On March 10th, 2022, I was contacted by Joe Castaldo, a business reporter for The Globe and Mail (which bills itself as “Canada’s National Newspaper”). He was writing up a story about businesses entering the metaverse, and the current metaverse hype cycle, and he asked me if I would be willing to be interviewed.
After checking in with my union representatives at the university, who gave me the all-clear to go ahead, I was interviewed for an hour via telephone. The Globe and Mail had given Joe a Meta Quest 2 wireless VR headset, so a couple of weeks later, I gave him a guided tour of two popular social VR platforms, VRChat and AltspaceVR.
I’m not going to reproduce the entire newspaper article here; I was mentioned in the final few paragraphs:
For Ryan Schultz, the widespread interest in the metaverse is a little weird. “My obscure, niche hobby has suddenly gone mainstream,” he told me. A reference librarian with the University of Manitoba, he spends a few hours every week strapped into a headset or exploring desktop-based worlds, and has been blogging about it for years.
Mr. Schultz finds the speculative nature of the digital land rush in some worlds off-putting. “People are investing in this basically as a flex and as a boast to their friends that they can afford these artificially limited items,” he said. Businesses with virtual office space, meanwhile, are likely spending money on a “really fancy three-dimensional brochure.”
He’s seen much of it before. Corporations flocked to Second Life when it took off in the 2000s. Coca-Cola installed soft drink machines, Toyota set up a car dealership, American Apparel built a clothing store, and IBM established an island for employee recruitment and training.
It wasn’t long before the corporate enthusiasm died. “Nobody came to visit these locations, because the people who were already in Second Life didn’t care,” Mr. Schultz said.
For those of us who are not already immersed, such moments are likely a long way off. I searched high and low for meaning and connection in the metaverse, but mostly found empty branding experiences, a speculative frenzy around digital assets, and people who were just as curious as I was to find out what this was all about, and were still searching for answers.
But given the relentless enthusiasm of those trying to turn the metaverse into some kind of reality, there will be plenty of chances to try again, for better or worse.
I think that Joe did a good job of describing the metaverse in a way that newspaper readers could easily understand, and there are a couple of videos included in the digital version of the article which made me laugh at certain points, as Joe and his producer Patrick Dell navigated Decentraland and Horizon Worlds!
(By the way, I do receive more and more requests to be interviewed lately, because of my blog. I turn most of them down, but I said yes to this one, because The Globe and Mail is a major Canadian newspaper, and one which I read often.)
MVFW, which starts this Thursday 24 March on virtual real estate platform Decentraland, is the largest digital fashion event to date. It is open to anyone, and a full schedule will appear online. Ongoing events throughout a four-day period include a handful of shows, alongside showrooms, stores, panels, virtual parties and NFT drops. It’s also become a major crossover event for mainstream fashion, with brands including Paco Rabanne, Dolce & Gabbana, Etro, Tommy Hilfiger, Dundas and Cavalli set to join digital firms such as Auroboros and DressX.
Where many see regulatory murkiness, the five-year-old, New York-based investing platform Republic sees opportunity. Indeed, while many outfits grapple with whether to distance themselves from certain digital assets, Republic — whose CEO, Kendrick Nguyen, started his career in securities litigation with Goodwin Procter — has focused from the start on establishing itself as a go-to brand for what Nguyen calls “compliant tokenization.”
Just today, the company is announcing a $150 million Series B round led by Valor Equity Partners, which follows a $36 million Series A round that the company announced in March from Galaxy Interactive, Motley Fool Ventures, HOF Capital, Tribe Capital and CoinFund. (Those earlier investors just re-upped, by the way, and were joined by new backers Pillar VC, Brevan Howard, GoldenTree and Atreides.)
Altogether, says Nguyen, Republic, which employs 200 people, had raised more than $50 million in equity financing ahead of this newest round, and more than $20 million in a token sale.
