Professional sports have been deeply rooted in the fabric of American society for more than a century, offering a daily source of joy (or pain if you’re a Mets fan) and serving as a safe haven for millions of people in difficult times.
However, when we inspire our favorite athletes, it is not transparent that the groups they play for are corporations that employ thousands of people in an original way and have ongoing monetary obligations, such as rents or debts. Like many industries, a deeply disruptive black swan An occasion like the current COVID-19 pandemic has caused monetary tensions for professional sports groups.
But calamity is also an opportunity to find solutions.
FC Barcelona, the titan of Catalan football, recently made a funding of 1. 2 million euros, although it is not exactly a remarkable success, the approach with which it has carried out it is novel.
The team racked up directly from enthusiasts and issued “tokens” based on the blockchain representing the investment. The chips do not provide any equity in the team or any percentage of the revenue, however, they give enthusiastic opportunities for “commitment”, such as on-screen appearances in the stadium and assembly matches of some players. The offer will be sold out in less than two hours. Even athletes are exploring new funding opportunities, as evidenced by Spencer Dinwiddie’s recent token sale.
FC Barcelona’s driving force presents a new funding opportunity for sports teams: to raise reasonable capital for the company while offering enthusiasts significant opportunities for participation.
Funding the day-to-day operations of a sports franchise or financing a new stadium has been precarious for team owners.
If you take on too many debts, you may have to restrict your athletes’ wages to pay interest. Use taxpayer cash and your city can also be simply derogatory (especially if you move the equipment later). upstart and I could go and deport you.
The allocation of the Barcelona pilot can simply create a path to financing the game involving debts, bankers, public cash or force conflicts. The solution is in the fans.
Fan ownership itself is not a new concept in sport. Green Bay Packers have been promoting inventories among enthusiasts for decades and are whoakered through enthusiasts. These enthusiasts do not realize any monetary return on their investment and do not influence the equipment or the long term. projects (decisions are made through a board of directors). What they get is an inventory certificate with a Packers logo to hang on the wall.
Packers have discovered a way to raise capital through interaction with enthusiasts and pleasing their nostalgia.
FC Barcelona’s chips would possibly be little more than the Packers’ certificate number, but the underlying generation, which is at the intersection of crowdfunding and blockchain, provides US sports groups with the needs to do so. But it’s not the first time A way to get capital from enthusiasts in a way that doesn’t. . t particularly affects the ownership structure, but produces a more significant return on investment for enthusiasts than a virtual collection object.
In the United States, crowdfunding allows the general public (think Main Street, Wall Street) to invest in personal companies, and has been popular since the Securities and Exchange Commission made some adjustments to the rules in 2015 in reaction to Jumpstart Our Business approval. Startups Act.
The JOBS Act created capital raising channels that in the past required extensive registration procedures and disclosure obligations with securities regulators. This has also generated a generation that has digitized and automated historically painful fundraising processes.
The confluence of these points makes the capital raise proposal for sports lovers undeniable and economical.
Crowdfunding generation provides the opportunity to independently market and sell an investment to millions of fans.
Fans who acquire tokens deserve them as blockchain-based representations of an underlying interest or asset In this scenario, it can be right in an investment vehicle that owns a small component of the equipment, an interest in a profit stream, a set of experience rights (e. g. FC Barcelona technique) or anything else: the design of the offer is the team’s prerogative.
Tokens offer a variety of benefits over classic assets through the account list.
They can be tracked, updated and transferred smoothly and temporarily by generating blockchain-based smart contracts, without documents or transaction fees. If tokens constitute values, smart contracts can ensure that all movements are carried out in a manner that complies with applicable securities law (i. e. , without anonymity and compliance with transfer restrictions). Automated compliance can create a colorful secondary market for tokens in regulated exchanges in the United States.
Fans who may have missed the main offer have the opportunity to participate, while investors of existing enthusiasts can download their chips for profit. If tokens constitute equity in a team, an active secondary market can produce a number of attractive effects for the team. Evaluations.
Fans can also access their assets in real time through a virtual wallet app on their phone. Depending on how the team structures the offer, enthusiasts can use their wallet to “scan” certain virtual or live occasions that are only open to token holders, as they would with a VIP pass. If the secure rights are similar to token ownership or the holding of a certain number of tokens on a “registration date”, a team could immediately verify the wallets of the fans at the appropriate time to see if or not it is eligible for the fan. This can come with a right to distribute to more tokens or other incentive-based rewards.
Sports groups exposed to COVID-19’s monetary difficulties would do well in all the characteristics offered to them, including non-traditional ones.
A symbolic offer of infinite possibilities for groups and their enthusiasts. The generation has been tested. The call of enthusiasts is close to certainty.