BlackPool Report - Q4 2022
- BlackPool Q4 revenues and profits exceeded the forecast for the quarter, allowing a total distribution of 36 WETH in reward to veBPT holders, as per governance request.
- BlackPool continued to double down on successful verticals and made further investments into new and exciting games.
- Further, Q4 saw the introduction of a brand new business unit, building on the early success of the Lab advisory arm; BlackPool has formed a dedicated advisory team focused on helping developing games that we are excited about.
- Additional revenue streams were introduced in Q4, the most important being Immortal Game, where BlackPool has been a consistent leader in the weekly leaderboards.
- BlackPool will double down on winning bets and will keep investing in new gaming verticals where we have an edge in order to top the leaderboards and reap the rewards
- The early traction of the Lab, the advisory arm of BlackPool, will hopefully translate into actual contractual agreements with game studios and partners, which will fuel BlackPool’s economic flywheel and prepare the ground for exciting new investment opportunities in H1 2023
- With the recent hiring of experienced contributors from the combined worlds of web3 and traditional finance, BlackPool is about to begin a global restructuring process to become better positioned and to dominate the market - not only in web3 gaming, but also in other new verticals, such as music and socials, to name a few.
With the start of the European football season and the additional Sorare verticals gaining momentum, revenues increased from last quarter to a new high of 221 ETH.
An even stronger performance from Sorare football has led to reaching a positive net earnings of 51.43 ETH in October, despite a continuously challenging economic environment.
Furthermore, we introduced another promising vertical in Q4, Immortal, which has consistently delivered an APY of 50%+ since its inception. As we continue to diversify our verticals and revenue streams, we anticipate increased inflows to BlackPool as Immortal as other verticals evolve and scale over the next quarters.
The main cost items can be summarised as follows:
- Contributor Rewards: Rewards for Q2 for freelancer contributions from 30 contributors. These costs have been increasing due to the onboarding of new verticals in March, brought forward in Q2.
- Infrastructure: Costs linked to running and maintaining validators and servers, and other infrastructure expenses.
- BlackPool has continued to double down on Sorare in Q4 with a total investment of 195k USDC, and we are excited about the progress that has been made in this vertical. We strongly believe that Sorare's innovative approach to collectible football cards has great potential, and we are confident that the same success can be reproduced with Sorare's NBA and MLB projects. Our team is dedicated to continued investing in this vertical, with a clear strategy in place to generate a sustainable yield and to reinvest part of the revenues in the game. We believe that our continued commitment and dedication to Sorare will lead to long-term success and growth in this vertical.
- In addition to our investment in Sorare, BlackPool is also pleased to report an increase in assets under management (AUM) and consistently strong performance from our managers. We are confident in our ability to achieve our growth objectives and continue delivering strong results.
- At the beginning of the quarter we decided to kick start the Immortal Vertical from scratch, without any piece or player. Despite the fact that it is still in its beta version, BlackPool has been assembling a highly competitive team, including some of the best chess players out there. So far, over 10 players have joined us, including 2 GMs, 4 IMs, and 5 FMs.
- Currently, we have 8 active players per week working on dominating weekly leaderboards. Most of them consistently rank within the top 10, solidifying BlackPool's position as the leading team in the game. We continuously improve our inventory to provide our players with the best possible pieces. Our investment in Immortal follows a clear strategy with the goal of generating sustainable yield, which will allow us to reinvest part of the revenues in the game. We are confident that we are on track to reach our targets and still have room for growth.
- On the other side, Immortal is continuing to improve and is willing to allocate more rewards to special tournaments while also strengthening their anti-cheat measures. This is good news for BlackPool, given the quality of our players and assets.
Asset Under eSport Management (ETH)
Asset Under Management and eSport Management accounts for all the digital assets (mainly NFTs) that power the different P2E verticals.
