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TOP STORY

Dapper Labs acquires Brud, the maker of virtual influencers.

The NFT startup behind NBA Topshot has purchased Brud, a 'virtual influencer' developer best known for their creation of Miquela - an Instagram model/ robot, but not for the reasons you'd expect...

It was reported earlier this month that Dapper Labs, the NFT startup behind NBA Top Shot, has purchased virtual influencer startup Brud and will be bringing the entire 32-person team aboard.

Brud is best-known as the developer of Miquela — a computer-animated character with more than three million followers on Instagram — serving as a “virtual influencer” on the platform. The startup has also spawned several other players in the space who have lived fictionalised lives on Instagram.

However, virtual influencers haven’t seen much interest from investors since they first exploded onto the scene in mid-2010’s. Therefore it comes as quite a surprise to see Dapper suddenly swoop in for the company. 

What could an NFT startup like Dapper want with a company making virtual influencers? 

Their CEO and founder, Trevor McFedries, apparently. The former DJ, producer, and director has increased his focus in the “crypto world” and shifted Brud's focus more toward collective decision-making through decentralised autonomous organisations (DAOs).

If you’re wondering what a DAO is, they are loosely defined as online communities with horizontal ownership structures based on tokens. They are organised around a mission that coordinates through a shared set of rules enforced on a blockchain. Put it simply, DAOs are a new way to finance projects, govern communities, and share value.

Thanks to their cryptographic mechanisms, they can also create a greater distribution of wealth by incentivising people in a more thoughtful way than current media platforms allow (e.g., the top 1% of all streamers earn more than half of all revenue on Twitch).

McFedries is already the co-founder of one of the more popular DAOs called “Friends with Benefits” and he will now lead a division inside Dapper Labs called Dapper Collectives focused on making DAOs more user friendly and accessible to a new generation of crypto web users while leveraging the company’s Flow blockchain.

📚 Further Reading

DAOs
  • How Creator DAOs redefine the way we work - Forefront
  • Dapper Labs took NFTs mainstream, now it wants to do the same for DAOs - Decrypt
  • DAOs are taking over, with new Wyoming law - Benzinga
Creator Economy 
  • The Creator Economy is failing to spread the wealth - Axios
  • Chingari launches social Token and NFT marketplace - Inc42
  • Afterparty enables creators to launch their own NFTs and social tokens - Venture Beat
THOUGHT FOR THE WEEK 
Photo Source: GIPHY
Over the weekend Lazio played Inter Milan in a game that Richard Johnson, Head of Content for INEOS Grenadiers, dubbed 'Battle of the Fan Tokens' due to their respective sponsorships with Binance and Socios. 

Highlighting fan tokens as a "controversial area", Johnson asked, "What would you do to improve these projects for fans?"

The common themes within the responses were as follows; 
  1. In their current form, the fan tokens are closer to a "Crypto asset" rather than a fan engagement platform. Similar to other assets, this means that they are susceptible to speculation, which has caused price dips after major events such as the signing of Messi or Atletico's title win - as would also occur with a company shares after a major product release. 
  2. The promise as a fan engagement tool is "disingenuous" due to the current limitations in fan involvement. Ultimately, there is a limited value exchange. This is hard to argue against, the example given on the Socios website, for instance, is for fans to vote on the "tunnel design of the new entrance tunnel at the Libertadores de America Stadium". 
In response to these comments, Andrea Morando, Sales Partnership Manager at Chiliz and Socios, responded that the company is "fully aware that there's still a lot of work to do to increase the utility of fan tokens but to position our product as speculative is not only unfair, but wrong."

Whether you are for or against fan tokens, it would seem as if they are here to stay. We have seen the launch of recent launch of Binance as a competitor to Socios and Bitci, brought to the fore by their sponsorship of Lazio. Furthermore, after "leading the tokenization of the sports" with close to 100 team partnerships globally, Chiliz has announced it will invest  $60M in the "tokenization of brands, media, entertainment, and retail," too. 

As stated in today's main article, Dapper Labs have identified DAOs as a potential use of Web 3.0 technologies that provides greater value for creators and communities using tokens and the blockchain. Could this be a better way to address fan tokens, which at their heart, have the potential to be very valuable to rights holders and fan communities alike.  

What do you think? Let me know by replying to this email.
📚 Further Reading

Fan Tokens
  • Fan tokens: Day trading your favorite sports team - CoinTelegraph
  • Tifo Video: The rise of fan tokens in football - The Athletic
  • Announcing Binance Fan Tokens: Everything you need to know about the future of fandom - Binance
WEEKLY ROUND UP 
Fitness & Wellness
  • Mindbody have acquired ClassPass in a bet on in-person fitness bouncing back. The Hustle argues that "both studios and consumers will benefit from the combined entity." The suggestion that physical fitness is building its strength back up is also supported by last months news that Peloton is going ‘beyond the home’ following Precor acquisition, checking in to hotels and health clubs for future growth.
Media
  • Everyone wants to be a media company. This comes as the New York Post announce that Major League Baseball is in discussions to launch a new streaming service that would allow fans to watch their teams’ home games without a cable-TV subscription. Furthermore, sports retailer Fanatics is reportedly investigating the possibility of entering the struggling regional sports network business in the US. 
NFTs
  • In an interview with CoinTelegraphAnimoca Brands co-founder, Yat Siu, has urged new NFT users to look past profiteering and examine how nonfungible tokens can redefine culture. Meanwhile, Sorare CEO Nicolas Julia has explained via email that the NFT unicorn is planning to better support female representation in sports.
Marketing Networking 
  • For the latest edition of the Sports Pundit Networking Series, I caught up with Grahame Paterson, acting CEO for Field of Dreams and Football Aid who believes that sport has a key role to play in achieving real change, maybe more so than any other mechanism, due to its global reach and abiding popularity.
PODCAST
In Episode 5 of Sports Pundit Explains… Sponsorship, Andy is joined by Peter Murray, CEO of Professional Fighters League, to discuss the unique commercial proposition of the PFL, the importance of a content strategy, and how sports betting is being embraced across North America.
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