Sports digital collectibles startup Sorare is rumored to be negotiating a €450 million ($532 million) round of funding, the largest single round in French history for a tech company, as reported by Business Insider. The outlet claims that sources said discussions value Sorare at $3.8 billion, and this number could surpass $4 billion. However, Sorare’s CEO Nicolas Julia denies that the funding will take place. Sorare raised $50 million in February.
In March, Dapper Labs raised $305 million at a $2.6 billion valuation. But NBA Top Shot creator Dapper is significantly larger than Sorare, its platform has far higher sales, and it is also the founder of the Flow Blockchain. However, the rumored lead investor for Sorare is SoftBank, which might explain the potential valuation.
Sorare was founded in 2018 and launched its product in 2019. The platform partners with soccer teams to launch player cards as non-fungible tokens that can be purchased and traded by fans and used to create a line up for Sorare’s weekly fantasy soccer game. In the fantasy game, users can earn cryptocurrency ETH if their line up does well.
The platform went through tremendous growth during the Covid-19 pandemic as clubs needed a new way to connect and engage with fans globally. The company signed deals with most leading European clubs and currently has over 140 teams on the platform.
With its increased popularity, Sorare’s card prices began inflating quickly after their launch, which attracted flippers to the platform that further inflate the price. The app still mainly appeals to soccer fans that have established a strong community providing resources around the app such as podcasts, weekly YouTube reviews of the fantasy games, trading threads, and posts on strategies.
Until now, Sorare had raised a little under $60 million in funding and its platform processed $54 million transactions, including secondary sales. Particularly compared to Dapper Labs, where the NBA Top Shot has processed more than ten times the sales, the question is whether the rumored figures are realistic.
Nevertheless, the platform has been growing successfully since its launch, claiming a 52% month-on-month growth at the beginning of the year, and might be looking to expand its product range significantly. It also has a relationship with game giant Ubisoft.
According to Business Insider, in this latest potential funding, Japanese conglomerate SoftBank is the lead investor. European fund Atomico, French fund Blisce, and asset management firm Eurazeo are also expected to participate, although none responded to requests for comment.
Around one year ago, Sorare raised a $4 million seed round. This February, the company raised a $50 million investment led by Benchmark. Reddit’s co-founder Alexis Ohanian also participated in the round. During the Euro 2020 tournament, Sorare expanded its outreach to national federations and onboarded the French, Belgian, and German national soccer teams to the platform.
