Fanatics gobbles up PWCC

[dustin42]

Originally Posted by dbpsooner

Maybe I am naive, but I don't understand the fear from people who had cards in the PWCC vault. Those cards would still be the property of the card owner and not PWCC right? If they went bankrupt, those cards would be returned to their owners and any PWCC assets would be liquidated and paid out to creditors. I am struggling to see a scenario where cards not owned by PWCC would not be returned to their owners barring fraudulent activity.

This process takes years. Look up Marx cards.

[dustin42]

How many of these frauds that lost tons of people's money during this card boom were mortgage brokers in 2006-2008 before the crash?

[cholodolo]

Originally Posted by dbpsooner

Maybe I am naive, but I don't understand the fear from people who had cards in the PWCC vault. Those cards would still be the property of the card owner and not PWCC right? If they went bankrupt, those cards would be returned to their owners and any PWCC assets would be liquidated and paid out to creditors. I am struggling to see a scenario where cards not owned by PWCC would not be returned to their owners barring fraudulent activity.

One would think so, but in another thread a PWCC user said there isn't a contract or agreement signed prior to submitting cards to the vault. He could have been mistaken, but I've never seen a form or document customers sign when submitting to PWCC. I'm sure PWCC makes them sign a waiver of some sort, but I've also never seen a copy of that.

That's a serious concern as it is not clear who has right of use or access to the card in their possession. If they were to go BK, secured AND unsecured creditors could have a claim on the assets in their possession. With no UCC filings or title, would be really, really messy to try and get cards out just like any other asset.

We could all be blowing smoke, but PWCC's lack of transparency hasn't put any half-truths or lies to bed.

[SpartanWarrior]

Originally Posted by dbpsooner

Maybe I am naive, but I don't understand the fear from people who had cards in the PWCC vault. Those cards would still be the property of the card owner and not PWCC right? If they went bankrupt, those cards would be returned to their owners and any PWCC assets would be liquidated and paid out to creditors. I am struggling to see a scenario where cards not owned by PWCC would not be returned to their owners barring fraudulent activity.

-----------------------

When GAI (grading company) went bankrupt in the late 2000's, lots of people that had submitted cards never got them back. Who would have done that?

Mike Baker

Yes the same Mike Baker that currently puts stickers on slabs. Who has some type of arrangement with PWCC.

Brent, Jesse, Mike.... trust them as far as you can throw them. Add to that a ton of lawyers filing claims and you'd end up with a multi-year mess. Supposedly, we just missed that scenario by a few days.

[mjohnatgt]

Originally Posted by dustin42

Who could have seen this coming

https://twitter.com/AdamKatzWriter/s...31763530203136

Wow, that Mahomes result does not bode well for the Blowout Modern Wax Fund. The best performing cases/boxes in the fund were split between 2017 Football (with Mahomes leading the way) and 2018 basketball. As of 1 Jan 2023, the Wax Fund claimed their value was still 3x the original purchase price, and it looks like they'll start selling off their investment assets in a couple of years.

[GeechQuest]

Originally Posted by mjohnatgt

Wow, that Mahomes result does not bode well for the Blowout Modern Wax Fund. The best performing cases/boxes in the fund were split between 2017 Football (with Mahomes leading the way) and 2018 basketball. As of 1 Jan 2023, the Wax Fund claimed their value was still 3x the original purchase price, and it looks like they'll start selling off their investment assets in a couple of years.

PWCC gutting the leverage in the hobby precipitates the next 50-90% drop on prices.

When BO goes to liquidate 80 boxes of 13/14 Timeless Treasures ($125 sold, $394 current value based on one sale in Q4 2022), it will start the next leg.

They’re currently valuing all 9202 boxes in the fund at an average price of $967…

The quarterly report is always fun to look at. Just scanning their biggest holding, 2018 Basketball boxes, it appears to have a recent value of 50% below the estimated cost of $1.1M. Thats also based off of a handful of boxes from that year selling, limiting supply. Not drowning the market with over 600 boxes.

Something, something, liquidity…

[mjohnatgt]

Yeah, and any injury from Pat Mahomes or softening of the Lulu/Luka market can make it even worse.

[KhalDrogo]

Originally Posted by GeechQuest

PWCC gutting the leverage in the hobby precipitates the next 50-90% drop on prices.

When BO goes to liquidate 80 boxes of 13/14 Timeless Treasures ($125 sold, $394 current value based on one sale in Q4 2022), it will start the next leg.

They’re currently valuing all 9202 boxes in the fund at an average price of $967…

The quarterly report is always fun to look at. Just scanning their biggest holding, 2018 Basketball boxes, it appears to have a recent value of 50% below the estimated cost of $1.1M. Thats also based off of a handful of boxes from that year selling, limiting supply. Not drowning the market with over 600 boxes.

Something, something, liquidity…

Blowout already got their money. They don’t care. The bag holders will be the same people who thought $500k RPAs and $100k Kobe refractors with LeBron on it were a good idea.

[GeechQuest]

Originally Posted by KhalDrogo

Blowout already got their money. They don’t care.

Agree completely. Found marks to buy up dead inventory that was destined for Black Friday.

Just saying, the Wax Fund liquidation will be the next leg down after we work through the lost PWCC leverage.

[KhalDrogo]

Originally Posted by GeechQuest

Agree completely. Found marks to buy up dead inventory that was destined for Black Friday.

Just saying, the Wax Fund liquidation will be the next leg down after we work through the lost PWCC leverage.

The reality is that the PWCC leverage was already lost. The next leg down is beginning now. And it's thanks to all of the publicly known big names in the hobby either scaling back significantly, or exiting altogether. This is not some big secret.

[fabiani12333]

Originally Posted by GeechQuest

Agree completely. Found marks to buy up dead inventory that was destined for Black Friday.

