The Utah County tech firm partnering with Brigham Young University on an NFT marketplace has cut its workforce by about half and closed its office, according to CEO Jon Cheney.
But with an increased focus on developing NFTs, Ocavu is “remaining at a good pace,” including “currently receiving some large buyout offers,” Cheney told The Salt Lake Tribune.
“We let underperformers go, that’s all,” he said, adding that tech companies often “optimize” their workforce. Ocavu went from 43 or 42 employees, he said, down to 34 and now down to 22, with layoffs in June, September and October.
The company moved out of office space in the Younique Products building in Lehi earlier this month.
NFTs (non-fungible tokens) are essentially digital trading cards, and BYU players can choose to participate under NIL agreements – which allow student-athletes to earn money for the use of their name, image and likeness.
Ocavu and BYU announced their five-year partnership in August, with Cheney predicting it could be worth up to $20 million in the first year.
[Read more: Experts say BYU’s NFT venture is risky, but Cougars stand behind new NIL plan]
Jim Rampton, a former Ocavu employee who said he was laid off along with “maybe four or five” others in September, said employees were told “that the budget was too tight” and that the layoffs were not based on performance.
(Photo by Jaren Wilkey | BYU) Casey Stauffer, Brigham Young University’s associate athletic director for corporate sponsorships, left, and Ocavu CEO Jon Cheney announced the BYU Athletics NFTs on August 16, 2022.
Rampton said he had been with the company for two and a half years. Ocavu “was doing very, very well a year ago at this time,” focusing on augmented reality, he said.
A company has a product like “a table or a sofa, et cetera, and we’ll make a 3D model of it,” Rampton explained, “then the client could put that link on their website,” and viewers can see it in 3D using a phone or tablet.
Latter-day Saint influencers Brooklyn and Bailey McKnight, for example, used Ocavus’ augmented reality platform as part of their August launch of ITK (In The Know) skincare products. A QR code allows Walmart customers to virtually take products out of their packaging and examine them.
Ocavus’ roots are in augmented reality; it grew out of the treasure hunting app Seek, which added AR features after the success of Pokemon Go, TechCrunch reported in 2017. In that interview, Cheney said Seek was becoming a hub for developers to pitch AR projects.
In May, renamed Ocavu, the privately held company announced its new Ocavu network for NFTs and a crypto token.
And in August, Ocavu and BYU announced the CougsRise.com marketplace for buying and trading player NFTs, relics (such as trophies), and moments. Cheney has declined to disclose the percentage of the payments held by the players, BYU’s athletic department and Ocavu.
In an August article for Utah Business magazine, Cheney said the company’s 2022 revenue forecast was $22 million.
“We have decided to redirect our business model from a 20 percent blockchain focus to 50 percent,” he wrote at the time, “letting crypto and NFTs share the spotlight with our virtual and augmented reality technologies.”
Some resources have been diverted away from augmented reality toward NFTs, Rampton said, as Ocavu invested in developing the blockchain technology it relies on. “I felt like it was a really big play,” Rampton said.
Ocavu said they have already spent $2 million creating the current BYU NFTs and will likely spend $2 million more next year.
(Ocavu) Screenshots of NFTs of BYU football players Gunner Romney and Micah Simon.
But Cheney said Ocavu has “rebalanced now,” with the company’s remaining staff focused about 60% on augmented reality and 40% on cryptocurrency and NFTs. “We were extra heavy on [augmented reality] side,” Cheney said.
Some experts said they saw the BYU partnership as risky when the deal was announced, because of the volatile market for NFTs. NFT sales fell by 60% between the second and third quarters of the year.
The value of Ocavu’s cryptocurrency, the Ocavu Network Token, also took a hit recently; over the past two weeks it is down 48.5%.
Most of this decline was concentrated in a few days after a major sell-off by a major coin holder. The nature of cryptocurrency means that a record of all transactions can be viewed publicly, even if the user is dealing with insufficient identifying information.
Asked about the sale, Cheney said, “I haven’t sold anything.” He added, “I can tell you that none of the founders have sold any of their airdrop tokens” — referring to tokens that company employees receive automatically as a benefit for their tenure or holdings.
However, Cheney continued, recently “one of our top investors decided to sell all his tokens … I have no idea why.”
The Ocavu token is separate from the BYU NFT agreement, he emphasized, and “does not affect our ability to deliver.”
BYU did not respond to The Salt Lake Tribune’s requests for comment.
The NFTs that BYU fans can buy and trade on Cougsrise.com are also tied to experiences. For example, a fan who is among the first to acquire all the NFTs in a particular collection might get free Cougartail goodies, or maybe get to fire the George Q. Cannon at a football game. The platform also hopes to become a hub of communication for BYU fans.
Fans have left enthusiastic comments on the site’s homepage about the NFTs they have purchased and their experiences. One user wrote, “thank you Cougs Rise for the great experience I had with the field pass to watch warmups against Wyoming. Such a memorable experience.” Another posted, “excited to see the next drop.”
Leto Sapunar is one Report for America corps member who covers business responsibility and sustainability for The Salt Lake Tribune. Your donation to match our RFA grant helps him write stories like this; Please consider making a tax-deductible gift of any amount today by clicking here.
