1 big thing: 💵 Fanatics bets big on trading cards


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Nov 11, 2008
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per Axios Sports:

Fanatics has acquired Topps' trading card and collectibles business for roughly $500 million, according to people familiar with the deal.

Why it matters: Fanatics, the world's largest seller of licensed sports apparel, is now the dominant player in the booming trading card space, and home to the hobby's most iconic brand.

Catch up quick: Fanatics made waves in August when it signed exclusive trading card deals with the NFL, NBA and MLB by making them offers they couldn't refuse (lots of guaranteed money, plus equity).

  • The MLB deal meant Topps would lose its core product (licensed baseball cards) by 2026, a grim reality that forced the company to abandon its plan to go public at a $1.3 billion valuation.
  • Fanatics Trading Cards (a subsidiary of Fanatics) then used those exclusive deals as leverage to raise $350 million at a $10.4 billion valuation — without selling a single card.
  • Now, it's buying the company it undercut five months ago. And instead of having to wait until 2026, Fanatics can start selling MLB cards immediately.
Between the lines: All signs point to the Topps brand being fully preserved. In fact, 350 employees will continue working for Topps independently within Fanatics, per NYT.

  • Fanatics is expected to expand Topps' direct-to-consumer and digital product offerings, while continuing to sell cards through big-box stores and other retail channels.
  • The NFL and NBA licenses belong to Panini until Fanatics takes over in 2026. Don't be surprised if they try to buy them, too. (Upper Deck, which makes NHL cards, could also be a target.)
  • Trading cards are just one piece of Fanatics' expansion strategy, which also includes a new sports betting vertical and an NFT company called Candy Digital. They've also explored ticketing.
Of note: Fanatics didn't buy Topps' gift card operation or candy business (Bazooka, Ring Pop, Baby Bottle Pop, etc.), which generated roughly a third of the company's 2020 revenue. They'll remain with the previous owners, one of whom is former Disney CEO Michael Eisner.

The big picture: Trading cards exploded in popularity during the pandemic. Fanatics CEO Michael Rubin and his team are making a big bet that the party has only just begun.

"Before this Topps deal, [Fanatics Trading Cards] had zero employees and had never sold an item, yet it was valued at $10.4 billion based just on licenses."

"To get the MLB deal, Fanatics paid 10 times more than Topps. That means they believe this industry will 10x over the next five years, as they help integrate trading cards further into modern sports culture."

"I think Fanatics views trading cards as a key part of its empire, alongside apparel, novelties, memorabilia, NFTs and betting."

The bottom line: Collectibles are cool again, and their resurgence points to a larger shift in fan behavior. Did you really think the sports world's most valuable private company was going to watch from the sidelines?

Go Gophers!!

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