The outfit is certainly busy putting it all to work. Republic already comprises several different business arms, including a popular retail investment platform that invites people to invest with as little as $10; a private capital division with almost $1 billion in assets under management that funnels accredited investors into startups; and a blockchain consultancy arm that provides technical, financing, distribution and tokenization services.
Republic also right now has two affiliated closed-end investment funds deploying capital into startups and crypto projects, along with a digital investment arm operating as Republic Realm that focuses exclusively on metaverses and NFTs.
Over 100 metaverse real estate developments (including the Metajuku shopping district in Decentraland)
It’s clear that Everyrealm has serious money to spend (they’ve already raised US$60 million), and they intend to invest it in a variety of metaverse platforms! Anita reports:
Everyrealm hopes to become “the gateway to the entire metaverse ecosystem,” according to the company. It is invested in 25 different metaverses and owns 3,000+ NFTs today, Yorio said.
“We started out investing [in the metaverse], but we’ve since expanded our mandate to do a lot more than that. We see ourselves as developers of metaverse content, so we don’t just passively invest and sit back and wait for other people to build things,” Yorio said. The company has built on top of many of its virtual properties — for example, it launched a retail store concept in Decentraland two weeks ago, which it plans to expand into other metaverse platforms, Yorio said. Indeed, 10,000 virtual items in the store sold out in the span of an hour, she added.
Apparently, they have set up a virtual campus in the blockchain-based social VR platform Somnium Space, and Somnium Space CEO Artur Sychov himself will be teaching “a class at the Academy about VR and the future of the metaverse:”
Tuition for four weeks, which includes a “limited edition Republic Realm Academy NFT Tuition Badge”, which will “be your campus ID card and unlock all Republic Realm Academy resources and initiatives at the start of the term”, six online courses, plus “limited office hours with professors, subject to availability”, costs US$1,000…
Let’s face it: it’s to Cathy’s and Artur’s and so many other people’s advantage to sell (and yes, I deliberately use the word sell) as many people as they can on this frankly blinkered perspective on the metaverse—even to the point of offering thousand-dollar certificates for things could probably be learned just as easily from others for free! The overall messaging here is that the non-blockchain-based metaverse platforms which predate this boom in artificially-scarce NFT-based real estate are simply not worth bothering with or investing in.
Well, I now publicly will eat some crow, because buried in Anita’s TechCrunch report is the following news nugget:
Everyrealm also operates a virtual educational campus called Realm Academy in the Somnium Space metaverse, where users can learn more about web3 concepts through online courses. Its inaugural class has 500 students who have paid $1,000 each to attend, Yorio said.
If Janine Yorio is to be believed (and frankly, I have zero reason to doubt her), Everyrealm cleared 500 x US1,000 = US$500,000 from the first offering of their six-course educational program. That’s right—a cool half-million dollars! I guess I was seriously wrong about people not being interested in signing up for their courses, and I am willing to admit that I was wrong. Hey, it does happen—sometimes… 😉
Check out this video sneak peek of what to expect on the runway. Video Production by Vrutega.
Irritatingly, the above link to “several runway shows scheduled throughout this week” only takes you to the sim where the events are taking place, but without the details of when they were happening! Fortunately, Inara Pey has all the details in a detailed write-up on her blog:
The individual in question is New York fashion designer and 2015 CFDA/Vogue Fashion Fund winner, Jonathan Simkhai. As a part of the New York Fashion Week event, he offered a special preview of some of his designs from his Autumn / Winter 2022 (AW22) collection at a special fashion show that took place in Second Life.
In all 11 pieces from the collection have been visualised for Second Life by none other than Mishi McDuff (aka Blueberryxx), founder and owner of SL’s popular Blueberry brand (and, I will admit, one of my go-to designers on the admittedly rare occasions I feel I need to spruce up my virtual wardrobe). In bringing the designs to SL, Blueberry has also given them a special “metaverse flair” – utilising the unique advantages of the digital world to offer twists to some of the items that cannot be replicated in the physical world – such as a sequined dress that gradually loses its embellishments and morphs into a bodysuit as the model walks the runway.
