In this episode of Edge of NFT, Yuga Labs CEO Daniel Alegre dives into the dynamic world of Web3 and the transformative impact it carries. The discussion delves into the unique concept of "Made by Apes," exploring the creative and entrepreneurial endeavors of BAYC and MAYC holders, ranging from neon sign makers to whiskey producers. The CEO shares the vision behind projects like the 12-fold art collection, the ordinals movement, and strategic partnerships with Magic Eden to protect creative royalties, offering listeners an exclusive insight into the innovative landscape of Yuga Labs and the evolving narrative of Web3. Join us as we navigate the complexities of Web3, unravel the diverse offline businesses sparked by Yuga Labs' community, and explore the future of digital innovation, art, and creativity in the crypto space. From strategic decisions during market challenges to empowering creators and narrowing down focus for success in 2024, this episode unveils the multifaceted journey of one of the most important trailblazers in the Web3 revolution.
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Building The Culture On The Blockchain Through Storytelling With Daniel Alegre, CEO Of Yuga Labs
I'm Daniel Alegre with Yuga Labs building culture on the blockchain through storytelling, experiences, and community. I'm here on the show featuring the pioneers putting culture on the blockchain. Keep reading.
Stay tuned for this episode to learn how the new CEO of Yuga Labs is continuing to catalyze the global cultural wave that began when four friends decided to create an NFT.
Also, why integrity was the most important ingredient to the rest of the success our guest experienced throughout his career.
Also, finally, why our guest gave into putting his cold Coca-Cola aside for a cold plunge the next time he's in LA.
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This episode features an interview with Daniel Alegre, the new CEO of Yuga Labs, a leading Web3 company known for the Bored Ape Yacht Club. Yuga Labs is at the forefront of shaping the future of Web3 through innovative storytelling, immersive experiences, and a strong community focus. Daniel brings a wealth of experience to Yuga Labs. He previously held the position of President and COO at Activision Blizzard from early 2020 to 2023.
During his tenure, he played a pivotal role in the international distribution and commercial success of major gaming franchises like Call of Duty, World of Warcraft, Diablo, Overwatch, and Candy Crush. He was instrumental in expanding the company's gaming presence across various platforms including console, PC, and mobile, and led the growth of its international studios.
Before Activision, Daniel's sixteen-year tenure at Google saw him lead global retail and shopping. He developed key global partnerships significantly impacting Google's core business areas. His global influence extended to leading Google's Asia Pacific and Japan operations and overseeing the Latin America business. Prior to Google, he was the VP at Bertelsmann Media. Yuga Labs’ mission is to harness the potential of Web3 by prioritizing imagination and innovation the company aims to redefine the utility of NFTs in the real world and advance the entire Web3 space. It's a pleasure to have you.
It’s nice to have you. Thanks, Josh. Thanks, Richard. If you want to keep with the introduction, why don't we do a full episode about my background and keep talking? It’s making me sound like I'm 400 years old.
That'd be like a Joe Rogan-style three-hour show if we did that. I'm game if you're game. Let's go. Daniel, I heard through the grapevine you're also based in Texas like Richard.
I am. I was living in San Francisco for a long time. I relocated from New York to San Francisco back in ‘99 with some interludes in Asia, Singapore, Tokyo, and Beijing. I was almost about twenty years in the Bay Area in San Francisco. Halfway through COVID, there was this big caravan of people leaving the city. I said, “Where are you guys heading?” They said, “We're heading down to Texas.” I packed up the kids and the dogs, got on the caravan, and ended up in Dallas. I've been here for two years.
The caravan is coming back to LA. There are a lot of folks coming back into the mix here. I am curious. With all those transplants from California, there's been a lot of biohacking here in LA where people are jumping into cold baths of water randomly throughout the city. There are all these cold plunge places. Is that trend carrying forward in Texas, too?
I don't think so. You have to remember that Texas is an oil state. The idea of something really cold is probably still very much heated with oil. I've heard about that. I don't know if it's a passing fad or not, but my grandfather who lived a long and healthy life would shower every single morning with ice cold water. He would never turn on the hot water. He espouses the wonders of it. I don't know. Warm water is so good. Why would anyone jump into a bath of ice-cold water? Will you tell me, Josh?
I've been doing it for about a month. I've gotten up to ten minutes of this craziness. It’s usually in two rotations of hot and cold. It gives you a kick. I feel better after my workouts. I have more energy. Tony Robbins was onto something as well as your grandfather. The next time you're in LA, I'm down to make sure you check this box like every other trendsetter in a city of ours. Come on by. Let's do it.
To add to that quickly for the benefits, I played D1 football. During our tour days, they made us do cold baths after our stuff. There are some use cases. I know it works. It's not ideal. I'm from Louisiana. I don't like the cold. It works, but not my cup of tea personally.
