Editor: RR
I don’t need to say much about the status of the Bored Monkey. Even people who have no interest in the crypto industry will think of this monkey when talking about NFT.
Now on Twitter, we will also see many influencers or celebrities with the profile picture of Bored Ape Yacht Club (PFP). Since its launch in April 2021, this colorful cartoon monkey NFT has become a cultural phenomenon and a status symbol for collectors of 10,000 digital art collections.
While some may scoff at the low-brow art style and Twitter degen cult of these collectibles, this project combined several novel concepts—including publishing a roadmap, minting at a fixed price, introducing long-term utility, and granting intellectual property (IP) to holders—that changed the NFT market and became a blueprint for new projects. It also spawned two successful offshoots (Bored Ape Kennel Club and Mutant Ape Yacht Club) and grew from an NFT collection to a full ecosystem with its own decentralized autonomous organization (DAO), cryptocurrency, and the upcoming gamified metaverse platform Otherside.
To understand the success of BAYC, you need to understand the leadership team behind it and the blockchain technology company Yuga Labs that powers all its efforts. Yuga Labs was originally proposed by close friends Wylie Aronow and Greg Solano, who assembled a team of college friends and childhood friends to realize this project. Now, Yuga Labs has grown to 110 employees, its brand portfolio has expanded to include NFT projects CryptoPunks and Meebits, and it received $450 million in financing earlier this year, with a valuation of $4 billion.
On December 19, the company announced that former Activision Blizzard President and COO Daniel Alegre will serve as its new CEO, and his expertise in gaming will help integrate all of Yuga’s passionate collector communities and shift its focus to building “immersive Web3 worlds.”
“That’s our ultimate goal,” Aronow said in an interview at the Institute of Contemporary Art in Miami, where the startup founder was celebrating the placement of CryptoPunk#305next to an Andy Warhol portrait on the museum’s wall. “We see Otherside as the intersection of those things, where we see the next evolution of this space, where gaming is very important,” added Solano.
Founder of the Foundation
Aronow and Solano are the creative drivers of what they call an “ideas-first company.”
“Our DNA is that we think about what we want to do first, and then we figure out the creative story we want to tell,” Solano said. “Then we think about how to do those things and work from there.”
He and Aronow both have backgrounds in creative writing, and despite their differences in personal tastes and personalities (one is extrovert, the other introvert), they have learned how to find common ground and jokingly call their relationship "codependency."
In addition to literature, both are avid gamers. Twelve years ago, both enjoyed massively multiplayer role-playing games such as World of Warcraft. "It was mostly about exchanging books and joking around," Aronow said of their early relationship. In fact, Aronow and Solano spent much of their budding friendship communicating through online games and social platforms, which gradually gave them a deep understanding of the digital meeting space. "(Before BAYC), we probably only met four or five times," Solano said.
“I guess you could say our friendship was born in the metaverse,” Aronow joked.
Create a project for degen
The leap from crypto enthusiast to founder of a multi-billion dollar company requires a combination of good planning and good timing.
As cryptocurrencies began to soar in the late 2010s, their shared interest in Ethereum grew, inspiring the two friends to create a blockchain-based project together. They recruited Kerem Atalay and Zeshan Ali, Solano’s college friends who co-founded Bored Ape Yacht Club, and Aronow’s childhood friend Nicole Muniz, who currently serves as the company’s CEO and will serve as a partner and strategic advisor after Daniel Alegre takes over as CEO next year.
“The first time you heard about cryptocurrency was probably because someone mentioned it casually and you didn’t know what to make of it,” Aronow said. “The second time you heard about it was probably the most important time because the person who told you about it the first time is now making a lot of money with it.”
Aronow had suffered from an autoimmune disease for years, which prompted him to seek social interaction online. The two soon became active on Crypto Twitter and became fascinated by what they saw as the emerging social movement around NFTs and Ethereum.
“We started to get interested in the culture on crypto Twitter, especially Ethereum. It felt like there was suddenly a platform that people could build on top of.”
The co-founder said the pandemic helped accelerate the process by bringing people indoors and prompting them to find new ways to collaborate in digital spaces.
“I don’t think it’s a coincidence that we launched during the lockdown, and a lot of people are a little lonely when they’re surfing,” Solano said.
