Fanatics, Inc.

Fanatics, Inc. is a global digital sports platform that consists of several businesses, including licensed sports merchandise, trading cards and collectibles, sports betting and iGaming, special events, and live commerce.

The company began as an American online retailer of licensed sportswear and merchandise, which operated the e-commerce businesses of major professional sports leagues and media brands, as well as hundreds of collegiate and professional team properties.

History
Michael G. Rubin is the founder and CEO of Fanatics. In 1998, Rubin created an apparel and logistics company, Global Sports Incorporated, which would later turn into GSI Commerce, a multibillion-dollar e-commerce company. Rubin sold GSI to eBay later that year for $2.4 billion and bought back the sports e-commerce business, which included online stores for all North American sports leagues along with hundreds of teams and colleges, keeping the name Fanatics, Inc. for the new company moving forward.

The early years
In April 2012, Fanatics raised $150 million from Insight Venture Partners and Andreessen Horowitz and acquired its Florida-based rival Dreams, Inc. for $158 million in cash and $25 million in debt. This move added the brands FansEdge and Mounted Memories, which was rebranded as Fanatics Authentic division.

Rubin's vision was to differentiate Fanatics by serving the real-time expectations of global sports fans and partners. In 2014, Doug Mack was appointed CEO and Fanatics opened a Bay Area office to tap into the Silicon Valley tech talent pool. Mack helped Fanatics move from a domestic e-commerce business to a mobile-first, direct-to-consumer brand with its own manufacturing capabilities. Priorities such as real-time manufacturing, data, and technology, would guide the company's innovative vertical commerce (v-commerce) model.

In 2015, Fanatics raised $300 million from Silver Lake Partners and in early 2016 the company acquired UK-based internet retailer Kitbag to accelerate focus around international expansion and global soccer.

In April 2017, Fanatics bought sportswear and merchandise manufacturer and MLB uniform provider Majestic Athletic from VF Corporation in an effort to add to the company's growing vertical manufacturing capabilities. Nike Inc. would eventually take over as MLB's official on-field uniform partner, with Fanatics using the existing facilities acquired during the Majestic acquisition to now make Nike MLB uniforms.

In September 2017, Fanatics closed a $1 billion round of fundraising led by Softbank, with participation from the NFL, MLB, NHL, MLS and NFLPA. Fanatics was expected to produce $2.2 billion in annual revenue that year. The next month, Fanatics acquired Fermata Partners to transform the college licensed sports business and a new Fanatics College division was formed.

In the following two years, Fanatics announced 10-year deals with Nike, the National Football League and Major League Baseball that granted Fanatics the rights to design, manufacture and distribute all Nike fan gear sold at retail for both leagues.

At the onset of the pandemic in early 2020, Fanatics and MLB halted production of MLB jerseys to manufacture masks and gowns for emergency personnel battling COVID-19. Using the exact same material that was previously used to make Yankees, Red Sox, Phillies and all other MLB jerseys, that fabric was instead used to make more than one million masks and gowns that were eventually shipped to more than a dozen states.

In April 2020, Michael Rubin—with the help of Fanatics employees around the world—launched the ALL IN Challenge, one of the largest digital fundraisers in history. The celebrity and athlete driven ALL IN Challenge exploded on social media and raised $60 million to provide nearly 300 million meals for Feeding America, Meals on Wheels, No Kid Hungry, and World Central Kitchen. Also in 2020, Fanatics established the All-In Challenge Foundation, which will continue to serve as the philanthropic arm of the company.

In August 2020, the company secured $350 million Series E funding raising Fanatics' valuation to $6.2 billion. Using the new funds, Fanatics purchased assets from Vetta Brands, including leading collegiate headwear producer Top of the World. This acquisition saved more than 200 jobs and added significant headwear scale and capabilities. In December 2020, Fanatics acquired WinCraft, the preeminent licensed hardgoods and promotional products company, which increased the company's presence with non-apparel merchandise.

Global digital sports platform (2021–present)
In March 2021, Fanatics secured a $320 million funding round, followed by another $325 million in August 2021 that brought the company's valuation to $18 billion as of September 2021. During the latter funding round, Fanatics also announced plans to evolve into a global digital sports platform through expansion into new verticals. It was reported at that time that these verticals may include NFTs, trading cards, sports betting and gaming, ticketing, media and more. With the move, Rubin assumed the new role of CEO of the broader Fanatics portfolio.