There is also such a thing as called Coca-Cola. Coca-Cola wakes you up and gives you a lot of energy, too. I don't know. Cold ice or a nice, cold Coca-Cola? I'm not sure which one I'm going to go for.
Choose your own adventure, which is the Web3 way. We should start by telling a little bit of the Yuga story, and then we'll go into more of your background. I remember the day after Bored Ape Yacht Club launched, it was a couple of friends, four friends, getting together and saying, “Let's make an NFT.” In this case, one thing led to another. You have a global company with a huge community behind it. How did that company evolve from that initial spark? How do you see it? You've seen a lot of companies evolve like Google and so forth. I'm curious how you look at the genesis and history of this company.
I'm amazed at how quickly this company evolved and then how it became a global company as quickly as well with having holders everywhere around the world that are passionate Web3 holders. It started with 4 friends getting together, 2 of whom are incredibly creative, Gordon and Garga. They had first the idea of the Bored Ape Yacht Club that it's not just an NFT but it's a community. It's a club.
The second piece is what would you do if you were to create a brand or create this quirky artwork and give the owners of the NFT full commercial rights over the creative and do with it what they want? That is an incredibly revolutionary idea for someone like me who's been in the media space pretty much all my life. My family is in radio. I started in the music business at BMG and Bertelsmann before joining Google. The idea that you are going to sell your IP and then let people do whatever they want with it and use it as their PFP or create a new business out of it is counter to everything of media rights that one has ever seen in the world. It's turning IP ownership on its head.
They had a great story and a great storyline behind the Bored Ape Yacht Club. The artwork was quirky but also identifiable by so many people. To add to that, it's community-based brand building. That's what's been a tremendous engine of growth, innovation, passion, and everything that you see. It's fascinating how a company that's two and a half years old has evolved and struck a chord, and most importantly, has been able to create what is, for me personally, the most incredibly connected and tight community that I've ever seen. I've seen some strong communities at Blizzard, people who love the Blizzard games and Google. It's fascinating. It's also an honor to be at the helm of this company.
In fact, what's really interesting that you mentioned is we started the show in late March 2021. Bored Ape Yacht Club launched in April 2021. There's some shared kinship there in terms of the timing of all this. What a rollercoaster it's been since then.
Coming from the background, coming from Activision Blizzard and working on a lot of the household names that everyone knows from mobile phone Candy Crush to Call of Duty, you know what it means to have a strong community and what it means to build something that people are proud of to be part of that brand.
Joining back in April of 2023, back at the time, Gordon mentioned that he estimated it would take about six months for you to understand the Web3 space. Was that an accurate assessment? Was there anything else that you thought you caught on quicker than you anticipated? Is there something that's taking longer for you to master than you anticipated?
Yeah. Is that six months crypto months? What I'm not sure about is that crypto months are shorter or longer. Is it 6 years or 6 days in normal human life? This is such a rapidly evolving space that in my view, there's no such thing as I know it and I'm a know-it-all. There have been a few aspects of Web3 that have surprised me, particularly coming from Activision.
In Activision, if you launch a new game, let's say a Diablo game or a World of Warcraft game, you announce it on Twitter. There's some pickup in TikTok or YouTube, and then there's Discord and Twitch. I wouldn't say that you live and die by the sentiment on Discord or Twitter. You listen to it, but it's not as prevalent as it is here in Web3. That, for me, has been one of the most interesting parts of this. It makes a lot of sense.
If you think that Web3, in addition to the utility, it provides for any industry or any kind of engagement, whether it's in art, gaming, shopping, or video production, etc., the community and the community sentiment, I underestimated how important it was to stay connected to particularly Twitter, how passionately people feel about it, and how you have these rollercoaster rides of emotion that exist on Twitter. That, for me, has been the biggest learning. I didn't think I'd be spending as much time as I do on Twitter, but since I'm on and listening to the feedback, getting some great ideas from people, and staying connected with the community, I realize how powerful it is.
The other one is this is such a rapidly evolving space that it's a little bit like gaming. In gaming, there's no such thing as the winner takes it all. If you have a great mobile game or console game, not only is it good for you from a business perspective but it's also good for the other console game makers and all other mobile game makers because it is the hockey stick growth in gaming. Multiply that by oomph in Web3 because we're in the very early 1st part of the 1st inning. Forget about the early innings.
This space is evolving so rapidly that I applaud innovation that not only happens at Yuga but it happens anywhere else in the space because we have a shared interest. The shared interest is to evangelize what Web3 can do and how it can transform experiences. That was also a key learning, the importance of Twitter but also the importance of supporting others in the community. That’s not only our own community but other projects because we're all in this together. That’s making the Web3 much more useful and accessible.
