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Metaversal And CoinFund
NFTs are the way of the future in the crypto space. With many chasing the crypto dream, Metaversal and CoinFund are two firms leading the way. In this episode, our hosts Jeff Kelley, Eathan Janney, Josh Kriger discuss the nitty-gritty of the metaverse with Yossi Hasson, co-founder and CEO of Metaversal and Vanessa Grellet, Head of Portfolio Growth at CoinFund. We discuss the state of the NFT space, where CoinFund and Metaversal are going and where they see NFTs will be in the near future. Tune in for more NFT insights as we discuss the ins and outs of the metaverse.
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Listen to the podcast here
Metaversal And CoinFund
This episode features guests Yossi Hasson and Vanessa Grellet. Yossi is the Cofounder and CEO of Metaversal, a metaverse-focused startup that invests and produces iconic NFTs that enable the metaverse. Prior to Metaversal, he was the Managing Director of Techstars, the first blockchain accelerator in New York City, and launched Techstars’ first fintech-focused accelerator in Africa. He is a passionate venture-backed and award-winning entrepreneur turned investor. He is also the Non-Executive Director of WeThinkCode, Africa’s largest nonprofit coding school that he cofounded and aimed to unlock Africa’s digital talent.
Here’s a bit about Vanessa. She is the Head of Portfolio Growth at CoinFund. She has twenty years of expertise in the financial services and tech industry. At CoinFund, she plays a leading role in helping the firm and its portfolio companies bridge the gap between the worlds of traditional companies and decentralized networks from early-stage development to growth at scale. She focuses on helping founders build world-class teams, protocols, applications, and network governance forming alliances within the CoinFund portfolio of companies as well as across other blockchain projects and protocols.
Prior to joining CoinFund, she was an Executive Director at ConsenSys, where she focused on driving adoption for Ethereum strategic initiatives, alliances and channels. She was involved in setting up the enterprise Ethereum Alliance. She sits on the board of the Accounting Blockchain Coalition and is the President of the Blockchain for Social Impact Coalition.
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Yossi** and Vanessa, welcome. That’s a lot you guys are up to. It’s good to have you here.**
It’s good to be on the show.
We are super fortunate to have you here. We are excited about this show. We are interested in the full spectrum of what is happening in the space now. For folks who are not familiar with your companies, could you give them a quick intro on how you arrived at your position in the space? Give a little background overall on your perspective. Let’s start with you, Yossi, and we will dive in.
A little background to myself is being a tech entrepreneur and a Founder for as long as I can remember. My story probably started in the world of games when I was a little kid. That’s how I learned about computers, technology, and the internet. What drove me to want to be a tech founder was starting one of the first open-source cloud companies back in 2004 when open source was a swear word and Microsoft was calling the next of cancer. We saw it as the future of how technology would be developed. We started a company building that.
What was interesting out of that story, I was there for eleven years. That’s where I learned about Bitcoin. The engineers who are much smarter than me decided to install it on our infrastructure and started mining back in 2011 when you could still mine with CPUs. This was a revelation of a new technology that sits on top of open-source software that created this currency for the world. I immediately fell in love with that.
I went down that rabbit hole for a number of years. I sold my business. I joined Techstars to work with early-stage founders. I moved to the US. I met the CoinFund team, and four years later, we decided to partner up. We are investing in NFTs to start this company called Metaversal, which is a company that invests and produces NFTs. That’s a very short summary of how I’ve got here now.
Metaversal And CoinFund: If an NFT project turns into a DAO and then turns into a brand and innovates from a technology perspective, that would be very interesting.
Vanessa, on the flip side from an investment fund, how did you arrive there? Tell us a little more about what you do and how CoinFund operates.
I was in traditional finance for about fifteen years and I came across Bitcoin pretty early. I paid attention but not too much. It’s not enough to make it my full-time job because I was investing a little bit. I was fundraising for a project. I came across ConsenSys and met with Joseph Lubin. When I understood the Ethereum project and the implications of it, I immediately jumped ship and worked at ConsenSys for five years. That was in 2016.
During my time at ConsenSys, I was pretty early in NFTs. Jake is the Founder of CoinFund. Jake and I bonded at that time when no one cared about NFTs. Moving from that, we had a discussion and decided to work together at CoinFund. I joined in May 2021 and I’m the Head of Portfolio Growth. I help our company scale and grow.
