Welcome to the Sporting Crypto podcast where we talk to leaders in sports and web 3. Today I'm delighted to be joined by Nicolas Julia who is the co-founder and CEO of Sorare. How's it going man?
Thank you for having me. Well, no, no, no. You're having me because I'm in your offices and this is a great setup. Pleasure to be in your show. I feel I've been listening to your show for a long time, it's the best part in crossing the sports and crypto industries. So I'm very excited for this conversation.
No, I really appreciate it. Why don't you tell us a bit about your personal journey and your background?
Yeah. So look, I'm a massive sports fan and I've been in crypto for more than 10 years and passionate by the industry as well. So it's not really a job for me. It's just amazing to be working at the intersection of these two industries. And you know, the story is very simple. As I said, I'm a massive sports fan. I've been collecting stuff, playing games, and doing lots of sports from early on. And when I went all in on my crypto journey, I found at some point NFTs, which were a technology that was interesting because that's digital property outside of the financial space. And I was looking at applications for sports and sports fans, and collecting to me was the first one. Humans have been collecting for a long, long time in the physical world, and to me it was obvious that they will do it in the digital world. And then I was like, okay, that's nice, but what if we bring some sports to the mix? So not only being able to collect them but to play with them. And adding the fantasy game layer on top was the big idea. And that's how we got started with Sorare.
Amazing. And you know, at that time the infrastructure wasn't really there to do some of this stuff, right? So how hard was it to actually build what you wanted to do?
Yeah, it was as you say, it was very hard. We had to build a lot of the technical stack. It was back in 2018 and it was very expensive. Every time a card was traded in the marketplace it was $10 that we had to pay to the Ethereum network, right? So it was just crazy. And our crypto journey infrastructure-wise has been a very long one, moving from Ethereum blockchain to Loom Network, back to Ethereum, and then who knows what the future holds. But yeah, the early days we had to do a lot of stuff by ourselves. Because from the first day we had this conviction that we needed to abstract the complexity of the technology for the end user. The end user, the sports fan, should only feel the benefits of the technology but not the pain. I'm not in the business of educating about the technology, I'm in the business of delivering emotions and fun to sports fans. So I want them to understand that the cards are scarce. I want them to understand that they can trade, get discounts, and make money out of them. I want them to make sure to understand that they can move their cards from games to games by experiencing it. That's our goal.
And why don't you give us a bit of insight into how that journey's gone since 2018? Obviously you exploded kind of onto the scene at the same time as the NFT boom in 21, 22. What was that kind of journey on the rocket ship like at that point?
Look, from the very first day, I mean maybe an important point that is important to your audience is that we are an officially licensed product by more than 300 partners. So we probably have the deepest portfolio in sports gaming generally, not only web 3 but web 2 and web 3. You have the NBA, the Premier League, MLB, all the top soccer leagues that are part of the journey, not just partners but equity holders. A significant part of the cap table is owned by the leagues. So I'm trying to build decade-long relationships. And even from the first day when we had only the Belgian league on board, so very limited content, we felt a passionate community. And that gave me the confidence that we should double down and keep on increasing the roster of partners and developing the gameplay. But as you said, the first big milestone for us was the first partner, the Belgian league, then adding more teams and more leagues. Then as you mentioned, late 21, even early 21, we started to see the NFT boom. So that helped us because it enabled us to grow faster and to also arm ourselves to bring more rights and partner with more leagues. So that was 22, 23, and keep on growing the user base. And fast forward to today, as I said, 300 partners. Last year we've made 150 million in sales on the marketplace with 200,000 active users. And you know, still early days to me, I feel like day one in terms of where we are compared to the potential. But yeah, some very decent progress has been made I would say.
I mean let's talk about the potential bit for a second. You say it still feels like early days. What is the goal if you look at it, you said decade-long relationships. If we look 2030 for example, what is the goal for Sorare to be?
