Q&A: Mark Faggiano, Co-Founder of Beelya

By Alicia Ashby On February 18, 2009 · Leave a Comment

Beelya is one of the four new virtual goods partners that There.com announced earlier this month. As the name hints, Beelya's spin on virtual goods is virtual recreations of sports memorabilia (or:"memora-beelya") that would often be impossible for most people to really own. Co-Founder Mark Faggiano explains Beelya's place in the virtual goods business as that of a convenient middleman, able to secure licenses from major athletes and then develop those licenses into lines of virtual goods more easily than most social networks or virtual worlds could by themselves.

"On a high level our goal is to be a content aggregator for premium
licensed goods related to professional sports," says Faggiano. "We went with There.com after talking to numerous other virtual worlds, because their
particular user base was really interested in being able to purchase
sports-related virtual goods. We see it as the first step of many he
hope to make this year."

Virtual Goods News: So what kind of content can Beelya offer to a client?

Faggiano: We have agreements, exclusive, with a couple hundred professional athletes from the NFL, MLB, NBA, and also gold medal Olympic athletes. We also have deals with on-air personalities from sports and some extreme sports athletes. The agreement lets us create and distribute virtual goods on their behalf. What we’re working toward, and the ultimate goal for us, is to be the aggregator of licensed sports content on behalf of all major professional sports leagues.

VGN: So when it comes to virtual goods, exactly what does Beelya help produce?

Faggiano: On There.com right now, what we have are things that people can display in their houses. People were coming back to There saying, “I just bought this new house and I don’t have anything to put on a wall.” So they expressed interest in wall art, and in There you can buy framed memorabilia. One item we offer is a racing jacket signed by Kasey Khane, framed and ready to hang. There are also jerseys people can buy for avatars that are autographed as well.

The goal there is to let people express themselves as sports fans, and there’s no real way to do that as a sports fan with an avatar in most virtual worlds right now. What we see as a huge opportunity is that if we can act as the aggregator for all of this content, we can help not only the leagues and athletes get involved in this exploding industry, but also the ultimate thing we can do here is allow all of the users that are out there to express themselves as sports fans.

VGN: It’s sounding like Beelya is going to be preparing different goods for each client, then? Everything you’ve mentioned seems pretty specific to There.com so far.

Faggiano: Yeah, we’ll probably do different goods for each client. One of the things that we do, and we’ve had discussions with a bunch of the worlds, is that we listen to them and do what makes the most sense for their users. We don’t offer, say, a catalog of standard stuff. We do more of a strategic plan with them to say “Let’s go through the demographics of your users, what sports do they like, what goods do they want.” Then we create those goods.

VGN: So it sounds like Beelya’s planning to expand beyond There.com this year?

Faggiano: Yes, definitely. Our plan this year, and this is the first step of many, is to work on acquiring the ability to create more content and distribute more content, but also sign more deals with more virtual worlds. We’re strengthening what we can offer as well as what’s been available.

VGN: So when exactly did Beelya’s goods go live in There.com?

Faggiano: We went live at the end of last month and There.com promoted it starting about two weeks ago with a fashion show and things like that. We don’t have sales data yet, we won’t have it until the end of this month. We did see some very preliminary numbers from the few days in January we were available and they were really encouraging. We’re pleased with the way it’s worked out for sure.

VGN: Is Beelya planning on working primarily with virtual worlds, or do you plan to head into other virtual goods venues?

Faggiano: Our plan is to go everywhere there are sports fans. We actually have an app going in Facebook that’s been really nothing more than a private beta. We’ve had some success with that but haven’t really done anything to promote it. To be quite honest with you, when we started this company over a year ago we thought, “We’d have the next killer app in Facebook and that’ll be enough,” but it’s amazing how the proliferation of virtual goods has helped us shift our priority to virtual worlds. We’re talking to most all of the big players there and are in pretty serious discussions to be in mobile, to be in games and anywhere people have set up avatar identities. As long as there’s interest on behalf of the publisher and they feel like it’s a good fit for their audience, we can fit our product into that platform.