“We’ve thought a lot about the impact of COVID-19 on the creation of Bored Ape Yacht Club and why the NFT and avatar collectible craze has taken off so quickly,” Aronow continued. “I feel strongly that humans, for better or worse, seem to thrive better in collective families or tribes. They just crave to be part of a club.”
He shared stories of anonymous Twitter users who tweeted late at night that they were bored and wanted someone to play video games with. Combined with the crypto community’s passion for “aping,” Bored Ape Yacht Club was born.
“All these people who have ‘aped’ to crypto in some way, they’ve probably become wealthy doing it,” Aronow said. “And they initially just wanted to hang out with other people who shared the same interest.”
Ultimately, they said that while the project is meant to pay homage to the “degenerate trader” in the crypto ecosystem, many of their early community members were first-time NFT buyers and they were learning along with them. “There was a moment… where we realized that we were building for ourselves, not for other people,” Aronow said.
Scaling up to boost growth
It didn’t take long for fine art vendors, celebrity collectors, and crypto millionaires to flock to collect one of the most popular NFT projects to date.
According to OpenSea, BAYC has completed 699,831 ETH (about $844 million as of publication) in total trading volume since its launch, not including their offshoots Bored Ape Kennel Club and Mutant Ape Yacht Club NFTs. This year, Yuga Labs has also acquired several traditional NFT projects including CryptoPunks, Meebits, and 10KTF, driving the company forward in ways that the two co-founders could not have expected.
“We were a small team for a long time, and in January we were still only 11 people,” Solano said. “We probably stuck with being a very small and nimble team for too long.”
Yuga Labs has licensed the intellectual property rights of its series to holders, allowing NFT characters to be used for branding of food trucks, TV shows, and music groups. This creates new revenue streams for holders and fosters more brand loyalty. “We always talk about how we can build scaffolding for other people to build on this story,” Aronow said. At this year’s ApeFest, the brand’s annual music and social festival for BAYC holders, Solano shared, “It feels like almost everyone we meet is building or leveraging their IP in this space.”
Bringing their community to Otherside
In recent months, the two co-founders have been looking for ways to merge the narratives of all their NFT brands into a shared ecosystem. In April, Yuga Labs announced the launch of Otherside, a gamified, interoperable metaverse experience where players can own land and turn existing NFTs into playable characters. Yuga Labs sold 55,000 Otherdeed NFTs tied to virtual land ownership, earning approximately $320 million in primary sales revenue.
“All of the projects we have are very important to us,” Aronow said. “We think Otherside is right at that intersection.”
In July, the brand held a "First Trip" event for more than 4,600 players to give people a glimpse into what their world-building platform is like. In a document released shortly after the event, the developers said that initially, only Otherdeed holders and selected third-party developers will be able to participate in this "narrative gaming experience."
“In the future, we look forward to seeing what new experiences and games our community can create to expand the possibilities of the Metaverse,” the document teases.
The next phases of the Otherside metaverse are still being kept secret, though they build on the games and narrative-driven stories that brought the founders together in the first place. Yuga Labs has already teased another potential series of characters called the Kodas, and released a promotional video in September that promised more stories by the end of the year.
Beyond brand expansion, Aronow believes the metaverse represents “a vaguely deterministic notion that it could be the end of the internet.”
“If we were to start being in digital space truly 24/7, what would that look like? Would it have an egalitarian feel? Would it be interoperable?”
He added: "The idea of clocking in to the metaverse in a very boring way sounds very dystopian," and called Otherside "a platform for games and weird experiences."
It's no coincidence that the incoming CEO oversaw gaming projects including World of Warcraft during his time at Activision Blizzard - a title Aronow consistently cited as an inspiration for Otherside during our interview.
"We started thinking about how to incentivize cooperation, so for example, in World of Warcraft, you can play as a single player, but if you run into a big bad guy in a swamp and you see other players around... suddenly you have an incentive to go to that person and say, 'Hey, can you help me kill this thing? We'll share the reward.'"
Solano said creating a "truly co-evolving, egalitarian, and fun metaverse" is Yuga's "highest priority" right now. "It's really about encouraging people to work together and get to know each other."
Aronow concluded: “It explains…why we did this in the first place.”
Information source: coindesk, slightly modified, author: Rosie Perper