I think I would separate two steps. Step number one is to truly deliver on our mission where we want every sports fan to be able to become a manager. That's really what we are trying to do, meaning that's the place where you can buy and sell cards, you can feel like a trader, you can feel like a scout identifying the next star and be rewarded for that, and you can play on the best fantasy sports game and have fun and emotions. So basically have all the roles that you could have if you own a real sports team. That's step number one. Then going a few years later, I want our product to be the place where sports fans not only have fun with collecting and playing but also integrate a social component that is strong, meaning that you play with friends, you play against friends. That's number one. Number two, the content is going to be important. So we're going to have way more content to consume in the product. That could take very different forms. But this is a very important part of the strategy. And number three, we are developing an ecosystem of side applications and side games. That's going to be more and more important. There's already dozens of side games and applications that are built on top of our proper game. And this is something we're very excited about and we're going to double down on this and we're going to announce stuff in that direction later on this year to help all the projects growing close to us.
Basically, you kind of talked about your infrastructure journey where you've gone from ETH layer 1 to layer 2, back to ETH to layer 2. We've seen a lot of, and obviously times have changed from 2018. So we've both been in the space for a while, 2018 to 2021 and 2025. A lot of people in the crypto space and also on the enterprise space are taking the more composable route. So Uniswap have moved from Ethereum to their own layer 2, Base have their own layer 2, apps have layer 3s on Base. Do you ever think that it would be advantageous or would you folks ever consider doing something like that where you have more ownership over the kind of technical stack but there's still the permissionless nature of it as well?
So it's a question unfortunately I cannot reveal everything here, this is our crypto strategy. To be frank, I was starting this show saying that one of our goals has been to abstract the complexity, and today 90% of new users that come into the platform they don't even know there's a blockchain. And that's cool, I think we delivered on that, but maybe at the expense of being visible in the crypto community which is our DNA. And so we are not truly leveraging the distribution effects of crypto today. We are on a private implementation of a blockchain, and so yeah, we are not really leveraging this. So that's one of our big goals, to go to an open network, to incentivize the creation of said applications, said games, to probably do co-marketing a bit more than what we are doing today. Probably integrate in the product a few crypto-native features that we don't have today. To answer precisely your question about are we going to develop our own layer, our own chain, I'm not sure. I'm not closing the door, I will never, but that's not my core business. My core business is being in the business of fantasy sports games and collectibles. That's where I want my product technical teams to focus most of the time.
Of course. So yeah, there's a lot to build, right? Yeah, it's a lot to add. And look, we want to go back a little bit to the NFT boom, right? There was some months where you guys were doing a lot of volume. Obviously the volumes have died down but are still pretty significant in isolation, right? When you're speaking to rights holders, and when you were speaking to rights holders at the time, were you trying to be cautious and tell them, hey, this is going really well, but don't expect these numbers forever, you know, because we want to build something that's longstanding outside of this bubble, right?
The reality is that we are creating a new category at this intersection of collecting and playing games with this unique twist of digital property brought by digital collectibles. But nobody knew back in the days if it was going to keep on growing and be something insane or slow down at some point. So I'm not going to say that I was selling all right or oh be cautious, the bubble is going to burst in two months. No, I was not saying that, I think nobody in the space did to be totally transparent. Yes, we knew that it was very, very quick in terms of growth. When we co-founded this company, we knew that the potential was massive but we never anticipated such a strong growth so early on in our journey. But the reality is that most of our partners are much more mature when it comes to innovators and tech companies than one could think. And you know, there's lots of playbooks of companies that had very strong growth early on and then some slowdown and then some acceleration afterwards. And so again, when you look back and you're like, okay, it's a company, it's a product that's five, six years old doing 150 million in volume on the marketplace with an important community and a big portfolio of partners, I think the achievements are still massive. And when you zoom from that bubble from 21, 22 and you adjust for that, the growth is still pretty significant, right? So I think they recognize that, and that's one of the reasons why some of the deals that we signed, we signed them during the peak of the bubble. So sometimes for prices that were not sustainable. And that's the reason why all of them, when looking at what happened in 23, 24, accepted to sit down with us, revise the deals, and stuck with us, you know, even if it was for price tags that were very different from what we had in the past.
