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Nike Sprints Into Metaverse Licensing With RTFKT Acquisition

By Gary Symons

TLL Editor in Chief

The footwear behemoth Nike is expanding its footprint in the metaverse, announcing the acquisition of digital collectibles company RTFKT.

The terms of the deal were not disclosed.

“This acquisition is another step that accelerates Nike’s digital transformation and allows us to serve athletes and creators at the intersection of sport, creativity, gaming and culture,” says John Donahoe, President and CEO of Nike, Inc. “We’re acquiring a very talented team of creators with an authentic and connected brand. Our plan is to invest in the RTFKT brand, serve and grow their innovative and creative community and extend Nike’s digital footprint and capabilities.”

For Nike, the acquisition makes sense as a way to make strides in the rapidly growing market for digital collectibles and NFTs, or non-fungible tokens.

An example of RTFKT’s digital sneakers. These a16 runners were created to celebrate the company’s $8 million seed funding round in May 2021.

RTFKT was founded by Benoit Pagotto, Chris Le and Steven Vasilev, three friends who say they formed the company in January, 2020, just as the COVID-19 pandemic began and forever changed the nature of our interactions with the online world. The tiny company made headlines in February this year when it released a trio of sneakers that looked a bit like doodled-on Nike Air Force Ones.

The digital shoes were a collaboration between RTFKT and Fewocious, an 18-year-old digital artist living in Seattle. Listed respectively at $3,000, $5,000 and $10,000 apiece, the three limited edition designs, each slightly different, were sold out in only seven minutes. In total, 621 pairs were purchased using Etherium cryptocurrency, netting the equivalent of $3.1 million.

“RTFKT was born on the metaverse, and this has defined its feel to this day,” the founders say in a post on their website. “RTFKT is a very eclectic, creator-led organization. RTFKT uses the latest in game engines, NFT , blockchain authentication and augmented reality, combined with manufacturing expertise to create one of a kind sneakers and digital artifacts.”

While the company takes pride in its ability to create highly profitable digital drops, competing against much larger tech firms, they also say the acquisition by Nike is a heaven-sent opportunity to grow the brand more rapidly.

“This is a unique opportunity to build the RTFKT brand and we are excited to benefit from Nike’s foundational strength and expertise to build the communities we love,” says Benoit Pagotto, one of RTFKT’s co-founders. “Nike is the only brand in the world that shares the deep passion we all have for innovation, creativity and community, and we’re excited to grow our brand which was fully formed in the metaverse.”

Nike has in fact been an early mover in metaverse licensing. Earlier this fall, Nike started filing trademark applications for the technology around virtual sneakers and apparel, which was seen as a sign that it would pick up the pace on its metaverse activity. Then, in November, it opened a Nikeland virtual space on Roblox, an online gaming platform popular with Gen Z and Gen Alpha. Roblox is considered an early and extremely successful early mover in the metaverse space. Nike’s huge interactive space is based on the company’s real-life headquarters in Oregon, and features a variety of sports activities like dodgeball, and a showroom to try on virtual goods.

As well, the company’s Jordan Brand started releasing virtual shoes in Fortnite years ago, and recently worked with Fortnite to create a dedicated Jumpman Zone! area within the video game.

But Nike is far from the only fashion or footwear company to dive into the licensing industry’s hottest new trend. For example, arch rival Adidas recently partnered on metaverse programs with the founder of Bored Ape Yacht Club, Pixel Vault’s NFT comics Punks Comic, and crypto investor and NFT collector Gmoney.

With competitors nipping at its heels, this acquisition gives Nike a headstart in the metaverse footrace, so to speak, adding both industry knowledge and RTFKT’s demonstrated savvy in creating highly desirable drops like the one they did with the digital artist Fewocious.

While RTFKT is a young company, it also was growing quickly before the acquisition. In May this year RTFKT secured $8 million in seed funding at a valuation of more than $30 million.

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