CoinFund is a multi-strategy asset manager. We invest in early-stage companies. We have a hedge fund. We create entities like Metaversal. We will explain how Yossi and I work together on that that focuses on specific sectors. We want to offer a wide array of strategies to our investors. We have been growing the firm since then.
We get the question all the time, “What NFT project should I invest in? What NFT should we buy?” If we get it all the time, I can only imagine how often you all get that question but we are going to ask you anyway. Let’s start with the broader picture in such a dynamic space, which feels like it’s changing by the day or if not the day, the second. What moves the needle for you? Let’s start with the broader projects, and then we can hone in on specific NFTs.
We look at the broader NFT market. We refer to iconic NFT assets, “What are the NFTs that are going to stand the test of time that have cultural relevance, that has a community, that is showing signs that this isn’t a flash in the pan. This is something where it’s going to be around in 3, 5, or 10 years’ time.” It’s the same way you would think about a venture investment into a startup. You are looking at the longevity of the team, the people behind it, and the product that they are producing.
Where does that stand in the market? Is it something that is unique? Is it differentiated? Is it pushing the boundaries? Is it something that already has the ingredients that, if successful, will last ten years? That’s the overarching lens that we look at any NFT that we are going to acquire. We have our own metrics and we have what we call the NFT Value Stack. It’s got different components to it and metrics that we can go into at what makes up that stack for us to determine that. In essence, we are investing in cultural moments that we believe by time are going to become more relevant and valuable to a segment of a population.
To answer your question on, “Which NFT should you be buying?” one, is it something that resonates with you as a culturally significant asset that you want to acquire and hold or that you think someone else is going to feel extremely valuable that they want to now be part of this? It’s either because of the status that it brings, the membership or community that it gives you access to, or the financial economy that’s being built around it in some kind of play-to-earn game mechanic or something that you can leverage on DeFi.
What do you think is coming in the next 3, 5 or 10 years down the road? Universally, everyone is like, “I don’t even know what is coming next a year from now, much less 3, 5 or 10 years.” To take that long-term perspective, though, and to invest in projects and support projects that are thinking that far ahead in a space that evolves quickly month by month, quarter by quarter, and certainly by the year is pretty powerful. I don’t know that a lot of folks even have the core competency to take that perspective or go that deep in the space in the weeds of what companies are working on. That’s pretty cool and impressive.
Where do generative art projects like these 10,000 collections or 8888 or 777 fit into that? My sense is some of them could fit the criteria and other ones clearly don’t. How do you differentiate between projects that have that type of staying power and the ones that don’t when you have very little data to run with? Sometimes these projects come out and 2 or 3 weeks later, it’s like, “Do I Mint or do I not Mint?”
We have seen something like Bored Ape Yacht Club. It has only been around for 9 or 10 months and securing partnerships with global brand powerhouses and is now valued anywhere between $2 billion to $3 billion. Nike announced that they are acquiring RTFKT that started in 2020. You’ve got early young projects that are entering the scene, gaining notoriety quickly. How do you differentiate between a flash in the pan and something that has longevity? There are a couple of areas to look at that can give you some indication of that. It’s very early, so it’s hard to say for sure.
The things that give you that type of indication are primarily around the community that is being built around these assets, particularly within the PFP and generative space because we were not talking about a cultural iconic moment years ago, or a winning NBA shot for a specific game or anything like that. We are talking about the avatars of the metaverse. Which ones are going to be the culturally relevant ones that when you are walking around in these metaverse worlds, people are going to be like, “That person has got some OG street cred because they are flexing this avatar?” That’s the equivalent that you are doing.
Metaversal And CoinFund: What we see is that conversion is coming where the accessibility of NFTs will increase. There will be more and more interoperability, whether it’s on the protocol layer or at the application layer, and that will continue over the next three to five years.
The way that happens is by other people who are collecting it and involved in that community, how strong those people are, and how vocal they are. It goes to the crux of some of what we are seeing now, which are new ways and new IP Laws or new ways of sharing IP that encourage that activity. We are seeing in the Bored Ape Yacht Club world as an example. They gave full commercial rights to anyone who is a holder of a Bored Ape.
What that did is propelled that project in a way much quicker than any other project before it because now, people were incentivized as owners to be part of this community and pour more additional effort into its success. “Now, I’m an Owner of this Ape. I’m able to build a comic book out of it. I’m able to do a commercial deal. I’m able to go to Universal Music and start a band with four of my Apes.” This is something that was unimaginable before, whereas other projects or brands hold their IP very closely and they have to decide.