You don't see that among big gaming players. You see it among game designers, game studios, and gaming platforms. The makers of one game are not necessarily going to reach out to the other guys and say, “How can I help you with your game?” Along with that as a student of innovation, in my former life, I was a management consultant. I did commercial innovation and government innovation. That was a big difference doing that versus having a food tech company and running sprints there. I'm curious. As you've stepped into this role at Yuga, you clearly have looked at release schedules and information sharing.
You looked at how Yuga does that compared to what you did previously in some of your other roles, particularly Activision, where maybe things are held a little bit closer to the vest and Web3. Have you tweaked the Yuga model to be a little bit more private in some ways or have you embraced this Web3 way fully? Do you think there's something to learn from your experience in gaming, for example, that you've applied to Yuga?
I thought about this a lot. I joined Google when it was still a very small company. It was a few hundred people when I joined. The ethos at Google was to launch and iterate. It was okay that you were in alpha or beta, but you launched it out there, and then you figured out what was working and got users out there to test whether the product resonated or not.
As Google grew, and I ended up leaving Google when it was from a few hundred people to over 120,000 when I left, the development process was such that they were much more concerned about the brand and ensuring that all products were perfect. That launch-and-iterate concept was only in a few fringe areas of Google but not the core product.
You move to gaming and particularly companies of the size of Activision Blizzard where you have these mega franchises that take 2 years, 3 years, or sometimes 5 years to make hundreds of millions of dollars that are at stake. It's hard to bring that mentality of test and innovate unless you're working with brand new IP, launching it out there, and seeing what works.
The benefits of the early days of Google were that you were much more transparent and raw in what you were doing and the community. In the early days of Google, Google was seen as a true innovation engine so they gave them a lot of slack for technical errors and such. The community made the product bigger and better. There are benefits there that Yuga has done a good job with.
As you start thinking about projects like Otherside that are much more complicated in nature and much more complicated in platform tech that's required, at that point, you need a greater level of operational rigor and discipline. It is like Call of Duty where you start 1 year thinking of what you're going to launch 3 years from now and all the different steps that are required. It's a much longer timeframe.
Since I joined and have had a number of new hires including Mike Seavers who was the CTO of Riot Games and Epic and Dave Rolefson who ran some of the largest partnerships at Google and was an incredible operator, we have to bring that level of operational discipline for our innovation, but we have to balance that with that startup scrappy launch and iterate fast. It's a constant tension. I'm sure you experienced it, Josh, in your previous career.
Also, with this company and how fast the NFT space and the event space are evolving, right?
That's right. We're still striking that balance. We hear it from the community where they say, “Yuga is becoming much more secretive,” or, “You're not releasing as much and not telling us as much.” We've tweaked that over the last couple of months. We're much more proactive. We separated our gaming Twitter handle from the rest because, for those who weren't necessarily passionate or interested in gaming, we were flooding their channels with that information. We're doing, in my view, a much better job, but there's still some work to do to ensure that people know what it is that we're working on and that we get uncomfortable in some of our launches and go, “Here we go. Let's see what they say.”
For me, it hearkens to the core of human psychology where, in some cases, we think we want to know more than we do. We do enjoy surprises but not all the time. It’s like, “Surprise me a little here and there,” but it depends on what else is going on in our lives. If what you guys are doing is the most exciting thing in someone's life, they're going to be curious.
I want to lean into that because one of the things that I thought brought a lot of joy to a lot of people initially in the Bored Ape community was that all of a sudden, mutant apes came out. If you own one, all of a sudden, you're getting airdropped by this mutant. You're like, “This is so cool.” The inside, I have become part of it. You're like, “We're building a game. We're building other sides.” They're like, “This is awesome. You keep building that up.” That was one of the big things that came out in 2022, and you are still working on that. Daniel, I've been curious. What's been the focus on the back half of 2023 for Yuga and where a lot of your focus has been?
On a number of fronts. First, when I first joined the company, I took a much closer look at our holders, where they are, and what they're interested in. Two things stood out. One is the Bored Ape community is strong and incredibly entrepreneurial, but also very global in nature. We had done our first two ApeFest here in the United States.
We were already going down the path of doing ApeFest in Vegas, believe it or not, for 2023. I looked at our holders and said, “What have we done for our holders in APAC?” It is and was a relatively young company, so I said, “Let's do something unique and different in APAC not only to serve our APAC holders but also to have a very different experience for our North American holders.”
We announced that we're going to do ApeFest in Hong Kong. That was a few months ago already. It went by fast. It was incredible to see people from everywhere around the world. Our Hong Kong, China, and Asia-based holders, everything they did for the community ended up being not only a 2-day Yuga hosted event but ended up being a 5-day community-based event that was spectacular. It is ensuring that we are connected with our global community. I spent a lot of time traveling in Europe and Asia since I joined. That was one.
