Shares of Funko (NASDAQ:FNKO) were surging today after the toy maker said it acquired a majority stake in non-fungible token (NFT) business TokenHead.
The consumer products stock was up 24.6% as of 10:16 a.m. EDT on the news.
In a press release this morning, Funko said it had acquired a majority stake in the maker of TokenWave, a leading mobile app and website for showcasing and tracking NFTs. TokenHead currently displays more than 10 million of the blockchain-based tokens and receives more than 100,000 daily visits on its sites.
Funko said the move would extend its pop culture platform into digital assets, and in many ways Funko seems like a natural fit with NFTs as its Pop! figurines, the product it's best known for, are often considered collectibles.
The company said it would launch its first NFT offerings in June, which will include auctions with a unique property each week starting at $9.99.
CEO Brian Mariotti said, "Funko is thrilled to advance another platform that our fans and collectors will love and find valuable. Our strategy in this space is clear -- bring the value-added NFT opportunity to our licensing partners to leverage our broad range of existing pop culture content across Television, Movies, Sports, Music, Anime, Video Games and Comic Books."
There's no question that NFTs are hot right now as digital tokens of everything from artwork to newspaper columns to sports highlights are selling for large sums of money, up to $69 million for an NFT from the artist Beeple. It makes sense for Funko to jump on the trend, given its position in collectible toys and figurines. However, it's unclear if NFTs are a lasting trend or just a fad.
Financial terms for the deal were not released, but it's clear that investors like the move. With Funko's revenue sliding through much of the pandemic, the company could use a new idea to boost its business.