That’s what we are seeing is propelling these types of communities and giving these types of incentives for everyone to double-down on it. We look for those types of projects where it has those mechanics built into it that allow that top of incentive structure. It’s very Web 3.0 and crypto native. It’s all about incentive organization. The NFTs enable that type of mechanic in new ways that were previously not possible.
What are your thoughts here on the NFT-specific projects and then the broader perspective?
CoinFund doesn’t invest directly in NFTs. We invest in founders who are building NFT solutions. We have been doing this for a while. We are pretty excited about giving other founders the opportunities to build on these solutions. We invested very early in wearable and Dapper to build NFT protocols in marketplaces. We have invested in Upshot, which looks at the financialization of NFTs. We have announced our investment in Holaplex, which is building individual stores for indie creators on Solano. We also invested in another company that focuses on the financialization of NFTs.
The solutions that cut across protocols and use cases are appealing to us. We believe in the future of NFTs. Now, we think the mental frame sometimes is NFTs are collectibles and art but NFTs are so much more than that. We are investing in all the infrastructure that will allow people to interact and transact with NFTs in the future, whether they be collectibles, financial instruments or real-world assets, everything can be represented by an NFT and transacted as an NFT in the metaverse or elsewhere. Creating that infrastructure is something that’s exciting to us.
One of the interesting things that you mentioned, Yossi, was the Bored Ape Yacht Club and all the things that it’s doing with regard to IP and how that’s opening up all these different channels. You had mentioned separately that you think it could become a powerhouse brand like a Nike of the world or something like that. I’m curious from both of your perspectives. Let’s start with Yossi because this was the genesis of the statement that you made. How does an NFT project become a powerhouse like that? Vanessa, does that on your side change, how you view investing in an NFT project versus a potentially world-changing, needle-moving brand?
What we are seeing with something like Bored Ape Yacht Club and these powerhouse projects that are emerging is rarely to be premium or the statements that you get when you become an owner versus a consumer. When you are buying a pair of Nike, you are buying into the vision of Nike and what they are selling to you in terms of the brand that you are buying into. Effectively, you are a consumer. You are on the one side of that transaction.
What you are seeing with Bored Apes and other projects in the space now when you become an owner is that your mental model of that community completely shifts. You are no longer just on one side of the transaction. You are on both sides of the transaction. You are both in it for the long haul and the potential financial gain that this can create. You are also a shareholder and voting member of what happens in this community and a vocal advocate of how it should be shaped.
If you are starting with a community of 10,000 Apes as an example and it starts with 2,000 or 3,000 people who have got a vested interest in the say of how this grows, all of a sudden, you have 2,000 to 3,000 raving fans on a very early brand as opposed to just raving consumers of a brand. If you put that into play, all those people, “What are they doing every single day to enhance the value of this?” You get these network effects in a small upstart brand. That gives you the ability to reach far beyond what another upstart would be doing that you can bring in all these culturally relevant moments into your brand.
You can get celebrities to now change their profile picture to an Ape. You can get musicians to be putting it up at their concerts. You can become a culturally relevant icon without having to spend like Nike does billions of dollars to buy that status. It’s coming with the status because everyone is coming onboard with it. That’s the phenomenon that we are seeing with something like Bored Ape Yacht Club.
Over time, if it continues on this trajectory, it will be more valuable than a brand like Nike without having to spend a fraction of the ad spend that Nike has to do to get those endorsements. You are seeing celebrities coming to Bored Ape Yacht Club as opposed to Bored Ape Yacht Club going into celebrities to sign them with celebrity deals. It has completely inversed the model.
Metaversal And CoinFund: For the first time, you have the ability to have true digital ownership, and the ability for that to be traded globally, instantly, as long as it meets the standards of an NFT and that standard is open and prolific.
It’s interesting because it evolves and morphs over time as that community evolves and different owners come in and out. We will talk about one of the hot topics here that somebody slipped through. Vanessa, how does that impact your perspective on investing in NFTs versus a community of NFT holders versus a brand like Bored Ape Yacht Club that’s becoming this powerhouse?
We invest in technology and technology innovation. For us, we see that with that lens. If an NFT project turns into a DAO, and then turns into a brand and innovates from a technology perspective, that would be very interesting for us. If it’s morphing into a consumer brand, I don’t think that’s in our mandates at this stage. There is so much to unpack here. NFTs are the new social media, brands, and loyalty points. It can be managed as a DAO. It can be a community that’s organized through a DAO.