The other is when I first joined, there was a lot of unhappiness in particularly the CryptoPunks world. They felt that we weren't respecting them and supporting them, and it was all about BAYC. I realized very early on that even though we do have both holders of CryptoPunks and Bored Ape, the CryptoPunks holders care about the artistry and the elegance of what CryptoPunks means as being the first NFT collection out there.
We've done a lot of work elevating our overall partnerships with museums around the world. We had the Centre Pompidou in Paris. We had an exposition with CryptoPunks out there doing many more engagement events for our CryptoPunks teams and community holders. We're in a much better place because we recognize what they stand for and what they value, and that's great.
On the Bored Apes side of the world, honestly, I didn't expect this, and it makes a lot of sense. If you give someone ownership over the IP and a lot of them are very entrepreneurial, they're going to do some crazy things with them, whether they create Ape Water or Ape Whiskey, or someone who has a hamburger joint in the Philippines with their Bored Ape. That level of Made by Apes entrepreneurship is phenomenal.
We've been very supportive and leaning into how we can help this whole ecosystem build businesses off of the Made By Apes. We still have a lot to do. Meebits, we've got interesting plans that we had. We showcased a little bit of what we were doing in Berlin for the Meebits community. With Kodas, we have a lot also in play.
That's good to hear because I happen to have accidentally pulled off the market coast mint but pre-revealed one of the rarest cold Kodas and other sides. I am excited to see what happens with my Koda and what kind of adventures it goes on in 2024.
We've got a whole host of things that are planned across the board. This is the challenge, honestly. Selfishly and subjectively, we have the best Web3 community in the entire world. It consists of a whole host of different kinds of people, different kinds of brands, different kinds of expectations, and different experiences whether they're art, gaming, Otherside, or IRL events. For a company, our youth that was two-plus years old, and we are still relatively small, to be able to execute upon all of them and keep the communities as excited and engaged and supporting them, that's not easy to do but we're all committed to it. We're all incredibly passionate to get it done.
I can't help again but think about the analogy of Outer Edge LA because our goal with that event formerly called NFT LA has been to create a home for everyone, the builders, the creators, the founders, the VCs, the talent, and the talent managers. As you do that, you realize how much diversity has been attracted to Web3 for different reasons. Some people love the art. Some people love the technology. Some people love the gamification capabilities. With all these different things, you have to make a recipe or multiple recipes that everyone likes to taste, but they don't feel like the spice of what they love about Web3 is taken out of the recipe.
If there's one thing they all have in common, which is what I love about this space, to get into Web3, it's complicated. You know it's hard. You have to understand the tech. The hurdles to get on board are pretty complicated. If you consider how hard it used to be to get onto the internet in the early days with the modem and the dial-up, that's peanuts compared to what it takes to ensure that you buy in the right way, get a wallet, don't hit the wrong link, and don't get fall prey to scammers, etc.
Despite all that, there's so much energy and so much excitement in the space. The one common thread is people are passionate about this. They may have, to your point, Josh, very different reasons for being in it, but the fact that they are so vocal on Twitter or Discord and are so vocally connected is because they love what they're doing. We all see the promise in the space.
I was very fortunate enough. I graduated from grad school at a time when the internet was starting to take off. I got in early on, which was 1993 or ‘94, into the internet space. Anyone who was in the space, you could see this is going to change so much of the world. You went through these rollercoaster rides where people said, “This is all hype. It's all about gambling. You're not going to do shopping on the internet.” All of a sudden, you realize, “It is going to transform.”
You then go on to mobile. I was lucky enough to be at the epicenter of the mobile evolution with Android on the Google side, helping build out the mobile ecosystem. You saw it. It was the same thing in gaming. I moved to gaming in late 2019 or early 2020. I knew gaming was going to be the next social networking platform because that's how people connect and enjoy each other.
All this that we're going through in Web3 is so transformative, if not as maybe more transformative, than what the internet was in ‘93 and what mobile was in 2008. We're going to look back on it. We're going to look back on your catalog of interviews and we're going to go, “We even underestimated where this was going to go.”
Someone shared over the fence a new coffee table book that was created about Web3 in its first two years. It was so rich with stories, narrative, complexity, and nuance. It gave me this warm feeling that so much has been built the pipes for the future and it's time to create that future. Along those lines, you started to mention Made by Apes. We want to touch on that a little bit more because it's a unique and special concept.
For those at home who aren't aware, this is how Yuga verifies, supports, and amplifies holders-made brands that are using the Bored Ape Yacht Club and Mutant Ape Yacht Club NFT IP. You mentioned a couple of those use cases, and we've had a chance to experience them. We partnered with Ape Water for Outer Edge. There was a burger spot a little south of LA.
