This startup, recently funded by a16z, is producing NFTs as if they were widgets – Techdoxx

Deepak Gupta January 25, 2022
Updated 2022/01/25 at 7:17 PM

As tech titans argue about how different or not decentralized “web3” equipment will be compared to its blatantly centralized predecessors, an ecosystem of companies is rapidly emerging to support one another – many with ties to each other, including backing from the same investors.

Consider that late last summer, Andreessen Horowitz (a16z) invested in a company, Yield Guild Games (YGG), that invests in blockchain-based gaming NFTs, then lends them to people who use them and generate revenue while playing. Among the fastest growing games is “Axie Infinity”, where creatures can be created for battle and which can be sold.

In October, a16z also led a massive investment in the parent company of “Axie”, which is Sky Mavis. Yet another building block is now apparently needed. Log in DAO Creatora “specialist manufacturer” of months-old digital assets based in the Philippines that will be used in blockchain-based games and virtual worlds.

In fact, founded by a team of young founders, one of whom was an early advisor to YGG, the 23-person team just closed with $10 million in Series A funding through a token sale that was co-led by a16z and Delphi Digital, with participation from Hashed, com2us , Morningstar Ventures, Mechanism Capital, Sfermion , LAO, Emfarsis and others.

Why fund a company focused solely on producing digital assets as if they were widgets on a factory line? According to Arianna Simpson, a16z general partner who leads many of these related efforts, it’s simple; demand for NFTs is starting to outpace supply. “We’re seeing so much demand and so much interest in the ability to play these games that there’s actually a shortage of Axies and other endgame assets that you need to play them.”

To ensure their games provide enough liquidity to keep users engaged, she says, they are very open to working with third-party gear like YGG and similar “win-guilds” like Ready Player DAO and Earn Guild that buy NFT game assets. and then rent them out to new players under revenue-sharing agreements. But guilds suddenly need more assets to borrow, faster, which is why all three are now BreederDAO customers. (YGG also has a stake in the outfit.)

More customers may be lining up soon, Simpson suggests. According to a16z data, companies like YGG and Earn Guild attracted $532 million in funding last year. But the players they lease assets to still make up less than 2% of the nearly 3 million daily active users that “Axie Infinity” has attracted.

As for the technical limitations that prevent blockchain games from simply generating more NFTs on behalf of their users, there are evidently none.. Instead, says Simpson, while companies like Sky Mavis have created the mechanisms that allow them to produce NFTs, they don’t necessarily want to focus more on this aspect of their business than necessary. She says to think of the whole process as a supply chain, where “you don’t necessarily have to have one company producing everything end-to-end, but different companies in different parts of the supply chain. [that produce] a fully finished product.”

BreederDAO is currently making NFTs for “Axie Infinity”. It is also creating assets for play-to-win blockchain games.”Carved” and “Pegaxy.”

It does not have any sort of revenue-sharing agreement with its customers, although that may change over time. Although today it is selling NFTs at a pre-set price and “splitting is not something they are doing now,” Simpson says, “in the future,” she adds, “who can say?”

BreederDAO is led by Filipino co-founders Renz Chong, Jeth Ang and Nicolo Odulio. Chong is a former management consultant; Ang founded several companies in the Philippines; Odulio, a former trade pilot, is BreederDAO’s in-house smart contract expert, the company says, with experience building cryptocurrency projects and decentralized applications across multiple chains, including Binance Smart Chain and Ethereum.

Simpson and the other startup investors invested before the public launch of the BreederDAO token; the idea is to help bolster the team ahead of this offer so they’re ready for prime time when the token launches. Private investors will receive a number of tokens proportional to their investment.

BreederDAO had also previously raised an undisclosed amount of seed funding. In addition to YGG, which participated in this round, other supporters included Infinity Ventures Crypto, Ascensive Assets, Bitscale Capital, FireX, Mentha Partners and Not3Lau Capital.

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