Episode 8

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Published on:

17th Jan 2022

8. Cow Metaverse, GameStop NFT, Centralized Marketplaces, Fan Controlled Football

In this episode, cows stuck inside for the winter are given virtual reality goggles to simulate being outside, GameStop launches its NFT marketplace, Lootex raises $9 million in a seed funding round, OpenSea secures a whopping $13.3 billion valuation, Animoca Brands and Delphi Digital lead a $40 million funding round to back Fan Controlled Football, and so much more!

Episode 8 Keywords: cows, virtual reality goggles, GameStop NFT marketplace, Lootex $9 million seed funding round, OpenSea $13.3 billion valuation, Animoca Brands & Delphi Digital lead Fan Controlled Football funding round

Transcript
Unknown:

Welcome to the metaphysics podcast. The Metaverse and web three are bringing about the

Unknown:

biggest revolution since the internet itself. With your hosts Paul the prophet Dawalibi And Jeff the

Unknown:

juice Cohen. We will be bringing you the latest Metaverse, business news and insight into what it

Unknown:

all means. The meta business podcast starts now.

Paul Dawalibi:

From the boardroom to the metaverse. This is the meta business podcast. I am

Paul Dawalibi:

Paul Dawalibi. I'm joined today by my friend and co host, Jeff the juice Cohen. For those of you

Paul Dawalibi:

who are new to the meta business podcast welcome. What we do here is we cover the most pressing,

Paul Dawalibi:

Metaverse, stories and news of the week. We look at all of it through a business and C suite lens,

Paul Dawalibi:

we dissect, we analyze the business implications of everything happening in the metaverse and web

Paul Dawalibi:

three industries. For our regular listeners for the people who have tuned in every single week.

Paul Dawalibi:

This is episode eight. Thank you guys. If you haven't yet, make sure you hit subscribe wherever

Paul Dawalibi:

you get this podcast, your favorite podcast apps, and be watching on YouTube. Wherever you get this.

Paul Dawalibi:

Make sure you hit that subscribe or follow button and tell your friends and family share it. That's

Paul Dawalibi:

the biggest thing we could ask for if you share it with your friends, family colleagues. If you love

Paul Dawalibi:

the content if you enjoy the metaverse content that we're putting out every week, really

Paul Dawalibi:

appreciate if you guys would share it. Jeff, how you doing this week?

Jeff Cohen:

Doing good? Doing good. How about you?

Paul Dawalibi:

Oh, you may have noticed I'm wearing this New Jersey that has that has me on it

Paul Dawalibi:

the profit which was a very nice gift from our, you know, our mutual friend, Jimmy, who, as you

Paul Dawalibi:

guys anyone who listens to this may know co hosts the business of esports podcast with me. But the

Paul Dawalibi:

cool part is it has met a TV on the business of esports on the other sleeve. It's it's pretty

Paul Dawalibi:

decked out I've got the profit on the back.

Jeff Cohen:

Man. I guess me mine. Mine's probably just in the mail. I haven't checked the mail in a

Jeff Cohen:

while. So I actually funny enough. This is gonna sound weird. I am. This is literally Jimmy shirt.

Jeff Cohen:

So Jimmy, Jimmy sent me a couple of shirts in the mail. After one noon. We were out in Vegas one

Jeff Cohen:

night and I told them I liked the shirt he was wearing. And a week later, he asked me for my

Jeff Cohen:

address and he literally sent me four shirts. So so we were both wearing gifts from Jimmy. This is

Jeff Cohen:

not interesting to anyone besides you and Jimmy probably. But yeah,

Paul Dawalibi:

well, it's a good it's a good plug to say. Make sure you guys watch the business of

Paul Dawalibi:

esports or listen to the business of esports podcast also, I will just say good chance that we

Paul Dawalibi:

will all get jerseys like this. We will need meta business merch at some point. But I think I'm the

Paul Dawalibi:

only one that has this right now. I know Jimmy wanted one but doesn't have one like you. And so I

Paul Dawalibi:

think we will have to get that done for everybody at some point. But we need to get into the news

Paul Dawalibi:

because there's a lot of Metaverse news this week. And I think maybe more important than the jersey

Paul Dawalibi:

is the first story here, which is by far the biggest Metaverse news, business news that came

Paul Dawalibi:

out this week, and I'll read the headline here. The headline is cows stuck indoors for winter are

Paul Dawalibi:

getting virtual reality goggles to feel like they're outside. Maybe the best part of this

Paul Dawalibi:

article is a picture. I thought this was photoshopped at first, but it genuinely seems it's

Paul Dawalibi:

quoted as saying this is a cow with VR glasses on. It was taken in by end of December. So you can't

Jeff Cohen:

see the picture. It's also it appears the cow is wearing two separate VR headsets, one

Jeff Cohen:

on each eye, which I have to imagine it's pretty trippy. So one eye thinks it's in one world the

Jeff Cohen:

other eye thinks it's in the other. I mean that is interesting, unless they're I guess they could be

Jeff Cohen:

synced up. Yeah, this is. This is what we were promised.

Paul Dawalibi:

This is this is the metaverse

Jeff Cohen:

technology.

