Rally, a platform for fractional investing in collectibles, has wrapped up $15 million in a funding round led by Wheelhouse.
Launched three years ago by Brent Montgomery in partnership with late night talk show host Jimmy Kimmel, Wheelhouse is a media, marketing and investment company. Its investment arm, Wheelhouse 360, participated in the round along with Thirty Five Ventures, Animal Capital, Bertelsmann Digital Media Investments and LionTree. To date, Rally has raised more than $65 million in equity capital.
The collectibles market has gained ground during the pandemic, due partially to months of lockdown in various parts of the world. The global collectibles market is estimated to be worth $370 billion.
Rally founder Rob Petrozzo said the latest round will be used for “adding more access and more on-ramps, expanding the platform and offerings, moving toward more continuous trading so there is the opportunity to invest on Rally, and expanding internationally and into new market classes.” The platform offers 15 categories including NFTs, which were added recently. Royalty streams for music and entertainment will be coming soon, and domain names and real estate are in the works for the coming months, he said.
Montgomery, Wheelhouse’s chief executive officer, noted the rise in fractional investing reflects the explosion of interest in collectibles as a dynamic asset class, which the company refers to as “investibiles, merging investors and collectors…”
Wheelhouse also has plans to help Rally bolster its brand through a larger content and talent-facing collaboration that includes the production of podcasts about collectibles and “passion investing,” and exposure to TV audiences through the History Channel’s “Pawn Stars.” Next season, the show will feature Rally-sourced finds such as a 1776 broadside of the Declaration of Independence.
To celebrate the latest investment round, Rally and Wheelhouse will hold a private event with some of Rally’s pricier collectibles on display including a piece of the hardwood from the Staples Center where Los Angeles Laker Kobe Bryant played his final game in April 2016, scoring 60 points. The NBA star and eight others died in a helicopter crash in Southern California last year.
While some might view the hardwood floor relic as somewhat morbid, asked if he had any reservations about that item, Petrozzo said, “For us, and for me, Kobe is this larger than life figure. He’s always been this legend and hero to me who I always watched. I tried to emulate his game, when I played [high school] basketball. For us, bringing the opportunities to our investors that create that same emotion is a huge part of what we do as a business and a platform. Even though Kobe’s not with us any more, to have a piece that was so meaningful to so many of his fans, to me and to our company was an important reason why we went with that hardwood floor.”
Seventeen percent of Rally’s total offerings are luxury items such as Birkin bags and watches.
While Thirty Five Ventures was started by Kevin Durant and Richard Kleiman, the Gen Z-focused Animal Capital, which claims to have more than 100 million engaged consumers, was started by social media types Josh Richards, Griffin Johnson and Noah Beck, among others. Although Petrozzo did not single out any individuals by name, he acknowledged the importance of Rally having “big-name investors,” in that it validates a lot of what it is doing and with the fan bases of those individuals. In addition, it is an opportunity to connect with users, “build that community and having that stamp or cosign from those important names in all these spaces where we operate is an important way we build community and this business,” he said.
For the remainder of this year and going into next year, the focus will be to continue to build and engage that community to inform Rally as to which direction the platform should go. There are plans to relocate the retail space to a nearly 5,000-square-foot location in Manhattan’s SoHo. “It’s easy to look through an app and understand the dynamics from a financial perspective. But there is a different feeling being around them in a museum setting that really brings them to life literally — to ask questions, to have conversations and to do that in a space, where your investments will live,” Petrozzo said.
Other Rally outposts are being considered in Los Angeles and Miami to get members of the community together in-person through informative lunches, partnership events and other situations. Petrozzo said, “Community for us is not about having a discord channel or sending a few emails. It’s really about allowing the investor to define the direction that we go [in] as a platform, the assets that we bring to market and the engagement that we create.”