In a recent article by Ben Fisher in the Sports Business Journal, it was revealed that the Fan Controlled Football (FCF) is undergoing a significant change in its business model. The FCF, known for allowing fans to make real-time coaching decisions through fan voting tools, is pivoting to a technology licensing model. This decision came about after the league faced a cash crunch that derailed its plans for a third season.
Sohrob Farudi, the co-founder and CEO of Fan Controlled Sports & Entertainment, told Sports Business Journal,
“Given the capital markets currently — and quite frankly, nobody’s going to tell you it’s not capital-intensive to run a sports league — we thought maybe the better idea in this environment is to focus on the technology and the platform for now”.
The FCF league gained attention with its innovative approach of new-age fan engagement tools, which seemed to resonate with the growing interest in blockchain technology and cryptocurrency. However, as Fisher reports, the league was hit by funding challenges. Despite having raised $55 million in venture capital, including a $40 million Series A round in January 2022, by late 2022, the capital markets dried up.
Farudi acknowledged the financial challenges, stating,
“I think we pretty quickly realized that the big growth road, which I’d say even six months ago was pretty achievable, was going to be next to impossible”.
One of the silver linings for the league is the interest generated in the technology behind their fan voting tools. The company is nearing completion on deals to incorporate fan-input elements into other sports, including basketball, auto racing, and golf. Farudi stated,
“Some we’ll co-own and co-produce, and some will be existing leagues we’re adding interactivity to”.
In addition to technology licensing, the FCF is considering a franchise ownership model as a means to relaunch the league. They are looking to sell franchises for high six figures to lower seven figures, aiming to secure eight buyers. The revenue from franchise fees would enable the league to operate for multiple years, and franchise owners would control their own profit and loss.
We here at XFL News Hub are fans of the FCF and hope we can see them again in 2024. The more opportunities for players and coaches, the better.
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