Paul Dawalibi:

I mean, it's it's it's it may be seems like a nothing story. Okay. And maybe people

Paul Dawalibi:

will think we're just being silly. But I genuinely feel like there's a really interesting two

Paul Dawalibi:

discussion to be had here. Because everyone talks about the metaverse from a gaming perspective,

Paul Dawalibi:

right? That's not new. I you know, since Facebook's rebranding, there's a lot of discussion

Paul Dawalibi:

around the metaverse for work from a work perspective, right how it's going to change work.

Paul Dawalibi:

But I feel like there's there hasn't been a lot of discussion around all of like the ancillary kind

Paul Dawalibi:

of metaphors benefits if you want to call that. And and this is just one of those that I'm going

Paul Dawalibi:

well, this is so clever, and I feel like there are probably human benefits that are that like that

Paul Dawalibi:

are similar to this right. Like the headline is that the idea is that cows that are stuck indoors

Paul Dawalibi:

for winter, I guess they produce better milk, more milk if they're less stressed, right? And if they

Paul Dawalibi:

feel like they're outside that that'll make them less stressed. How was this Different than, like,

Paul Dawalibi:

human beings. And when we talk about mental health and things like that,

Jeff Cohen:

it's I mean, it's absolutely a great point, I do wonder if maybe it's a little

Jeff Cohen:

different that the human would know they're in VR, whereas the cow may may really be tricked to

Jeff Cohen:

thinking that they're, they're in, you know, a different pasture. But besides that, I mean, there

Jeff Cohen:

certainly can be other benefits. I mean, we've talked on a live stream many times about potential

Jeff Cohen:

military, you know, training exercises, doctors, like, you know, you don't want your doctor to be

Jeff Cohen:

doing his first open heart surgery on you as the patient. But if it's, you know, he's doing it in

Jeff Cohen:

VR, that's a great way to practice and learn. So there definitely are and and this is all stuff

Jeff Cohen:

that's, you know, that is happening. So there definitely are a ton of different uses for I

Jeff Cohen:

guess, what we would consider VR and also, you know, you could kind of expand that to be the

Jeff Cohen:

metaverse.

Paul Dawalibi:

But I just think again, it's one. It's one of those things where, you know, and I've

Paul Dawalibi:

made I've blogged about this stuff. And I've had discussions around this. And I've sort of made

Paul Dawalibi:

lists in my own head of here are all the industries that the metaverse essentially

Paul Dawalibi:

disrupts, right? Like the meta capital and Metaverse will disrupt, you know, the travel

Paul Dawalibi:

industry, the adult industry, right, like all these other industries that get massively

Paul Dawalibi:

disrupted by the metaverse. But then, you know, one of the ones that was one that was not on my

Paul Dawalibi:

list was agriculture, right? Like, that's not something I had thought of, but you see this real

Paul Dawalibi:

world application with and it's not five years or 10 years from now, right? It's today. And, and

Paul Dawalibi:

that can be big business. Like I think people underestimate how big agriculture is, as an

Paul Dawalibi:

industry. And if you can, you know, if you can make an impact in even in a relatively small way,

Paul Dawalibi:

you're talking about pretty big dollars,

Jeff Cohen:

I think about just just impacting yields, or, you know, any sort of anything, in a

Jeff Cohen:

small way is massive, I mean, look at kind of agrotech like, there's a lot of these these

Jeff Cohen:

things, you know, if you could increase the crop yield by 5%. I mean, that's, that's worth billions

Jeff Cohen:

of dollars. So, you know, if these VR goggles can actually make the cows produce better, or, you

Jeff Cohen:

know, grow faster, you know, that's going to be a massive impact. And it's a fun story, obviously,

Paul Dawalibi:

it's a fun story. But I also I think it's great that we highlight impact on

Paul Dawalibi:

industries that maybe other people aren't thinking about, right, that are not as sexy, not as top of

Paul Dawalibi:

mind. And I wouldn't be surprised, like, again, maybe the cows are fooled, but I think human

Paul Dawalibi:

brains are not, you know, they're obviously more sophisticated. But, you know, your brain is a

Paul Dawalibi:

powerful organ. It can fool your body into into having positive benefits, right? Like I see this

Paul Dawalibi:

translating to human beings. And I know there are app VR apps and things around meditation and

Paul Dawalibi:

things like that. But I love seeing the story. And I love seeing the metaverse sort of creeping into

Paul Dawalibi:

other industries. Jeff, let's, let's you know, let's get a bit more serious here. And we've got

Paul Dawalibi:

three stories back to back. And I, you know, you sent these to me, and I think it was really

Paul Dawalibi:

interesting to see sort of, in one week, three stories in the exact same kind of realm. And then

Paul Dawalibi:

the realm here is NFT marketplaces. So let me just, let me show you the three stories. Let me

Paul Dawalibi:

read the three stories for those of you who are listening, at least the headlines, and then let's

Paul Dawalibi:

discuss them as a group because I think they go together. And, and so the first one here is

Paul Dawalibi:

Gamestop to launch NFT marketplace for gamers. Shares of the beleaguered gaming retailer were up

Paul Dawalibi:

about 20%. In New York pre market trading, this was last Friday. So this is Gamestop coming out

