What is Skin In The Game? – Celebrity investors galore – Soccer-focused NFTs – Psilocybin x depression – Virtual coaching – Digital musculoskeletal therapy – Peloton without the bike
Week 16
Skin In The Game is a weekly newsletter dedicated to sports investing. We highlight the startups and investors shaping the future of sports and its adjacent markets.
We also run a regulated startup investment club connecting investors with visionary sports, health, and entertainment startups – a platform for investors to collaborate and co-invest.
Confessions
I try not to bang on too much about Skin In The Game in these weekly outings as I’m a firm believer in “show don’t tell”. But after 16 weeks of bombarding you with obscure German philosophy and other guilty pleasures it might actually be helpful to explain a little about the business.
As some of you know, I’m currently raising a seed round to go full-time and focus on building “Skin” over the next 18 or so months. I’m convinced that investment will come from people who know me – friends and former colleagues from my time in banking, startups, consulting, or indeed, writing this newsletter.
I founded the business because I want to invest in the future of sports and its adjacent markets – health and entertainment. I know I’m not alone – many others want to invest in this space but they don’t have the expertise, financial firepower, time, network etc. So, I’m building a platform that makes it easy for people to invest. By pooling our resources as investors we can get access to the best opportunities in sports and hopefully develop as people, too.
Why sports? I’ve spent my life playing, watching, and deconstructing the games people play; tech transfer is real; and sports give us the best possible chance to build a thriving community. Everyone has a favourite sport, athlete, event, or story. It’s not that FinTech, CleanTech, SpaceTech and other “techs” aren’t interesting – they are. But they simply can’t compete with sports on a human level. And because sports is event-driven, there are limitless opportunities to engage people and bring them into the community.
So, that’s the why. The how is simple. Instead of doing what traditional finance firms do – launching a business then using a blog or newsletter to market it – I’m flipping the model and using the newsletter (and soon enough, a podcast) as a distribution channel. I guess MBAs would call this a “route to market”; but it’s just building something that’s useful to people and trusting them to reward you further down the line.
The newsletter is the engine of the business, driving credibility, network, and deal flow. Skin In The Game is already FCA regulated – which means we can do deals from the get-go – but instead of getting fundraising mandates from startups and trying to connect them with a nascent and unengaged investor base, I’m building a committed community of wealthy individuals, family offices and corporate accelerators who are actively looking to invest in sports deals.
Once I have critical mass on the demand side I’ll start plugging in investment opportunities, but I want to do this is a thoughtful, structured, and replicable way. In the meantime, I’m building relationship with founders via some selective outbound marketing and making new friends all the time through the newsletter, Twitter and even the dreaded LinkedIn! The idea being to make myself useful to founders and go on a journey with them from pre-seed to Series A and beyond.
This “back-to-front”, community-first approach doesn’t just make sense from a business perspective – it also taps into the natural laws of human desire; the way that influence is driving investment flows. Week in, week out, this newsletter is packed with celebrity investors – athletes, musicians, c-suiters co-mingle in deals, leveraging each others’ brand equity to add strategic value to cap tables. It’s only a matter of time before the financial services industry clocks the fact that likes and follows drive capital flows more than fund factsheets and ads in the FT. Technology firms will ultimately dominate the investment management business because they are better at understanding the science of human behaviour.
After the why and the how, comes the what. I recently had some feedback that the term “syndicate” is a little esoteric and confusing. Historically, syndicates were loosely affiliated groups of people who banded together to invest in deals, with one person taking the lead and driving the process. Later, a business model emerged from this organic process, with angel syndicates charging fees to startups and investors in the form of upfront cash and a share in any investment profits. It’s an attractive proposition for operators – not just because it combines short term revenue with long term value accrual – but because it beautifully aligns interests and creates a win-win-win situation for startups, investors, and syndicate leads (I really should trademark that).
But confusion is never a good thing, and for the sake of clarity I actually think that startup investment club might be a better, more useful way of describing what Skin In The Game is. After all, we’re building a club. Investors pay an ongoing monthly fee for access to quality investment opportunities, and additional fees for our help in structuring and executing their investments. They get deal curation, heavy lifting, and a brand that attracts other heavyweights who can add to their credibility and bargaining power with startups.
Like all founders, I’ve made some assumptions since starting the business. And I’ve already learned a few important lessons. Some people get angel investing, and others don’t. Not everyone is excited about technology, big ideas, founders, disruptive innovation... even fewer are willing to put their money where their mouth is. Despite the cultural ubiquity of unicorns, we are very much in the minority; so we need to stick together. Skin In The Game is a club for people who want to do just that.