VGN: What are Beelya’s plans for getting into mobile?

Faggiano: Mostly what we’re planning right now is to come up with our own avatars specific for our content. In terms of existing apps, we really haven’t done a whole lot of talking to the mobile apps doing virtual goods transactions. From what we know of the virtual goods transaction space on iPhone, it’s still relatively immature. We’ve had some really great ideas and are trying to put those into development phase in terms of ways sports fans can express themselves.

As a quick example, imagine that you’re at the Daytona 500, and through the iPhone’s geotargeting, it knows you’re at that particular event. Imagine if there was some sort of limited edition virtual good that came out and popped up on your event and said, “Kasey Khane just won! Do you want to purchase a virtual commemorative trophy?” We’re in the very early stages of development for development of apps like this.

VGN: Which mobile platforms are you considering right now? It sounds like the iPhone?

Faggiano: We’re considering all mobile platforms at this point, but we’re closest to working with the iPhone. At this point, we’re in development for iPhone apps and trying to get that launched.

VGN: Have you come up with a way to get around the iPhone microtransaction issue? That really seems to be giving people a hard time when it comes to getting virtual goods sales onto the platform.

Faggiano: We’re trying to work that out, yeah. Honestly, that’s probably going to determine whether or not what we decided to build here is going to include purchases. If you had to pin me down today, I’d say we’re not comfortable enough yet to even try to encourage microtransactions in the app. We’re thinking more about selling a premium app that offers “free” transactions later at this point.

VGN: So in developing your licenses with athletes, have you had any difficulties? I could imagine some problems just explaining what you’re going to sell.

Faggiano: For the most part, the athletes are aware of the market and that it’s worth their attention, and they’re starting to come around to how big virtual goods are from a revenue standpoint. One of the challenges for them right now is that sponsorship dollars are disappearing with the economy faltering. The leagues are really open to new sources of revenue.

Much like if you went to any typical brand out there, the general feeling among the athletes is one of being overwhelmed when they see how many social networks and virtual worlds are out there. The thought of educating themselves and cutting 10, 20, 30 deals on their own is not something that they’re totally excited about.

So, they like that we’re willing to serve as the clearinghouse for them. We get to go back to the league and tell them which worlds are interested and which lines of licensed products they want. We can tell them what’s a good deal based on the world’s demographics and how their virtual goods sell and tell them which worlds have a lot of international users which are a big plus from the league’s point of view. Then we can give them an idea of how the goods look, and they can decide if it’s a good deal or not. We act as their first line of defense and screen out the deals that don’t make sense and bring them the deals that do make sense and simplify the approvals process. They really like that concept, and I think that really gets them the most excited.

Another thought is that from the world’s perspe
ctive, from the other side, it doesn’t make any sense economically for a virtual world to pay individually for licenses. A lot of the worlds we’ve talked to that have a huge interest in the type of content we’re going after say, “We’ve talked to the leagues and it makes no economic sense for us to do that deal.” The league may have asked for huge premium fees, so we can come back and negotiate a new deal that makes sense for everyone.

VGN: Do you deal with individual athletes to get around league fees?

Faggiano: It’s not to get around the a league licensing fee. We knew all along that athlete licenses were what we’d need eventually. Two of the guys that helped us found the company are Matt Hasselbeck, who is a pro for the Seattle Seahawks, and his brother Tim. They’re both very active in the company. Those two guys bring in an incredible amount of legitimacy and credibility when we talk to the leagues.

One of the things we wanted to do up front is show them that our focus was purely on sports, and that we had the ability to work with and sign athletes. That ended up being a really good move. When we talk to the leagues, they ask, “What do you have in hand that is sports-focused?” So we can show them our contracts and who’s on our board. Being able to tell them that we’re working with the number of athletes we have really opens doors.