Paul Dawalibi:

with their own NFT marketplace for gamers. Second story is the headline here is game fi NFT

Paul Dawalibi:

marketplace. Lou Tex closes $9 million funding round. The Taiwan based asset marketplace features

Paul Dawalibi:

over 12,000 NF T's across 500 collections. So if you're not noticing the the theme here, it's NFT

Paul Dawalibi:

marketplaces. And then the third story is leading NFT marketplace open sea raises 300 million firms

Paul Dawalibi:

post money valuation tops 13 point 3 billion, they announced that they had raised 30 300 million in a

Paul Dawalibi:

Series C funding round led by paradigm and Cotu that compelled to propel the company to a $13.3

Paul Dawalibi:

billion post money valuation. So we've got three stories, Jeff about NFT marketplaces, some earlier

Paul Dawalibi:

stage, some later stage and in game stops case, this is an established, you know, public company,

Paul Dawalibi:

launching one. I'm curious, just general thoughts on these stories as you've seen them back to back.

Paul Dawalibi:

And maybe sort of the specific question I have is, is this an environment where we're going to see

Paul Dawalibi:

100 winners 10 Winners one winner is it Winner Take All right. So to speak? And what do you how

Paul Dawalibi:

do you feel about the chances of these three kind of competitors?

Jeff Cohen:

It's a bunch of questions. I'll kind of go through a couple of them and then have some,

Jeff Cohen:

you know, maybe some questions to put to volley back to you. Yeah. You know, I do think this is

Jeff Cohen:

going to, there will be a several different winners. I think, right now, open sea is

Jeff Cohen:

definitely the leader in terms of kind of the broad NFT marketplaces. And the way I like to

Jeff Cohen:

think about this and the question I'll pose to you is sort of, you know, on one hand, you have broad

Jeff Cohen:

based kind of, you're trying to be The Everything Store the Amazon, that's kind of what open sea is

Jeff Cohen:

doing. I think that's what you know, FTX is doing that's what Coinbase is looking to launch NFT

Jeff Cohen:

marketplace, and that sort of being like, The Everything Store, you know, the place where if you

Jeff Cohen:

want to buy an NF t you just go there and you know, it'll probably be there. versus sort of the

Jeff Cohen:

niche vertical focused, I think NFT stores, you know, where you have something like NBA top shots

Jeff Cohen:

you have what DraftKings is doing with their DraftKings marketplace? And that's where I think,

Jeff Cohen:

you know, the question I have posed for you with gaming. Where does that fit in? I have my opinion.

Jeff Cohen:

And I kind of want to hear hear yours first. Do you think the ultimate winner? Because I think we

Jeff Cohen:

you and I both agree. You know, we're both big believers in kind of web three in sort of

Jeff Cohen:

blockchain gaming, I do think that there will be at least one massive gaming NFT marketplace. Will

Jeff Cohen:

it be one of these bigger players like an open seat? Or is there room for kind of a vertical

Jeff Cohen:

focused sort of competitor to be that one winner?

Paul Dawalibi:

It's a great question. I'm not convinced that genre specific marketplaces will

Paul Dawalibi:

carve large enough niches to justify the kinds of valuations. Maybe we're seeing now. You know, Lou

Paul Dawalibi:

Tech's raised, you know, according to this article, and I'll bring it back up, raised a $9

Paul Dawalibi:

million seed round, right, like, we're talking, we're talking about the first money in right, the

Paul Dawalibi:

very first dollars $9 million, is a really big seed round. And I know, not so much these days.

Paul Dawalibi:

I'm a little old fashioned in that sense, I guess in this the current world, we live in that more

Paul Dawalibi:

and more normal. But, you know, in a world where in the same week, a direct competitor raise 300

Paul Dawalibi:

million. I question a little bit, the thought process of the investors in the game specific NFT

Paul Dawalibi:

marketplace loot Tex Right. And, and I take my use as a comparison, just ecommerce in general,

Paul Dawalibi:

because fundamentally, we can call them NFT marketplaces, their stores write their storefronts

Paul Dawalibi:

to go by and trade and fts. Amazon has dominated, right, like, there's a reason Gamestop as a

Paul Dawalibi:

specialty vertical retailer has struggled, and yes, you know, they're burdened with physical

Paul Dawalibi:

stores and things like that. But specialty retail, for the most part, has been, has been defeated by

Paul Dawalibi:

Amazon, right? Like, we seem to be in live in a world where everything stores when at least Amazon

Paul Dawalibi:

does

Jeff Cohen:

fair, but I guess the counter example is that you have seen some product categories do

Jeff Cohen:

well, like chewy with pet food and pet supplies Wayfair with, you know, furniture like this sort

Jeff Cohen:

of concept of, you know, growing niches like this happened, I think with eBay, where eBay was sort

Jeff Cohen:

of trying to be, you know, sort of the, the platform for everything. And then you did see a

Jeff Cohen:

bunch of different kind of niches split off. You know, even if you look at Craigslist kind of got

Jeff Cohen:

defeated by Airbnb and some of these more vertical kind of focused things. But I think I think you do

Jeff Cohen:

bring up a good point with with Amazon and kind of having one place wherever one goes, this is

Jeff Cohen:

definitely a network effects. Because we're not talking about physical goods, here, we're talking.

