While this is a painful message to write, we believe the community deserves transparency. We will get right to the point: Currently, we do not have clarity around Swoop’s future, and cannot yet commit to a Season 3. Below we’ll share more on how we’ve gotten here, some options, and what to expect moving forward.
Swoops is a venture-backed startup, one that relies on external funding to support operations and fuel growth. Typically this capital is raised every 18-24 months from a group of investors (VCs). Swoops raised its only round of venture capital funding ($3.5M) in November of 2021. At the time, Swoops was little more than an idea and a team of passionate sports fans, gamers, and blockchain enthusiasts. This was also near the peak of Web3 adoption and funding.
It is no secret that things have looked very different since then, with Web3 funding recently hitting 7 consecutive ‘down’ quarters. Shutdowns, restructurings, and layoffs are abundant, including projects with exponentially more funding than Swoops.
Swoops has been in the fundraising process for a couple of months now. We first went to market on the backs of our incredible community and gameplay, as evidenced by player volume/sales, engagement, and retention. The feedback in this ‘new’ market was that it wasn’t enough, and that we needed to show we can acquire customers…aka growth. So the team quickly built out a F2P workflow w/ complimentary infrastructure (social sign in, etc) to prove acquisition. With some updated metrics here (1000+ new accounts), we re-engaged potentially interested investors. Unfortunately, while there are still some prospects engaged, nothing has closed yet.
As a company with a dwindling cash balance, we’ve had to adapt, including letting go some team members whom we are grateful for their contributions. Unsurprisingly, this has caused the remaining team to be spread thin, causing further cracks in the gameplay, experience, and customer service. We have been, and continue to be, in survival mode.
Today, the team is focused on three things:
- Finishing out Season 2, though on a condensed timeline (more below)
- Doing our best to raise capital, and unlock the next phase of growth for Swoops. We are running out of time, and options, here. If you have any leads, please do share w/ the leadership team.
- If we are not able to raise new capital, we have begun to explore the M&A process, ideally with a partner who will not only keep Swoops alive, but invest in its future. We have a pipeline of potential fits (Sports, Gaming, Fantasy, Web3), but will take new leads here as well.
In order to give options 2 and 3 the time necessary needed to see through, we have made the difficult decision to shorten the remainder of Season2. We will keep all major events and prizes, just on a shorter timeline. Key Dates will now be:
- 10/26: Global Open
- 10/29: Last Day of Regular Season; Swooper Bowl (and Bronze Jug) Seed Lock
- 10/30: Swoopy Award Finalists Announced
- 11/1: Swoopy Winners Announced
- 11/2: Bronze Jug
- 11/3: Swooper Bowl Round of 64
- 11/6: Swooper Bowl Rounds of 32 + 16
- 11/7: Swooper Bowl Rounds of 8, 4, and Championship
The timing, and content, of this message took a lot of thought. We have tried to balance maintaining optimism and confidence in the company with ‘building in public’ and transparency. Until recently, we had high confidence that funding would be secured. Once the team determined it was not looking nearly as good as thought, we collectively decided to share with you. We understand this impacts confidence in the project, and similarly, values of many of the assets you hold, and for that we are sorry. But it was important to be open, and to do so in a fair, democratic way where all found out the same time, so the market dynamics can work out fairly.
Again, we still have hope that we can find a good solution here, but felt this step was necessary.
-Manish & David