The Token Takeover
Join us on "The Token Takeover", where we dive into the exciting world of web3 gaming and explore the latest trends and developments in this emerging industry. From NFT collectibles to decentralized gaming platforms, we'll break down complex concepts in a simple and fun way, making it easy for anyone to understand and get involved in this rapidly growing ecosystem. So, whether you're a seasoned crypto veteran or a gaming newbie, tune in and discover how blockchain technology is revolutionizing the world of gaming and beyond.
The Token Takeover
#25 A mess of an AMA on Web3 Fundraising w/Game7 😂
Summary: Navigating Fundraising and Incubation for Web3 Startups
Major Themes:
- Incubation and Fundraising Strategies: The discussion offered valuable insights into how developers and startups can approach incubation and fundraising. For developers like 1208 AM, who have developed a product and secured partnerships but are seeking investment to scale, incubation programs were recommended as a viable path. These programs can provide the necessary support, resources, and networking opportunities to take projects to the next level.
- Community Engagement and Network Building: The importance of community engagement and network building was emphasized. Participating in relevant communities, such as Game7, can lead to meaningful connections, partnerships, and potential investment opportunities. Sharing stories, experiences, and seeking advice within these communities can open doors and provide valuable guidance.
- Product Demonstration and Market Fit: It was suggested that having a playable demo or beta version of a game can significantly enhance a startup's appeal to incubators and investors. Demonstrating engagement metrics, player retention, and the potential for growth can be more convincing than merely presenting an idea. Thus, startups should focus on showcasing their product's value and market fit to attract investment.
- Grant Applications and Chain Partnerships: Startups are encouraged to explore grant applications and partnerships with blockchain platforms. While the bear market has made securing grants more challenging, presenting a developed product and clear partnership benefits can improve the chances of receiving support. These grants can provide crucial funding for further development and scaling efforts.
- Investor Relations and Expectations: Understanding the dynamics of venture capital and investor expectations is crucial. Startups should seek investors who offer not only financial support but also strategic value, such as industry expertise and networking opportunities. Being transparent, honest, and aligned with investors' goals can foster long-term partnerships and support subsequent fundraising rounds.
Actionable Takeaways:
- Explore Incubation Programs: Startups at the cusp of scaling should consider applying to incubation programs that cater to their industry and goals. These programs can offer mentorship, resources, and exposure to potential investors.
- Engage with Communities: Actively participating in relevant communities can lead to partnerships, advice, and investor connections. Sharing progress and seeking feedback can also validate the project's direction and appeal.
- Demonstrate Product Value: Prioritize creating a playable demo or beta version to demonstrate the game's potential to investors and incubators. Focus on metrics that showcase engagement, retention, and the game's unique selling points.
- Pursue Grants and Partnerships: Continue applying for grants and seeking partnerships with blockchain platforms. Tailor applications to highlight how the project aligns with the grantor's objectives and the mutual benefits of a partnership.
- Build Trustworthy Investor Relationships: Seek investors who align with the startup's vision and can provide value beyond capital. Be transparent about the team's commitment, the project's status, and realistic projections to build trust and secure long-term support.
This session provided a platform for discussing the intricacies of fundraising and incubation in the Web3 space, emphasizing the importance of community engagement, strategic partnerships, and demonstrating product value to secure investment and support for growth.
https://game7.io/
https://twitter.com/G7_DAO
Follow us on Twitter - https://twitter.com/GamingStartUp_
Hey, this is Noah Autopilot, founder of the Gaming Startup Collective and host of the Token Takeover podcast. In today's episode, we're conducting another deep dive into the complexity of fundraising for your Web3 startup. Now, this one went off the rails a little bit because my main guest ghosted me, but we were able to salvage it thanks to the help of some awesome folks within the Game7 community. Alright, enough of me talking, let's jump in. Hey, what's up, Helios? Let me know if you can hear me, because if you can't, that's a problem. Hey, nice. Hello. Hey, what's up, June? Hey, I'm good. How are you?
Host:I'm doing good. I did not almost fail. I stepped outside for like five minutes to get some sun, so my mood's not great if I like wake up in the dark as day in the dark, so I wanted to get some energy back before I call.
NoAutopilot:Yeah, it's, uh, that's a challenge up here, too. I live outside of Portland, Oregon. And we have more cloudy days than most folks, so. It's tough, man. Yeah, like today is actually quite sunny, so after this I might have to go take the dog for a walk. Yeah, so I'd say for the folks who are trickling in, this is supposed to be a very communal question and answer session. So if you have specific questions about, you know, fundraising for your project, or you're just curious in general, feel free to jump up on the stage. Nobody will bite. Maybe June, but I won't. That's for sure. And we should have, uh, Miko joining us here any moment. I had my first read through the, uh, the Game 7 report yesterday.
Host:The state of, uh, Wot3r Gaming?
NoAutopilot:Yeah.
Host:I still haven't finished it. I started it A few days ago and I've been out time to read through. I feel like How is it so far?