Jeff Cohen:

This is purely network effects. It's like, where do I want to list my NFT, probably the place where

Jeff Cohen:

there's the most buyers, and buyers want to come to the place where there's the most liquidity and

Jeff Cohen:

most things to buy. So you know, we are definitely talking about a network effects driven platform.

Jeff Cohen:

So maybe it is just hey, the one winner, the open see that whoever is the biggest will end up being

Jeff Cohen:

the biggest just because of network effects. But to me, I am more on the side of vertical focus. So

Jeff Cohen:

I do think for games, particularly with the gamer audience, like I just think there's something

Jeff Cohen:

about the branding to gamers like I do think you're going, you know, part of the reason why,

Jeff Cohen:

you know Amazon hasn't won in game distribution, like why do people go to steam versus, you know,

Jeff Cohen:

various other places that they could be buying games? You know, I think there's something to be

Jeff Cohen:

said for gamers wanting their own platform and kind of their own user experience and their own

Jeff Cohen:

marketing. So I'd be a little more bullish on the vertical focus one than maybe you are.

Paul Dawalibi:

I mean, Jeff, the question I have for you is like, or at least the comment I would

Paul Dawalibi:

make is vertical focus to me has has to add some value In some way, right, like, I buy, I would buy

Paul Dawalibi:

furniture from Wayfair instead of from Amazon, because I believe Wayfair knows more about

Paul Dawalibi:

furniture, they, you know, they they don't source anything that's, you know, like such low quality

Paul Dawalibi:

that it's gonna fall apart in the first day. Right? Whereas if I buy furniture on Amazon, maybe

Paul Dawalibi:

I don't know, it's, you know, it's, it's made in China and it falls apart two seconds later, you

Paul Dawalibi:

know, in some ways you go to a vertical, like a highly specialized retailer, because you're

Paul Dawalibi:

getting some value. They're, they're, they're doing some of the thinking for you some of the

Paul Dawalibi:

curation for you. And I'm just not sure that's, that's what's driving the NFT space today, right?

Paul Dawalibi:

It's not like, We need someone to curate it. For us. There's, they're the biggest drops make all

Paul Dawalibi:

the money, right? The biggest artists make the majority of the money. And I think people will go

Paul Dawalibi:

where the biggest drops go, is my cents today. Now, is there is there room five years from now

Paul Dawalibi:

for a specialty sort of marketplace, that's more gamer specific. I buy that. I just don't know if

Paul Dawalibi:

they'll ever become that big, right? Like Wayfair. Compared to Amazon, we're talking at least two

Paul Dawalibi:

orders of magnitude, right? Probably

Jeff Cohen:

more but but but we're still talking about Wayfarer, I think is a multi, you know, at

Jeff Cohen:

least a multi billion dollar company. So there's, there's juice to be squeezed. They're like

Jeff Cohen:

they're, you know, you wouldn't be upset if you created the next Wayfair. No,

Paul Dawalibi:

no. And you know, $9 million seed round tells me there's real commitment around

Paul Dawalibi:

whatever this vision is, right? They have some money. But it's also like, again, if my competitor

Paul Dawalibi:

tomorrow, raise 300 million to go do exactly what I'm doing. I mean, that would keep me up at night,

Paul Dawalibi:

it would also justify what I'm doing. Right? I go, Well, I'm in the right space. So I'm not It's not

Paul Dawalibi:

that I'm down on Lu tech see or what, you know, what they're trying to accomplish? And I think

Paul Dawalibi:

they have to do this. So that's I think the other part of the my the conversation, which is, what

Paul Dawalibi:

choice do they have, right? When you already have two or three, everything stores, you you're not

Paul Dawalibi:

going to be the fourth everything store that definitely doesn't work, you have to specialize.

Paul Dawalibi:

And you hope you carve out a significant enough niche that you have a very profitable business or

Paul Dawalibi:

her that The Everything Store eventually buys you.

Jeff Cohen:

Yeah, which, which Amazon has done, you know, many of you, right? They did with

Jeff Cohen:

diapers, or whatever was called they did it with jet codes. They they've done it with toys, Zappos

Jeff Cohen:

like they. So you know, that is I guess a model where you you create a nice kind of, you know,

Jeff Cohen:

again, Zappos was just selling shoes, Quinsey, just selling diapers, I think it's a baby

Jeff Cohen:

products. And then, you know, the open sea or the, you know, the Amazon, you know, comes in buys

Jeff Cohen:

them. So maybe that is that is part of the approach here. But I think there's an opening,

Jeff Cohen:

like a flank with, you know, discoverability, potentially. And then the only other thing I was

Jeff Cohen:

gonna say why maybe I'm a little more bullish on GameStop. And I kind of had thought I would be,

Jeff Cohen:

you know, because I think when, when people saw this headline at first, with GameStop, there was a

Jeff Cohen:

lot of eye rolling, and it was like, oh, classic, the meme stock, you know, is going after the most

Jeff Cohen:

buzzword possible at the moment, you know, they're never gonna be able to execute on this. And then I

Jeff Cohen:

thought about it a little bit. And, you know, I'm not sure that Gamestop can execute on this, I