I'm sure you've seen so many fun use cases creatively. Maybe you could touch on some of the other ones that have crossed your desk, so to speak, and then your hopes and aspirations for what some of the use cases could be. We've seen some of that potential with what Pudgy Penguins has done with Walmart and that incredible collaboration. Where do you see all this Ape-made IP going?
It's limitless. This gets me excited because I love being able to help people create businesses and create jobs anywhere around the world. Pretty much any major city that you go to, you are going to find a strong Ape community. Even more exciting is when you go and there is a hangout spot that is owned by an Ape holder and they Ape-ify their location.
For instance, every time I go to Tokyo, I go to the Roppongi district. There's an Ape bar there that is so uniquely done and has four Apes right there up in the front. It is not only an innovative bar in Roppongi but it also attracts community members every time they go to Tokyo. I love that kind of collaboration where people are inviting community members to participate and help each other.
I hark back to the early days of YouTube when Google acquired YouTube. YouTube as a platform went in a bunch of different directions that we could never have predicted. When YouTube started, it was a site where people would post funny cat videos and baby videos. We thought what's likely going to happen is we're going to get enough eyeballs on the platform, and then we're going to get licensed content. All the major studios are going to license your content. You’re going to be like Netflix on YouTube.
What we didn't expect was it went down that path. It was not as extreme as Netflix, but you can see a number of licensed content movies on YouTube. The UGC aspect or the User-Generated Content aspect of YouTube took off where you had content farms that made content for YouTube. You had the influencer economy. You had talent agencies only for that and a way to do commerce.
If you provide a platform where people can own their businesses and innovate, that's where things take off. That's what's happening here. I bought neon signs from a guy who makes Bored Ape neon signs that should be coming that I'm going to put up on my wall over here. I bought shirts and whiskey. There's a great Polish holder who makes fantastic whiskey.
We did this at ApeFest in Hong Kong. We had this whole wall that we call the bodega that was dedicated to all or some of our Made By Apes holders who've created businesses. A lot of those are offline businesses. What I mean by that is you're selling water, whiskey, beer, clothes, or neon signs. Where Otherside is going to come in and how this whole space is going to evolve is similar to YouTube where you're going to have the innovation of IP and the shared IP that happens in community-based IP creation. New digital models are going to be created.
There are already some that are evolving. There's a company that has licensed the Bored Apes from some of our holders. They’re making casual games out of them. They’re making puzzles. They’re finding ways to generate new engagement and revenue. I'm starting to see others where one has licensed content from one of the major sports leagues. They're going to Ape-ify some of the experiences that you see in some of the games. Others are engaging with Hollywood and getting rights to be able to digitize and turn some iconic movies into Bored Ape movies. This level of innovation is going to continue and we're going to make sure we're going to support them.
One of the biggest draws to the community is how you are empowering your collectors to be entrepreneurial and give them resources and support them. It’s the fact that you did that bodega and let other holders be able to come in and try all these different things. I personally am a big whiskey fan, so if you say it's good, I might have to find a way to try some myself selfishly.
Another question I want to ask you about is the importance of the creator and making sure that they are not just protected but that you're giving them interest in how they're going about their entrepreneurial journey. On that same token, Yuga Labs and Magic Eden teamed up to create a marketplace with a focus on protecting creator royalties. Can you share more about this partnership and what people can expect from that marketplace?
We are very excited. I've known Jack, the CEO and Founder of Magic Eden, from way back when we both worked at Google. They're a great company. At the core, they fundamentally believe as we do that creators should be compensated for their work. There were other marketplaces out there that may have started that way but they lost their way or they weren't willing to invest in the right tech to ensure that royalties were protected. It was a disappointment to me. I didn't expect this to be one of the issues I would have to deal with when I became CEO.
When OpenSea came out with their announcement, it was crystal clear to us that we, as industry leaders, needed to make a stance for creators and for the protection of creator royalties. We made our announcement and immediately started looking at potential partners out there, and Magic Eden stood out. They've been a great partner and a great collaborator. It's a contractual commitment that they have to support creator royalties.
As I mentioned in the beginning, it's so important to create an environment where creators can make money and find avenues to connect with different kinds of communities. If we don't support that, this ecosystem is not going to evolve as quickly and as creatively as we all know it can. Setting the ground rules right from the beginning, particularly with companies like us who are so focused on doing right for the industry, was the absolute right thing to do. That's part of the commitment that we have with the Magic Eden partnership.
What's next there?
They are looking at the next launch of the marketplace. We're collaborating with them. I believe they're in discussions with other players. We're all in this as an industry together. You're going to see a number of announcements and launches coming out of Magic Eden.