NoAutopilot:I mean, it's amazing just like last year's. I find like I have to read it once and then think about it and then come back and like dive into the details to like really understand like what's happening in the market. Hey, what's up everyone? Thanks for joining. We should have Miko in here any moment. And actually, I guess I could probably go ahead and knock out some, uh, some basics. So let's do some, uh, quick introductions. So my name is Ryan Turner. I go by the handle, no autopilot. I've created a discord community called the gaming startup collective, whose whole purpose is to bring web three founders together to collaborate, network, educate, and hopefully accelerate. Game seven has been tremendously gracious and has given us the opportunity to host one of our question and answer sessions in their discord, which is what we will be doing today here in a moment. We're going to be joined by Miko Matsumura. He's a general partner at Gumi cryptos. We had this in the announcement, but their firm has over 500 million deployed in web three. Uh, they were early backers in YGG, OpenSea and others. And what's really quite interesting about that is. You know, they were able to see things that no one else did in those teams and those products. So really quite exceptional and interesting. So, yeah, so he has agreed to kind of join us this morning to answer any questions that the community has around fundraising for their web three startup. So super straightforward, super easy. See, can we get the links? Which links are we referring to? Ooh, what's up everybody? Great turnout today. Thanks for showing up. In addition, so while we're waiting on Miko here, I do have a disclaimer to read. Right, we gotta give these things out, make sure everyone's staying safe. So, discussions, opinions expressed here are not intended to provide investment, accounting, tax, or legal advice. Nor are we recommending that you purchase, sell, or hold any security or other investment, or that you pursue any investment style or strategy. Seek out your own financial legal advisors for any such advice. Also, please note that the views expressed in this AMA are not necessarily Game 7's views. We encourage participation and learning from this citizen led initiative. Hey, I see Miko! See him on the side there, okay. Gotta open the chat. Oh, yeah, yeah, those links, I'm sorry. Yeah, I got those. Send them right over here. While we're waiting for Miko here, does anyone have, I guess, any questions they want to share in advance? And I can make sure that we ask those first and foremost to, uh, to Miko. Yeah, start listing questions. Let's go. Do you like autopilot? No, man. Okay, so quick story behind that while we're waiting here. So I'm 36, right? I feel like for most my part, for most part of my life, I did a lot of stuff on autopilot. Like, I went to college, I got a job, I worked for a decade and a half, and like, it's cool, but I really wasn't feeling fulfilled. And so, no autopilot is the sense of approaching everything with just a tremendous amount of energy and excitement, and maybe doing some crazy things that don't make sense. But just like enjoying the journey. So there you go. Camper. Yeah. Fundraising type questions. That'd be great. And actually here, let me, uh, I'm going to jump into, there's Mr. Meadcup here. I'm going to try jumping into this Google Meets that he sent. Maybe wires are crossed and he's there. So give me, uh, give me one moment, folks. Hey, are you a builder looking for a grant to build your ideal Web3 gaming startup? If so, you should take a look at the Arbitrum Grant Program. With grants up to 25, 000 and a specific focus on supporting early stage indie game devs, it could be the perfect fit. Link is in the description. Make sure to check it out. Now back to the podcast. All right, folks. So I am back. I am not being able to catch Miko. So I'm gonna hope he, he trickles in here at some point. In the meantime, if it would be valuable or helpful, I'm happy to look at some of the questions that have been asked and either maybe I can help kind of provide some insight or guidance or other members in the community may have experience as well.
Host:We have the questions on the side and Josh offered to, to hop on and chat with us. Uh, while we wait for Niko as well. Josh, if you want to give a brief intro, um, sounds like you have some experience at Buffy Korn Ventures. So, uh, we'll do this for now, um, and hopefully Niko can, can make it through before, before the end.
Josh:Fun, funny beginning story with Niko. I actually went on a, you guys have all seen, uh, Bill here at some point and Bill Warren. Uh, he and I had a company back in the late beach democracy, but we went on Niko's show at one point. Uh, and then we pitched Nico as part of, um, Opolis where I'm one of their founding stewards and Nico turned us down to this, uh, It's a fun, like, lesson of learning and improving pitches. And he, he then came in personally. So I'm a founding steward at Oplux and one of the Buffcorn steward at EatDenver. And I help out with partnerships on summon. As part of EatDenver, we have Buffcorn Ventures that invest in EatDenver Hackathon. Projects and founders that have some sort of eat them for origin story. Um, we have 11 portcos. They need a fairly smaller balance sheet than, than gummy cryptos does. They're a much larger fund, but we have a much smaller scope. It's very narrow and it's a focused on kind of the regenerative circle of making sure that we invest in people who come to eat them so they can come back as sponsors and. Bit a little next year, but we, we look, we go through the same diligence process, whether the check size is 5, 000 or 500, 000 or 5 million, you still have to do really good diligence on these deals. You don't want to throw good money away.
NoAutopilot:Let's do this. So Miko did hit me back. He's saying that discord onboarding makes him feel a bit uneasy. And so I don't know if he's going to be able to swing through today. So Josh, I think you're, you're next man up here.
Host:Is he getting, is he having trouble getting through discord or is he just not uncomfortable? Is he just uncomfortable with discord?
NoAutopilot:Uh, well, I think he's generally comfortable with Discord, but I think he's maybe turned off a little bit by the security. And I don't want to heavy hand him into doing something he's not comfortable with,
Host:you know? I see. Okay. I mean, understood. Yeah, just learning moments for us as we do these more in the future, so no problem.
