The company informed employees of the cuts Monday morning, said the people, who were granted anonymity because the details are private. The cuts encompass more than one third of the company’s roughly 100 employees.
A representative for Candy Digital didn’t respond to a request for comment. A representative for Fanatics declined to comment.
The downsizing comes amid a “layoff surge” sweeping tech. Earlier this month Twitter laid of roughly half of its workforce in the wake of Elon Musk’s takeover. Lyft and Stripe recently laid off more than 10% of their respective staffs. Even Apple (Nasdaq: AAPL) and Amazon (Nasdaq: AMZN), two of the largest public companies in America, have instituted hiring freezes.
The cuts have been especially deep in NFTs and cryptocurrency, a corner of tech that was already in steep decline before the FTX collapse threw the industry into a tailspin. Earlier this month Dapper Labs, the NFT platform behind NBA Top Shot and NFL All Day, announced a 22% staff cut. Top Shot did just $1.5 million in sales in October 2022, down 99.3% from $224.1 million in February 2021.
Candy Digital launched in June 2021, back when sports NFTs were still white hot. Fanatics is the majority shareholder, with Novogratz’s Galaxy Digital and Vaynerchuk as equity partners. A few months after the launch, the firm raised $100 million at a $1.5 billion valuation. That round included investment from SoftBank, Insight Partners, Will Ventures, Peyton Manning and a number of other current/retired athletes, whose names weren’t released.
Candy Digital’s day-to-day operations are run separately from Fanatics’. Rubin’s e-commerce giant has an NFT vertical within Topps, the trading card brand that it acquired in January. Fanatics is investing in that business and is currently hiring in its collectibles division, which includes those NFTs.
Candy Digital’s partners include Major League Baseball, WWE and Netflix.
(This article was updated in the penultimate paragraph to include information about Fanatics digital collectibles.)