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Introduction 🔌🔧

Last week we started sending out invites to the biggest Sporting Crypto meet-up we’ve ever hosted. It’s going to be on the 13th of April in NYC from 6-9pm. If you’d like to come and meet some amazing people in Sports, Crypto, Media and Tech - please respond to this email!

We’ve already had 40 RSVPs over the weekend from leaders at some amazing organisations. I’m super excited about this so get yourself a free ticket before they run out!

Raising money in this market is difficult. Especially if your proposition is Crypto related.

But not for Matchday who have raised $21 million in a seed funding round to build an ecosystem of casual football games for billions of fans around the world.

The Web3 Soccer Gaming company boast an impressive list of partners, advisors and investors including Lionel Messi’s investment firm Play Time and two-time Ballon d’Or-winner Alexia Putellas. They are also backed by notable investment groups such as Courtside Ventures, Greylock, HackVC, Capricorn Investment Group and Horizons Ventures. On top of that, Matchday are officially in partnership with both FIFA and FIFPRO.

• Monster Raise ✅

• Officially licensed ✅

• Superstar investors, partners and advisors ✅

👥 So what about the Matchday team?

Let’s start with Co-Founder and CEO Derrick Ko, a Product Manager at Lyft before founding E-scooter company Spin, which was later acquired by Ford. Matchday is his first venture since the acquisition.

Former Spin CTO Benny Wong is also part of the team. He Co-Founded Matchday alongside Derrick taking up the CTO role.

Their Chief Gaming Officer, Sebastien de Halleux, has built successful game companies Glu Mobile and Playfish whom were both sold to EA, before going to serve as an executive at EA launching games such as FIFA, Madden and The Sims.

Razmig Hovaghimian, founder of early stage VC Graph ventures, serves as the company’s Chairman.

Matchday have assembled the avengers when it comes to Tech and Gaming — and are looking to take on the challenge and opportunity that Blockchain-based Sports gaming presents.

CEO Ko Said:

🎮 The Game

Matchday have been pointed so far in emphasising that there is going to be a ‘Matchday Ecosystem’, meaning that Matchday cards will be used in a variety of games in the future as they’re built out.

Right now, however, the Matchday experience is somewhat similar to the FIFA Ultimate Team Web App.

Users are able to create a starting XI Matchday call a ‘Squad’ which they are then able to play in simulated games against other users.

Cards are available to purchase anywhere from $0.50. 

One of the first points of activation for Matchday was giving away a ‘Challenge pass’ NFT on the Solana blockchain, with the 15,000 supply minted by over 2000 individual wallets. The passes were free but have generated ~ 2000 SOL (Solana’s native token) in secondary market volume.

The Challenge Pass allowed users to open up more packs for free to finish assembling their squads, rather than buying individual players. The pass also gives you access to token gated communities within their discord and a few other perks.

The cards themselves have rarities, similar to many other NFT Sports projects in the market.

Matchday launched a limited-time Matchday Challenge: FIFA World Cup Qatar 2022 Edition. The mini-game saw nearly 600,000 signups with two million player cards distributed.

To summarise so far: 

• Matchday have a rockstar team with superb advisors and investors

• They’ve raised $21m in seed funding

• They’ve deployed Matchday Pass NFTs which saw 15,000 free claims

• Their World Cup 2022 Mini-game saw nearly 600,000 signups

• Their game so far is one where users collect and trade player cards, to then use them in game simulations against other users

🧠 My Thoughts

Everyone is looking for the next Sorare. The French Unicorn have set the world alight with their NFT Fantasy game and investors are always looking for something that will go from 0 to $4bn valuation in a few years. They’ve set the standard for Blockchain-based Sports games.

My view is that like the physical trading card realm, there will be very few, large players that dominate the market due to the way Sports rights are managed.

These (typically exclusive) rights are long term and extremely expensive.

The question I’ve asked myself is whether or not Sorare have given rights holders unrealistic expectations? 

