentiator for Sorare lies in its collaborations with 180 football organizations globally. This includes prominent European clubs like Real Madrid, Liverpool, and Juventus. These partnerships establish a significant competitive barrier within the industry.

Future Expansion Plans

The newly acquired funding will be allocated to several key areas. The company intends to broaden its scope to include additional sports, establish a U.S. based office, increase its workforce, and launch targeted marketing initiatives.

Further announcements regarding partnerships with professional sports organizations are anticipated in the coming months.

Investors Participating in the Round

Besides SoftBank’s Vision Fund, the investment round saw participation from Atomico, Bessemer Ventures, D1 Capital, Eurazeo, IVP, and Liontree. Existing investors, including Benchmark, Accel, and Headline, along with various angel investors, also contributed to this funding round.

Revenue Generation Model

Sorare generates income through the issuance of new cards on its platform. Players can acquire these cards to expand their collections. Furthermore, users can assemble teams of players and accrue points based on their real-world performance statistics.

Card Value and Trading Dynamics

The value of each card is subject to market fluctuations, increasing or decreasing over time. Consequently, a robust secondary market has emerged, with players actively buying and selling cards from each other. Dedicated third-party websites now assist in tracking auction activity.

Since January, a total of $150 million worth of cards have been traded on the platform. Currently, Sorare does not levy any fees on these peer-to-peer transactions.

User Growth and Transaction Volume

Despite substantial transaction volumes, considerable potential remains for user base expansion. Currently, Sorare boasts 600,000 registered users, with 150,000 actively purchasing cards or building teams on a monthly basis.

Sales figures have experienced a remarkable 51-fold increase between the second quarter of 2020 and the second quarter of 2021.

Vision for the Future

Nicolas Julia, co-founder and CEO of Sorare, stated: “We recognized the significant possibilities that blockchain and NFTs offer in fostering a more profound connection between football clubs, players, and their supporters. We are delighted with the progress achieved thus far, but this represents only the initial phase.”

He continued, “We are confident in the opportunity to establish the next major sports entertainment entity, extending Sorare’s reach to a wider audience of football enthusiasts and organizations, and replicating this successful model across other sports and their respective fan bases.”

Significance of the Funding and the Role of NFTs

Sorare’s Series B funding represents a major investment, particularly for a French startup. Fantasy sports platforms are proving to be an effective gateway for introducing new audiences to the world of NFTs. This is a factor contributing to the popularity of platforms like NBA Top Shot among basketball fans.

These platforms are also serving as an accessible entry point into the realm of cryptocurrencies. The evolving regulatory landscape surrounding these platforms will be a key area to watch as user participation continues to grow.