Deal flow
⛓ Dapper Labs valued at ‘$7.6bn’ after $250m funding round – Dapper Labs, best known as the maker of NBA Top Shot digital collectibles, has raised $250m in a funding round led by global investment manager Coatue.
💰 The Athletic Hires LionTree to Find Buyer at Price of More Than $750m – After holding unsuccessful discussions for a sale with both Axios and the New York Times over the past few months, the online sports news subscription site has hired investment bank LionTree to help it find a buyer.
🇺🇸 Inter Miami get $150m Ares investment – The club’s remaining owners have finalised the buyout of Marcelo Claure and Masayoshi Son’s stakes in the MLS franchise, with US investment manager Ares Management also joining as a preferred equity investor.
🏁 Streaming service DAZN in advanced talks to buy BT Sport – DAZN, the sports streaming service owned by billionaire Sir Leonard Blavatnik, is in advanced talks to buy BT’s sports business.
📱 Fitness community platform Fittr bags $11.5M in Series A funding – Fittr, a digital fitness and nutrition community platform based in India, has scored $11.5m in a Series A funding round co-led by Dream Sports’ venture capital firm Dream Capital and LA Dodgers’ private investment arm Elysian Park Ventures.
🃏 Sorare raises $680m in SoftBank-led funding round – Soccer-focused NFT platform Sorare has raised $680m in a Series B funding round led by Japanese conglomerate SoftBank. The latest investment, which has been hailed as one of Europe’s biggest ever Series B rounds, gives the blockchain digital collectibles and fantasy platform a valuation of $4.3 billion.
🧠 Journey Clinical raises $3m to allow psychotherapists to offer psychedelic therapies – Compass Pathways is working with the magic mushroom compound psilocybin to treat depression. It’s has raised $290m in total.
🇮🇹 Italian club Genoa bought by US investment firm 777 Partners – Italy’s oldest soccer team Genoa became the sixth Serie A side to come under American ownership on Thursday when Miami-based 777 Partners purchased the club from long-time owner Enrico Preziosi. The private investment firm is the latest US owner in Italy's top league following the acquisitions of AC Milan, Fiorentina, Spezia, AS Roma and Venezia.
💻 New investor Mayfair Equity Partners – EGYM, a leading global fitness technology developer, has received $41m in Series E financing from Mayfair Equity Partners, a leading tech and consumer growth investor.
🤝 Spring Media announces Future Sports Agency merger – Spring Media announced a merger with fellow Stockholm-based agency Future Sports, as well as an investment from Swedish investment firm Helix Kapital.
🤖 BetterUp Acquires Leading Emotion AI and People Technology Companies to Accelerate Growth – BetterUp, the inventor of virtual coaching and global leader in whole person transformation for the enterprise, has acquired two advanced technology software companies, Motive and Impraise.
🚣♀️ Justin Timberlake, Lizzo Back Rowing Startup Hydrow Ahead of SPAC Deal – Recording artists Justin Timberlake and Lizzo invested in Hydrow, a maker of at-home rowing machines that’s discussing going public through a merger with a blank-check firm. NFL star Travis Kelce of the Kansas City Chiefs and comedian Whitney Cummings, who like Timberlake and Lizzo, own Hydrow machines, are also among the company’s investors. The foursome and retailer Fabletics join actor Kevin Hart, who was named creative director of Cambridge, Massachusetts-based Hydrow last October.
👁 Hinge Health Acquires the Most Advanced Computer Vision Technology for Tracking Human Motion – Hinge Health, the world’s #1 Digital Musculoskeletal Clinic, has acquired wrnch, developer of the leading computer vision platform for measuring human motion. wrnch’s three-dimensional motion-tracking technology enables the same precise tracking of full-body movement used by elite athletes and the motion picture industry.
🤸♀️ Krew offers equipment-free classes for a post-gym world. Check out the 18-slide deck it used to sell seed investors on being 'Peloton without the $3k bike.' – A fitness startup banking on hybrid workers cutting down on visits to the gym has raised $1.6m in seed funding. London-based Krew bills itself in its investor deck as “Peloton without the $3k bike”, offering remote fitness classes that don't require any kit.
🎲 Boom Entertainment raises $15m to redefine sports betting and casino gaming for the digital world – Boom Entertainment, the creator of popular sports gaming apps such as NBC Sports Predictor, has announced a $15m Series A led by Sands Capital to fuel the company's expansion into real-money gaming products.