NoAutopilot:I want to make sure we get at least some of these questions answered and, uh, we do have Josh here. So, Josh, thanks again for, for jumping in. Scroll to the very beginning. I don't want to miss anybody's great questions here. Oh, Josh, you yourself had the first question. Should we ask you your own question? Probably not.
Josh:Yeah, sure. Alright, so, um, so, go ahead. Uh, not a lawyer, and not an accountant. The advice that I give is not particularly. Alright, what was the question that this asshole asked?
Host:Yeah, before we get into the questions, we had a suggestion in the chat if Miko would be open to coming on Google Meets and someone can stream.
NoAutopilot:Josh, why don't you answer that question for yourself? I'm going to try and see if we get him on a Google Meet and maybe I can share my
Josh:screen. Miko to answer my question. We can do a, you need a streaming software? I have a streaming software.
NoAutopilot:It's okay. Let me, let me try this Google Meets thing, and if it doesn't work, I don't want to waste his time or everyone else's time. Especially if we can get some of the basic things answered, you know? But here, I'll try this. Go ahead and answer that question, and if I can't get it sorted, then we'll scrap it.
Host:Yeah, maybe we can, uh, bounce over to Jordan's question and then over to Spidey's. Do you see, Josh?
Josh:Although I don't have experience investing in games, so I don't want to give bad advice here.
Host:Completely fine. Uh, get what you can, and if the question is not appropriate for you, we can just move on to the next. Maybe a more general one, like Spidey asking, like,
Josh:does the pitch deck really matter? Uh, it depends. It depends on the investor you're in front of. Everybody has their own kind of corpse. Like you'll see you on like VC Twitter. Like some people will be like, Oh, it's about the warm intro. And some people will be like, yeah, the pitch deck needs to be perfect. It really depends on who your audience is and who you're, who you're trying to talk to. For me, the pitch deck doesn't need to be perfect. It just needs to get across the information that I'm looking for. There are, there are like some binary things of like, um, if you've got 10 decks in front of you and you're only allowed to make two deals. Like one of the things that you can do, the check to like whittle it down is like, does this deck have typos? Like if they didn't, if they didn't put the care into preparing the deck with decent English structure or like overlapping. If it doesn't look as a good presentation, like is the product going to turn out well? And it's kind of like a first like easy test. I've never dinged someone that hard for having a, for not having a deck or for having not a perfect one.
Host:But if your project does entail and. A lot of companies do require pitch decks, uh, even to open up conversation with them. In the expert Q& A Spidey, uh, we've had several people, uh, share their pitch decks and get some feedback, uh, and practical next steps to improve it. Uh, we have Delroy in the audience as well. I know he's reviewed a bunch and he's helped a bunch as well. Uh, I think Jordan has offered his pitch decks for review. Um, I think Helio has helped out, uh, with reviewing as well. So that's an option for you. I know this is, you know, This is not the perfect answer that you were looking for, but yeah, this is something that we can help out with, uh, with, you know, in the meantime, and we can bring Miko back another time for you to get a more straightforward, uh, a more blunt response to your question.
Josh:I don't know if a blunt response is I mean, like, yes, we do want to hear from multiple people because like every part of my, it depends as every investor to answer that question differently. Like, obviously you should try to put your best foot forward.
NoAutopilot:I have a question that's come up a couple different times. So if you're a founder who doesn't have a network, like, like say that you, you're bootstrapped and now it's at the point where you need capital to hit your next major milestone. So it's time to meet some angels. Right? Like if you're a founder without a network at all, how would you recommend they find angels and kind of start that conversation?
Josh:That's a good question. I've met a few founders who've had this problem. One of the common answers I get when offers is to go out and build that network. It's kind of like a first, like early tell. Like some people, they see the, like the stellar founder, they've got a thing, it's a slam dunk, like they'll Want to be that first money in the door, but often a lot of, a lot of investors don't want to, they FOMO. And so they'll want to like, they'll invest because other people are investing. Right. And this is part of the warm intro, cold intro dilemma conundrum is like, if you can't find yourself a way to get a warm intro, like, how are you going to be able to build a team? Like, how are you going to find them? How are you going to network to find the employees who are going to come work for you? There's a ton of readouts, most cities, like you can find. I actually don't know about gaming meetups. I bet there are, there's a lot of web stream meetups.
NoAutopilot:I was going to say, and I've heard this before, but it's almost like a filter, right? Like it is, if you're not scrappy enough to go out and like blunt force your way into a network or build relationships with people to like help your project succeed, that could be a really strong indicator that like, maybe you just don't have the skillset quite yet to have a successful startup, which is, you know, there's been, Millions of amazing products built, but the, the difficult part is connecting it to a customer or a user base or partners that, that would value it. You can get
Josh:these discords and this is like, this is another good community. One of the, one of the things that's really important is to get yourself out there, but like in person and like on these calls. So if, if I see just like a blurb in a random channel, I'm probably going to ignore it. Unless I've seen you a few of these calls before, or I met you at a conference. Like there's at least six or seven names in here that I recognize like super well. And if I saw a post, I'd be like, Oh, okay. I'm going to pay attention to this. It's just the way you can start building a network is by being active in the communities.
