NBA Top Shot NFTs Creator Dapper Raises $250 Million in Funding

(Bloomberg) --

Dapper Labs Inc., the company behind the popular NBA Top Shot platform, raised $250 million in its latest funding round and announced a deal with LaLiga to offer digital collectibles for soccer fans. 

The funding round, its second this year, was led by Philippe Laffont’s Coatue Management and included backing from Andreessen Horowitz’s a16z, GV -- which was formerly known as Google Ventures -- as well as Version One Ventures, among others. The Vancouver-based company didn’t publicly disclose its current valuation. 

“This round, for me, was much more about bringing the right partners around the table for our next leg of growth,” Roham Gharegozlou, the company’s co-founder and chief executive officer, said in an interview. “Earlier this year, we proved the concept for NFTs and I think we’ve seen the industry as a whole exploding -- and we’ve got the platform that can power thousands of times more activity than we see today.”

Meanwhile, Dapper Labs’s partnership with LaLiga, a popular soccer league, will give users the opportunity to collect and own NFTs from over 10 seasons of play and will feature content from teams including Real Madrid, FC Barcelona, Atlético de Madrid, Sevilla FC and others. It has the potential to attract a wide base of fans -- Real Madrid, for instance, has more than 38 million followers on Twitter alone. It will become available on Dapper’s Flow blockchain starting in June 2022.

Interest for non-fungible tokens -- which are known as NFTs and allow holders of art and collectibles to track ownership -- has been gaining steam, with sales hitting a record in recent weeks. A wide variety of them have become popular, including pictures of rocks, as well as cartoonish depictions of penguins and apes, among other things. 

NBA Top Shot allows users to find limited edition video “cards,” which are short highlights from NBA games. It also offers packs of memorable “moments” that sometimes sell out in minutes. Funding from the latest round will go toward expanding Top Shot and developing the mobile product, said Gharegozlou from Spain, as well as expanding real-world benefits for users. A small portion will be used to invest in other startups that are building on top of Dapper Labs’s Flow blockchain. 

Top Shot, a blockchain-based platform that Dapper is working on in conjunction with the NBA, is still in a beta phase but has grown 30-fold just this year, according to a press release. More than $780 million in collectibles has been bought and sold on the platform, with over 13 million transactions recorded. 

Dapper Labs has plans to expand to “basically all major sports,” said Gharegozlou. The company already has backing from prominent National Football League stars, including Stefon Diggs. “LaLiga is the first big league announcement that we’re making, but there will be more coming in the next few months as well,” said Gharegozlou. 

Meanwhile, OpenSea, the largest marketplace for non-fungible tokens, was recently embroiled in an insider-trading scandal, whereby an employee bought items that were later featured on the company’s home page. The incident sparked a suspicion that has long dogged the unregulated world of digital collectibles: Insiders are making huge profits off of the industry’s wild valuation swings.

Gharegozlou said on his platform, everything is transparent: every account and user is verified -- both buyers and sellers -- and there’s no ability to mix funds or hide assets. “We wanted to make sure that trust is at the core of our product experience,” he said. “We are planning on being a banner-bearer for the right way to do things.”

©2021 Bloomberg L.P.