Hey Sports Tech Fans,
What an insane week.
It feels frivolous to talk about sports with everything is going on in the world right now.
Thoughts and prayers are with those who are caught up in a conflict that no one wants.
But the show must go on.
Thanks to those who voted for my company LiveDuel in the ICE pitch competition. It is greatly appreciated.
DAZN has a recapitalisation of $4.3 billion after posting $1.3 billion in losses for 2020.
It goes without saying that a lack of sports in 2020 really hit the “Netflix of Live Sports”.
It is interesting that this new money, which leaves the company debt free will be used to fund its expansion into to sports betting and NFT’s as the sports industry continues to adopt both at a record pace.
DAZN might have lost out on a deal to purchase BT Sports, which would have given it a huge presence in the UK with a very rich catalog of sports rights, but this new cash injection is a huge vote of confidence in the company and its strategy from its very rich owner.
BT Sports are still in discussions with Discovery about a joint venture. I will be sure to report on that as soon as new news is available as it is a very interesting deal.
If 2021 was the year of the NFT, it looks like 2022 might be the year of the DAO.
DAO’s are decentralised autonomous organisations, which essentially means that it is an organisation that is governed largely by smart contracts that people invest in and as an investor you can vote on the running of the company.
You can look at it as an investment fund on the blockchain, funded by anyone and its governed by a set of rules embedded in the smart contract with votes making decisions for the organistion by token holders.
Last year I reported on a couple of DAO’s in the sports space. One to buy and NBA team and another to buy an English Football League team with the goal of getting to the Premier League. As well as the Class of 92’s DAO a couple of weeks ago.
We have another two this week.
The most striking of the two is a $4 billion DAO to buy the Denver Broncos.
The DAO is being led by Sean O'Brien, a 10 year veteran of Cisco.
But it is not without its complications.
Obviously raising $4 billion is no easy achievement but there are also NFL rules which might get in the way of such a purchase:
- In 1980, the NFL put in new rules that banned a “decentralized,” community-driven ownership that the Green Bay Packers use (though the team has an exception via a grandfathering clause).
- Rules state that ownership must be led by a single person that has at least 30% equity in the team, with minor exceptions for a family ownership structure. There is also a limit of 32 owners for one team, and sales need to be approved by the NFL.
It remains to be seen what will happen here or even if the funds can be raised in the first place but the sports fan in me would love to be a part owner of an NFL team and I’d imagine there would be a lot of other sports fans out there that would love the idea of it, even if in reality you dont get the owners box or get to lift the trophy should the team win the Super Bowl.
The other DAO is a lot more achievable, but not without its own complications.
LinksDAO is a golf dao that is on the hunt for a golf course after selling membership NFT’s that raised over $10.5 million.
A great start but a PGA rated golf course can cost multiple of that and the operational costs are substantial to keep it PGA rated.
The DAO will look to launch is governance token LINKS later in 2022 which is sure to raise more money with NFT holders likely to be airdropped tokens.
But legal issues around owning real estate by a decentralised organisation is a tricky one and might come down to where the DAO votes to try and buy the golf course.
Again a very interesting project that I will be paying attention to as the story progresses.
Elsewhere in Crypto land the Premier League are looking at deals for the sale of image rights for NFT’s.
The bidding is reported to be at the $600 million mark, which would be a massive deal and would drawf deals made by the NFL and NBA.
There are a number of bidders including Sorare, Candy Digital, Dapper Labs and ConsenSys.
It would be a massive deal, no doubt but players are paying close attention as it is their likeness that will be used and they believe they should be part of the conversation.
There are a number of factors and how the money is divided out is unclear at this point.
The Premier League obviously own the rights to the on field action, so a Top Shot-esque would likely see the Premier League receive the money, which is then divided out to teams with everyone getting a base rate, with teams higher up the table receiving more in a similar structure to the live rights themselves.
Would this model work for NFT’s? I am very confident in saying that Ronaldo NFT’s would trade for a lot more that Neal Maupay’s. No offence intended but it gets complicated quickly.
The Premier League is due to bring forward the final bids with a recommendation of a preferred bidder in March for a vote by the 20 Premier League teams.
We will revisit this when we get more updates.
On the tech side it is worth noting that Sorare, Candy Digital and ConsesSys are built on the Ethereum blockchain while Dapper Labs decided to build their own blockchain Flow.
Have a great sporting weekend,