It was probably inevitable.
Hot on the heels of buying its biggest competitor for the title of hottest non-fungible token (NFT) line last week, Bored Ape Yacht Club creator Yuga Labs is looking to raise hundreds of millions of dollars to build a metaverse.
According to a pitch deck seen by The Block, a crypto industry publication, Yuga Labs is looking for a $5 billion valuation on the premise that it can raise the $127 million it made in 2021 to $455 million this year, largely from sales of “land” plots in a gaming-focused virtual reality called MetaRPG.
(Anyone care to bet that name will get past lawyers for Meta, which CEO Mark Zuckerberg just rebranded to Facebook to highlight his belief that metaverse is the future of social media?) Yuga apparently also wants to launch its own cryptocurrency, the APECoin.
Aside from the Facebook metaverse, starting a metaverse is the thing to do in the crypto industry these days, particularly in the segment dedicated to collectable NFTs, many of which are usable as avatars in the virtual world.
That’s likely because big businesses ranging from HSBC and American Express to McDonalds and Disney are buying into the metaverse hype, dreaming of a virtual world full of marketing targets who can be enticed to embrace experiential marketing.
At least in blockchain-based metaverses like The Sandbox and Decentraland, NFTs are used for just about everything from “clothes” to give your avatar a fashionable style to the actual land plots themselves.
It’s worth noting that the hottest NFTs doesn’t necessarily mean the most popular. Ranked by sales, CryptoPunks is the No. 1 NFT collection, with $2.1 billion. Bored Apes is No. 3, with $1.4 billion.
Ahead of them is Axie Infinity, which uses NFTs to power the top blockchain-based game, with just over $4 billion, according to CryptoSlam.
Ranking by buyers, however, is a very different tale: The 20,000 combined CryptoPunks and Bored Apes NFTs — not all of which have been released — have been sold and resold ore than 45,000 times. Axie Infinity NFTs? Just north of 15 million.
Beating Their Chest
In the March 11 deal that saw Yuga add the CryptoPunks collection — some of which have sold for millions at Christie’s and Sotheby’s — the company’s success at using experiential marketing and building a community was on full display.
In large part, the sale was a result of the fact that CryptoPunks creator Larva Labs wasn’t interested in becoming a marketing firm — something that Yuga is far better at.
The Bored Ape Yacht Club (BAYC) gained prominence by embracing the “club” part of the name. Exclusivity was played up with a private Discord channel and has evolved to include access to access to a SoHo gallery and Brooklyn warehouse party during the NFT.NYC industry event in early November.
It doesn’t hurt that celebrities from Paris Hilton and Jimmy Fallon to Eminem have bought and talked up their Apes. Adidas has even made branding deals, and an Ape was on the cover of a limited-edition Rolling Stone magazine.
One key: BAYC owners were also given full commercial rights to their Bored Apes — a rarity in the NFT industry, in which someone paid $69 million for an NFT artwork that came with no rights other than to display it publicly.
BAYC owners have cut IP deals such as the Backpack Boyz marijuana lines, which plays into the brand’s visibility.
That was a part of the very first announcement of the CryptoPunks purchase: “Some big news to share today: Yuga has acquired the CryptoPunks and Meebits collections from @LarvaLabs,” the company tweeted. “And the first thing we’re doing is giving full commercial rights to the NFT holders. Just like we did for BAYC … owners.”
In the formal press release, they added, “By handing over these rights, we’re further aligning CryptoPunks and Meebits with the web3 ethos, and we expect a wide-range of third party developers and community creators to incorporate CryptoPunks and Meebits into their web3 projects. We’ll be building the overall brand right alongside them.”