NoAutopilot:Alright, so I was finally able to connect with Miko, still having challenges with the Discord stuff, so I'm gonna have to get him in
Josh:at another time. Yeah, he texted me, it seems that there's a, um, on one of the, the pages, it wanted him to enter a password, and I was like, I think that's probably just an ad, and he just needs to find a different button.
NoAutopilot:Oh, that's hilarious. So we got a bunch of questions coming through. Yeah. Let's see, uh, see if we've missed any. Do you recommend building a game demo to ask for funding? Or is it better to get feedback first, iterate on that, and then build out a demo. This is from HD Olivers. Hope I pronounced that right. Yeah. Josh, I guess, do you want to take
Josh:a first crack at that one? So not from a game specific, but from like a product. So it depends on the round and like how much you're asking for and what you're asking for. A lot of, uh, I'm helping a company right now in Austin raise a pre seed. And. A lot of the investors we talked to were like, you should probably be doing that seed and have an MVP ready for us. And so that's kind of like the difference of like how much money, how, how much of your company are you willing to give away early on some of the, like the earliest checks that are going to take a little bit more, but will help you to get that MVP. Whereas if you've got the resources to be able to put an MVP together, then you can, you can skip that, like pre see your friends and family. And try to do like a proper seed round. The answer to almost every question is going to be it to patents, because no, no two situations are the same. You got one founder who's got a million in the bank and they're doing a second thing versus a founder who's, you know, washing dishes, trying to like break into a taxi and like, they're not going to be able to approach the same problem the same way.
NoAutopilot:I'll add onto that too. So in the Gaming Startup Collective, we've had a couple web3 VCs and web3 gaming founders kind of talk about the process. And what they've shared is, you yourself need to determine what your MVP is. Like, don't let the investors dictate that to you. And then you need to find investor partners who align with, like, your vision is behind that, right? And so for some teams, if you've shipped games before, maybe you don't have to create, like, a playable alpha to prove that you can do it. If it's your first time shipping a game, or like, your founder team, or like, first time founders, then maybe you would. Need to prove more in terms of your capability in order to be successful in your fundraising. All right, moving through here. Trancy, Trancy said, Is it much harder to raise for a pre seed round versus a token round? And, you know, I think a broader question to that is, I, I don't know. Are VCs still doing token rounds? I thought it flipped to,
Josh:uh, equity. I'm gonna give my favorite answer here, it depends. Again, I think it depends on who you're trying to raise from, like what arena, like, like what's in demand. So like, uh, about a year ago, all the crypto VCs were like trying to get into AI and they were trying to buy up what they could. So it's kind of, it's a founder's market, right? So the founder can sell whatever they want. And then I also think there's a difference between trying to raise from like one of the big guys versus like some Russian with 5 million. It's like, Oh, I have a VC, we do token deals or a DAO that's just doing DAO to DAO investment. And they're not able to take equity. They're only able to do token deals. Uh, DXDAO was doing that for a long while. In which case you're doing token, token warrants if you don't have a token yet. And then you're, you're, you know, you have a U. S. Nine warrants quite soon. Which is that you're going to exclude Americans, the preference may be to just go off and sell a token, even if you know that you're not going to be regulated by the SEC. Now what the appetite is among the, either like what stage you are and the investors that you have or you're aiming to.
NoAutopilot:You know, I think that's uh, maybe that's not the answer we all want to hear, but I think that's the best answer. We want the hard
Josh:hitting facts. Well, I don't know if there are facts. Because there's so much subjectivity, and like, I haven't built a unicorn, right? And, and I haven't been on the beastly side of investing in a unicorn. Not yet. It's, it's all subjective.
NoAutopilot:I guess that's the beauty of these conversations, is we can pick little pieces off from everybody, and hopefully get pointed in the The general correct direction. All right, cruising through here. So Grand Marquis had question. Now I'm wondering if the first part may have been addressed to Miko, who again, uh, we had some challenges with, but, uh, he said you're investing in projects across several verticals in web three. What did these projects, especially at an early stage, have in common that gave you conviction to invest? And then his follow on question was, are you more prioritizing team Are you more prioritizing product market fit? Good questions. Josh, do you want to correct those?
Josh:I'll just keep with, yeah, I'll just give the Buffcorn Ventures answer real quick. We focus significantly more on team and what we believed in this team to be, these teams to be capable of, rather than worrying about product market fit. Cause like, we only invest in first money in the door. So it's preceded with like, is there a hackathon project? And like the whole point of it is, quit your job. Go build the hackathon project that you just won, you know, 20, 30 grand with. And like spend six months to a year like building it. It's more about experimentation in the ecosystem and trying to build building blocks that, that may be able to do something for the ecosystem, be a positive for the ecosystem. effects for good. So inside of our view, since it's not so much like, do we think you have a good idea? It's more of like you as a founder, do you have a positive track record? Did you assemble a team around G that is also willing to quit their jobs and is competent and, you know, laying code and, A lot of these, a lot of these cases in crypto, in crypto investing, like you'll find a team and you've got a deck that's got 12 people listed on a deck and like nine of them have full time jobs somewhere else. And so it's like, uh, okay, what am I actually investing in? This is so, it's so common and it's, it's like one of the questions you have to ask people. It's like, okay, of these people, like run through your roster, who's working on this full time. Um, and that can be like one of the most important questions that you get asked. Yeah. Um, when you're, when you're raising funds, like don't just throw people on. Because you think the name or like, I got thrown on a deck once because I worked at consensus and this guy was like, no, no, I want you on my, I want you on my side because you worked at consensus. It'll add weight to their thing. It's like, that's not, no, no, it won't. Probably it won't. Can I give another? It depends if you like it.