Jeff Cohen:

don't know that they have the developers to do so. But if we assume they're able to actually build

Jeff Cohen:

something that's technically sound, I think they have some decent advantages in terms of when

Jeff Cohen:

you're thinking about building a platform, you need a couple things you need, kind of player

Jeff Cohen:

relationships. And I'll call that customer relationships, you need a lot of people coming to

Jeff Cohen:

your site, name recognition, they have that, particularly with the kinds of people right now

Jeff Cohen:

that are into this community of Let's call a spade a spade, it's a little bit of speculation and

Jeff Cohen:

gambling. But guess what they have the community of hundreds of 1000s of quote unquote, apes that

Jeff Cohen:

went and bought their stock and love GameStop. Those are pretty much the exact people that are

Jeff Cohen:

going to go trade and buy on these kind of marketplaces, at least as the early adopters. And

Jeff Cohen:

then to I think, to be a games focused platform here, you're going to need publisher and developer

Jeff Cohen:

support. So you need blockchain games to say, Hey, this is where I'm going to list my NFT. And

Jeff Cohen:

Gamestop has those relationships. So if they execute on this, right, they could be one of the

Jeff Cohen:

few platforms that has the name recognition, sort of the trust, and both sides have that kind of

Jeff Cohen:

platform to bring, you know, to the table to really gain scale quickly. And so yeah, I think

Jeff Cohen:

I'm more bullish than most on the Gamestop NFT announcement.

Paul Dawalibi:

And you know, when you started this thought, I was like, Man, I'm gonna come after

Paul Dawalibi:

Jeff. I'm just I like, I totally disagree with this. Like I get the open sea one. I'm a big fan

Paul Dawalibi:

of, you know, they did over 14 billion in sales of NFT sales on open sea last year, right like this.

Paul Dawalibi:

These are big numbers, big fan of that sort of transaction. Lou Tex, I get it specialty, still a

Paul Dawalibi:

big financing. But you know, I could see where that goes. It was the Gamestop one that I didn't

Paul Dawalibi:

really understand, right that that that was the head scratcher for me. And I was my mind was in a

Paul Dawalibi:

place of like, this is just pumping them, you know, get the apes to pump the stock, which seems

Paul Dawalibi:

to be in line with the nothing else game stops doing right? They, they have this new management,

Paul Dawalibi:

supposedly this new vision, and they've done nothing, right, literally nothing. And then I was

Paul Dawalibi:

trying to find a reason for this NFT marketplace. And when you started on that point, I was about to

Paul Dawalibi:

sort of cut you off and say that you're totally wrong. And then I think Jeff, you made a great

Paul Dawalibi:

point about like, maybe it's the tie in with the publishers, right? Maybe they leverage those

Paul Dawalibi:

relationships. Here's my question to you, though, if you're GameStop, and that is the play. And I

Paul Dawalibi:

think that's a smart play. Now, big question mark, if the publisher still respect them at all? Or if

Paul Dawalibi:

they're still, you know, who knows? Because Gamestop hasn't really been relevant for quite a

Paul Dawalibi:

while now. But if that's the case, why kind of advertise that strategy? Right? Why not? Why are

Paul Dawalibi:

we not seeing, you know, Ryan Cohn come out and be like, Hey, this is what we're doing. This is not

Paul Dawalibi:

just a pump and dump, where this NFT marketplace is gonna fit in with, you know, we're gonna

Paul Dawalibi:

leverage these publisher relationships, we're gonna be the one stop shop for all the big games

Paul Dawalibi:

and FTS, right. Like, one thing.

Jeff Cohen:

Usually, if you're if you're going around saying we're not a pump enough, that's

Jeff Cohen:

usually a sign that you're I think, I think part of it is they like, sort of being sure, and I'm

Jeff Cohen:

totally guessing this, obviously, I think they'd like kind of being shrouded in mystery a little

Jeff Cohen:

bit where I sort of think this Ryan Cohen guy gets off on this a little bit being like this man of

Jeff Cohen:

mystery that the apes follow. And, you know, I am sure if you're an analyst, or you were, you know,

Jeff Cohen:

an real investor in their company, and you talk to them, this right, these guys are smart guys,

Jeff Cohen:

right? They hired a bunch of people from Amazon, that Ryan Cohen, founder of chewy, which was

Jeff Cohen:

obviously an example that we use that someone who sort of Nish attacked Amazon in the past, so has

Jeff Cohen:

sort of expertise of building kind of a digital platform, or an E commerce platform. I would

Jeff Cohen:

imagine if you sat down with him that this is what he would be saying, I think they sort of like

Jeff Cohen:

having kind of this devil may care like a fish attitude a little bit. And maybe they're just not

Jeff Cohen:

good at communicating to investors. I could be either of those, but part of me thinks it's like,

Jeff Cohen:

they're they're a little bit shrewd. I'm giving them a little bit of credit here.

Paul Dawalibi:

Let me let me offer a third explanation is that you're right there, you, you

Paul Dawalibi:

advanced the more clever idea that they've thought of. And so I have my doubts that they've thought

Paul Dawalibi:

of this, I'll do it. Although I do agree. It's a great idea. And if I was them, I would definitely

Paul Dawalibi:

be doing it or thinking about it. The bigger problem to me is, I just suspect they can't do it

Paul Dawalibi:

at this point, that it's a combination of two things, their own market power has eroded, right?