In May 2021, Rubin co-founded the digital collectibles company Candy Digital with Mike Novogratz and Gary Vaynerchuk. Candy Digital secured an exclusive, long-term agreement with MLB as its first content partner. Later that year, Candy Digital received $100 million financing round, valuing the company at $1.5 billion. The round was led by Insight Partners and SoftBank Vision Fund2, and included NFL Hall of Famer Peyton Manning, Connect Ventures and Will Ventures. In January 2022, Fanatics divested its 60% stake in Candy Digital.

In August 2021, Fanatics secured long-term trading cards manufacturing and distribution rights from MLB, MLBPA, NBA, NBPA and NFLPA. A month later, Fanatics Collectibles, Fanatics' new trading cards and collectibles business secured a $350 million Series A round at $10.4 billion valuation. Fanatics acquired Topps, the preeminent licensed trading card brand that has serviced collectors, fans and retailers for more than 70 years, in early 2022. As part of the deal, approximately 350 global Topps sports and entertainment employees joined Fanatics to operate under Fanatics Collectibles.

In February 2022, Fanatics, along with some names in sports, entertainment and culture, acquired lifestyle and streetwear brand Mitchell & Ness from Juggernaut Capital Partners. Mitchell & Ness continues to operate as a separate, distinct brand within the Fanatics Commerce division. In April 2022, Fanatics announced a $1.5 billion fundraising round followed by another $700 million in December 2022, reportedly pushing the company's valuation to $31 billion. During the December round, Rubin announced Fanatics would be expanding into a third vertical in 2023, Fanatics Betting & Gaming.

In May 2023, Fanatics bid to acquire PointsBet's U.S. business for $150 million, marking Fanatics' first move into the U.S. sports betting industry. In June 2023, Fanatics increased the offer to $225 million to outbid DraftKings after that company made a competing bid of $195 million. The first wave of the deal closed in August 2023 in eight U.S. states and started the brand transition from PointsBet to Fanatics Sportsbook

Fanatics expanded its international footprint for the Commerce business with the acquisitions of Italian sports merchandise company Epi in April 2023, and Latin American sports wholesaler Fex Pro in June 2023.

NBA
In 2015, the NBA announced a multi-year partnership with Fanatics to operate its 25,000 sq ft flagship store in New York City. Since Fanatics also operates the online NBAStore.com, customers of the New York City store are able to browse and purchase from the entire online inventory through in-store handheld devices.

NFL
In March 2016, the NFL and Fanatics agreed to a new long-term extension to operate NFLShop.com. The NFLPA also granted Fanatics the rights for player merchandise. Fanatics replaced Nike as the largest maker and seller of player merchandise starting in March 2017.

NASCAR
In 2015, Fanatics obtained a license from NASCAR to sell the merchandise trackside at all 36 Monster Energy NASCAR Cup Series races and select NASCAR Xfinity Series races. This contract eliminated car owner and sponsor-owned merchandising haulers, which had previously sold mixed merchandise and limited edition items in favor of a singular "superstore" shopping area with one checkout zone for all merchandise, generally located outside one track entrance. It was initiated in August 2015 at the Pocono Raceway. By 2017 however, the plan was considered a failure due to limited merchandise and poor foot traffic, and it led to a decline in overall at-track merchandise sales. Larger tracks such as Daytona International Speedway utilized the first turn for merchandising, however, the majority of fans did not enter through this area as well as the many fans camping infield. Sponsors were unable to find places for drivers to initiate fan contact as they had previously in merchandise haulers for events such as autograph signings.

Fanatics currently employs a "hybrid" system with a blend of haulers and smaller Fanatics tents (size/space varies per track). This allows Fanatics to reach more fans, especially once inside the gates and has reopened the door for NASCAR and driver sponsor interaction. Fanatics President Ross Tannenbaum indicated, "We've got all this money and all this product invested [in the tent] and it's sitting outside the gates where there is nobody coming [while the race is happening]. All those people are inside and at some point walking around or doing something and there's a very poor product offering. To have the best shopping experience, our goal would be to have a really strong offering of product out front like we have today but do a better job of having destination shopping inside the track." On November 2, 2018, Fanatics announced they would no longer provide the trailers for the series, though Fanatics would continue with online sales until 2024.

NHL
In 2017, when the National Hockey League switched from Reebok to Adidas, Fanatics took over production of the "semi-pro" jersey with the Fanatics label of the "Breakaway jersey." This jersey featured a foldable single layer front crest. Adidas only manufactured the on-ice and retail version of the "pro" jerseys. Fanatics and Adidas also partnered up to make NHL hats in 2017, ending the 20 year New Era contract.

