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SportVEST: WHERE VENTURE CAPITAL MEETS SPORT AT THE INTERSECTION OF BLOCKCHAIN

  • by Alberto Maiorana
  • July 21, 2018
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The Global sports economy was valued at $480Bn+ (USD) in 2017 with the U.S. sports market being valued at $69.3Bn (USD) in 2017. This metric is expected to reach $78.5Bn (USD) by 2021. Lucrative new deals for the sports content such as media and digital rights traditionally owned by large media companies like ESPN and SKY, now have gained the interest of tech giants such as Facebook, Amazon & Netflix which is likely to drive up the value of those IP contracts even further.

INTRODUCING SPORTVEST & SPORTVEST VENTURE FUND

Democratize Sports Investments and improve fund performance metrics. At SportVEST we believe in the transformational opportunities provided by blockchain technology and have set out to disrupt the “exclusive” nature of the venture capital sector and sports investments. Our mission is to empower a broader audience with improved VC measurement tools while bringing liquidity to investments in the sports sector so it is at the Token-holders discretion to decide the optimal time to take profits.

SportVEST Venture Fund will divest the Token-Sale proceeds over a period of time – investing in a portfolio of diversified sports businesses that operate both on or off the blockchain (“Digital Assets”) with all potential investments being approved by the Fund’s Advisory Board.

Through the use of blockchain technology, SportVEST captures the value of our sports Fund using a Token that is publicly tradable. The values of the Portfolio Companies who constitute the Fund are continuously assessed based on an innovative approach utilizing token micro-sales “Power Law Sales” providing us with a stream of market value based estimates, along with our Brand Equity Algorithms and NAV measurements to provide a basis for the most accurate valuation of these Portfolio Companies. Our valuation Algorithm is a multi-factor estimation algorithm that can learn and adapt within a band around these more formal estimates and adjust based on Kalman Filters to mitigate errors and some of the flaws in human judgement currently in VC NAV models.

“Venture into Sports”: SVE Tokens are issued by Global Sports Inc. and the Fund will form the legal vehicle that invests in blockchain and non-blockchain sports startups, legally compliant ICOs and/or tokens (“Coins”), by using smart-contracts to create the Fund’s portfolio.

SVE Token-holders will own a pro-rata percentage of the Fund’s portfolio and are therefore considered Limited Partners (“LPs”), with SVE Tokens forming the digital counterpart.

SVE Tokens can be purchased through our Token-Sale at various stages (using crypto or fiat currency) and will be able to be exchanged (traded) in the future on secondary exchanges after the one-year “Vesting Period” (SEC-mandated), providing SVE Token-holders with liquidity regardless of their location.

If the market valuation of the SVE Token is below the external marketplace price, SportVEST will buy and burn SVE Tokens until the public SVE Token price is above the internal exchange rate for the Token. We thus say SVE Tokens are strongly backed by assets but have an upward potential. Over time, the payoff of successful investments will increase the Fund’s investment potential. The SVE Token will appreciate in public marketplaces in response to raising internal exchange rates.

SportVEST has committed a portion of our profits and fundraising to fund the SportVEST Foundation (the “Foundation”) based on specific thresholds. The Foundation will focus on blockchain research and development (“R&D”), community building and support of non-profit sports businesses on the blockchain.

SPORTS OPPORTUNITIES

Key market opportunities include:

  • Virtual Reality/Augmented Reality: Improving Fan Experience.
  • Drone Technology: Improving Fan Viewing.
  • Data & Analytics: Fan engagement and on-field performance.
  • Wearables: Improve Athlete performance.
  • Media: Social and informational mediums for content consumption.
  • eCommerce/ticketing: Consumer facing models.
  • eSports: Will overtake traditional sports value in next few years.
  • Fantasy sports: Leagues and Fans converge in daily activities.
  • Fitness applications: Health and Wellness for athletes and fans.

