Rumors of Sorare raising a record amount of funding have been swirling for months, and they turned out to be true.
The Paris-based fantasy soccer game and non-fungible token (NFT) trading platform has raised $680 million in Series B financing, led by Japanese conglomerate SoftBank, at a valuation of $4.3 billion. Announced today, the investment round follows a $50 million Series A, completed in February at an undisclosed valuation, and is Europe’s biggest ever Series B as well as the second-largest private fundraise among blockchain startups, just behind cryptocurrency exchange FTX, founded by the industry’s wealthiest billionaire Sam Bankman-Fried. Other investors included Atomico, Bessemer Ventures, D1 Capital, Eurazeo, IVP and Liontre, and existing investors Benchmark, Accel and Headline.
Similar to FTX, which positions itself as a platform built “by traders for traders”, Sorare was created “by football (soccer) fans for football fans” to operate at the intersection of the rapidly growing market for non-fungible tokens, which surpassed $14.27 billion in market capitalization last month, and sports cards. The company’s co-founder CEO, Nicolas Julia, sees its mission as becoming ‘a game within a game’.
“We want to create the biggest entertainment group in the sports world,” says Julia, who previously was the VP of Operations at Stratumn, a Paris-based company that offers a platform for developing enterprise-level blockchain applications. Sorare will use this investment to accelerate the company’s growth within soccer, expand into other sports, hire new talent, and open its first office in the U.S. (accounting for more than 20% of the firm’s revenue, according to Julia) in the coming months.
It is this credo of ‘a game within a game’ that prompted SoftBank to lead the fundraise, according to Marcelo Claure, CEO of SoftBank Group International and COO of SoftBank Group. The conglomerate has invested in multiple cryptocurrency startups, including Brazil’s largest crypto exchange Mercado Bitcoin and Peter Thiel-backed venture Bullish, and Claure has been taking an increasingly hands-on approach to managing his investments. “I’ve personally joined the board,” he told Forbes in an exclusive interview, “which is something that I try not to do, but I’m just so motivated by Sorare’s potential and what it’s trying to build.”
Founded in 2018, the French startup has quickly established a dominant presence in fantasy sports, the world of online games where users can assemble virtual teams of real players of a professional sport. In the case of Sorare, players trade and manage a team with digital cards in the form of unique digital assets, namely non-fungible tokens verifiable via the Ethereum blockchain.
The most expensive cards, featuring star players like Cristiano Ronaldo and Antoine Griezmann, sell for nearly 100,000 EUR or more. Notably, some of these players have interacted with Sorare’s platform first-hand, according to Julia. “Antoine, for instance, is playing the game on a regular basis,” Julia says. “He’s a real fan and brings me feedback on the scoring” (Forbes has not received a confirmation from Griezmann’s team by press time). In December 2020, Barcelona defender Gerard Pique joined the startup as a strategic advisor. Both players as well as Chelsea captain César Azpilicueta and former Manchester United captain Rio Ferdinand also participated in the current round.
Sorare says it has over 600,000 registered users on the platform and has licensed players from over 180 professional clubs, including Real Madrid, Liverpool, Juventus, the French and German Football Federation. According to the company, over $150 million worth of cards traded on the platform since January, and the number of monthly active users grew by 34 times between Q2 2020 and Q2 2021 while quarterly sales increased more than 50 times over the same period.
As similar platforms, built at the intersection of sports and crypto collectibles, take off—take NBA Top Shot, a $683 million online marketplace where basketball fans can buy and sell video highlights of their favorite players, or newly established Candy Digital, NFT startup founded by popular sports merchandise company Fanatics in partnership with Galaxy Digital CEO Mike Novogratz and chairman of communications company VaynerX, Gary Vaynerchuck,—the freshly minted unicorn hopes to replicate its model in other sports. “We are thrilled by the success we have seen so far, but this is just the beginning,” says Julia. “We believe this is a huge opportunity to create the next sports entertainment giant, bringing Sorare to more football fans and organizations, and to introduce the same proven model to other sports and sports fans worldwide.”