We are looking a lot at DAOs and the power of the community that they create and what can come out of it. Yossi can speak to the ConstitutionDAO investment that they made and see how it is interesting and experimental at this stage to see what the outcome is. In our mandate as a fund, we are focusing on the technology built and less so on the commercial outcome that could be part of it. For example, we are not investing in specific games because we don’t know what the commercial outcome of that specific game will be. We will invest in gaming infrastructure and NFT infrastructure that allow for using NFTs in gaming, for example.
We talked a little bit about co-ownership and versions of ownership. There’s this very nebulous thing that’s going on now around IP like, “Who owns the trademark? Who owns the IP of a particular thing? Is it divided up in some interesting way?” I’m curious maybe we can kick it back to you, Yossi, on your thoughts about how IP plays a role in all of this. How much do those community members need to own versus feeling a part of it? How does that play out? I don’t think we have seen all the repercussions that are going to play out here in terms of how maybe there are some landmark legal cases coming up here around how does this IP ownership gets implemented.
In owning the metaverse or being a successful NFT brand in it, the more you lean towards an open ecosystem, the higher your chances of success in this ecosystem. A typical Web 1.0 or Web 2.0 approach is closed and centralized. It’s very, “I’m the gatekeeper. I make all the decisions. You have to come to me for permission.” What we see here in the Web 3.0 world and the crypto world is that everything is opened up. The more you open it up, the faster the network effects and the more people become raving consumers, fans, co-owners, and believers and start contributing to these projects. It’s very much an open-source approach.
Where we look is, “Where are those IP licenses being applied.” In fact, the first investment we made in an NFT was a project called Nouns. If you know Nouns DAO, we acquired Noun9. One of the reasons for that was it was the first project that rarely put its weight behind a Creative Commons license, CC0. What CC0 means is rarely that no one owns the rights to this license. Anyone can do anything, which is a radical idea for a new brand.
Anyone can do anything with us. You don’t need permission to copy it. You can create generative works, make derivative works, take our logo, put it on a T-shirt or sell it as merchandise. We have no claim to any of that and that’s how it was released. This idea that the more open you make it, the faster it will spread, it’s exactly in line with that philosophy. That’s why we participated in Noun9.
What we see is that conversion is coming where the accessibility of NFTs will increase. There will be more interoperability, whether it’s on the protocol layer or at the application layer. That will continue over the next 3 to 5 years. That will allow seamless experience from a consumer and an owner perspective of the NFTs or the people in the metaverse. That’s going to transpire in our everyday life. We are looking at art collectibles and the financialization of NFTs but we are going to see workplaces, credit credentials, loyalty points, and eCommerce in the metaverse.
Vanessa, how about you?
Early influential books for you?
I bought some makeup.
It was a CloneX WIN file from RTFKT.
Vanessa, what are your thoughts?
Vanessa, how about you?
Important Links:
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Cheetah Cowboy – Twitter
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Bored Ape Number 3,547 – Article
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Ubisoft – Article
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EllioTrades – Article
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@YossiHasson – Twitter
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@HelloMetaversal – Twitter
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@VanessaGrellet_– Twitter
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iTunes – Edge of NFT Podcast
About Yossi Hasson
I live, work and play in the Metaverse. As an active crypto, NFT and blockchain investor, I write an email newsletter and host a podcast on how these technologies will continue to shape our lives and impact our digital future. You can subscribe here: https://yossihasson.substack.com/
You can also view my startup investment portfolio here: https://cutt.ly/yossi
About me: Exited open source cloud business, SYNAQ that I co-founded in 2004 Co-founder and board member of non-profit coding school WeThinkCode_ Launched first Techstars Accelerator program in Africa Co-founder of crypto investment fund, Onchain Capital Launched first Techstars Blockchain Accelerator (New York City) Active angel and crypto investor Co-founder and CEO of Metaversal: investor and curator of iconic NFT assets and companies building the Metaverse.
About Vanessa Grellet
The CoinFund Portfolio Growth team supports and guides Web3 founders and their teams during their journeys from early-stage to growth-at-scale. Our work encompasses helping them build world-class teams, protocols, applications and network governance, forming alliances within the CoinFund portfolio companies as well as across other blockchain projects and protocols.