It is the largest amount ever raised in a single private fundraising round in the French tech sector, with the company riding high on a global craze for the digital collectibles known as non-fungible tokens (NFTs).
The funding round caps a meteoric rise for Sorare, which was only founded in 2018 and now ranks as France’s most valuable startup, with international football stars among its investors.
“Our ambition is to be the world’s first entertainment company within the sports sector,” co-founder Nicolas Julia said, adding that Sorare was eyeing a launch on the stock exchange “in the next few years”.
Sorare’s game blends old-fashioned football sticker collecting with new technology, financial speculation, and aspects of hugely popular “fantasy football” games where fans can build their dream squads.
Using the cryptocurrency Ethereum, players can buy and sell digital images of footballers in NFT form, with their value fluctuating according to their performances on the pitch.
Newcomers can play with free cards, which exist in unlimited quantities. But as always with collectibles, the rarest are the most coveted.
A unique Cristiano Ronaldo card sold for nearly US$290,000 in March, breaking the site’s records.
Celebrity investors
Blockchain, the technology underpinning cryptocurrency transfers, is used to authenticate the cards’ rarity, with the most sought-after existing only in batches of 10, 100, or as unique copies.
Sorare makes its money by taking a commission on auctions of the NFTs. The company also runs Mercato, a resale market, and cards here are sometimes traded for millions of dollars.
For now, Sorare takes “no commission on Mercato, but that may be what comes next”, said Julia.
Celebrity investors including former Manchester United star Rio Ferdinand, France forward Antoine Griezmann, and Chelsea captain Cesar Azpilicueta have helped drive the clamour to get hold of the cards.
But with Sorare falling somewhere between a game and an investment, players must be mindful of the highly speculative nature of the trades, and the volatility of the cryptocurrency they are made in.
“Straightaway I was hooked,” said Julien Bochereau, a 36-year-old journalist. “I find myself watching a Japanese match at 11am, a Belgian one at 2pm, Ligue 1 in the evening and Major League Soccer at 4am.”
He needs to watch the matches, he explains, to follow the performances of the players whose cards he holds. But he struggles to explain to friends why people are investing so much money in virtual football cards.
“People don’t always get it when I say I’ve spent €1,000 (around RM4,900) buying a Japanese defender, Ryuho Kikuchi,” Bochereau said, adding that Kikuchi “plays all the matches and he’s never injured”, pushing up his value on Sorare.
Sorare claims to have more than 250,000 active players, including up to 40,000 possessing paid-for cards.
The startup says it intends to pour the investment into an international expansion, with a US office in the works, as well as launching into other sports.
The company is also set to launch new partnerships with football clubs and leagues, hot on the heels of a deal with Spain’s La Liga.