- Sailing league currently has nine teams and is in its third season
- New team will offer equity and non-equity tokens
- Organisation hopes to drive engagement and offer unique selling point
SailGP is launching its first ever fan-owned team, organised as a decentralised autonomous organisation (DAO) and representing Bermuda and the Caribbean.
Based on the Near blockchain, the sailing series hopes the DAO will appeal to fans who want to own either a stake in a team or be able to make meaningful decisions about how it operates on and off the water. The hope is that the new team will make its debut in season four of the competition.
DAOs use smart contracts powered by a set of rules to allow collectives, rather than an individual or a centralised body, to have authority in decision making. The rules, as well as any actions taken, are recorded and verified with blockchain technology, in theory providing a high degree of visibility.
SailGP’s director of Web 3.0 strategy, Tod Reynolds, told SportsPro the aim was to emulate the fan-ownership or membership model employed in other sports and apply it on a global scale.
Although he admitted that many of the benefits could be achieved using other technologies and ownership structures, Reynolds stressed none were as efficient or could foster the same sense of global community as a DAO.
Meanwhile, the use of the ‘proof-of-stake’ method for validating transactions on the blockchain is sustainable enough for the concept to adhere to SailGP’s environmental philosophy.
“We think of Web 3.0 as the ultimate fan loyalty programme,” said Reynolds. “What we’re trying to do is have true ownership with thousands of individuals in a professional sports team.”
The DAO will be formed by Web 3.0 investors Bernoulli Locke and the parameters of the new organisation are set by the agreement between SailGP and its existing teams. The framework specifies the creation of equity and non-equity tokens that balance both the risk of ownership and the desire for voting rights – and ensure compliance with financial regulations.
While the former category will be available to a limited number of individuals and institutions meeting financial requirements, the latter will be available to anyone who wants to get involved.
The DAO must have a management team that performs day-to-day functions and reports back to the fan owners. While token owners won’t be able to vote on who gets on the boat on a race-to-race basis, they will be able to vote on the management team, budget, livery, sponsorship, and business decisions. There also will be a degree of athlete selection on a broader level.
“This will still be a high-performance organisation,” added Reynolds. “It’s not going to just be a decentralised [team] where thousands of people voting on who is going to be on the boat for each race. The management team will report to the token owners in the same way the executive reports into congress in the US government.”
Reynolds added there was nothing to stop other teams following the decentralised ownership route and that the benefits of being a DAO could be realised even with a group as small as ten owners.
SailGP currently comprises teams representing different nations in a bid to drive localised fandom. The decision to go for a whole region was driven by the fact that a global community might be more attracted to the fact that both Bermuda and several Caribbean nations have small populations but have a passion for the sport.
“SailGP has had and will continue to have an involvement with Bermuda,” said Reynolds. “It’s an amazing place to sail but it has fewer people than Chicago has hotel rooms so it’s too small to sustain its own team. There are a lot of places in the Caribbean that have amazing maritime history and sailing talent.
“There’s an amazing, passionate fanbase of smaller nations that have a connection to the water and I think these destinations have a romantic element to people in North America and Europe who love, or would love to visit, so I think it can appeal to a global audience.
“This could become the Jamaican bobsleigh team of sailing.”