Drone Racing League signs $ 100 million deal with crypto platform Algorand

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Drone Racing League

Source: Drone Racing League

The New York-based Drone Racing League has landed its largest sponsorship deal to date with cryptocurrency platform Algorand, the company said on Tuesday.

DRL is a first-person racing league where drone pilots fly devices on neon-lit courses and compete for cash prizes. The company started in 2017 and is now valued at $ 200 million, according to PitchBook.

The terms of the deal with Algorand were not made public, but people familiar with the deal told CNBC it was a five-year pact worth $ 100million. dollars. German financial services firm Allianz had held the property rights since the inception of DRL and will remain a league partner. Excel Sports Management has negotiated the agreement with Algorand.

In an interview with CNBC last week, DRL president Rachel Jacobson called the pact with Algorand a “transformative” and a “perfect marriage.” She added the crypto platform and DRL both cater to a “tech” fan base.

Jacobson described Gen Z audiences as early digital savvy users “who care as much about the launch of an Apple iPhone as they are about sports and entertainment,” she said. “When you look at what’s going on with crypto and blockchain, you need to make sure you’re targeting the right audience.”

Boston-based Algorand has a blockchain or digital ledger and is traded on the cryptocurrency exchange under the symbol ALGO. As crypto continues to evolve in the financial industry, companies are positioning themselves to attract more digital consumers, using sports sponsorships to market themselves.

This year, crypto companies took over the sports naming rights assets of National Basketball Association, Major League Baseball, and a company struck a $ 100 million deal with Formula 1 owned by Liberty Media.

Drone Racing League

Source: Drone Racing League

Jacobson, a former NBA executive, said the sport helps new companies build brand awareness, but crypto firms still need to educate young audiences about the space and use engaging platforms to push through. his message. DRL says it reaches around 75 million fans worldwide

“You have to build in the right programming so it’s not just a logo slap,” Jacobson said. “The crypto community, they’re too smart to see only through a jersey patch or signage. They want to know, ‘How can I get involved? And how will this change my sporting experience? “”

DRL begins its sixth season on September 29. The league has media rights deals with NBCUniversal and a streaming deal with Twitter. Other sponsorships include deals with DraftKings, T-Mobile, Bodyarmor, the US Air Force. DRL assists the Air Force in the recruitment and training of future drone operators.

Drones used in races are designed and built by DRL, which builds models for each race. Drones are worth around $ 2,000 and can travel up to 90 miles an hour.

The global drone market described as the “unmanned aerial vehicle” industry is expected to reach $ 58 billion by 2026, according to Markets and Markets. Therefore, with DRL also operating as a drone maker, Jacobson said he wanted to leverage the products to attract more revenue.

“The opportunities are endless,” Jacobson said, noting that more and more companies are testing deliveries using drones. “We build our drones, and when we think of other lines of business, it can be anything. We’re just getting started.”

Disclosure: NBCUniversal is the parent company of CNBC.

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