👩👦👦 Maternal Health Platform Mae Launches with $1.3m – Digital health platform, Mae, announced its $1.3m pre-seed funding round led by SteelSky Ventures. Other investors in this pre-seed round include Avestria Ventures, MBX Capital, Rhia Ventures, and the Social Starts Health and Happiness Fund.
🩸 9am.health launches with $3.7M to tackle virtual diabetes care – The San Diego-based company announced a $3.7m seed round from Founders Fund, Define Ventures, Speedinvest and iSeed Ventures to target the 1 in 3 people living with diabetes in the US.
🕶 WIN Reality Adds Investment Partner LAGO Innovation Fund – WIN Reality, the leader in virtual reality athlete training, today announced a $3.75m debt raise from new partner LAGO Innovation Fund. LAGO provides a breadth of industry expertise and a scaling non-dilutive financing partner as WIN looks to expand upon its explosive >300% revenue growth over the past year.
🤖 NEX raises $25m, launches Active Arcade to get people moving – NEX is building motion entertainment – content that encourages physical movement. It has announced a $25m Series B to coincide with launch of Active Arcade, its new mobile AI interactive motion-tracking game. The new funding was led by Blue Pool Capital, with participation from Samsung Ventures, SparkLabs and Susquehanna. This round also attracted influencers in sports, entertainment industries and business executives including Simu Liu (Shang-Chi), Albert Pujols (LA Dodgers), Thierry Henry (Arsenal Legend), Sabrina Ionescu (WNBA), tech CEOs and founders from YouTube, Dapper Labs, Alchemy, OpenDoor, WordPress and executives from Zendesk, Uber, MasterClass and Facebook.
🇮🇳 Sony Plans $200m VC Fund To Co-Invest in Indian Startups Alongside Celebrities – Sony’s VC fund comes at a time when many Indian celebrities, including Bollywood actors and sports stars, have turned to startups as an investment avenue. The unnamed VC fund will leverage its celebrity network to support “startups that could have long-term strategic value”.
🦄 Sleeper Raises $40m in Funding Round, Posts Strong User Base Growth – Fantasy sports group Sleeper has raised $40m in fresh funding on the tail of a strong user base growth over the past several months. The round reunited a number of prominent investors who have come to back the platform once again.
🤩 Austin startup reaches for the stars with $35m in celebrity funding – An Austin startup that sells healthy, sustainable packaged foods and other wellness-oriented goods has attracted some of the biggest names in entertainment, sports, and business as investors. HumanCo, announced that it picked up $35m in bridge funding. Among the heavyweights backing HumanCo are (get ready for this):
– Actress Scarlett Johansson
– Musician Shawn Mendes
– Musician Nick Jonas and his wife, actress Priyanka Chopra
– Tennis star Venus Williams
– Former tennis pro Andy Roddick and his wife, actress and model Brooklyn Decker.
– Model and actress Cindy Crawford and her husband, entertainment entrepreneur Rande Gerber
– Actor Edward Norton
– Austin investor Brian Sheth
– Austin venture capitalist Joe Lonsdale
– Walter Robb, former co-CEO of Austin-based Whole Foods
– Indra Nooyi, former CEO of PepsiCo
🧫 AstraZeneca invests in Imperial’s self-amplifying RNA technology with eye on future drugs – AstraZeneca struck a deal with the firm behind Imperial College London's experimental COVID-19 vaccine to develop and sell drugs based on its self-amplifying RNA technology platform in other disease areas.
Some tweets
It’s the week after the weekend before. The Ryder Cup came and went like a bad dream for Team Europe... But you have to admit, that flop shot from Jordan Speith was pretty dreamy.
Cheers,
Ed
—
Edward Rhys
Founder / Skin In The Game
www.skininthegamegroup.com
🙏 A favour
I hope you enjoyed this newsletter. If you did, please share with friends who you think will get something out of it.
And if you can spare the time, hit me up with your thoughts. Whether entrepreneur, investor, exec or sports fan, your input will help me to improve what I’m doing and serve the Skin In The Game family better.
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Skin In The Game is a startup investment club connecting investors with visionary sports startups. We provide a regulated platform for fans, athletes, entrepreneurs and brands to collaborate and co-invest. By investing in SportsTech we can unleash the full potential of sports, enriching the lives of people everywhere.
SKIN IN THE GAME LIMITED is registered in England and Wales under Company Number 13200102 and with the FCA as an Appointed Representative with FRN 946089. SKIN IN THE GAME LIMITED is an Appointed Representative of Finex LLP which is authorised and regulated in the UK by the Financial Conduct Authority (“FCA”) with firm reference number 507537.