Gary Vaynerchuk, otherwise known as GaryVee, has never shied away from trailblazing new internet technologies. From his internet ventures in the early 2000s to pioneering a large NFT project in 2021, he has a long track record of recognizing the value of emerging technologies.
In 2021, Gary launched his VeeFriends project — a collection of 10,255 NFTs containing hand-drawn pictures (by Gary himself) of animals. The drawings remind us of something a grade school student might draw in art class. Gary doesn’t claim to be a professional artist, so why do VeeFriends sell tens or hundreds of thousands of dollars?
Simple — the value of the NFTs are not in their artwork but in the utility that the holder receives by owning the token.
All VeeFriends token owners get admission to VeeCon — a multi-day, multi-year conference that focuses on business and entrepreneurship in the Web3 space. Depending on the token that you own, token owners may also be entitled to additional access to speakers at the event.
Some value of the rarer tokens can be attributed to their rarity within the project, but most of the value is tied to the utility backing the token.
After conducting a case study on this project, we’ve come to the following conclusions.
VeeCon is a conference about Web3, and it makes sense that they use NFTs instead of traditional tickets. However, issuing tickets as NFTs ultimately benefits GaryVee’s supporters.
Let’s say you drop several hundred dollars on a multi-day pass to a conference and later find out that you’re unable to attend. Maybe you got sick. Or may something came up that’s more important. Unlike concerts, most conferences do not have a way to resell or even get a refund for tickets once they’ve been purchased.
Because VeeFriends are NFTs, ticket holders now can sell their tokens, whether they no longer want to attend or want to capitalize on the price appreciation of their ticket, to anyone with an Ethereum wallet.
Many ticketholders have benefitted enormously since minting their VeeFriends token — something that we believe is a key benefit to selling utility through NFTs.
If someone wants to resell their VeeFriend, they have the freedom to choose the platform they wish to offer their token.
Ticket resale platforms like Ticketmaster charge notoriously-high fees to both the buyer and the seller. It is not uncommon to see these platforms hold on to 30% of the proceeds from a ticket sale. VeeFriends holders don’t have this problem as NFT marketplaces are usually significantly cheaper.
Not only do GaryVee supporters benefit from these tickets being sold as NFTs, but so does GaryVee.
We’ve written about the importance of content creators building multiple revenue streams and see VeeFriends as a price example of how this works.
Let’s start with the initial sale. When Gary released this project in 2021, he effectively presold tickets for three years’ worth of events at once (each token covers 2022, 2023, and 2024 VeeCon). This allowed him to get the up-front investment he needed to pay for the event and ensured that VeeFriends holders were incentivized to attend.
Now, let’s talk about aftermarket sales. Every time a VeeFriends token is sold, Gary receives 10% of the proceeds. Over the last 90 days, Gary received 1,157 ETH, or $3.3 million, from resales alone.
As Gary gets more high-profile speakers (i.e. providing more utility), he then drives the price of his token higher, allowing him to invest more in the event.
It’s no secret that a loyal community is essential to any content creator’s future success, and GaryVee is no different.
By issuing tokens that have multi-year utility, Gary gave his supporters the ability to invest in his future through VeeFriends. While we’ll have to wait to see how this plays out, we believe that this will increase the loyalty that token holders have to Gary and VeeCon.
While we think that the VeeFriends project brings a lot of value to Gary and his supporters, we feel that his decision to use Ethereum is something we need to talk about.
The VeeFriends site says that they will contribute to DAOs (decentralized autonomous organizations) focused on renewable energy and carbon offsets; we’re unclear what percentage of sales will go towards these causes.
NFTs don’t need to have a large carbon footprint. In our article, we discussed Enshrine’s commitment to creating carbon-neutral NFTs on Polygon.
When Gary created VeeFriends in 2021, Ethereum was the leading blockchain for NFTs. Since then, other blockchains have proven to have comparable integrity to Ethereum, with a much smaller carbon footprint. Although Gary is doing something about the environmental impact of the VeeFriends project, we think that he should consider other blockchains in his next NFT project.