Just saying, the Wax Fund liquidation will be the next leg down after we work through the lost PWCC leverage.

This was the second fund they created -- they ended the first one in 2021, with investors making big returns. BO had a 50% controlling stake in it.

[fabiani12333]

Call me naive, but I don't think PWCC's lending program or the Modern Wax Fund were scams. I think they were part of a strategy to treat trading cards like investments in an attempt to drive the market higher.

The Modern Wax Fund actually made the original investors huge percentage returns. PWCC's lending program provided more liquidity in the market to card investors.

Blowout Cards was able to sell off their inventory instantly, allowing them to access a lot of funding without taking on debt. PWCC tried to grow its new marketplace, adding a new competitor to eBay.

The problem was these efforts helped to drive the prices of cards much higher, creating a price bubble, and led to hobbyists being priced out of the market -- "You ruined the hobby I love ..."

Also, there's a question about PWCC's tactics. They seemed very aggressive in trying to grow their business. There are questions about possible shill bidding on auctions. They also publicized a video of a 15-year-old kid receiving an $80,000 loan to buy a Zion card, which frankly gets under my skin. The kid's father, who helped to facilitate the transaction, needs to also take responsibility.

[mjohnatgt]

Originally Posted by fabiani12333

Call me naive, but I don't think PWCC's lending program or the Modern Wax Fund were scams.
The Modern Wax Fund actually made the original investors huge percentage returns. PWCC's lending program provided more liquidity in the market to card investors.

Well, they haven't sold any yet, so the jury's still out on Modern Wax Fund from 2020.

PWCC's lending program reminded me at the time of the subprime lending crisis from 2006. Looks like Fanatics was nice enough to pick up their Collateralized Debt Objects. Too bad they didn't implode for real.

[fabiani12333]

The smart investors utilized PWCC's lending program in 2021. They were able to borrow money with no risk beyond the cards they used as collateral. But they were able to benefit from any sales profits, with PWCC only taking a small portion.

Other bag holders who invested in 2021 lost out.

[auburn35]

Sports Collectors Daily is reporting that similar to PWCC, PSA recently dumped several employees with more cuts upcoming as PSA prepares for a possible sale.

Fanatics rumors?

PSA Lays Off 11 Employees

Collectors, parent company of PSA, has recently reduced its employee roster.

SC Daily has learned that 11 workers, including several members of PSA’s marketing staff were abruptly laid off last week. Among them was Dave Steinberger, hired less than three years ago as the company’s director of customer experience. Terry Melia and Todd Tobias, both long term employees who contributed to the company’s content platforms, were also among those who were let go.

It’s not believed any members of the grading and authentication teams were part of the employee cuts. The action comes one month after PWCC Marketplace laid off what’s now believed to be more than 40 employees ahead of its acquisition by Fanatics last week.

Unlike the employees terminated by PWCC, PSA’s laid off workers did receive some severance pay.

In February of 2021, PSA and its sister grading and authentication companies were purchased for $853 million by an investor group, turning the firm formerly known as Collectors Universe from public to private ownership.

One source close to the situation believes Collectors has begun cutting certain expenses in anticipation of a possible future sale, much like what occurred with PWCC. Our source indicated more layoffs were expected.

SC Daily has learned that Collectors was among those interested in purchasing PWCC before the sale to Fanatics, which continues to gobble up properties in the sports collectibles space.

[KhalDrogo]

I see no reason for Fanatics to not acquire PSA. They can cut out Goldin and PCGS from the deal. Fanatics acquires more mature companies that already have most of what is necessary to succeed at large scale. None of the other TPGs fit that bill, except maybe CCG. But CSG appears to be a lost cause.

[splitrockgamer]

Originally Posted by KhalDrogo

I see no reason for Fanatics to not acquire PSA. They can cut out Goldin and PCGS from the deal. Fanatics acquires more mature companies that already have most of what is necessary to succeed at large scale. None of the other TPGs fit that bill, except maybe CCG. But CSG appears to be a lost cause.

Complete the monopoly! Why shouldn't a single company control every part start to finish of a market, what could possibly go wrong there?

Glad I am on my way out of this what used to be an enjoyable hobby. Like most things in life greed destroys all.

[KhalDrogo]

Originally Posted by splitrockgamer

Complete the monopoly! Why shouldn't a single company control every part start to finish of a market, what could possibly go wrong there?

Glad I am on my way out of this what used to be an enjoyable hobby. Like most things in life greed destroys all.

I agree. But you can easily participate in the hobby without spending a dime on Fanatics’ products and services.

[splitrockgamer]

Originally Posted by KhalDrogo

I agree. But you can easily participate in the hobby without spending a dime on Fanatics’ products and services.

Ok you got me, how?

[theshowandme]

Originally Posted by splitrockgamer

Ok you got me, how?

Buy cards that were already made before Fanatics got involved...

[OhioLawyerF5]

Originally Posted by splitrockgamer

Complete the monopoly! Why shouldn't a single company control every part start to finish of a market, what could possibly go wrong there?

Glad I am on my way out of this what used to be an enjoyable hobby. Like most things in life greed destroys all.

That's not what a monopoly is. Fanatics owning all the exclusive licenses to produce cards makes a monopoly on licensed cards. But them acquiring one of the many grading companies, and one of the major auction houses, is absolutely not a monopoly. There are plenty of other players in those spaces.

[xbignick]

[Bowman1951]

Hah, I wasn’t sure which to bump…..good lookin out.

[hermanotarjeta]

Translation - we are jealous and want the money that he was able to steal from his clients.

[xbignick]

Originally Posted by Bowman1951

Hah, I wasn’t sure which to bump…..good lookin out.

Yeah took me a couple minutes to find the thread. Thought it was maybe deleted lol.

Both good.