Let's turn our attention to Ordinals for a moment. It's another buzzy topic. In the Ordinals community, it's all about Ordinals 24/7 365. It's hard not to feel a little of that energy even if you haven't dived deep down the rabbit hole. I know you guys have also started to explore that with the creation of TwelveFold. I would love to learn more about that project, the vision behind it, how it's been received from the community, and what you see going on with this Ordinals movement.
Michael Figge is a Founder of WENEW and the brainchild of 10KTF. It was a company we acquired. He's our chief creative officer. He is very passionate about this space. He was one of the core people who thought of our TwelveFold collection. Before TwelveFold, Yuga hadn't built a pure art project. Having thoughtful artwork is something that is core to Figge and core to what we do as a company.
A lot of our work is positioned to build value within the Ethereum blockchain in a way that has composability with other protocols on Ethereum. To publish something on Bitcoin takes away from that composability, and that allows the work to stand alone purely as artwork. TwelveFold for us was an opportunity to create something simple, clear, and with the same level of traits, variance, and collectibility that we as Yuga are known for. It was received very well.
Since then, we've had quirky engagements. We've had the puzzle series. We had about 50,000 people participating in the campaign. We're onto our final puzzle soon. The winner of the puzzle is going to receive a TwelveFold. It has worked out well and we resonated with it. For us, it comes down to the importance of innovative artwork. That's why it struck a strong chord.
It makes sense with Ordinals. You have this immutability on these engravings on Bitcoin. Someone would argue more permanent than engraving something in gold or diamond. Tying that to fine art as you all did makes sense. It sounds like that's how you're looking at that space at the moment eyes wide open. Also, Darewise is coming out with a Bitcoin-powered game. There is a lot of fun stuff happening there. We'll have to see how it all unfolds. The story is still being written.
When we say, “It's going to take me six months to understand the space,” as you think you understood it, curve balls get thrown at you. The level of innovation here is fantastic. My role as CEO is 1) To make sure that Yuga is at the forefront of innovation and 2) That we're there to support creators who are thinking about new ways of engaging and new creations. That's so exhilarating.
When becoming the CEO, you get thrown all kinds of curve balls. One that was the very best curveball for most of us here in the Web3 space is the extended bear that we've seen over the last couple of years. With that, a lot of hard decisions have to be made in order for companies to be successful, survive, and thrive. One of the challenges that had to happen was layoffs. Can you walk us through the thinking of why that decision had to be made and some strategic plans that you have for 2024 on how you can continue to grow talent and continue to grow Yuga Labs?
I don't take those decisions at all lightly. It impacts people, their careers, and their livelihoods. Where we were when I first joined the company, it's very normal for a startup to be in the space where you start with four entrepreneurs who have an idea. Before you know it, you've got a huge business and global attention. You raise capital and get so many offers of partnerships and ideas.
The hardest part for a startup in my view is not how to say yes. Saying yes is easy. It's how to say no. When I first stepped into this role, I saw the number of really well-intentioned ideas and where the company wanted to go. I said, “Realistically, for a company of our size and where we are, we need to narrow down our focus and get the few areas that are going to matter and going to move the needle. We need to get those moving in the right direction, including the re-engagement with CryptoPunks with the focus on art and creativity, the engagement with Made by Apes, Meebits, and the evolution of our gaming strategy.”
We're a company of about 120-ish people. That's a lot on our plate. Many of the people who were hired were hired with some of the other projects in mind. Their skillset was not attuned to the priorities and the execution of priorities that we had. We made a pivot and brought in people who understood platforms like what we're trying to build with Otherside.
Mike Seavers is leading that in his endeavors and the infrastructure side of Otherside. We also brought in people who understood how to build ongoing digital experiences and live operations. That was a skillset that we didn't have that we needed to bring into the company. It's a normal evolution of companies who need to focus on a few key priorities that matter and set ourselves up for success in 2024 and beyond.
I appreciate your candor and reflective nature on all of this. I, for one, am very bullish on you guys and what you all are doing. With the types of folks that you've brought in, it's going to be an exciting 2024. I am honored to have this conversation going into the next year. We also want to take a little bit of time to get to know you as a human if that's okay.
If you can figure out whether I'm a human being or not, that'd be awesome.
What do you think, Richard?
Absolutely. We should dive into some quick hitters.
Let's do it.
This is how this works, Daniel. Edge Quick Hitters is a fun and quick way to get to know you a little bit better. There are going to be ten questions. We're looking for a short single-word or a few-word response, but feel free to expand if you get the urge. Does that sound good?
It sounds good. Let's do it.
Number one, what is the first thing you remember ever purchasing in your life?
