Sports merchandising giant Fanatics made a big play in the NFT space last year, launching Candy Digital with the Major League Baseball license and then netting a $1.5 billion valuation for the NFT firm in October on the back of a $100 million Series A round. Now the firm is expanding its sports collectibles lineup with the launch of Candy Racing.
Candy’s new racing vertical will officially roll out next week with the release of NFTs based on 23 NASCAR Cup Series cars from a total of 10 teams, including Hendrick Motorsports, Joe Gibbs Racing, Stewart-Haas Racing, Richard Childress Racing, and Roush Fenway Keselowski Racing.
To be clear, Candy’s deal is with the Race Team Alliance—not the NASCAR league itself. The Race Team Alliance is an organization that represents the collective business interests of 13 teams in the league. Popular drivers such as Chase Elliott, Kyle Larson, and Kevin Harvick are among those whose cars will be represented as NFTs.
Each NFT takes the form of a 3D animation that showcases a deconstructed view of NASCAR’s brand new “next-gen” team cars—Chevrolet Camaro ZL1, Ford Mustang GT, and Toyota Camry TRD—dressed up with each driver’s respective paint scheme. Essentially, it lets collectors see the new cars from the inside out.
Candy is calling them “digi-casts,” like digital versions of classic die-cast cars, and will sell the open edition NFTs for $50 apiece beginning on February 15 and running through February 20, the date of this year’s Daytona 500 race. Owners of the NFTs for the top three finishers at Daytona will be airdropped an additional free NFT after the event.
Offering that kind of real-world tie and incentive was key to the firm’s plans for racing NFTs, Candy Digital CEO Scott Lawin told Decrypt, as was delivering collectibles that closely adhere to the technical design of the real-world cars.
𝗢𝗡𝗘 𝗪𝗘𝗘𝗞 until the 𝗳𝗶𝗿𝘀𝘁 𝗲𝘃𝗲𝗿 Candy Racing NFT drop 🏎💨
Which cars will you collect??
🏁 Car/Driver Checklist: https://t.co/eqWbjeqWZP
🔗 Sign up to be there first: https://t.co/9VHfSaA2bY pic.twitter.com/yIvdzattRs
— Candy (@CandyDigital) February 8, 2022
“Everything that we try to do,” said Lawin, “we do through the lens of being a fan and being a collector.”
Candy plans to release additional NFTs in collaboration with the Race Team Alliance during the 2022 NASCAR Cup Series season, and it is looking into ways to enhance the race day experience for holders who attend the live events. The Candy Racing brand could also be used for NFTs from other racing leagues in the future as well.
An NFT acts like a receipt or deed of ownership to a unique digital item. Ethereum is the leading platform for NFTs, and the wider NFT market grew to $25 billion worth of trading volume in 2021—up from about $100 million the year prior. Candy mints its NFTs on Palm, a sidechain scaling solution built on Ethereum.
Expanding beyond sports
Candy Digital came into the NFT scene last June with big names attached—and not only Fanatics as majority owner and CEO Michael Rubin as co-chair. The firm was also co-founded with Galaxy Digital founder and CEO Mike Novogratz as co-chair, as well as prominent NFT creator and collector Gary Vaynerchuk as board member and advisor.
Launching with the Major League Baseball license, Candy Digital has issued a number of NFT drops with the league, including digital championship rings based on the 2020 World Series-winning Los Angeles Dodgers, trading card-like packs, and stadium-themed collectibles. The breadth of designs and drops suggests Candy’s approach to creating sports NFTs.
“Our general view is there is no one-size-fits-all to fans, particularly at the very early stages of the NFT market as a whole,” said Lawin. “We believe the right way to approach that is to create a series of different products that appeal to collectors—casual fans, hardcore fans, etc.”
Fanatics recently acquired storied trading card brand Topps, which also has its own NFTs running on the Avalanche blockchain (and previously on WAX). Lawin said that the Topps deal doesn’t immediately impact Candy Digital’s own NFT play, but it does create options.
“It brings an exciting opportunity for us to work more closely with Topps and the Fanatics card business overall,” he said. “Despite the popularity of NFTs and digital assets, the traditional physical card market is still very much alive. Some of the ideas that the Topps team and the Fanatics card team have around how that traditional business evolved… we're excited to partner with them and find ways to bring the two together.”
Candy Digital has a “full suite” of NFT products planned for the upcoming MLB season, said Lawin, as well as new releases through its Sweet Futures line of college athlete NFTs. He teased additional sports partnerships ahead, as well, plus the company’s first entertainment partnership as Candy eyes expansion beyond its initial sports vertical.
It’s a move echoing that of Tom Brady’s Autograph, a key rival in the NFT space that started with athlete-centric NFT drops before launching movie and music collectibles—the latter in partnership with The Weeknd.
Sports NFTs is an increasingly crowded market, with rival platforms also including Dapper Labs’ own three marketplaces—NBA Top Shot, UFC Strike, and the upcoming NFL All Day—plus efforts by Panini, OneOf and Sports Illustrated, and others.
Lawin pointed to Candy’s diverse approach to NFT drops that helps set it apart from the competition, along with access to Fanatics’ 83 million customers and the learnings that come with serving such a vast audience. He said that Candy Digital also aims to tell stories with its NFTs and build an emotional bond with fans.
“We want to create digital assets that tie people back to the things that they love and have some emotional connectivity,” Lawin said, “or some engagement beyond just the initial sale and whether it's worth more in the secondary market itself.”