The creation of a global digital fan club featuring Neymar, Beckham and Messi showcases 23 Capital’s strengths in developing and financing next-generation media platforms
23 Capital has unveiled a landmark deal that saw it provide innovative capital in the creation of OTRO – a global digital fan club that brings together the world’s greatest footballers, including Neymar, Beckham and Messi, and allows their near one billion followers to engage with them as never before.
The OTRO app and website give members access to the stars through a unique digital offering. Exclusive daily updates include videos, Q&As, live chats, competitions and personal updates. This content takes fans inside their idols’ off-pitch, everyday lives and reveals the personalities behind the superstar names.
“There’s a lot of access to stars on the pitch, but once the game’s finished there’s very little engagement,” says Jason Traub, co-founder of 23 Capital. “Given the size of the market and the excitement surrounding these players, there’s a world of opportunity to unite them with their fans.”
Expertise at every stage
The idea behind OTRO was first conceived by Principals of 23 Capital, who worked with colleagues, industry contacts and players to develop the idea. Thereafter, the company was established by an influential group of now shareholders.
23 Capital have been involved throughout: assisting the company where appropriate, challenging the business plan through its development, and helping bring together the expertise needed to build a global digital content platform – from broadcast-quality video production to software engineering. 23 Capital provided the financial structuring to make it all happen.
“This deal is a perfect illustration of how 23 Capital stands out from other capital providers in this market,” says Traub. “We sit at the junction of the real-world business of football and the fast-evolving digital world. We help bring them together through our knowledge, experience and relationships. Our intellectual capital and creativity, together with our innovative financing to OTRO, positions 23 Capital as value creators for the artists, players and rights owners that we partner with.”
Lukaku, Mendy, Jesus, Cantona
23 Capital worked with the OTRO team for two years, refining and testing the idea until they were confident they had the right proposition.
Even then, working with a start-up like OTRO obliged 23 Capital to demonstrate a level of flexibility and creative thinking well beyond what other debt providers can offer. In a situation where equity funding would have been the usual default option, 23 Capital came up with a financing structure that provided tens of millions of dollars of debt finance for the launch.
“I don’t know many start-ups that can build a risk profile capable of assuming any type of debt facility,” says Traub. “But we were able to structure a funding solution outside of equity that speaks to a start-up.” The key, he says, was 23 Capital’s ability to understand the risks of the project, thanks to the company’s experience in valuing and financing intellectual property.
A billion-strong audience
The effort and credibility needed to secure agreements from three of the world’s biggest football stars – Beckham, Neymar and Messi – along with many other top names, represented a “massive barrier to entry”, says Traub. But, with those deals in place, the 23 Capital team understood that the huge social-media reach of these heroes gave OTRO instant access to a vast global market.
“Beckham, Neymar and Messi reach over 200 million people on social media. Across the 17 names signed to OTRO that rises to nearly one billion, illustrating the global scale of the opportunity.”
OTRO offers a free basic service, alongside a premium subscription membership, priced globally at $3.99 a month depending on territory.
“The opportunity to launch OTRO to an existing audience approaching one billion people from day one was extremely valuable to 23 Capital as a risk-factor,” explains Traub. “We were able to build a structured debt facility based on the ability to maximise digital IP irrespective of the greater OTRO proposition, a subscription-based model."
Duggan, Dybala, Boateng
The people behind the stars
OTRO answers the demand from today’s consumers to engage with their idols and gain access to their world.
Among the 17 founding stars to sign up are some of the most successful and popular footballers. Along with Messi, Neymar and Beckham are: James Rodríguez, Romelu Lukaku, Benjamin Mendy, Gabriel Jesus, Dele Alli, Luis Suárez, David Luiz, Toni Duggan, Lieke Martens, Eric Cantona, Zinedine Zidane, Jérôme Boateng, Paulo Dybala, and Isco. Together, they represent nine different nations, play for seven clubs, have three World Cup winners’ medals between them, 15 Champions League titles, 52 domestic titles, 2140 goals for club and country, 5733 appearances for club and country and nearly one billion followers on social media.
Traub points out the value of OTRO to these stars in allowing them to bypass the traditional media that dominates the way the world views them, instead showing a different side of their lives and personality. By enabling the biggest names in football to develop a relationship with their fans that goes beyond what happens in the game, OTRO opens up the opportunity for sports stars to develop a following that will outlast their football career.
“By being part of OTRO, footballers are bringing their fans into their world, outside the 90 minutes on the pitch. They’re generating engagement among their loyal followers and building a personal brand that’s bigger than whether or not they score a goal. OTRO is a genuine opportunity for the players to show who they really are.”
It’s also been a great opportunity for 23 Capital to demonstrate its creativity in the digital space, by delivering a complex range of finance solutions that maximize the potential of exclusive intellectual property rights.