The items were presented to an invited audience of models, influencers, celebrities, and journalists from the fashion, technology and lifestyle industries. They had the opportunity to see the virtual items ahead of Simkhai presenting their physical world equivalents on the New York catwalk, so the guests could witness the virtual garments and their unique properties up close – and even try them on.
I think that this is a brilliant move by Everyrealm. Why? Because none of the NFT metaverse platforms they currently invest in (Decentraland, Somnium Space, Axie Infinity, etc.) have anything which compares to the mature, fully-evolved dressable avatar system which has evolved over the 18+ years of the history of Second Life! Here’s one of the pictures used in the (unfortunately paywalled) Vogue Business article:
This may sound like something straight out of 2006-2008, when many physical world brands tried to hop into SL in the belief it would magically allow them to grow their market influence, but actually it isn’t. The Simkhai / Blueberry relationship is far more symbiotic and engaging, and for two reasons.
The first is that as well as being presented to invited guests, the Second Life Simkhai collection will be the subject of a series of catwalk shows open to Second Life residents on Thursday February 17th / Friday February 18th, with shows set hourly from 13:00 through 16:00 (inclusive – see the Destination Guide link at the end of this article). Not only will these serve to show the designs to the Second Life community, they will also – according to Vogue’s Maghan McDowell – allow SL users to purchase them at around L$1,000 per item.
These NFTs, which cost anywhere from US$200-600 apiece, confer the following “benefits” (please note that this does not apply to sales within Second Life; as mentioned earlier, SL versions of these virtual garments, made in association with well-known womenswear designer Blueberry, will cost about L$1,000 each, a relative bargain!):
Ability to wear Jonathan Simkhai NFT wearables as your avatar in the metaverse
Access to future Everyrealm digital wearables activations
Whitelisting for future digital wearables drops
Keep in mind that your ability to actually wear these garments on your avatar in the various NFT metaverse platforms is heavily dependent upon the ability of the various companies building those platforms to support it (I can guarantee you that the lovely Lucee dress shown above will not look nearly as sparkly on the current crop of Decentraland avatars, for example, let alone the voxel-based blockchain-based platforms like Cryptovoxels and The Sandbox!)
Therefore, many of these “benefits”, like so much for sale in this current season of blockchain, crypto, and NFT-based metaverse madness, are essentially the opportunity to flex and/or gloat to your friends…and to be first in line for the next line-up of expensive NFT-based avatar wearables!
However, I do have to hand it to Everyrealm. The company is certainly putting its money where its mouth is, and they are making a significant splash in the metaverse in a short time. I honestly cannot think of another firm which has its fingers in so many metaverse pies, all at the same time! More power to them.
As I often say on my blog, “a rising tide lifts all boats,” and Everyrealm is attracting big money (and attention) to the ever-evolving and mutating metaverse! Who knows, maybe Second Life will be home to a few more fashion shows linked to real-world, big-name designers? As we can see, there’s still a valuable place for older, non-NFT-based metaverse platforms like SL in this season of the NFT metaverse!
2022 is promising to be a very interesting year, I predict! Stay tuned! I leave you with this (undated) writeup by David Murphy of MobileMarketing:
Metaverse Fashion Week, an event produced by Everyrealm and Blueberry Entertainment, took place yesterday, featuring Jonathan Simkhai as the debut designer. The event occurred day prior to the physical Jonathan Simkhai 2022 presentation at New York Fashion Week, making the real-world designer the first ever to show it’s Fall/Winter 2022 digital wearables collection ahead of their physical counterparts…
Guest took their seats in the larger-than-life bespoke set made specifically for the fashion event in the Second Life metaverse. The secluded location was inspired by natural elements such as rock, water, air, and fire. Simkhai’s latest collection was showcased on the avatar models during the 8-minute presentation. Simkhai debuted 11 designs from his Fall/Winter 2022 collection, which were digitally reimagined for the Metaverse.
