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BY Eric James Beyer
December 06, 2022
Gary Vee is no stranger to Web3. After launching VeeFriends, one of the most successful NFT brands in early 2021, the project later surged to nearly 60,000 ETH in trading volume and has spawned several follow-up and collaboration collections, including VeeFriends Series 2 and VeeFriends Mini Drops. In the last six years, VaynerX, Vee’s holding company — which focuses on contemporary media and communications projects — has grown significantly, and now encompasses subdivisions like Vayner3. Formerly VaynerNFT, Vayner3 is a Web3 consultancy that helped major brands like Stella Artois, PepsiCo, and JP Morgan Chase & Co. develop strategies to bridge into the Web3 space profitably.
But Vee and the company are, as always, focused on the long-term future. To get a better understanding of how the entrepreneur and his many Web3-focused entities view the Web3 landscape — in addition to the way they’re positioning themselves for the rapidly approaching 2023, nft now caught up with the President of VeeFriends, Andy Krainak; the President of Vayner3, Avery Akkineni; and Gary Vee himself at the Vayner X’s Art Basel activation, at Scope Beach, Miami, last week. Here’s what they had to say.
The NFT and crypto spaces continue to deal with the tangible and emotional fallout from the scandal surrounding the fall of FTX. The hit to the Web3 space came when NFT projects and brands were already struggling to find ways to stay relevant and justify their own floor prices, even in the short term.
For this reason, VeeFriends President Andy Krainak advises enthusiasts and projects in the space to take time to seriously reflect on what such landmark events taught the industry, and whether or not the strategies that marked the 2021 NFT bull run will ever be relevant or profitable again.
“You couldn’t have had a worse scenario [with FTX]. That’s the truth of it.”
“[In 2022,] everyone learned what it means to have moments in time,” said Krainak while speaking to nft now, referring to the right and wrong times for actions in Web3. “There’s a moment in time to launch a project. And now may or may not be the moment in time to launch a project, and to really maximize opportunity [in Web3]. You couldn’t have had a worse scenario [with FTX]. That’s the truth of it. But I feel confident that in two or three years’ time, more and more adoption will happen, and the latest FTX fiasco will be like a good movie that everyone watched. The terms we’re using today are not going to be the terms we’re using for years. I don’t think we’re going say ‘NFT’ anymore.”
Given the lack of trust pervading the space in recent weeks and months, Krainak emphasized the importance of community building and transparency for NFT brands that want to have even the slightest bit of longevity. Overcommunication, he said, will always be the core foundation of any project’s success in both good times and bad. For Krainak, one of the best ways to foster that trust is to ensure you have a physical presence in community members’ IRL lives, which can be achieved through community activations on both a large and small scale.
“[Doing events] is a very important and practical strategy, because it’s a value that you can experience,” Krainak continued. “And I think bringing the digital into the physical with events is really important. It can be a huge event with 10,000 people, but you can still create opportunities for small networking through different activations.” Offering a small hint about VeeFriends’ next moves in the NFT space, Krainak echoed Vee’s comments from the day before: that deflationary dynamics could play a role in creating a scenario in which “tokens go away.”
“We have so much time, and it’s so fun to be able to play creatively with technology as a function of storytelling, deflationary mechanics, and collaboration drops in parallel paths with what the singular focus of VeeFriends is, which is to create the IP of the characters,” Krainak elaborated.
The President of Vayner3 knows what she’s doing when it comes to helping brands branch out into the world of Web3. The consultancy firm has helped companies like Johnnie Walker and Stella Artois develop strategies to meaningfully (and profitably) engage with the space while avoiding scaring off parts of its existing consumer base that are wary of the crypto world. Non-Web3-native brands are not deaf to the potential of the blockchain in this regard. However, since NFTs and crypto are still nascent and comparably volatile, these companies are hesitant to dive in without proper guidance. That’s where Vayner3 comes in.
“We don’t convince [brands] about Web3, we prove what we’re doing and we show them the use case.”
“We don’t convince [brands] about Web3, we prove what we’re doing and we show them the use case,” Akkineni explained while speaking to nft now. “What we’re doing here today at Scope, for example, is really designed to help demonstrate the power of token ticketing and the power of what you can do leveraging all the amazing technology of Web3 to link loyalty through VeeFriends.”
