Sorare is not closing its New York office entirely, but is moving more employees to Paris
Web3 enabled fantasy sports Platform Sorare laid off 22 employees based in its New York office in February. The move comes as the startup wants some teams to consolidate at the company’s Paris headquarters to improve communication and efficiency, a source familiar with the matter told TechCrunch.
“As we plan for our next stage of growth, Sorare has made the decision to centralize some of our operations at our headquarters in Paris,” Nicolas Julia, Sorare’s co-founder and CEO, told TechCrunch via email. “This primarily impacts our product development team, as we believe bringing this team together in the same space in Paris will allow them to work together more effectively as they continue to build best-in-class products across our football, baseball and basketball offerings.”
Another 11 employees in the New York office have been asked to relocate to Paris, a source familiar with the matter said. The company will fill most of those laid-off roles in Paris, according to Julia, with plans to hire more than 20 roles over the next six months.
Sorare is not closing its New York office. It will keep some teams there, such as those working with US clients or in its US brand partnerships with leagues such as MLB and NBA, according to Julia. Sorare’s partnerships with these sports leagues have been locked for several years, a source added.
While a source familiar with the matter said those layoffs were not financially motivated, the source added that like many other web3 companies, the time horizon for how long it will take Sorare to achieve its growth goals is longer. than he originally thought. Sorare users can buy and sell NFT cards from other players on its platforms, although Sorare makes its money mainly by issuing and selling new cards. Sorare saw $200 million in user transaction volume in 2023, a source familiar with the situation said. The company declined to say whether it was profitable or what runway it had left.
Sorare has not raised funds from its $680 million Series B round in 2021, which valued the company at $4 billion. According to secondary data platforms, Sorare has not garnered much interest from investors there. To be fair, waning interest isn’t strictly an issue for Sorare — web3 companies have largely been disappointed by investors. Startups in the category raised $7 billion in 2023, according to Crunchbase datadown 74% from 2022’s $26 billion. For context, overall Venture funding down 38% in the same time frame.
Gaming-focused Web3 companies are struggling to find meaningful traction. Last month, VCs focused on video games told TechCrunch that the market for web3 games turned out to be significantly smaller than some investors had hoped. This has become apparent.
Mythical gamesa gaming startup web3, raised nearly $300 million in venture money before going through three rounds of layoffs. Dapper Labsanother startup in the category, has also had multiple rounds of layoffs.
That doesn’t mean Sorare will suffer the same fate. The company has an active community of nearly 13,000 people on Reddit who regularly post about fantasy games and a third-party media community dedicated to these contests. Hopefully, even if the web3 winter continues, Sorare’s reorg will be enough.
