South African startup Fanfire has launched to help sports franchises engage with their fans using non-fungible tokens (NFTs).
An NFT is a unit of data stored on the blockchain that certifies a digital asset to be unique and non-interchangeable, and can be used to represent items such as photos, videos, audio, and other types of digital files. The NFT market value tripled in 2020, reaching more than US$250 million, and in the first quarter of 2021 sales exceeded US$2 billion.
Fanfire is tapping into this trend, and is using NFTs to rethink the ways in which sports franchises can engage with their fans. In this case, fast online trading of physical and digital memorabilia, NFT-based tradeable lifetime passes to meet players online and in the real world, and tradeable items in games.
G-J van Rooyen, a co-founder of Fanfire as well as fellow South African crypto-focused startup Custos Media Technologies, said the company had launched the concept with The Sharks during the recent British & Irish Lions Tour.
“Sports franchises use Fanfire to blend digital and physical engagement with their fans. A key component of the platform is the use of NFTs that can be used to reward fans with physical merchandise, real-world privileges such as dinner invites with players or access to voice chat rooms, and digital collectibles that can integrate with mobile games,” he said.
“All of these combine to create a fan economy that continuously ploughs back value into the sport. A franchise may indicate that a percentage of the resale value flows back to them each time an NFT trades. This could be given to their sports development foundation, or used to create new perks for fans.”
Most of the hype around NFTs focuses on selling ownership of digital media like images and video.
“However, we believe ownership can extend to real-life privileges – an NFT that grants the holder an annual dinner with the coach and some players; or digital collectible card games that evolve over time,” van Rooyen said.
The venture is funded by its founding shareholders, and van Rooyen said the early collaboration with the Sharks had been a “game-changer”.
“It allowed us to quickly start testing the concept with a real fanbase,” he said. “We have already had other organisations reaching out to us for similar auctions. At the moment we are just piloting in South Africa, but have some solid connections into the United States.”