NoAutopilot:No, man, you crushed it, but I have a follow up on it then. So, so you talked about like founding team members or equity owners having working full time jobs or maybe in multiple startups. I'm curious, like, what does your due diligence process look like when, like, a debt comes across your desk and you're trying to validate, okay, are these guys, like, all in or are they, like, half in, half out? Like, what does that process typically look like?
Josh:What does the due diligence process look like?
NoAutopilot:Yeah,
Josh:yeah, exactly. Usually just asking questions. People don't usually lie about that stuff, um, especially because if you lie on due diligence, like you can, like, those are, those are legal problems, like you're going to court and you're probably going to lose. Um, you can't lie to investors. Um, I can't remember the exact, oh, yeah, I want to help me out on what's still like, the SEC is like real strict about lying to investors. You just cannot do it. Quite a lot of these calls are recorded. Yeah. Just ask the question. There's some like LinkedIn digging. Like there's nothing wrong with in web three. Like I have three different part time jobs right now. Right. And I'm, I'm probably on at least one or two decks that are raising a fifth part of the ecosystem and how it works. It's just like, uh, as a founder, when you're answering these questions, don't oversell someone's participation because you think it'll serve the narrators. It'll come back to bite you. Be, be, be honest. It would be my advice.
NoAutopilot:It kind of feels like for a lot of this, it boils down to relationship building, being trustworthy, forthright, admitting the fact that maybe you don't have all the answers. Um, and that you're looking for a PR and filling your blanks.
Josh:Yeah, that's definitely a big part of it. And then another thing to consider is investors that you bring on to your, your seed round, especially let's not just like call angels is like, these are your partners that are going to be around for a while. Like the, the, okay. I don't know if I want to give this as financial advice, but like you shouldn't just go out and look for investors and they're just going to write a check and fuck off. Cause they're not going to help you. There's no value add there. Like anybody can write you a check, but you want someone who's like, like industry specific and, or has some sort of like ability to help you hire, um, and can connect you to their other portfolio companies and et cetera. Right. Um, but most importantly, you're probably going to have to raise again. And so if you're not being honest with the people that you're raising in the first round, Like they're not going to follow on and they're probably going to tell their friends that they're follow on when you go to raise again, if you lied to them. The VC community is super tight. Um, and I know this because I'm on that outside. I don't get away with it. I don't get away with it. Cool kid. But they all thought all of them talk.
NoAutopilot:I feel like you should be at the cool kid table, man. Like the whole Buffa corn like eats. Come on, man. What are the, what are they doing? They need to open the door, let you slide through.
Josh:We have our own cool kid club. Yeah. Um, well, like we. Our, our, our checks are like 50 to 250, 000. Um, and so they, the cool kid club is like when you're writing a million dollar checks, you know, we're not there yet, but we will be soon.
NoAutopilot:Okay. So, so this is going to take me on another somewhat relevant tangent for the people who don't know. Can you explain where VCs get their money from? And it may be like some of their concerns or considerations. Around how they deploy it, the frequency that they have to deploy, the returns that are expected from the people they've taken the money from, just for folks who maybe are familiar with how that side of the coin works. Here's another
Josh:classic Josh, it depends. There is like a clear answer here, but they also depends. So, BuffCoin Ventures, alright, so the easy answer is other people's money. Uh, the person who is like in these meetings is not usually writing over their own money. It is the case that some VCs are invested in their own funds. Most of them do have to have some skin in the game. There's limited partners, and then there's general partners. Um, the LPs are usually the ones who, they'll write a check to join the fund, but they don't take in active participation in any of the, like, investing and due diligence stuff. They'll just kind of read reports. Um, some are more active than that, of course. Every VC is different. So this is why it's a broadly inside of the answer of, it depends. Um, and then you've got GPs who, who generally do have to write a check and it varies by size of fund and type and whatever, um, so that they do have skin in the game, so they're not just like finding away other people's money. And a lot of the guys and women who are involved in these deals get something called carry, in which if they make an investment deal, And you take off and you have another round and then once it, and everybody gets money, everybody gets rich, um, they're going to get cut off at. And so they, they very specifically, like, so they've got, you know, their day job where they've got a heavy plate of, they've got to take X amount of meetings and write X amount of memos and make X amount of deals per year, but they also have to make sure that they're making good deals. Because if they invest in all duds, they're not making that variable cost. That's where they get rich is, is investing in the right deals and be able to carry and, and, um, and, and make that, that big, those bonuses, right? That answers one side of the question. Um, with BuffCoin Ventures, we did, uh, a couple of the major web free companies and Dallas gave us grants, um, and the rest are LPs. So, like, Harmony wrote a 500, 000 grant, meaning they don't have any investment into the fund. They don't have any, like, economic rights to the fund, they just want to support the ecosystem. And then you've got, like, Nier and Polygon, and a bunch of smaller angels. I don't think Miku would join that. But he's not here to defend himself, so I'm not gonna. I'm gonna think a damn week or it should be like the maybe next year basically anybody who invested in the fund like we did it all on a chain so the money's in a DAO and if at any point the LPs wanted to withdraw their funds they could they could rage quit a prorat amount of what's left in the fund We, we did a non chain thing, which is unique, it's particularly, it's, it's not common, but anybody who, who joined that Molok Dao has access to the Discord and the Tronverse, um, um, and actually summon soon, uh, when that unrolls. This is not public, so the state's here. In the recording. It's public. Yeah, it's, it's public in the recording. By the time this comes out, or if this ever gets reproduced, it'll be public. So it's, I mean, we're like weeks away from the point. Um, but, uh, BuffCorn Benchy, he can even use Summon, which you guys all use here to become citizens. I, I love being a citizen, it's one of my favorite things, um, to like token gate access to deal memorals and that kind of stuff. Some of the bigger funds do something similar, just off chain, I know it's like Google Drive.