In March 2023, Fanatics announced that they would be replacing Adidas as the on-ice uniform and authentic jersey supplier. The deal is set to start for the 2024–2025 season and will last for 10 years.

Upon completion of the deal between Fanatics and the NHL, negative feedback has been expressed by many fans over perceived quality issues with Fanatics products.

MLB
In December 2015, MLB announced a merchandise deal that split the rights between Fanatics and Nike.

In August 2021, it was announced that Fanatics would take over the MLB baseball cards license from Topps after 2026. With the subsequent purchase of Topps by Fanatics in January 2022, the license began immediately.

Nike's new Vapor Premier template, manufactured by Fanatics, will be used across all Major League uniforms beginning the 2024 Major League Baseball season, replacing the previous Majestic Athletic FlexBase template that Nike inherited upon taking over MLB's uniform contract in 2020. The new template was first used in the uniforms worn during the 2023 All-Star Game.

MLS
Fanatics began operating the e-store for Major League Soccer (MLS) and Soccer United Marketing in 2015. A larger partnership was signed in 2017 and took effect in 2019 that granted Fanatics the right to manufacture and sell merchandise for MLS teams and events, excluding official jerseys.

Formula 1
In 2020, Fanatics announced a partnership with Formula One for merchandise production and sales. The deal was extended in July 2021 after a surge in e-commerce sales.

NPB
In 2018, Fanatics announced a ten-year partnership with the Fukuoka SoftBank Hawks of Nippon Professional Baseball for merchandise production and sales through their Majestic Athletic brand, becoming the first team in all of Asia to partner with Fanatics. This also included becoming the official uniform partner of the Hawks through 2029. As of 2023, Fanatics is under partnership with the Chiba Lotte Marines, Tohoku Rakuten Golden Eagles, Saitama Seibu Lions, Tokyo Yakult Swallows, and Yomiuri Giants.

Other ventures
In January 2015, Fanatics began selling a collection of casual womenswear designed by Ricki Noel Lander called Let Loose By RNL. In October 2019, Fanatics teamed up with sports broadcaster Erin Andrews on a line of clothing.

In 2017, Fanatics signed a manufacturing, design and e-commerce partnership with English association football club Aston Villa, a first for an English club. In 2022, this partnership was extended, after Aston Villa reported they had seen a 450% increase in e-commerce sales under this agreement. In July & August 2021, Fanatics struck a similar deal with Manchester United, Chelsea, Derby County and Everton.

In June 2020, Fanatics announced a ten-year licensing, manufacturing and e-commerce partnership with French soccer club Paris Saint-Germain. There are also partnerships with German clubs Schalke and Bayern Munich, as well as Spanish club Atlético Madrid.

Fanatics have licensing partnerships with the England national football team, the Canada men's national soccer team and the England national rugby union team.

In 2022, was announced that Fanatics would get rights to be the official e-commerce and event retail of UEFA National Team Competitions, including Euro 2024 and Euro 2028.

In February 2023, the company announced a move into livestreamed shopping centered around trading cards and collectibles. As part of its efforts, it hired Nick Bell, then of Snap, to lead this new effort. The new business would be called Fanatics Live, and Bell would serve as CEO, with an estimated launch in the second half of the year. There would be a standalone app as well as a website. So-called Fanatics would receive a percentage of each transaction. This move came as livestreamed shopping was growing in popularity in the US, with more established brands like Nordstrom, Petco, and Walmart as well as TikTok and EBay already involved in the space but with more potential to growth, with the vast majority of US adults not having heard of it at the time of the announcement. For Fanatics, it came after the acquisition of Topps trading cards in January 2022.

Criticism and Controversies
Fanatics, by many, is considered a monopoly in North America due its aggressive ventures into sports merchandising and collectible card markets.

Such aggressive actions have been the subject of lawsuits by smaller vendors and other companies such as Panini. These legal battles have centered around allegations of anti-competitive conduct and interference with business relations, further fueling the debate about Fanatics’ market practices.

In addition to legal challenges, Fanatics has also been subject to various types of fan criticism. Many consider the Fanatics products subpar, citing issues with the quality and design of their merchandise. So much so, that there are even dedicated pages where consumers voice their dissatisfaction and critique such poor products.

A notable event was the backlash over the quality of its MLB jerseys before and during the 2024 season. During spring training, the Kansas City Royals opted out of using the Vapor Premier template, instead wearing uniforms that featured the larger player name and number font used by the older uniforms. By the time the 2024 regular season started, however, the league required the Royals to instead wear the new uniforms with the smaller font sizes, with a league spokesperson giving "consistency with other Major League Baseball teams" as the rationale for the mandate.