In crypto, being “early” is everything.
Investors repeat it like a mantra: “We’re still early,” or, “It’s so early,” the idea being that it’s far from “too late” to get in on the crypto gold rush. You can see it in Twitter posts and subway advertisements, hear it in podcasts and pitch decks. The promise of early adoption is that you, too, can be ahead of the curve. Buying in now can feel like owning a piece of on-chain history, something that’s bound to appreciate once everyone else catches on.
And while the ethos of the “early” meme is mainly about price appreciation, it’s also about reputation. It’s those first investors – the ones who bet it all on new, unproven ideas and came out with unfathomable riches – whose example we’re meant to follow.
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Enter Kevin Rose, co-founder of the news aggregator Digg. The site brought him a decent amount of press in the late aughts: in 2006, a Businessweek cover story declared him the leader of a “new brat pack of Silicon Valley entrepreneurs.” Digg eventually imploded and was sold to the startup incubator Betaworks for almost nothing. Rose went on to found a couple other internet companies, but for the past decade he’s mostly been an investor.
Now a partner at True Ventures, he works with companies in crypto and non-fungible tokens (NFTs), where his status as an “early” internet entrepreneur has given him a real reputational head start. Never mind the fact that he once uploaded a video of himself throwing a live raccoon down a set of stairs – the crypto community remains decently confident in Rose’s ability to pick winners.
That confidence was on full display this past weekend when a new NFT project called Moonbirds made its public debut. The tokens – 10,000 pixelated images of owls – initially sold for 2.5 ether (ETH) each, and are already being traded for tens of thousands of dollars. As of this morning, the cheapest Moonbirds will cost you around 20 ETH, or $58,000.
It’s one of the clearest examples to date of the way in which crypto can assign a monetary value to reputation and social clout.
The collection is also the product of an online social club called Proof Collective. Rose and two other crypto investors, Ryan Carson and Justin Mezzell, founded Proof Collective late last year as a way to monetize the community around Rose’s crypto podcast. It now bills Moonbirds as the “official PFP [profile picture]” of the group, a way for adherents to express their allegiance online.
In a short video message on Saturday, Rose said the Moonbirds sale made $58 million for an entity called Proof Holdings Inc. – money he sees as a “capital raise” for Proof Collective. (Per the Moonbirds FAQ, Proof Holdings is backed by True Ventures.)
Membership in Proof Collective is limited to 1,000 slots, and guaranteed through a separate collection of 1,000 NFTs (they debuted at 1 ETH each and now go for an eye-popping 98 ETH – $285,000).
It’s essentially the Bored Ape Yacht Club playbook: NFT ownership makes you a part of the community, which gets you special perks and early access to new crypto projects down the line (ka-ching!).
Read More: Can Crypto Put a Price on Community? | Opinion
Moonbirds are also built around a special investment mechanism, whereby holders can effectively lock up their tokens in exchange for additional perks. Proof calls this process “nesting,” and claims it will incentivize long-term holding as opposed to day trading and flipping.
Crucially, though, there has been less talk around what Proof actually intends to build beyond the VIP social club framework it's already established. Proof has promoted a few NFTs in the past and runs a small Discord server, but its plans for future projects still lack specificity. Among those plans, so far: a series of real-life community meetups and a dedicated metaverse platform called “Project Highrise.”
"We like to under-promise and over-deliver,” Moonbird's website reads, perhaps a tacit admission that they're building on the fly.
At least one prominent Twitter account has alleged that Proof members may be “wash trading” their NFTs – selling them back and forth between wallets controlled by the same trader, in an effort to pump up prices – but traders don’t seem fazed. Yes, Kevin Rose once threw a wild racoon several feet in the air; yes, he has experienced his fair share of business failures but he also seems to know where the money is. At least, that’s what the market appears to have decided.
It speaks to a larger dynamic around buzzy NFT projects and token launches, many of which operate around similar cults of personality. The success of Gary Vaynerchuk’s NFT collection, VeeFriends, has a lot to do with the fact that Gary Vaynerchuk is who he is. Same goes for the MyBFF collection, founded by the entrepreneur and investor Jaime Schmidt (she sold a startup to Unilever in 2017, and now runs a VC firm with her partner Chris Cantino).
In an industry rife with anonymous traders, projects tied to famous investors often have a leg up. And connections in the VC world probably don’t hurt either. Rose was “early” with Digg – Moonbirds’ backers seem to think he’s still got some of that intuition.
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