The first thing I ever purchased was a K-tel album called Goofy Greats. I loved it. I played it so often. I'm dating myself. It was with the needle with the turnstile. I played it so many times that the needle eventually ended up creating grooves on some of my few Goofy Greats compilation favorites.
I'm googling it. My girlfriend is a record player. It might make the cut for this season. We've got Bread and Butter, Itsy-Bitsy Teenie-Weenie, and See You Later, Alligator.
There’s Snoopy Vs. The Red Baron, The Purple People Eater, and Bony Moronie. I can name all of them because I listened to them so many times.
It’s on my list. I'm going to see what this album is all about. What is the first thing you remember ever selling in your life?
That's painful to admit. I grew up in Mexico City. My dad sent my mom and the kids to Canada so we could learn English and French. When I was nine years old, I moved to Toronto. I got this chewing gum that came with hockey cards of hockey legends. I sold a Guy Lafleur Montreal Canadiens card to a friend of mine because he had been looking for that. Apparently, it was rare, the one that I got. I said, “Have it.” I looked it up to see the value of what it is that I gave away. It was a bad trade for the nickel that I got for it.
Are we talking 5 figures or 6 figures?
It's six figures if it had been kept in mint condition.
That's the sign of a true friend right there. You’re a golden child right there.
A true friend or ignorant. Knowledge is king. Who would've known?
What is the most recent thing that you've purchased?
The neon sign of my Captain Pancho. One of our community members is a neon maker. I bought it and I'm expecting it.
We'll have to get a picture of the sign from your team after it's hanging on the wall.
That'd be a great one. What is the most recent thing that you've sold?
I have 5 kids, 2, 4, 10, 11, and 13-year-olds this 2023. We've had 1 crib for all 5. The two-year-old has graduated from that one crib and we sold that crib. It was painful to see it go, but the crib is gone.
You got your use out of it. It's something that all your kids have got to share, so that's pretty special.
Have you noticed I haven't sold any NFTs? I'm a holder. You're going to say, “Did he sell any NFTs?” I haven't sold. I'm in it for the long haul.
Daniel, what is your most prized possession?
It sounds corny but integrity. In life, if there's one thing I've learned both from my parents and my own experience, it is if you cut a corner once, you may benefit from cutting that one corner but you won't sleep well. It will come back to haunt you at some point in your life. Integrity is everything.
That's the first time anyone has answered that question in over 300 episodes that way. I respect that. My Cofounder, Jeff, is a West Point guy. Integrity means the world to our company as well. If you could buy anything in the world, digital, physical, service, or experience that’s for sale, what would it be?
I'm surrounded by three things, family pictures, Made by Apes products, and the band Rush’s paraphernalia. What I would want is the drummer of Rush’s drum kit from the 1980s.
I'm pretty good friends with Scott Page from Pink Floyd. If it was a Pink Floyd request, I might be able to help you. Hopefully, someone out there reading this can phone a friend and hook you up. I'm sure someone in the Ape community can help you out here.
I think so too. It went up for sale. It's a red mahogany TAMA drum set. It went up for sale on eBay several years ago. Someone scooped it up for $1,000 or maybe $2,000. I remember I was like, “Maybe I should bid for it,” but I was focused on something else and I missed it. Unfortunately, he passed away a few years ago, but his drum set from the 1970s sold for 6 figures. This one from the 1980s, whoever bought that on eBay, which I've been trying to track the person down but I can't find him or her, is sitting on a gold mine.
Even knowing the power of that in eBay, the correlation over the NFTs probably made perfect sense. You're like, “I need to get it immediately. Let's go.”
Scarcity and uniqueness breed tremendous value and emotional value, too. That's the other thing. I am emotionally tied to this band. Much of my teenage years were tied to being a geeky guy who liked Rush and playing air drums. I played air drums and real drums. I was in a band and I tried to mimic him whenever I could, so if I could have his drum set. I know you want a short answer. I do have a unique drum set. I have Stewart Copeland's drum set, the drummer from The Police when they did the reunion tour. Believe it or not, I own his drum set, but it is Neil Peart’s drum set that I want.
It's the emotional connection piece that draws people in. That's why what you guys are doing at Yuga makes a ton of sense. The next question I have for you is if you could pass on one of your personality traits to the next generation, what would it be?
I'd say constant reinvention. Reinvent yourself. Reinvent the world. Continue reinventing and putting yourself in uncomfortable situations where you do new things in new ways. It has done well for me professionally. I always put myself right at the intersection of opportunity and innovation. That's what spurs the world. If done for good, it can transform people's lives as Bored Ape and CryptoPunks have done for so many people.
It's the creative thinking that allows for so much innovation and for new ways to solve problems. To ask the question on the flip side, if you could eliminate one of your personality traits for the next generation, what would that be?
