Yuga labs’ new $450M funding led by A16z is geared towards building a Metaverse project.
Yuga Labs, the owner of the Bored Ape Yacht Club and crypto punk, officially announced via Twitter that it had secured $450 million in investment at a $4 billion value. Yuga Labs plans to use the funds to establish a media empire centred on NFTs, starting with games and its own metaverse project.
Yuga Labs’ metaverse project “Otherside”
Otherside, the metaverse project by the NFT creators is described as an MMORPG that connects the wider NFT world. According to Wylie Aronow, a co-founder of Bored Ape Yacht Club who goes by the moniker Gordon Goner, they want to build “an interoperable universe” that is “gamified” and “totally decentralized.” “We believe that the true Ready Player One experience will be driven by the players.”
The news of the new project comes only weeks after the company acquired CryptoPunks and Meebits from Larva Labs in a big drive to consolidate the NFT industry.
The NFT giants now have a larger portfolio of IP to draw from when developing their game and metaverse plans, thanks to the acquisition of three of the most profitable NFT collections. Last week, Yuga Labs also introduced ApeCoin, a cryptocurrency that would be controlled autonomously and utilized as the principal money in Yuga Labs’ sites.
CEO Nicole Muniz said Yuga Labs is working with “a few different gaming developers” to bring Otherside to reality. The game will not be confined to Bored Ape owners, and the business hopes to provide development tools that would allow NFTs from other projects to interact with them. “We’re basically opening the entrance to a walled garden and saying, ‘Everyone is welcome.’”
Yuga Labs’ wants to enter the metaverse differently
While other firms entered the metaverse once Facebook changed its name to Meta, Yuga Labs believes that these newcomers are approaching metaverse ideas incorrectly, allowing the startup to stand out.
According to Greg Solano, a Yuga Labs co-founder who goes by the nickname Gargamel, people will not bond by spending time together in a shared virtual world with nothing going on. Instead, he claims, individuals form bonds as a result of being forced to work together.
Solano explains, “You only play with people and become friends when you’re getting your ass kicked.” “Basically, we don’t believe that having a Zoom conversation and going around saying ‘hello’ provides a rich social experience.”
Yuga Labs has refused to give a release date for Otherside, although their Tweet showed that it would happen in April. A play-to-earn game is also part of the plans by Yuga Labs, this, however, would be later this year.
Andreessen Horowitz, which has been investing aggressively in the Web3 field, led the fundraising round, which was one of the largest for an NFT startup to date. It has previously invested in companies such as OpenSea, Dapper Labs, and Coinbase.
Animoca Brands, as well as cryptocurrency startups Coinbase and MoonPay, are among those who have invested in the round. Yuga Labs will also be welcoming Chris Lyons, a general partner at Andreessen Horowitz, to its board of directors. The Financial Times broke the news of the funding discussions last month.
“To me, Yuga Labs, combined with these other emerging web3 companies, are an important counterweight to companies like Meta,” Chris Dixon, who leads Andreessen Horowitz’s crypto arm, tells The Verge.
“There’s a dystopian future where Meta is this kind of dominant digital experience provider, and all of the money and control goes to that company.” Interestingly, Marc Andreessen, the co-founder of Andreessen Horowitz, is on Meta’s board of directors and was an early investor in Facebook.
To date, Yuga Labs has been making significant financial strides. According to a leaked pitch deck, the business generated $137 million last year, mostly by taking a share of transactions associated with its NFT brands, with a profit margin of 95%. Yuga Labs did not respond to comments about the statistics in the deck.
According to OpenSea’s data, the company’s NFT collections have a maximum of 40,000 users, and it has only produced one game for a brief time. That means Yuga Labs is being granted hundreds of millions of dollars to start from scratch and develop a gaming firm — or at least the Web3-ified 2022 version of one — on the strength of a tremendously profitable art endeavour.
When it comes to investing in Yuga Labs, the creators want to see it thrive beyond the industry standards. “They created this energizing community and a cultural phenomenon,” Dixon explains. But, in the end, the corporation is making the same enormous bet as so many others: that some type of metaverse initiative will become the next big thing. They only need to construct it now.