NoAutopilot:Did I answer the whole question? No, you, you really did. You crushed it. Other people's money, OPAC, I'll always remember that. Other people's money. So, okay, so, in that, in that dynamic, like, where we've lived through a pretty deep bear, a lot of those. Limited partners maybe don't have as much capital as, uh, as they did. Yeah. And so like, I imagine that makes the job of a VC very stressful because you're trying to squeeze, you know, lemons out of a rock in the market. You got the people who gave you the money
Josh:maybe need to go back. In a lot of cases, in a lot of cases, they actually don't even have the money yet. Um, and this is what, one of the cascading problems from the FBX. Well, it started with Luna, but the FTF to Contagion, this is one of the problems. So when someone like AC, here's a good example, uh, uh, bankless venture is just right at the 30 million fund. That doesn't mean that 30 million. Is sitting in a bank account somewhere because, and I don't remember the exact details from the deck. Their capital calls are like 10%, 30%, 30%, 30% or something like that. Which means that like to close the fund and have the deal, like have it ready to go, they only needed of that 30 million, 3 million sitting in bank account.'cause they only call 10% of the commitments. And as time goes by, those commitments are called. And they're able to deploy more capital in these deals. So what happens during, during this bear market, um, and this is all like conjecture, not all of conjecture, it's somewhat conjecture. A lot of the funds that were operating in the States were actually, they were, yeah, mile milestone based commitment. That's a good going to cater. Um, a lot of the funds were actually, During their commitments in FTA. And so when Sam went on a spending spree was investing all these politicians, it was with these funds money. Um, one of the things that we'd like, it's still being shaken out that a lot of these funds like have not, I think that they're maybe hiding it from their investors a little bit because they're just waiting to see if they can get the money back before they have to start getting into some shit. But like, it's, you know, I can't say definitively that's what's happening because it's, it's conjecture. It's we, we assume. Um, that all of this capital not being deployed is not being deployed because it can't be deployed. And this also happened with like Genesis and BlockFi and so like the funds that were, that were storing their funds. Absolutely fine. Still deploying capital because they were self custodying their money and they were, they were living their values. And this is another one of the things when you want to like pay attention to, it's actually like gaming industry. If you're a head from the gaming industry, they're going to be banking and wires probably. Right. But if it's like web three niche gaming, would you say, Hey, are you going to send the U S and C to this multi sig? And they're like, no, we only send wires. It's like, Hmm. Maybe, is that a red flag? I don't, I don't know. I don't invest in the state specifically to be able to say if that's a red flag or not, but, um, to me it would be. I don't, I don't like people who can't use USDC.
NoAutopilot:Can you expand on that a little bit? Like, what's your fear or concern
Josh:in that situation? My concern, because I'm a decentralization maximalist, rather than, you know, decentralization. A game or excellence, which I'm in the process of converting or like, yeah, the, my concern would be that like, if you're trying to build a web three game and you take money from pure like gaming industry, like, and you know, it's on them for writing the check, but like, maybe they won't be as on board with the web three stuff. You know, the next time the sec does some sort of bullshit regulatory crackdown, the That we all know isn't going anywhere, but it spooks them. And they're like, nah, you got to pivot. You got to cut the web three stuff out. Are you going to buckle to the investor that has 20 percent of your cap table or. Are you going to, you know, you, I mean, you don't want to put yourself, and this goes back to the question I asked, because I wanted Miko to answer, how do you involve more of the community? Um, I'm, I'm part of two very large communities that don't have investors who can dictate terms. Borkedow doesn't have investors. Opolis doesn't have investors. It does have investors, but investors that don't have governance rights because the, the way the cooperative was designed, the members, the citizens. Of the cooperative have that, that, that power. And so we don't have that, that, that issue doesn't come up. And when we get. Further deeper into the next cycle and the deal starting structure then becomes, um, a founder's market again. Right now it's a bear market. Everyone's struggling for oxygen, right? But once everybody and their mom was deploying smart contracts and they're raising money, it'll, it'll, the money will be flowing much easier. Once, you know, he has back at 4, 000 because instead of having to write a 10 ETH check, I'm able to write a three ETH check. You know what I mean? Like the, it's just the, The founders really will dictate terms a little bit better. I think we should be really focusing on these like wet three terms that empower the community rather than empower. Now, obviously it's if they're capital and they should be able to deploy it how they want and, you know, we live in a capitalist society. I, I know I said it with a tone, but like we do. We, we live in a capital society where like, they can put their money into treasuries at 5%, or they can take a risk on your game, and, and your company, and, and potentially 10x, 100x, 500x. Um, and that's a risk that they're taking, so they have every right to try to dictate terms. But you have to remember it's your company, and you should be dictating terms. That's my financial, not financial advice.
