Empire of the Bored Apes
In the 18 months since the launch of the highly successful NFT project Bored Ape Yacht Club (BAYC), Yuga Labs has taught the nascent Web3 industry how to build a community around an NFT project and maintain that momentum despite the market volatility.
Now it’s clear that Yuga Labs had much bigger ambitions to become a multi-layered enterprise inspired by the creative thinking of animation studios like Pixar, acquiring a handful of other character-driven NFT collections and creating virtual worlds where people can interact with them. To realize this vision, Yuga raised $450 million in March led by venture capital firm Andreessen Horowitz (a16z), achieving a $4 billion valuation along the way.
“We see ourselves as a creative company,” Solano said. “Our DNA is thinking about the things we want to do, then we figure out the creative stories we want to tell, and then we figure out how to do them and work back from there.”
What is astonishing about Yuga’s growth is how fast it has been. It wasn’t until February 2021 that four friends – Greg Solano, aka “Gargamel”, Wylie Aronow, aka “Gordon Goner”, Kerem Atalay, aka “Emperor Tomato Ketchup” and Zeshan Ali, aka ” No Sass”. to “join the crypto club” by co-founding Yuga Labs when the idea of developing an online community around NFT profile pictures (PFPs) was still relatively nascent.
Aronow and Solano met in college and bonded over their shared interests in literature and gaming. What sets BAYC apart from other PFP collections is the men’s ability to spin a narrative story around the characters.
“That’s when we came up with the Bored Ape Yacht Club. The idea was that it was this place for degenerates to go, right? Because that’s who we were, Aronow and Solano told my colleague Jeff Wilser in September 2021.
Over the past year, the company has added capital to expand its portfolio of brands:
Their stream of steady product launches and high-value acquisitions has positioned Yuga Labs as one of the top NFT brands, with its product lineup consistently ranking among the top collections on top NFT marketplace OpenSea. Still, some have pushed back against the company as the “first NFT monopoly” in a space meant to champion decentralization and individual ownership.
“I think the idea of a monopoly comes from people who don’t understand the impact we’ve had on the space in terms of decentralization,” Solano told me in an email.
The company has also grown its staff from 11 to 110 people, formalized its leadership team by bringing in CEO Nicole Muniz, a childhood friend of Aronow’s who founded and ran a creative agency, as well as adding a head of games, vice president of product and vice president for communication.
Solano said he and Aronow led the creative vision of Yuga since its early days, including all aspects of the creative and strategic processes, while Muniz has been key in building out the company’s infrastructure and helping it scale.
I sat down with Aronow and Solano at the Institute of Contemporary Art during Art Basel Miami, where they celebrated the installation of the recently donated CryptoPunk #305, the third NFT to enter the museum’s collection. While the event attracted leaders and influencers from the crypto and art fields, the founders appeared to still be navigating the “overnight celebrity status” they gained after their identities were leaked in a controversial piece by BuzzFeed News in February.
The two 30-year-olds are proud and perhaps even surprised that their passion project has exploded into such a cultural phenomenon, with celebrities such as Snoop Dogg, Justin Bieber, Steph Curry, Eminem and Madonna, along with thousands of other collectors, proudly poses with the cartoon monkeys. designed by artist All Seeing Seneca as their profile pictures.
Yuga Labs was arguably the first NFT project to integrate previously niche concepts such as using a flat pricing model, adding long-term benefits, offering surprise flights, publishing a project roadmap, and giving its holders full intellectual IP rights, allowing them to use the likeness of the characters their for commercial purposes. This has paved the way for dozens of community-created projects and counting—including a California burger joint called Bored and Hungry, a beverage company called Ape Water, and a music group called KINGSHIP made up entirely of Ape avatars.
“From day one of the Bored Ape Yacht Club, the community has been empowered and encouraged to commercialize their NFTs. That’s at the heart of why we’ve seen such rapid growth,” Aronow wrote me in an email. “This approach, even if initially perceived as risky, has proven to be key to the company’s success.” Indeed, enabling BAYC owners to monetize their PFPs may also be key to community loyalty.
At the Web Summit conference in Lisbon in November, Muniz emphasized the brand’s ability to turn previously passive consumers into owners of their own content. In recent months, this shift has been observed throughout an increase in NFT trademark registrations and an increasing number of IP licensing structures used across NFT projects.
Yuga’s rapid growth and community-building efforts over the past year are in service of a much larger vision, the development of the ambitious Otherside metaverse project. As the co-founder describes it, Otherside will be an interoperable, gamified world-building platform that will turn NFTs into playable characters. “We see it as the platform for our communities and many other communities to come together,” Solano said.
Otherside, which blends mechanics from massively multiplayer online role-playing games (MMORPGs) and Web3-enabled virtual worlds, sold 55,000 Otherdeed NFTs linked to virtual land ownership in April, raising around $320 million. In July, Yuga organized its first tech demo for thousands of Otherdeed holders, which it called its “First Trip”, giving the community a glimpse into the future where virtual identities are intertwined and owning an NFT is the key to unlocking the metaverse.
“We see Otherside as the intersection of many of these ideas,” Solano said. “That’s where we see the next evolution of the space going.”
“We wanted to create a truly co-developed, egalitarian metaverse that was fun,” Aronow added.