In addition, use cases in the blockchain sector are increasing as well across the industry, with many examples showing potential in the early stages:

Professional Sports Franchises: In the U.S.A, the NFL likes to tout the Green Bay Packers as a publicly owned franchise, and while that is technically true the structure doesn’t provide true ownership for the fans in the way that the blockchain can allow. The capability for individual sports fans to be able to invest in sports franchises around the globe are sprouting up in ICOs already and aiming to revolutionize the global sport ecosystem.

Professional Athletes: The investment in future earnings, marketing potential and other areas of a professional athlete’s career is already in the works. ICOs may bring new revenue streams for mainstream athletes, bridging the disconnect with fans. In addition, this is a great vehicle for discovering up and coming athletes, provide hope for talented individuals from impoverished regions and support niche marketplaces, including realms like the Olympics.

Ticketing & Events: The Sacramento Kings began accepting Bitcoin in 2014. The Dallas Mavericks recently announced that from next season fans will be able purchase Mavericks tickets using Bitcoin and possibly other tokens. Ticketing services are a perfect fit for a decentralized structure. Providing a clear path to track the entire life cycle of a ticket, even when it has been re-sold, brings great benefit to the ticket originators across the sports landscape.

Sports Tech (such as VR/AR, Drones, Wearables, Data): Technology development around athletic events, fan experiences and even big data has risen dramatically with Virtual Reality and Augmented Reality leading the way. The fan experience is paramount for sports franchises globally, and the VR/AR market reached $3Bn (USD) in 2017, and wearables, fitness and analytics all have very robust growth patterns as well.

CURRENT BLOCKCHAIN USES IN THE SPORTS INDUSTRY

Sports Gambling Platforms. – With advancements in smart-contracts, gambling will continue to be one of the most competitive spaces on the blockchain. The Supreme Court struck down a 1992 federal law in May 2018 that effectively banned commercial sports betting in most States, opening the door to legalizing the estimated additional $150Bn in illegal wagers on professional and amateur sports that Americans make every year. Blockchain will play a key role in the further development of the gambling market over the coming years.

Fantasy Sports & Predictions. – The rise of fantasy sports has dramatically changed the nature by which fans “consume” sports. In 2017, an estimated total of 59.3M fantasy sports players in the U.S. and Canada.  Daily Fantasy Sports are projected to collect a total of $14.4Bn (USD) in entry fees globally in 2020 (41% CAGR). Fantasy Sports & Prediction blockchain startups have recently launched to compete again Goliaths such as FanDuel & DraftKings.

eSports. – Projected to be $1.5Bn (USD) industry by 2020, and with a 34% increase year by year, eSports is already leading the way with 28 ICOs by early 2018. Many projection show eSports taking over a lead over all traditional sports in audience and revenue very soon, leading this to be one of the largest growth sectors in all of sports, including blockchain, in the years to come.

As of mid-2018, there have been over 70 ICOs in the sports market overall, with fresh concepts expanding on these obvious targets above at an increasing pace.

CONCLUSION}
SportVEST is confident that the team’s extensive experience in finance, relationships in the sports sector, alongside its new position as the leader in the sports blockchain market will provide them with early access to sports startups and well structured, legal Token-Sales, ICOs and blockchain entrants. The team’s ability to access these opportunities early and finding hidden gems will provide SportVEST with many benefits including: discounted prices, reduced transaction costs, increased transparency and efficiency, early liquidity and voting, in turn enhancing the ROI for potential investors

SVE Tokens can be purchased through the SportVEST Token Sale at various stages (using crypto or fiat currency) and will be able to be exchanged (traded) in the future on secondary exchanges after the one-year “Vesting Period” (SEC-mandated), providing SVE Token-holders with liquidity regardless of their location.

For more information on the SportVEST Token-Sale or to take part in the SportVEST Private Sales, contact the SportVEST Team at: hello@sportvest.io or visit our website at: www.sportvest.io. Don’t forget to join us on Telegram and follow us on Twitter.

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Advisor at SportVEST