NoAutopilot:So we got three minutes here. 12. 08 AM. I am so sorry. I, uh, I was thrown off my game by, uh, by the struggle to get Miko on. I just realized you're on on for like a half an hour? Who's
Josh:on the stage?
NoAutopilot:12. 08 AM. Yeah, so, uh, Oh. I'm like, it's not that time. It's like 12. 45. How little you think of me, man. Come on. Come on, Josh.
Josh:Nice to meet you, 1208.
Host:Yeah, so, uh, Ryan, to your earlier question about, you know, what can people do if they are working on a project, they're coming into this space without a network. Uh, what can you do to, uh, but what can you do to expand your network and like have more reach? Um, and 12Away, he, you know, he joined the Game7 discord and he wanted to share a story of like how he was able to meet people and like get him off the foot. And if we have time, maybe we can bring Jordan on the table as well. Um, I think he has a, he's had a lot of positive experiences and he's, he's been able to leverage the Game7 community, uh, in a way that, you know, Works for him and it's fun for him. Um, so if you have time and if he wants. Yeah, that'd be great. Go away. Is there, is there a mic working? We can't hear you if you're talking.
NoAutopilot:Blame all the technical difficulties on me. It's, it's all, it's all no auto's fault.
Host:You're good, man. We, we live and we learn. We've run into discord issues in the past too. So like we've had to move our like 40 percent calls onto Google meets to make sure to include everyone.
Josh:So 1208. Make sure that your computer settings are the same as your Discord setting. My, those will always get screwed up and I have to go into both and make sure they're connected to my headphones.
Jordan:Yo, the Discord audio is incredibly annoying and frequently, like, it'll, it'll pop up that, uh, hello everyone, it'll pop up that, you know, it'll pop up a notification saying like, Oh, we've detected something new. Do you want to change? And like, the answer is no, but it makes you think you want to say yes.
Guest:I think it's working now. Hey, there you go. Oh, I'm so sorry about that. I'm like, what the hell's going on here? But okay. I'll just introduce myself. I'm, I'm from the perspective of like a developer. I do have a question or two. I guess I can share a little background. I find myself producing this game. I've been working on it for like a year and a half or two. Uh, I've been working with some partners for the whole time that I've been kind of putting it out there in the world. We're preparing ourselves to release the demo, basically beta 1. 0 next month and then continue developing through next year. But like I mentioned, I'm in a peculiar place where I've gotten some significant interest from partnerships in the last couple years. I landed a third partner recently. Uh, I see I'm in the crowd right now. How you doing Delroy? What I just wanted to ask was like, the way I got connected through my partners thus far, I approached them with, With offering them a service that they needed, which was, you know, graphics, 3d animations, and that's how I approached them as far as them getting to know me as a person, uh, and as a worker. So that opened the doors for me with Moda DAO and they brought me in as their metaverse experience designer. So what I did is I very quickly in six months, metaverse and decentralized for them, uh, last year. Uh, we hit the meta, Uh, Metaverse Music Festival in 2022. Uh, we had like over 50 performances. So we had like a really ambitious space where I really hit the nail on the head as far as trying to make an EDM centered space within the Centralland. So we were going for a warehouse type party and they were really happy with all of that. And that gave me a chance to work with them for over a year, which then led to our business partner relationship, right? They knew I was working on this game the whole time. I kept it in my back pocket and on the weekends. And then when, uh, after a year came up, uh, we started talking about like what I was doing with my game on the side. And we started talking more as far as partnership goes. And that's been the last three or four months or five months now. And so we're coming to the close of the year, preparing to release and show everything that I've been working on, gathering our community of course. But like, this is where I find myself. Uh, I have no runway left with my team, but we've put together a whole product. Where it includes character NFTs, token collecting, and the whole thing's based around this music game, right? That's how I gained trust with someone to give me, you know, money and partnership and guidance because that's been the main thing that I've been learning from these guys after the, like, year and a half or two is all the business side of things, which I was completely ignorant to before, right? And so what's interesting these days is obviously got a couple of really good partnerships that. Not only fit the game, but like are going to open up doors for me as far as music and the music industry. What I'm wondering right now is before we start pitching to angel investors, uh, what is an angel investor? Like the best strategy to move forward with the particular position I'm in where we have the product built. We're working on all the marketing stuff. Our runways is over, but, um, we want to put out the product late this year, early next year. And I'm trying to strategize as to what would be the best way to attract not only an investor, but like obviously have them giving me the maximum amount of investment money and how to convince them to do that. Now, I was going to ask, should I put the money? The demo on the market for anyone to play, should I keep it gated so that only people who invest money into the project get to play it or is there any other strategy for me to like take this company to the next step so that we can have community and the funding there in place, right? I know it's a heavy question, but if anybody has any advice, I would really appreciate it. Cause that's where I find myself going from 2023 to 2024.
