A global sports merchandise company, has divested its majority stake in nft firm candy digital. the move was announced by fanatics ceo michael rubin to employees. candy digital was launched in june 2021 with the official major league baseball license and had raised $100 million in october 2021, achieving a $1.5 billion valuation.
Move was made in 2022 following a significant decline in the nft market and the subsequent layoffs of at least one-third of the 100-person staff. michael rubin, along with galaxy digital’s mike novogratz and entrepreneur and investor gary vaynerchuk, were founding board members of the startup. divesting the ownership stake allowed investors to recoup most of their investment.
Move was made now to try to maintain the integrity of the relationships with investors. it was decided that nfts are unlikely to be sustainable or profitable as a standalone business, and have more value and utility when connected to physical collectibles. fanatics had also acquired storied trading card brand topps, which has its own nft business. therefore, it was decided that nfts will most likely emerge as an integrated product/feature and not as a standalone business.