And what were those discussions like? You said that the difference between 2021 and 2023 and 24 in terms of the maturity of those partners when you went back to the table to talk about those deals. Was there, were there people who were kind of, you don't have to name names, but were there people who were kind of like, those are the deal terms, blah blah blah, or are you in this position where because these businesses are integrated they have a vested interest in building with you and not just using you as a licensing partner?
Look, I think, so as I said we have more than 300 partners so there's many variety in the conversations. What I can say is that if we kept all of them, there's a strong reason which is they all believe in the vision, they all believe in the potential of the category, they all believe that new generations of fans will need new ways to engage with the sport and that digital property is something that's going to stick for a long time. So yeah, I think that has been the reason why. And when you look at it as well from a business perspective for them, we are a new stream for them. We're not competing with anything. We created a new category, right? So even if the growth in terms of net revenue for them is not as strong as what they could have expected in 21 or 22, it's still new money for them. And it's still engagement and new users on their products which is valuable as well for them. And data as well, right? You have a free-to-play game as well and some of these teams and leagues they don't really know their fans and who is engaging with them. And having that kind of new digital channel where you can say, hey, 27,000 people bought this Kylian Mbappé card and we can see that 15,000 of them are Paris Saint-Germain fans and 5,000 of them are fans of the French national team and so on and so forth. Some of that data can be powerful as well.
Right. Exactly. No, data matters a lot. It's an important part of this. Yeah. And if we talk about kind of the period of consolidation but if we look at it in isolation, the volumes are still really strong. How are you operating Sorare differently now in the current climate where you were as you said 150 in a year rather than maybe some of the bigger numbers we saw in 2021. What are the kind of key differences you're doing as a business to progress things and move things forward?
I think we stay lean. Even in 21, 22 we never went to hundreds or thousands in terms of employee count. So we stay lean. So I think that's something we do not regret. I think the important change we've made is more like product or gameplay wise. So we moved from a reward model basically where when you buy a card you can keep on playing it on the main game mode and it gets stronger and stronger. And you can win the best prizes and you have very little incentive to buy again and so on, which was a model that we thought could work but that we realized was not sustainable nor scalable. So we had to make a pivot gameplay wise where to play the main game, you can still play with your old season cards and they are useful in the game, but if you want to play in the main game mode you need to have at least a few cards from the current season. So that was a difficult but necessary move that we made last summer. And I think that's the main adjustment that we've made.
Really interesting. Really want to get into some more things about the future and the other opportunities and maybe some of your thoughts on the broader space. But for now I'm going to thank some of our sponsors. Before we move on to part two, I'm happy to remind you that this podcast is sponsored by the HBAR Foundation. The most beloved sports brands understand that what fans want is simple, a reason to be passionate. The HBAR Foundation enables brands and fans to share their passion on-chain using the Hedera network, the most used sustainable enterprise-grade DLT for the decentralized economy. Visit linkedin.com/company/hbarfoundation to learn more and get the latest HBAR Foundation news. This podcast is also supported by Credenza. Credenza harnesses blockchain technology to power a real-time data synchronization platform that transforms customer data ecosystems. They make data more relevant and actionable for sports brands, teams, leagues, and IP. Find out more at credenz3.com. That's credenz3.com.
Welcome back to part two where we talk a little bit more about the future of sports and web 3 but also in this case Sorare specifically. So you kind of touched on potentially different social experiences, content products. What are you seeing right now in the market where you're like, ah, that's pretty cool. We could think about that as a business.
Yeah. In terms of technical infrastructure and product?
Technical infrastructure, anything that excites you?
I mean, we were talking just off air now. You know, Telegram gaming has become a really big thing. Telegram gaming is definitely something that we are looking at. And I've been trying to play with some of the games like Hamster Kombat. I don't know if you trade some of them.