If you’re a Sports Gaming product that wants to use officially licensed IP - it’s incredibly capital intensive. Which therefore has a knock on effect to the amount of money these startups raise, and how much VCs are writing cheques for.

Sorare started off by acquiring relatively cheap licenses with the Belgian Pro League and some teams individually, like Liverpool FC.

The proposition started off as relatively high ticket, low userbase.

This means that the amount of marketing dollars required to increase revenues isn’t massive, as it is more about the type of user you acquire.

Then came a bull market in both Crypto and NFTs, and Sorare were there to capitalise with a great product that football fans and crypto enthusiasts both enjoyed. Hello hockey-stick growth in both revenue and users.

At that point, it’s a lot easier to expand and acquire more expensive licenses. Especially with strong, sustainable revenues as rights holders are more likely to take less money upfront, and more as a percentage of revenue.

Sorare started high ticket, low user count - and have started expanding that user count ever since — whilst still maintaining high ticket sales. Extremely difficult to.

What Matchday are trying to do is the opposite, and I do think there is a market for it.

They are trying to create a low-ticket proposition with a large number of users to drive strong revenues. A proposition that is far more simplistic and appeals to a larger group of people.

The issue is, it takes a while to get to the point where you’re making a significant amount of money with a model like this. All the while you are spending money on marketing to increase that userbase, and also paying high licensing fees to respective athletes, teams, leagues or in this case - federations. The bulk of this, is probably upfront cost as well — due to lack of revenue.

This is capital intensive and requires great investment — hence the $21m raise. 

With all that being said -— Matchday have the talent, connections, licenses and capital to create a formula for success that co-exists with the likes of market leaders Sorare.

One of the things I’m incredibly curious to see in Web3 and Gaming more generally is just how open some of these ecosystems will be.

RTFKT for example have (somehow) convinced Nike that opensourcing RTFKT content is the right strategy for their brand and proposition.

This is much more difficult when you’re using Sports IP, particularly player imagery. So the way around this has to be creative and calculated should Matchday want to create a community led ecosystem, rather than a company led one. Will the entire Matchday ecosystem be built and developed my Matchday?

Or will they look to create an incentivisation mechanism that allows developers and creators to use their IP, in a permissioned way of course where revenue funnels back toward the rights holders?

Time will tell how successful Matchday become but to me they’re one of the more durable and exciting propositions I’ve seen in the Sports Web3 Gaming market over the past 12-18 months.

Sporting Crypto Spotlight 💡

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More Sports & Web3 Stories

• Knights of Degen have released their on-chain fantasy tournaments. The mobile app looks sleek!

• Krause House were reportedly one of the entities in the running to acquire the Phoenix Suns. I might write about this and sports ownership DAOs next week!

• DraftKings have hit a new record for NFT sales on Polygon with their Reignmakers PGA Tour drop. 

• Dorking Wanderers have launched a digital membership scheme for their fans in the form of NFTs. Some free advice - if you have an incredibly small addressable market of fans whom you don’t make that much revenue from per head, do not create a digital members club.

• BIG3 have won the inaugural Sports Business Journal award for ‘Best in Web3’.

• McLaren have dropped their NFT collectibles on Tezos with over 100k claims. 

• NBA Legend Shaq is reportedly dodging lawsuits due to his promotion of FTX. 

• Kraken’s NFT platform is hosting a tournament in celebration of the Men’s & Women’s NCAA tournaments, where users can compete for over $50,000 in NFT prizes.

General ‘Stuff’ that Could Impact you

• Many of you will have been paying attention to the implosion of Silicon Valley Bank which had $140bn worth of assets. $3.3bn of which were funds that Circle used to backstop the stablecoin USDC. Thankfully regulators in the US and UK have moved quickly to protect depositors from this banking failure.

• Faze Clan & Nike joined forces to collaborate in an awesome campaign. Gamers are now cultural icons.

• Pokemon is looking for a Metaverse and Web3 Expert

Thank you!

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