Paul Dawalibi:

They're not as relevant as they used to be to gamers. And so that's like, that's a bit of a,

Paul Dawalibi:

it's a it's a tougher sell. And second, I think the publishers, when they're looking at web three,

Paul Dawalibi:

when they're looking at Metaverse, now when they're looking at all this, call it next gen

Paul Dawalibi:

stuff, right, I think they've most have come to the conclusion that they can figure it out

Paul Dawalibi:

themselves like that. I think they learned the hard way that handing power to marketplaces with

Paul Dawalibi:

games in the past, has not, you know, that they would have been better off going direct to the

Paul Dawalibi:

customer. And I think we're seeing more of an aversion to marketplace, to marketplaces with the

Paul Dawalibi:

big publishers, right, who are all launching their own stores who are all trying to go direct, who

Paul Dawalibi:

are all, you know, have their own services. Now. I suspect most of them do not want to deal with a

Paul Dawalibi:

third party when it comes to NF T's and won't want to deal with the third party.

Jeff Cohen:

That's an absolutely great point as it relates to triple A publishers. But I think as a

Jeff Cohen:

relate because I do think you're right, I don't I don't see, you know, an Activision or an EA

Jeff Cohen:

anytime soon wanting to give up control up what effectively could be an incredibly important

Jeff Cohen:

marketplace and distribution platform. And we've already seen them doing the opposite as as you

Jeff Cohen:

mentioned. But as it as it relates to, you know, these new blockchain games and sort of web three

Jeff Cohen:

gaming, I kind of think it has to be that way. Because I just don't know if gamer, that customer,

Jeff Cohen:

I think doesn't want too much power with the developer. I think they want to be a bit they

Jeff Cohen:

specifically want to be able to take their assets from one game and go sell them on a different

Jeff Cohen:

platform. If they're selling them on the same platform that they bought them. I think that

Jeff Cohen:

almost like it's like disqualifies it immediately from being what they consider in this web three

Jeff Cohen:

ethos.

Paul Dawalibi:

But in this is the point I wanted to sort of close this out on, which is the bigger

Paul Dawalibi:

philosophical question, which I think you've alluded to here, which is, you know, we're talking

Paul Dawalibi:

about a an object in an NFT. That is fundamentally decentralized, right? It's, it's recorded on a

Paul Dawalibi:

blockchain that is decentralized. It's right that the product itself, the object itself, is

Paul Dawalibi:

distributed and decentralized. And then we're trying to like we're having a discussion around

Paul Dawalibi:

very centralized kind of like monolithic marketplaces, where all of this still has to

Paul Dawalibi:

happen. It seems philosophically like at odds with the the, the ethos and the thinking behind NF T's

Paul Dawalibi:

in the first place. I'm

Jeff Cohen:

sure you saw this became like a big sort of theme on Twitter over the last couple of

Jeff Cohen:

weeks with like Jack Dorsey. And I forget who he was kind of arguing back and forth with basically,

Jeff Cohen:

you know, the argument was like, Who owns web three? And it's like, can you really say web three

Jeff Cohen:

is decentralized, if something like open sea, you know, is owned by venture capitalists, and just

Jeff Cohen:

took $300 million from coke to which the massive hedge fund so it's like, Who is it really

Jeff Cohen:

decentralized? If it's, like you just said, owned by one monolithic platform, and that monolithic

Jeff Cohen:

platform is owned by the same people owned web do?

Paul Dawalibi:

I don't know. It was a question I love. I look, I'd love feedback from our listeners

Paul Dawalibi:

on this one, just what do they think in terms of what do you guys think in terms of, you know,

Paul Dawalibi:

fundamentally decentralized kind of a product's objects being at odds with completely centralized

Paul Dawalibi:

and monolithic marketplaces that have clear ownership and things like that? So it's a power

Paul Dawalibi:

struggle, I think we haven't seen the end of and and I'm, I am curious how it plays out. And I'm

Paul Dawalibi:

curious, what are you know, listeners think about it. Jeff, let's move on. Because there's a story

Paul Dawalibi:

here, which also very interesting. And you know, I'll say sort of a fringe Metaverse story here.

Paul Dawalibi:

And the headline here is, this is from Forbes. The headline is fan controlled Football League raises

Paul Dawalibi:

40 million Series A round led by cryptocurrency investors. And and so for those of you don't know,

Paul Dawalibi:

fan controlled football, it's exactly what it is. But what they says it is, I think it's seven on

Paul Dawalibi:

seven football, where the spectators you the fan can make decisions in terms of the play that's

Paul Dawalibi:

called in terms of the players that are drafted, right, like you have some level of control over

Paul Dawalibi:

what goes on on the field. And and they've raised a bunch of money now from Animoca brands and

Paul Dawalibi:

Delphi, digital, both VCs that specialize in cryptocurrency investments. And let me just be

Paul Dawalibi:

clear here what the thing they're doing. That is crypto or web three related is they are going to

Paul Dawalibi:

be minting I think, yeah, they're gonna launch 8888 NF T's related to the four new franchises

Paul Dawalibi:

that are that are that are coming out. And people who purchase the NF T's will become fans of the

Paul Dawalibi:

team and have a chance to draft players choose plays and receive other perks. So NF T's I guess

Paul Dawalibi:

as as as a method of owning and having influence over these new franchises. I'm curious, what are

Paul Dawalibi:

your I know, Jeff, you're a football fan. What do you think of fan controlled football? And they're

Paul Dawalibi:

sort of tie in with crypto and NF T's and the metaverse here.

