The Crown League announced its launch today as the first professional fantasy football league that will begin play with the 2019 NFL season. Fans will be able to own part of the fantasy franchises—and the league—through blockchain technology that will grant them rights to league revenue sharing and team governance. They will able to hire and fire fantasy experts to serve as general managers.
The founders of the Crown League hope to mimic the institutional infrastructure of the NFL while drawing on esports as inspiration that people can become avid fans of a product that exists on a technology platform. The new league will hold live drafts, feature high-profile experts, produce broadcast content for a new OTT platform and for cable syndication, seek sponsorships, and sell merchandise.
CEO Dan Nissanoff said the Crown League has been raising $100 million to create the venture. Nissanoff aspires to have the league’s economics mirror the revenue model of a traditional sports league, but have fans own the enterprise as an investment vehicle. Tuesday marks the initial public sale of league tokens, and franchise tokens will be made available later this year.
“That’s the beauty of this business and how it’s really going to evolve into a brand-new paradigm that’s never existed before,” Nissanoff said, “and we’re just seeing it emerge in esports right now.”
Co-founders Nissanoff, Derek Siskin, and Mat Sposta bring expertise from previous careers in technology, marketing, and finance, respectively—and, importantly, as fantasy players. Siskin and Sposta have played in the same fantasy league for 20 years, yet Siskin said of his friend, “He doesn’t care about my team. Nobody cares about anybody else’s team. You can’t enjoy it with everybody else. The ability to leverage the community experience is one of the strongest aspects of this business.”
Added Sposta, “We are the consumer. We are the fantasy player. We saw the model was broken.”
Nissanoff called fantasy football “an American pastime,” given its 60 million participants and $7 billion industry valuation, yet he decried its binary outcome for players and its fragmented nature. There are millions of teams in millions of leagues, and a fantasy championship is “the loneliest celebration on the planet,” he said.
“In traditional fantasy sports, there is no accretive value created,” Nissanoff said. “It’s basically a zero-sum game where people throw money into a pot, and the money is redistributed to a few select winners.”
The Crown League, instead, will serve as an ETF (exchange-traded fund) such as those that track the Dow Jones Index. There will be 12 franchises—each calling a major U.S. city home—that will be legal entities whose equity will grow over time, only with cryptocurrencies instead of stocks. (The “Crown” in Crown League is derived from the words “crypto ownership.”)
The league’s net profit will be distributed as an annual dividend to teams via league tokens based on milestones such as team performance. Franchise value will fluctuate based on the free market with securities traded on multiple exchanges, Nissanoff said. Fans can only hold a stake of one team at a time but can buy or sell those franchise tokens whenever—even in the middle of a game.
As for the actual competition, the Crown League will operate much like a standard fantasy dynasty league, with rosters carrying over year to year. Each franchise will be operated by a team of experts drawn from sports media, fantasy gurus, and former NFL players. Nissanoff said the incentive structure will be created in such a way that these will be full-time jobs with significant earnings potential. Through the blockchain, owners can weigh in on transactions and lineup changes. The consensus will be presented to GMs, who can choose whether to follow their owners’ directives or not.
The Crown League has been operating in stealth mode for more than a year but has already attracted an array of executives and advisors that includes former NFL chief communications strategist Joe Lockhart, Wasserman Media Group co-founder Josh Swartz, SportsLine founder Mike Levy, and Bears safety-turned-Techlete Ventures managing director Ryan Mundy. The plan is to start with fantasy football and likely expand to other fantasy sports down the line.
The hope is for the Crown League to institutionalize fantasy games the same way, for example, that the World Series of Poker has done for its game. Poker fans tune in to watch and learn from other players, and new celebrities and personalities have emerged from that series.
The broadcast component of the Crown League will be overseen by chief content officer Jeff Kaiser, who has experience in programming and production with the NBA, NFL, and Time Warner Cable Sports. The new media platform will aim to bring life to the characters and personalities of the league. Teams and the league will also hold live events for fans and owners.
“It’s more than just how good you are at fantasy football,” Nissanoff said. “It’s about leadership and it’s about emotion and it’s about community.”