Last issue of The Random I discussed what I believe is a new business model for content creators…basically…the tokenization of everything.
This issue, I’d like to take you further down the rabbit hole.
Hey Meta
Facebook’s decision to rename their company as Meta has everyone talking about the metaverse. If you’re not familiar, the term metaverse comes from Neil Stephenson’s book Snow Crash, a science fiction novel in the same category as Ready Player One. I highly recommend the read, not only for enjoyment but for training purposes.
Why? In the book there are two kinds of property: one for the real world and one for the digital world (metaverse). I believe this is what’s to come (and that right soon).
So yes, you will own a house and a car and all the things you see around you (the NFTs of the real world). This is the world where property rights are things we can see and touch.
And then you will own your digital property. This goes for digital money like Bitcoin and Ethereum and now a whole new world of digital property made possible with NFTs.
I’ve become obsessed with this concept. I believe it unleashes possibilities for content and creative entrepreneurs that we’ve never thought possible.
Web 1.0 to Web 3
Just like the first wave of the internet, we are just seeing NFTs today as digital replicas of what already exists. For example, when Web 1.0 first came online, websites were pretty much just digital magazines or digital classifieds. Same exact thing as in the real world, just accessible via the web.
Today we are seeing art, but instead of going to a gallery, we can purchase it digitally as an NFT. We know what memberships looks like today, but now you can package them in an NFT or as community tokens (like we do at The Tilt).
Maybe we aren’t at Web 3 yet…how about Web 2.5? Let’s say instead of selling my book on Amazon, I can sell it as an NFT to, say, 300 people…what I might consider my true fans. I can make more money on the NFT version if people are willing to spend more, which a few people will, and also make money off every resale…which is impossible today (I do not make money when a used bookstore sells my book).
If you are a content creator, that’s where I’d be spending my thinking time. What intellectual property do I have and can create, and how do I develop it as digital property that people would want access to?
Think of a musician today. I have a few in my family. They make their living by doing in-person gigs or recording for people. Many people in the middle take their cut. Musicians almost never directly receive compensation from fans. They get what’s left over.
But if I’m starting out in music today, I’m building a small audience of fans. That musician can probably survive off a couple hundred or a thousand true fans, creating custom in-person and digital experiences, music, merchandise and more just for those people who are willing to pay a little more because of the scarcity and because they want to be a part of that musician’s journey.
It’s a game changer for every creative. And, if things work out, I can see more millionaire musicians than ever before. Just think of what just happened with writers on Substack. So many of them went from working for media companies to making millions on Substack the next year. THAT is going to be possible for every creative out there in the next three years because creators now control their own supply chain.
I don’t know where this is going to lead. I actually do think that people will “plug in” to the metaverse to experience life in a different way. When they get there, they’ll want all kinds of experiences, including ones you can offer (as part of their digital property).
Tokenization
Why all this now? Packy McCormick says it well. “Web 3 is the Internet “owned” by builders and users, motivated by tokens.” The tokenization of everything makes this thing possible.
Think about this…in Web 2 everyone was a content creator but only a few companies made all the money (Google, Facebook, Apple, Amazon, etc.). Almost all the content creation value from millions of creators went to just a few companies.
Web 3 can change everything because the creators won’t have to monetize through the platforms. Sure, creators will still use Facebook and YouTube, but they will drive super fans to purchase unique experiences and merchandise (digital property/NFTs) and won’t have to make money ON the platform.
Facebook (Meta) and company won’t go down without a fight. That’s why the change to Meta. They want to be THE PLACE that people buy all these things (think IOI in Ready Player One) and they want to take a cut. I’m hoping these interactions will happen outside of a centralized network (I’m betting it will).
So, you’ll have your physical property and you’ll have your digital property. As the years go on, we’ll be spending more time in the virtual world experiencing our digital property.
And get this? There are only about 10 million digital wallets right now in the entire world (your Apple wallet doesn’t count…think of a Metamask wallet). 10 million out of 7 billion people. I can’t imagine how big this thing is going to be. This is what the internet was built for.
Here are some great resources if you want more information:
This Tim Ferriss podcast with Chris Dixon and Naval is amazing. It’s two hours long, and worth almost every minute. They talk extensively about digital property rights.
This Bankless podcast featuring Chris Dixon talks about what the world will be like in Web 3. This will blow your mind.
Love this post from Doug Kessler on why B2B marketers need to care about Web 3. Great for beginners if you still don’t get this stuff.