Jeff Cohen:

I I actually really like it. You know, so I had been pretty bearish on fan controlled

Jeff Cohen:

football previously. Mostly because any any Football League that has tried to start, that

Jeff Cohen:

wasn't the NFL has basically failed for the last 30 years, you know, the XFL, twice USFL once the

Jeff Cohen:

one they tried last year that failed, the one they're doing this year that I guarantee was also

Jeff Cohen:

gonna fail this one prior to this, you know, resuscitation via crypto. So none of them none of

Jeff Cohen:

them have worked. That's that's sort of not not the point of the story here. I think the crypto

Jeff Cohen:

angle and sort of the NFT angle is interesting. Because it gives one you know it's it's pretty

Jeff Cohen:

amazing decentralization the fact that you're sort of giving up ownership of these teams to to the

Jeff Cohen:

players kind of almost in a in a dowel like function. To me, I think that's really

Jeff Cohen:

interesting. And just to be a fascinating sort of social experiment. And I like that all of them

Jeff Cohen:

have sort of like popular crypto personalities behind them like I saw on the article. One of them

Jeff Cohen:

was owned by Steve Aoki and other ones owned by Marshawn Lynch and various different

Jeff Cohen:

personalities, I think, you know, could potentially grow to have almost like a board a

Jeff Cohen:

yacht club type following, you know, if this gets to, you know, a further extent so I think that's

Jeff Cohen:

pretty cool. Also, as someone who's a big Madden fan, I love the idea of being able to call plays

Jeff Cohen:

and then watch them happen on the field. I've always every time I watch a football game, I think

Jeff Cohen:

I can be better than than the coaches. I think it's a cool thing that you know, you'll be able to

Jeff Cohen:

do that. Also. I like that it's perfectly to how much of the NFT you own. So it's like if you

Jeff Cohen:

theoretically on 51% of the NFT, you can control the game, you're literally the coach or the the

Jeff Cohen:

owner of the team. And you're essentially controlling the players on the field. I think

Jeff Cohen:

that's, you know, that and of itself is pretty cool and can drive some some value to these coins.

Jeff Cohen:

I'm curious how long it's going to be until we see an esports League do this, because to me, this is

Jeff Cohen:

essentially, a lot of this can be done with esports. You know, right now you're just doing it

Jeff Cohen:

with players like actual human being players, rather than digital players. But a lot of these

Jeff Cohen:

same concepts could could easily work with esports. That are those those are some of my

Jeff Cohen:

musings. But I'm curious what you think.

Paul Dawalibi:

No question. Let me just, there was one quote from this, which I want to hone in on.

Paul Dawalibi:

And I'm curious, specifically what you think on it, because I have some thoughts. And the quote

Paul Dawalibi:

is, this was from a partner at lightspeed venture capital. And this they're the VC firm that led

Paul Dawalibi:

FCFS fan control football seed round. And they participated in this current Series A round. And

Paul Dawalibi:

and he is quoted as saying, there's a ton of overlap of crypto enthusiast, as sports and sports

Paul Dawalibi:

fans. It's definitely a big Venn diagram overlap, that specifically stood out for me, because I'm

Paul Dawalibi:

not I wasn't sure if that was actually true. You know, we've had these discussions on business of

Paul Dawalibi:

esports, around overlap of esports fans and sports fans, and overlap of esports fans in crypto. And

Paul Dawalibi:

there's very strong overlap between esport like gamers and crypto very strong. But gamers and

Paul Dawalibi:

sports fans, there's not a lot of overlap. So like by what is it the it's true? Like what is the the

Paul Dawalibi:

transitive mathematical trillia? Transitive Property? Whatever, right? Like, I'm not convinced

Paul Dawalibi:

that crypto and sports, there's a ton of overlap here. So while I buy kind of the the premise, and

Paul Dawalibi:

I think it's cool, personally, right? Is there enough interest from sports fans for this kind of

Paul Dawalibi:

tie in?

Jeff Cohen:

So I'm not sure I've seen the data. But I do think anecdotally we've seen enough in

Jeff Cohen:

whether it's, you know, the Staples Center in LA was just renamed crypto comm center FTX invested

Jeff Cohen:

in, they renamed I think, the Miami Heat or so like, true, I sure there's enough and to be fair,

Jeff Cohen:

that could all just be driven by someone said this quote. And it's like now become a truism. Like,

Jeff Cohen:

Oh, of course, there's overlap between sports. But I imagine there's some sort of YouGov type data

Jeff Cohen:

source out there. That's that sort of informing all these investments, because we have seen a lot,

Jeff Cohen:

and a lot of athletes are taking, you know, doing investments in crypto, or sorry, getting

Jeff Cohen:

investments in crypto, and, you know, Tom Brady's a sponsor of FTX, stuff like that. So my guess is

Jeff Cohen:

that there is some data out there that showing that this is true. And it's not just everyone got

Jeff Cohen:

up believing this myth, but I have not seen the data.