The garments are converted from the real-world version into 3D digital models using design software and video gaming technology. The Second Life Marketplace has been selling digital clothing and accessories from Blueberry since 2011. Wearables and clothing are among the most popular types of commerce in Second Life’s $650m dollar virtual economy.
Founded by Mishi McDuff in 2012 as a solo creator on Second Life, Blueberry has sold more than 20m on digital wearables, amassed a library of more than 10,000 digital SKUs optimized for hundreds of design attributes, and scaled an engaged community of loyal customers. Blueberry is already live on multiple metaverse platforms, and is actively expanding its brand and community to other web 2.0 and 3.0 metaverses.
Mario Gabriele is the founder and editor of The Generalist, a self-described “free newsletter for deep thinkers, serious builders, and imaginative investors”, with over 53,000 subscribers. On January 9th, 2022, Mario wrote a long and wide-ranging article (what he calls one of his “briefings”) about one of the very first blockchain-based virtual world projects, Decentraland (which is, of course, of interest to me!).
I found what Mario had to say so interesting that I wanted to write this blogpost to bring wider attention to his article, which os titled Decentraland: The Metaverse’s Early Mover. One of things I found unique about this article is that Mario really does his homework, delving into the early history of Decentraland and interviewing many key people associated with the project in one way or another. Also, he isn’t afraid to level criticism of the project. This is not some breathless fan-boy take; I enjoyed his writing because it is a multi-faceted, critical inspection of the Decentraland project to date, combined with some analysis of what it all means, including a few educated guesses about the future. And even if you are not all that interested in Decentraland per se, he also touches on other worlds, such as The Sandbox. I learned a lot from reading this, and I suspect you will as well.
I’m going to suggest you to go over to The Generalist and read it in full, but I will pull out and comment on a few quotes which interested me. For example, Mario does a better than anybody else I know in painting a picture of what the early days of the Decentraland start-up were like:
In 2011, Manuel Araoz was a computer science student at ITBA, a university called “Argentina’s MIT.” As part of a cryptography class, he discovered Satoshi Nakamoto’s bitcoin whitepaper. Argentina’s past two decades had been marked by economic volatility and rapid currency devaluation, giving tangible power to Nakamoto’s words. Araoz was transfixed…
Araoz set about trying to make his dent in the new realm, launching “Proof of Existence” (POE), billed as the “first-ever non-financial blockchain application.” POE acts as a notary, allowing anyone to “prove” a document exists by adding an encrypted “digest” of it to the blockchain, where it is timestamped. As its site notes, this is the “first online service allowing you to publicly prove that you have certain information without revealing the data or yourself.”
Araoz also joined BitPay, then a bitcoin payments business. As a technical lead, his remit included opening an office in Buenos Aires. He picked a two-story house in Palermo Hollywood.
Populated by BitPay engineers, friends from ITBA, and other early crypto obsessives, “Voltaire House” quickly became a place for deep thinkers to gather. In researching this piece, I got to speak to several former residents and visitors, including Esteban Ordano, one of Decentraland’s founders.
Voltaire House became the incubator for a number of blockchain projects. In 2015, Voltaire House’s resident purchased their first VR headset, an HTC Vive, which “opened their eyes to the potential of spatial experiences”. From this sprung the idea of Decentraland.
Mario discusses Decentraland’s crazy Initial Coin Offering (ICO), and in particular discusses how Mark Zuckerberg’s keynote address in October 2021 marked a significant turning point for Decentraland and countless other projects, writing:
From one month to the next, Decentraland’s MAUs nearly tripled. The price of MANA went very nearly vertical, jolting from $0.75 to $3.56 and eventually closing in on $5.50.
Decentraland’s fully diluted market cap jumped from $1.6 billion to more than $7 billion in four days, effectively increasing its size from 1-800-FLOWERS to The New York Times over the equivalent of a long weekend. Since that leap, MANA has retreated, along with many other tokens, but it is still multiples higher than before Meta’s announcement.