The second half of the year and Q4 saw a general increase of the Blackpool portfolio that has reached a total of 5,104 ETH, representing an increase of 7.7% compared to the first half of the year.
Below is the evolution of Blackpool’s AuM and AueM over the last two quarters.
Treasury Recap (ETH)
Given the market uncertainty, we kept our treasury deleverage (debt amount to zero), and converted the majority to stablecoins to grow our stability and investment potential for the upcoming months.
Further, we decided to put the liquid asset to use, allocating part of the stablecoins to yield-generating strategies, expecting an annualised return of over 6.5%.
The Treasury is divided mainly into four different wallets:
- Treasury ETH: 0x07DFF52fb8B38E55E6eCb407913cd847396Af4f0
- Treasury Polygon: 0xb9d72519f9F9ec41a657C57c5A59a32737Ae6636
- Magic Vesting Contract: 0xe3fbAC93506359fC56CB51D7CE62057Cd51215Ac
- BlackPool LAB: 0xbe19c923355daf3b792D920935d51CBDf2fe99BA
With the following breakdown:
- Liquid Assets: $2,846,090
- Deposits: $0
- Debt: $0
- Other Assets (LPs): $23,260.41
Total AuM in USD terms can be split as follows:
Investments made during Q2 have primarily focused on doubling down on successful verticals, which includes further investments into Sorare Football as well as Sorare's new exciting NBA and MLB projects.
In addition, our team of in-house experts has continued to actively screen and evaluate new projects in search of promising long-term ventures that excite us and will serve as the pivot for the entire ecosystem. This effort has led us to establish a long-term partnership with Immortal Game, the next-generation chess platform. Blackpool has been at the forefront of this platform since its inception, with many players ranked in the top 10 of weekly leaderboards.
The BlackPool Lab
Q4 R&D Overview
The lab has been particularly active on two fronts, strengthening the gaming activities with Immortal Game and proposing advisory services to promising games.
Q4 Verticals Incubator
The team focused on building a strong position on Immortal Game, with strategic purchases and recruitments. We welcomed Grandmasters, International Masters and FIDE Masters as well as a new manager for a test period. The incubating process of the Immortal vertical should end in Q1 2023.
On the advisory side, the Lab has decided to ramp up its activity as sustainable and qualitative games are lacking in the space. The BlackPool team’s expertise built over the past years can be of great use to game studios. Our process is extremely selective to reflect the high level of excellence that we expect from games that we wish to work with.
Branding and Marketing Activities
On the marketing side, we have ramped up our visibility across social platforms to cast a wider net and find a bridge between web2 and web3 audiences. Our focus has been twofold spotlighting and telling the story of our gaming vertical and the fund that umbrellas it. In the coming year, we will continue with growing our community to content creation and will create stickiness by offering more gamified activities and experiences.
In November 2022, we organised The Arcade, one of the biggest web3 esports experiences seen so far with our partners like Cometh, SportFaction, MetaFight and Immortal: a three-day event with tournaments on emerging games, streams with KOLs and talks and panel discussions about a variety of topics in the crypto and gaming space.
In 2023 we will turn the spotlight on the activities of the Lab in further detail and share more knowledge and insights in collaboration with this advisory arm. We will organise a few key events to create touchpoints with our community and to tell the continued story of the BlackPool Apes.
In conclusion, BlackPool's Q4 financial performance exceeded expectations, resulting in a distribution of 36 WETH in rewards to our community of veBPT holders. The group continued to focus on doubling down on successful verticals, investing in new and exciting games, and introducing a brand-new business unit. With the Lab advisory arm's early success, BlackPool formed a dedicated advisory team focused on helping and growing games we strongly believe in.
Additionally, new revenue streams were introduced in Q4, including Immortal Game, where BlackPool has consistently been a leader in the weekly leaderboards. Overall, BlackPool's Q4 performance demonstrates the group's commitment to innovation, investment in promising ventures, and continued success in the gaming ecosystem.