Any tech company can advertise on a billboard over the freeway or put up a digital ad while you scroll through a website. But some go above and beyond to make sure they're seen.
From Lumen Field to Vivint Arena, tech companies have long been obsessed with making their branding a part of city skylines. A tech company plastering its name on an arena is a quick way to skyrocket brand awareness, differentiating itself from its competitors and helping it "stand out in the digital marketplace," said EJ Narcise, co-founder and principal of sports marketing and consulting company Team Services LLC. These deals also give companies access to hospitality perks such as concert and sporting event tickets for clients, fans or themselves, he said.
But historically, stadium namesakes have been a bad omen for tech companies. A prime example of this is Enron, the scandalous energy company which took over the name of The Ballpark at Union Station in Houston between 2000 and 2002. The company collapsed after declaring bankruptcy in December of 2001, and the stadium was briefly renamed Astros Field in February of 2002 before Coca-Cola bought the naming rights to it in June of that year, making it Minute Maid Park.
You can practically track the ups and downs of the tech industry by the names on arenas around the U.S. As the first dot-com bubble burst, so did the brief tenures of PSINet Stadium (now known as M&T Bank Stadium) and CMGI Field (now Gillette Stadium). 2002 also marked the end of the seven years 3Com's logo spent displayed on the former Candlestick Park. Adelphia Coliseum, now known as Nissan Stadium, lost its naming rights the same year after missing a required payment and filing for bankruptcy.
But despite the fact that companies often collapse after attaching their names onto sports stadiums, Narcise claims there is no correlation between the two. "That would be like saying a company failed because they bought, you know, a huge ad campaign or they did Super bowl commercials," Narcise said. "There's no direct correlation to a naming rights deal, and a company fails for a lot of reasons. Wasn't because they did a naming rights deal."
Tech companies obviously don't see a correlation either. Many are hopeful that they'll end up reaping the benefits of having their name in lights. The latest buyer is Crypto.com, which announced a 20-year deal to take over the naming rights of the Staples Center in Los Angeles. The startup is paying a historic $700 million over 20 years, or $35 million annually, for the naming rights to the building, the Associated Press reported.
"Known as the Creative Capital of the World, the city of Los Angeles and the people who call it home have always been pioneers, pushing the boundaries and innovating as the undeniable global leaders of culture and entertainment," Crypto.com co-founder and CEO Kris Marszalek said in the announcement. (Crypto.com did not respond immediately to additional requests for comment.)
The Crypto.com deal is "almost double" any other naming rights agreement, Narcise said, making it the largest deal of its kind in the U.S. "by far." Jeff Bezos, by comparison, spent just $400 million for the naming rights to the Climate Pledge Arena, formerly known as KeyArena.
LA being a hub for the entertainment industry and a city with high-powered sports teams likely contributed to the deal's unusually high price tag, he said. "It's no different than real estate: its location, location," Narcise said. "But it's also the building itself and the events that are driven there. Plus right now, you'll have LeBron James there for the foreseeable future."
The deal is only the latest of Crypto.com's spending spree. The five-year-old startup has struck sponsorship agreements worth hundreds of millions with sports and competition teams such as Formula 1, UFC and the Philadelphia 76ers in the past year. "If you want to reach several billions of people, sports is the way to go," Marszalek told the Wall Street Journal. "Our objective is to be, in the next three to five years, one of the top 20 consumer brands alongside Nike or Apple."
And Crypto.com isn't even the only blockchain company dropping major cash on brand deals. In March, FTX Trading was approved by the Miami-Dade Board of County Commissioners to attach its name to the former American Airlines Arena, home to the NBA's Miami Heat. The 19-year deal was worth $135 million, or $7 million annually.
If history is any guide, some of those names won't last the full length of their deals. For that matter, some of the companies may not make it that long. But in a crypto market that continues to boom across practically every company and industry and has become a cultural force in its own right, it seems appropriate that the most successful startups in the space are spending big on stadium names. Someday soon, we'll all be going to concerts at Dogecoin Stadium, and it might even feel normal. For a while.