Dapper Labs cuts 22% of workforce amid NFT market downturn

• Dapper Labs is the producer of NBA Top Shot and NFL All Day
• The company had more than 600 employees
• October sales of NBA Top Shot reportedly fell 94% year over year

Dapper Labs, the company behind the NBA Top Shot and NFL All Day digital trading platforms, is laying off 22 percent of its workforce.

Roham Gharegozlou (pictured above), the founder and CEO of the non-fungible token (NFT) marketplace, confirmed the decision in a letter to Dapper Labs employees, describing the reduction as “necessary for the long-term health of our business and community”.

“We know that Web 3.0 and crypto are the future across a range of industries – with 1,000 times the potential from here in terms of mainstream adoption and impact – but today’s macroeconomic environment means we don’t have full control over the timing,” the letter from Gharegozlou.

Dapper Labs was founded in 2018 and grew from 100 to more than 600 employees in less than two years. The Vancouver-headquartered company was originally best known in the sports space as the maker of the National Basketball Association’s (NBA) Top Shot, which allows users to buy, trade and collect basketball highlights in the form of NFTs. Launched in October 2020, Dapper Labs said the platform had facilitated $700 million in marketplace sales by May 2021.

Since then, Dapper Labs has made inroads into other sports, including inking deals with the National Football League (NFL), Ultimate Fighting Championship (UFC) and Spanish soccer’s LaLiga.

In September 2021, the company raised $250 million in a funding round led by global investment manager Coatue. By then, the value of Dapper Labs is said to have reached $7.6 billion, meaning it had tripled in value in less than six months. In total, Dapper Labs has raised more than US$650 million and counts Google Ventures, as well as former and current NBA starters Michael Jordan, Klay Thompson and Kevin Durant, among its backers.

However, the popularity of Dapper Labs’ platforms and a wider interest in NFTs has declined. As reported by CNBC, there were $2.7 million in sales across the NBA Top Shot platform in October, down 94 percent from $40.9 million the previous year. The platform has also seen four consecutive months of sales declines, with unique buyers totaling 13,462 last month, compared to 65,769 in October 2021.

CNBC added that the NFL All Day market also saw a decline, with $6 million in volume in October down from $14 million in September.

“Across Dapper Labs, we’re doubling down on what will move the needle and get the entire industry to its next inflection point – and pulling back on anything that doesn’t fit that focus,” Gharegozlou said.

“While we ourselves take large swings to 10 times the market size, we must also become a focused, streamlined organization that allows us to achieve profitability, control our own destiny and sustainably build towards achieving our mission, regardless of financial conditions. the next few years.’