The Vayner X’s Art Basel activation at Scope Beach featured a party for VeeFriends’ Series 1 Epic and Access NFT holders, allowing them to network, explore art installations, and gain access to exclusive performances. The common thread for companies that approach Vayner3 looking to explore Web3 options, Akkineni said, is a kind of cautious curiosity. Less common is when the people who make up those brands’ marketing teams are personally interested and involved in crypto and NFTs.
Akkineni distinguishes traditional brands like Gucci and Nike, who both have had wildly successful forays into the Web3 space in the last year, from others who fail to appeal to crypto natives. “[Those companies] are really targeting the existing crypto-native communities,” Akkineni explained. “And, because they’re looking to do very endemic activations, they have done really well and gotten a lot of respect in the crypto-native community.”
A day after Vaynerchuck addressed crypto winter concerns at nft now and Mana Common’s The Gateway: A Web3 Metropolis in Miami during Art Basel, the entrepreneur revealed that VaynerX would open a permanent office in the city, and expand its presence in Latin and South America, during a panel talk at Scope. Speaking to nft now after the event, Vee emphasized that Spanish and Portuguese-speaking character development is a top priority for the VeeFriends team.
“Animation is a big play.”
“It gives me the leverage to be able to expand the intellectual property there,” Vee explained. “I’m not trying to be in a rush, but I’m on a journey to communicate everywhere in the world. You know, I have 450 employees in APAC Asia, 200 employees in Europe and EMEA. And I’m traveling to the Middle East quite a bit to kind of establish shop. I’m on a 50-year journey to communicate everywhere in the world.”
It’s no secret that Vee is pushing the VeeFriends IP to new heights, having announced a partnership with Toys “R” Us and Macy’s in October to sell VeeFriends plushie collectibles. The entrepreneur also explained that he has three to four business development ideas in the works regarding further VeeFriends IP expansion.
“Animation is a big play,” Vee offered as a preview. “Collectibles is a big play. We want to continue to build out a trading card platform. We want to continue to build on the toy platform with Toys R Us and Macy’s. We need to quadruple down on character development. I need to get people to fall in love with these characters. We’re going to do that through comic books, through cartoons. I’ve got to do storytelling. And I would say this: a kid’s book.”
Well-known for his love of wine, Vee also spoke to the long-term viability of spirits NFTs in the broader Web3 market. The ability for users to hold a token that represents ownership of spirits physically located in places where they can be stored appropriately presents a potent dynamic for project developers and spirits enthusiasts, the businessman said.
“I’m actually very intrigued by the concept of holding NFTs that represent the ownership of wine and spirits.”
“I’m actually very intrigued by the concept of holding NFTs that represent the ownership of wine and spirits,” Vee explained. “Alcohol is incredibly challenging to move around. But the value of alcohol goes up in these limited-edition NFTs. I’d love to issue an NFT and own a Japanese whiskey or a high-end burgundy, but never take ownership. And then, if I wanted to drink it, I can burn [the token] and have it come to me.”
Vee went on to say that there is plenty of validity to the concept of high-end spirits, given the legal limitations regarding their storage and movement around the world. NFTs present a way for ownership and trade without dealing with such laws. “It’s not very different than the highest-end art that sits in facilities that are temperature-controlled and fireproof,” Vee offered as an analogy. “And so, I think [spirits NFTs] are going be a thing.”
When asked if Vee’s optimism for phygital products like spirits NFTs extends to other industries, Vee was enthusiastic.
“Physical and digital items will be collected in perpetuity from here on out. I love mixing the two. And think VeeFriends has always been very aggressive with that.”
“It’s always ‘and,’” Vee underscored. “Physical and digital items will be collected in perpetuity from here on out. I love mixing the two. And think VeeFriends has always been very aggressive with that.”
The Vayner empire’s focus on IP development will undoubtedly be one to follow closely. Vee will face stiff competition from other massively successful NFT brands like Pudgy Penguins, a project that has likewise begun to establish a foothold in the family-friendly IP market with physical toys and publications. Regardless, it’s clear that an NFT project simply dropping a PFP project and relying on its avatars’ primary and secondary sales to stay afloat and offer value to its community isn’t viable anymore. VeeFriends and others are showing that, once again, success in the NFT realm stems from one thing above all: adaptability.
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