One of the best parts of Mario’s article is where he creates an avatar and goes exploring!
Over the past week, I’ve used Sutherland [the name of Mario’s avatar] to tour as much of Decentraland’s world as possible. We’ve fallen down the fountain in “Genesis Plaza,” hit up the casinos in Vegas City, stumbled across a Pride Parade, mined fallen asteroids in exchange for gems, gone to the stables, gawked at swirling spiral homes, browsed art at a Sotheby’s gallery, and tried to fly a dragon. We made it about ten feet before crashing into a wall.
I have also walked around empty lots and whole neighborhoods without a soul in sight. At around noon on a Tuesday, I stood in Frankie’s Tavern, a virtual dive bar, watching a music video alone. After hearing about District X, Decentraland’s red-light district, I fruitlessly searched for brothels that apparently exist. I hoped to interview the most modern members of the world’s oldest profession. (How does this work? What do people buy? Is VR involved? Is the money good?). Though a failure, I did stumble across “Waifu HQ,” a confusing monument to female anime characters featuring a scantily clad breakdancer.
I had a good chuckle at Mario/Sutherland trying to find escorts in Decentraland! Oh, honey, if you are looking for sex in Decentraland, you are going about this all wrong! 😉
He goes on to write:
Were these outings enjoyable? Sort of, though spending time in Decentraland feels more interesting than fun, per se. Despite spending several hours in the world, I didn’t find a game or activity that captured my attention for more than a few minutes. There is no addictive dopamine vortex pulling me back in against my better judgment.
I suspect I would feel differently if I were an enthusiastic or competent gambler. Across my various visits, Decentraland’s casinos were almost always the best-trafficked locations. Decentral Games run many, a startup that has raised a reported $5 million from investors like Digital Currency Group and operates as a DAO. Its locations include Chateau Satoshi, The Aquarium, and the Bored Ape Yacht Club, a riverboat casino.
The result was that I experienced Decentraland similarly to Las Vegas, interesting as an anthropological study even if not a true pleasure trip.
The comparison between Decentraland and Las Vegas is very apt!
Mario also talks about companies such as Ed Radion’s Squiggle School, which was founded to help teach people how to create content in both Decentraland and The Sandbox. Ed is quoted by Mario: “We’re all-in on The Sandbox. Their no-code game engine and design tool are easy to pick up, meaning the ecosystem will have more fun experiences than Decentraland…Decentraland struggles to engage non-landowners because their experiences have to be built in production-grade tools (Blender, Unity). Most people don’t have a clue how to do that or have the time to learn how.”
Mario also looks under the hood, talking about Decentraland’s three-layer protocol and peer-to-peer architecture in an accessible, easy-to-understand way. He also discusses the project’s Decentralized Autonomous Organization (DAO):
In early 2020, Decentraland completed one of its initial goals – to hand control of the project over to its community. It did so by formalizing a DAO and handing it power over the essential smart contracts controlling LAND, wearables, the marketplace, and more. If these were ever to change, it would be because the community voted for it, not because a single developer decided it was a good idea.
Near the end of his report, Mario compares Decentraland to Roblox, talks a bit about Meta, and even namedrops a few competitor platforms already (or soon to be) in operation, mentioning The Sandbox, Cryptovoxels, and Somnium Space (all of which I have written about previously). He adds:
Which means, I have a whole new bunch of blockchain-based virtual worlds to explore and write about!
In summary, Mario Gabriele has provided a well-written, insightful deep dive into the past history, current value, and potential future of Decentraland. If you want to learn more about Mario and his thoughts on a variety of tech topics, you can join his free mailing list via his website The Generalist, or follow him on Twitter (I just did!).
I do have a number of other thinkers whom I have been following on various social media in the virtual worlds, social VR, and metaverse space, and I hope to introduce you to more of these people over time (as well as any new metaverse platforms I come across in my travels!).