The rise of fractional investing has given investors and collectors the opportunity to own small stakes in alternate assets such as trading cards, video games, wine, first edition books, cars and sports memorabilia.
Rally Rd. is one of several companies in the space and has made headlines with record-breaking buyout offers for video games, comics and trading cards offered on its platform.
Video Game Records: A 1985 sealed Super Mario Bros. video game that was offered to Rally customers recently broke the video game sale record as investors accepted a $2 million buyout offer for the asset.
The record came after several video game sales had topped the $1 million mark earlier this year and broken previous records.
“Games are an asset class that we had our eye on as soon as we went into sports memorabilia in 2018 and 2019,” Rally founder Rob Petrozzo told Benzinga in an interview.
Petrozzo cited video games having history, rarity and relevance for decades, all items that appeal to Rally’s user base.
“We were lucky to find what is potentially the highest graded hangtag copy in existence and investors were able to see a significant return — a world record — as a result.”
Rally bought the game for $140,000 in April 2020 and has landed several other Nintendo Co. (OTC: NTDOY) vintage games to offer on the platform.
Rally has a sealed 1987 Zelda game for Super Nintendo on its platform, which Petrozzo noted was extremely hard to find in the unopened state. A 9.6 A++ graded Goldeneye Nintendo 64 game is up over 340% for Rally investors who bought at the offering price.
“We’ve got over two dozen games listed on the platform currently, with more to come,” he said.
Apple Assets: One asset class that has gained attention on Rally is Apple Inc (NASDAQ: AAPL) related collectibles.
“For me personally, they’re really important assets,” Petrozzo said of the Apple offerings from Rally.
Petrozzo cited the dynamics of rarity and collectability for Apple assets. Rally looks at them as a “true collectible asset.”
Rally offered shares in a first-generation sealed 2001 Apple iPod in July. The company also has a 1986 Macintosh Plus signed by Apple co-founder Steve Jobs and other members of the Apple team. The Macintosh Plus asset has more than doubled in value since being offered to Rally users.
An original Apple I computer can also be found on Rally’s platform.
“In many instances, these assets stayed under the radar as collectibles until recently and a lot of tech enthusiasts held on to the earliest examples without even realizing the value would rise so dramatically.”
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Other Assets: Along with the staples of trading cards, comic books, first edition books, cars and wine, Rally had dipped its toes into other asset classes.
This includes the launch of non-fungible tokens recently with two CryptoPunks being offered for fractional ownership.
Rally has also added legendary musician memorabilia with a partnership from Gibson Guitars.
Customers can also find unique pieces like a Megalodon jaw fossil, Mosasaur skeleton and a lunar meteorite.
Petrozzo said he is proud of all the assets on Rally but cites some from his childhood as being special to him.
“There are a few that represent my childhood like ‘Where the Wild Things Are’ and Mario, but there are others that represent the future like the CryptoPunks which I’m equally excited about.”
Rally will also branch into the new asset class of political memorabilia with a planned launch in the fourth quarter of one of the best-known pieces of American history.
What’s Next for Rally: Petrozzo said the idea for Rally was started on paper six or seven years ago. Rally become a pioneer in the industry but now faces competition.
“We look at ourselves as a leader,” he said.
Rally wants to continue being in front and Petrozzo acknowledged competitors do things well and there is room for others in the market.
“There’s always going to be an Uber vs. Lyft,” he said.
Rally raised $30 million in May led by Accel. Petrozzo highlighted investments made in the company prior to that round including Reddit co-founder Alexis Ohanian.
“Rally is bringing in people who understand collectibles and how to build communities,” Petrozzo shared.
He said Rally is not seeking to go public at this time but would have a conversation if it would help with liquidity and building the community.
“We’re so focused on what we’re building,” Petrozzo added.
Rally’s biggest focus right now is building out a secondary offering platform. Right now, Rally assets are only offered in a one-day trading window every three months.
Allowing instant access to assets via a bid/ask 24-hour trading window has always been on Rally’s radar, Petrozzo said.
© 2021 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.