Paul Dawalibi:

And then might the second sort of thought I had which, and you alluded to it a

Paul Dawalibi:

little bit, which is like, this is childhood dream, right? It's like, in some ways, it's like

Paul Dawalibi:

Madden, but in real life. But but then the metaverse sort of the the metaverse Prophet in me

Paul Dawalibi:

says, Why do we need the real life component then? Right? Like, fundamentally, couldn't we just do

Paul Dawalibi:

all of this digitally? Right, it could just be fan controlled Madden, which is basically just Madden.

Paul Dawalibi:

And this is where from a business standpoint, I'm not sure if fan controlled football survives long

Paul Dawalibi:

term, right? It feels a little bit like a and I think that we're gonna see a lot of this where the

Paul Dawalibi:

metaverse, we know that and we all talk about capital M is going to be massively disruptive to a

Paul Dawalibi:

lot of things. And there will be sort of like these middle steps, right, these sort of these,

Paul Dawalibi:

these not it's not the eventual, let's not the last step, it's not the first step. It's sort of

Paul Dawalibi:

the small steps in between that you forget about. And this feels a little bit like that. And, and

Paul Dawalibi:

I'm sure that will be a theme in other podcasts where we see these kind of middle steps that get

Paul Dawalibi:

disintermediated as technology gets better and go away, like, at some point, VR football is going to

Paul Dawalibi:

be so good that why would we have fan control, you know, with human players and things like this,

Paul Dawalibi:

like why wouldn't we just do it all digitally or something like that? I just don't see it as a

Paul Dawalibi:

viable business long term. And the NFT thing feels well, I get the point. Feels a little bit forced

Paul Dawalibi:

to me here. Right. This is one of those things where it feels like we'll glom this on and, and

Paul Dawalibi:

now it's attractive to investors because fundamentally, they could have done this without

Paul Dawalibi:

NF T's Right? Like they didn't need NF T's to do what they're to do what they're doing

Jeff Cohen:

here. Well, some would argue that that's the case for any Anything with NF T's like

Jeff Cohen:

you rarely need decentralized blockchain technology. It's just the, you know, the pipes.

Jeff Cohen:

But I think I don't disagree with you, this probably probably won't work. I am, like I said

Jeff Cohen:

more bullish on this than I was about fan control football, I still don't really I probably wouldn't

Jeff Cohen:

be buying some of these tokens, just in my own personal money, but I am more bullish on it. I

Jeff Cohen:

will say though, just to give them some credit, in terms of NFT projects we've seen, like crossovers

Jeff Cohen:

between NFT and sports, this is one of the more interesting ones and the NFT does get you

Jeff Cohen:

something, right, like the fact that if I buy enough in the NFT, I could sit there on a Saturday

Jeff Cohen:

morning and literally call the plays that, you know, Johnny Football goes and goes out and does.

Jeff Cohen:

That, to me is a heck of a lot more interesting than buying an NBA Top Shot where it's just like,

Jeff Cohen:

Oh, I'm watching like a JPEG of someone shooting a free throw like that, you know, to me like that,

Jeff Cohen:

that never made sense to me. Like there was not a ton of value there. Whereas this, I do see there

Jeff Cohen:

some value. I think there will then be a next step where it gets even more interesting. And maybe

Jeff Cohen:

it's having to do with esports maybe it's disintermediating, the physical players, something

Jeff Cohen:

like that. But I do think it's a positive step in the right direction. And it's interesting for kind

Jeff Cohen:

of the sports Metaverse esports media scene to pay attention to it's an interesting experiment if

Jeff Cohen:

nothing else.

Paul Dawalibi:

I agree. 100% You're right. You make a great point, which I hadn't, you know, I

Paul Dawalibi:

hadn't thought of it's definitely better than an NBA top shot like that. No question. This is more

Paul Dawalibi:

interesting. You there's some utility here, right? I come back to that point of like, well, there's

Paul Dawalibi:

utility at least. It just, it feels like an intermediate step for me that that's the right

Paul Dawalibi:

word like it feels like a stepping stone to something bigger and better and more interesting

Paul Dawalibi:

and more true. metaverse. I guess, Jeff, that wraps up this week's podcast man that flew by

Paul Dawalibi:

show.

Jeff Cohen:

That's the one yet best one yet.

Paul Dawalibi:

For those of you who are enjoying this content, please just tell others tell your

Paul Dawalibi:

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Paul Dawalibi:

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Paul Dawalibi:

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Paul Dawalibi:

They drop every Monday. And we thank you guys for tuning in every week. We welcome your feedback if

Paul Dawalibi:

you're loving the show, Jeff thank you as always. We will see you guys next week.

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About the Podcast

META Business
From the metaverse to the boardroom...
Meta Business tackles the most important Metaverse industry news. Business experts dissect and discuss all of the hottest topics and happenings, from a unique C-suite perspective.

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Paul Dawalibi