That's a tough one. It's always easy to say all the good things. I do have an obsessive personality. It can be good, but at times, it can drain you, particularly if something is not going in the direction you want it to and you're obsessively focused on the quality and the execution of things. That's a lame answer. At times, it gets so strung up that I say, “Take it easy. Take a look around you and everything that's good. Take a look at all the bounty and the goodness that exists around you. Don't be so maniacal on certain things.”
It's a good reminder. I was listening to a podcast about happiness while I was working out. It's easy to get so passionate about all this potential technology and things and creating all these jobs all over the world, but looking within from time to time is helpful, too.
I'm envisioning what you said. Here's Josh who got put into a tub of ice cold water and thinking, “What is happiness? Happiness is getting out of this water.”
That's true. I don't know. I'm getting pretty content in that tub of water. They time me for 5 minutes and I was still in it 6 and a half minutes later.
I'm going to try it. I am going commit to this show that when I go to LA and meet up with you, I am going to give it a try.
It's going to be a lot of fun. You won't regret it. I know what you didn't do, but what did you do before joining us on the show?
I changed the batteries on a little fan that was given to me that I've used so much. It was given to me at ApeFest by the Hong Kong Elite Apes. It has ApeFest Hong Kong 2023 when you rotate it. When I'm in meetings and things get hot and heavy, I turn on the fan and it cools me off.
Thank you, Hong Kong Elite Apes. If they only knew how much use I got out of that fan.
That’s very poetic. I was in UAE a lot. They had those there and it was clutch. What are you going to do next after the show besides finding the closest place to get a cold plunge?
Also, open an ice-cold Coca-Cola. I am having a meeting with the Otherside team. We're going to go over some of the immediate work that they have planned for early in 2024. There will be a lot happening on Otherside. If you look at my calendar, a lot of time is being spent with the great team that we have on Otherside.
I'll send you offline all the attributes of my Koda in case you want to consider that information in some shape or form.
Thank you for all of that insightful information. We always like to wrap up with a fun bonus question. To keep it on topic and theme with the one thing that you've ever wanted was the drum kit from Rush, you only get to pick one. What is your favorite Rush song?
It has to be 2112. It was a game-changer for them as a band. I remember as a twelve-year-old when someone put the Sony Walkman in my ears. I remember that well. He said, “You got to listen to this.” He put it in my ears and I went, “What is that?” This was a Mexican who relocated to Canada and heard this. I went, “Wow.” It knocked my socks off. It has to be 2112.
Daniel, we have a segment called Shoutout where we want to give you a chance to give someone in the Ape community who’s working hard behind the scenes a little bit of TLC, or the Yuga community. I shouldn't say Ape community because there's a lot more going on at Yuga than at Bored Ape Yacht Club. Is there anyone that comes to mind that you want to give a shout-out?
He is known as PP Man. First of all, it's his birthday today, tomorrow, and the day after. Every day is his birthday, which is incredible. He's probably 6,000 years old. He works so hard. He's so passionate. He loves the space and the community. Shout out to PP Man. This person is not necessarily inside our company, but he has been dealing with health issues. You know it is Gordon. He seems to be doing better, but he is not out of the woods. To have a founder and a partner, for me, someone like Gordon is unique. I miss him inside the company, but I'm glad to see him reviving his engagement on Twitter. I wish him continued improvement in his health. The company loves him. The community loves him. His insights are fantastic, so a shout-out to Gordon.
Shout-out to Gordon for all he has done for the Yuga family and the broader Web3 community. I wish him the best. Daniel, this has been amazing because it's important that people identify the right version of you on Twitter and the right version of Yuga. There are a lot of folks imitating Yuga. Where do people go on Twitter to follow you, Yuga Labs, and all the cool stuff you guys are up to?
I'm @DAlegre on Twitter. You'll see Captain Pancho as my handle. It’s very accessible. I try to respond to any direct mails that anyone sends me. If you go to Twitter and search for Yuga Labs or Bored Ape Yacht Club, you'll see our handles @Yuga Labs and @YugaLabsGaming as well. That's where you can get our information or @BoredApeYC. We're very actively engaged and there for the community and the support of the whole space.
That's a wrap for this episode. We've reached the outer limit of the show. Thanks for exploring with us. We've got space for more adventures on the starship, so invite your friends and recruit some cool strangers who will make this journey all so much better. How? Go to Spotify or iTunes. Rate us and say something awesome. Then, go to EdgeOfNFT.com to dive further down the rabbit hole. Look for us on all major social platforms by typing EdgeOfNFT with no spaces and start a fun conversation with us online. You can also join our newsletter at EdgeOfNFT.com. Lastly, be sure to tune in next time for more great NFT content. Thanks again for sharing this time with us.