Josh:So I don't know this well in the music and gaming industry specifically. Um, but like you sound like you're a perfect candidate for an incubator. There's a lot of incubators out there that want to see, yeah, they want to see like, at least some sort of product. So you're kind of an add on the game. Like why, why, why Combinator is like the biggest and most well known. And then there's the other ones that are like. We are not white Combinator. Um, I, Techstars does, does a decent, like, I would be wary of some of the smaller incubators that like over promise and under deliver, but some of the bigger names are, I mean, they'll take, what, 7% of the company or something, but Right. The like, yeah. The in um, where, where are you based? I'm in ca, Los Angeles, California. Yeah. There's a lot out there. California is a, a mecca for incubation. That's good to know. I mean, that's a, that's a, that would be my first. Anybody else want to take a shot? Incubations, thanks man. Wrote all this down.
NoAutopilot:I, I guess just uh, just a quick comment, it's really exciting at what stage you're at. Yeah, it's super
Jordan:exciting, man. Like, I see all these opportunities, I just don't know where we're going next, you know? Wrote a, a, a piece of an answer, which is um, I can't really think of a situation in which players having played your game is unhelpful to getting into an incubator, getting investment or anything, literally. Um, that's kind of the number one thing, unless someone here can think of, you know, a reason you wouldn't want that.
Guest:That's how I felt so far, because I'm so close to releasing this thing that like, I feel like that's the last piece I need to put out to convince like the next VC, right. Or like the next investor or whatever it is, incubator. to see some revenue numbers, right? And some analytics.
Jordan:Yeah, exactly. You know, if the game is fun, but the numbers are low, what matters is, you know, the people who are playing it, what's their engagement with it like? What's the, you know, repeat players and stuff like that? Because Anyone can understand, like, if you just haven't had money to scale and market yet, right, that you can get there and they can help you, so it's like, you know, focus on those core first players. And, like, how much retainment you get and how many players are on there? All those things are great numbers, yeah.
NoAutopilot:Another thing that might be interesting to look at, too, is outside of fundraising, A lot of the chains are creating grant programs. Now it won't give you like a year's runway, but it could give you three months. If like there's a major milestone that if you hit now, instead of raising, let's say a million dollars, now you raise like 3 million because you've proven more. So that could be something to explore
Guest:as, as well. Don't know. We actually started with grant applications. It's only been a few months. I've gotten some pretty good. Kickbacks, but they've only led to talks that haven't led to you know movement, um, but they're still open So i'm really hoping I can still get a grant or two But I think um next month when we actually put the trailer out and we've announced our partnerships and everything Hopefully, um, I can come back to them and say hey like what's what's up? Like we're gonna move forward with a couple other chains Hopefully they're interested in moving forward with us But if not, then like, you know, I need to just keep moving ahead Um, it's just that they are some pretty big names, it's just, just still a bear market, you know, so it's been tough getting grants thus far.
NoAutopilot:Just know you're not alone. I talked with a lot of builders and it's, it's the same experience kind of all the way around.
Guest:Yeah, there's a little bit of solidarity there for sure.
NoAutopilot:So we have, we've kind of ran through. Right over. Sorry, June, but I think the conversation's been great. And I think like the amount of discussion around it has kind of proven that this is a topic that that's top of mind for, for a lot of y'all. Sorry that we couldn't get Miko here. Sounds like we're going to reschedule and I'll definitely kind of share that with June and the team. See if we can get that set up here in the G7 Discord. Two kind of calls to action real quick. One. Suggestions. So like, if there's additional guests you would like to have these type of spaces hosted with or discussions you'd like to explore, tag the G7 team, let them know. And then also, if you haven't checked it out yet, Game 7 released pretty big, massive, important research report just yesterday called the, uh, Game 7. Uh, State of Web 3 Gaming Report. And it gives you like a deep, deep dive into like the current trends of the industry, and maybe how you can structure your startup around it to be even more successful than you would have been potentially without that, those insights and information. June just posted right there. Helios, have you posted podcast? Yeah, man. Come on, you don't know about my podcast, bro? Come on, man. I haven't podcast for like six months. I got a little, little podcast deal. All right, cool. Thanks, everyone. Cool. I'll pass it over to you, June. Sorry for talking so much. Thank you. Bye.
Host:Yeah, as no autopilot just mentioned, I know this wasn't precisely what we were looking for, but I really appreciate Josh for stepping up and, you know, positively, we did get a lot of important topics and questions from the community that we can use for Miko and similar discussions in the future and I'm happy we got together and got to share stories on how we were able to You know get to this point and what we can do to help each other to get to the next stage. Not so bad We'll learn from each lesson. So it'll be better the next time and hope you guys we have you guys back for that one, too So we'll wrap it up here. We do have community hangouts Michael's sitting in there chilling right now If you guys want to hang out more we'll be in the game 7 live voice channel right below this one If not, we'll connect another time. Oh, by the way For uh, I think we have a lot of new members who came from reading the report. Would love to talk to you guys. Just shoot me a message anywhere. I'm happy to share my Calendly. Uh, would love to learn, you know, what your thoughts on Game 7 is about the report. Were you open to get out of, you know, participating in this community and such. So, uh, looking forward to chatting with you all. Thanks everyone. Peace.
