Masterscout shutters Football Index-style platform over liquidity concerns

Masterscout, a Dutch company that allowed customers to “virtually invest” in professional football players in a similar vein to Football Index, has announced it will shut down.

Masterscout will end operations on 1 June, with the firm’s app and website going offline. Marketing channels and a WhatsApp group will close this month.

The product allowed players to buy and sell “shares” in players from both the Premier League and the Dutch Eredivisie, with the value of those shares increasing based on individual performances.

Users needed to buy FTB, the app’s in-game currency, to then purchase shares in players.

When tested today, 1 April, payments were being processed by Irish-American financial services firm Stripe. The conversion for the site was €1 for 1 FTB.

Masterscout’s website states: “With Masterscout, soccer fans scout, discuss and invest in […] soccer players. They do this in an app, where they find plenty of data analysis to discover talent, and buy virtual shares of these talents for the lowest price. Whoever has the sharpest eye gets the highest return.”

The model is similar to that of Football Index, which collapsed in 2021 following a series of market crashes, sparking uproar and widespread media coverage in the UK. With Football Index, users made a three-year bet on a player’s value increasing, rather than owning actual shares.

A report into Football Index parent company BetIndex by barrister Malcolm Sheehan KC found the group had failed to properly inform the Gambling Commission of the nature of its product.

Campaigners are still lobbying MPs to relaunch an investigation into the collapse, as it is thought at least £100m was left stuck in open bets on the failed platform.

Masterscout was not licensed by the Gambling Commission in the UK, nor the Netherlands Gambling Authority (KSA) in its home country.

A statement on the company’s website reads: “Having started in 2023 as a game where you could virtually invest in players, the platform has subsequently evolved as a game into a football fantasy game.

“Although the transfer market has always been the unique feature of Masterscout, we unfortunately failed to create a good supply/demand model, making it increasingly difficult to offer a good trading market.”

Masterscout added that last year it tried to expand into new game formats, including peer-to-peer battles and lineup challenges.

However, those additions failed to improve liquidity. The statement continues: “In the end, all those actions did not contribute enough to make Masterscout a success.

“We feel terrible that we did not succeed, because we still believe in the idea of Masterscout. Therefore, we have been actively working in recent months to find partners and/or investors to take it further.

“However, based on the current results, we have not been successful in finding a party in this. Based on the current liquidity, it means that Masterscout is forced to stop, because the current operation is not sustainable.”

The Masterscout app has been downloaded more than 5,000 times on Android devices in the UK.

The business noted that FTB balances could be withdrawn until 30 May, although users must hold at least 5 FTB to be able to cash out.

Footballers in customers’ portfolios will continue to lose value, but can still be used in the peer-to-peer games, the company said.

“The players you have in your portfolio no longer have a value that is convertible to euros. However, you can continue to use them in the game until the [closure],” the company added.      

Customers with queries only relating to email address resets and payouts can contact Masterscout’s support team.

The company said all other questions should be directed to the FAQ page on the website.