A Yacht Club for Bored Apes
Happy Sunday! Today’s exciting Web3 Profile dives into the world of NFTs, the importance of community, and NFTs as the bridge between Metaverse and the outside world.
The Profile Basics
Startup Name:
Bored Ape Yacht Club
Industry:
Web3 - Consumer NFT Marketplace
Competitors:
CryptoPunks, Meebits, SupDucks
Floor Price:
46 ETH (~$180,000)
Break It Down for Me
The Problem:
In Web2, platforms make decisions based on what they deem will benefit the platforms and its financial progress. Platforms don’t inherently incentivize participants to spend time, energy, and resources necessary to add value to the community both internally and externally.
The Solution:
Decentralized platforms and NFTs-based membership incentivize members to 1) provide their time and resources to add value to the community, as well as the very assets they hold; and 2) protect the scarcity of their assets to avoid value deflation.
Core Users:
Project early adopters, Web3 influencers, and other notable celebrity users such as Steph Curry, 3LAU, Logan Paul, The Chainsmokers, and Odell Beckham
Walk Me Through It:
Bored Ape Yacht Club (BAYC) is a Web3 community centered around 10 thousand unique Apes (each 1 of 1 NFTs) randomly generated with different feature combinations for eyes, mouth, expression, earrings, fur, clothes, hats, and others. Each serves as a right of passage into the yacht club community and are used by most as a profile picture across twitter, Discord, and other platforms.
Ape profiles can be seen as status symbols and also digital identities along the lines of “digital skins” in Fortnite — however in this case, each Ape is verified to be unique and can be utilized or implemented in games across Web3. In buying a Bored Ape, holders get access to a private Discord, where members interact with one another. Like other tight knit crypto communities, BAYC members are all incentivized to bring as much value to the table as possible, whether that is discussing NFT and crypto strategies, talking about life, or helping others get a job. Members gain access to in-person events including a yacht club party that took place recently at NFT NYC, as well as hope to open a permanent in-person bar in Miami where any member can stop by any time.
Though many members were buying Apes for $300 in May and floor prices for most Apes are currently all the way above $100K, most members (and the largest holders such as the project founders and Pranksy) are not selling because of the access that their Ape provides them.
Show Me the Money
Currently:
Currently, the owners of the project make money through a small percentage of each sale.
BAYC has been creative in finding new ways to add-value to their own members (including the creators themselves who are Ape holders). They enabled all Ape holders to get an additional Kennel Dog as an NFT, many of whom were able to sell it for more than their initial investment they made in the Ape, allowing them to be paid back their investment and open the community to new members.
Be Wary
Where to be wary for BAYC:
Like other projects in Web3 that are nascent and have a lot of hype, there are multifold risks. First, floor prices for BAYC NFTs are up around 10x in the past few months; there is no telling whether this trend will continue at all. Though there seems to be a strong community in this project, there is a chance users could move on to the next exciting NFT community (even if they are financially disincentivized from doing so).
Another element to be wary of is exclusivity. While it is true that this club lets in anyone who holds an Ape NFT without even needing to know the person’s name or background, the substantial increase in price means that there is currently a significant financial barrier for most from entering into this club and reaping the benefits of this community. Though this project has certainly financially empowered many of its early adopters who were able to purchase an Ape for $300 earlier this year, many of these same users likely would not be able to join the club just a couple more months into its existence simply because the floor prices are too high. In this way, Bored Apes highlights the notion that as a project becomes more successful it will increasingly realize the monetary benefits of scarcity as well as the drawbacks of an increasing amount of exclusivity.
Now Get Excited
This is one exciting yacht club, let me share more about why you should also be excited.
First is the community. BAYC has a cult-like-following that genuinely seems to love the idea of the club if not the Discord, other members, and events themselves. Because members own their own rights to their Ape, many have created merchandise with their unique digital Ape printed on a shirt and shoes. If a user creates a verified Instagram account for their Ape, they can use the likeness of the Ape for their own profit (e.g. In a marketing deal 100% would go to the Ape owner, not BAYC). Beyond a community that talks on Discord, networks, and parties together, this aspect of IP ownership creates another level of brand evangelization.
Second is the extent to which these Ape NFTs can represent digital identities across Web3 and the Metaverse. Holders of an Ape can utilize it as their character in
Decentraland
or the Sandbox, which implement IP of popular collectible brands such as BAYC. Because BAYC is more and more seen as a premium brand in the NFT space, Web3 games looking into onboard obsessive followings will immediately look to include BAYC IP. Imagine a game in the ilk of Super Smash Bros where your Bored Ape can battle a friend’s CryptoPunk or someone else’s Meebit. Or using it as your character to explore different NFT art galleries or lands on Decentraland. Holders will be able to hold this digital identity as their own and carry it across all of these different platforms.
Finally, I’m excited about BAYC’s potential for expansion by:
The product - There is so much they can do regarding expansion. As so many already use the discord to interact with one another, BAYC can create more of an immersive game somewhat along the lines of a Web3 club penguin with social, interactive, and competitive elements. They could also create a virtual yacht and Bar for their users to interact virtually, as well as an in-game currency.
The target user market - The target market is currently limited given its 10K limit of total Apes and the high price point of each. BAYC could expand this group of users by including the option for a scholars program a la
YGG
once the game is released.
Revenue generation - If and when BAYC releases its game, it can administer an in-game token and take a cut of each token sale as well as a proportion of the overall token supply. They could also build out a full-fledged eCommerce shop to sell customized merch to its avid fans.
And that’s a wrap. As always, I welcome all replies - I love to hear what you enjoyed and didn’t.
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