#537: Duncan Cock Foster on the NFT Boom

Duncan Cock Foster is a co-founder of Nifty Gateway, the leading platform and exchange for digital art and NFTs. In this conversation, we discuss the current state of NFTs, successful drops, sale dynamics, digital museums, physical NFT displays, impact on artists, and the response from the legacy market. ======================= Remote makes it easy for companies of all sizes to employ global full-time employees and contractors. We take care of international payroll, benefits, taxes and local compliance, so you can focus on growing your business. Learn more about Remote and their new Remote for Startups program at http://www.remote.com. ======================= Choice is a new self-directed IRA product that I'm really excited about. If you are listening to this, you are likely part of the 7.1 million bitcoin owners who have retirement accounts with dollars in them, but not bitcoin. I was in that situation too. Now you can actually buy real Bitcoin in your retirement account. I'm talking about owning your private keys and using tax-advantaged dollars to do it too. Absolute game changer. https://www.retirewithchoice.com/pomp =======================

Speaker names marked ? are inferred from speaking time and the show’s known hosts — they are not voice-verified.

• 0:02Anthony Pompliano?

  What's up everyone, this is Anthony Pompliano. Most of you know me as Pomp. You're listening to the Pomp Podcast, simply the best podcast out there. Let's kick this thing off. Duncan Cockfoster is a co-founder of Nifty Gateway, the leading platform and exchange for digital art and NFTs. In this conversation, we discuss the current state of NFTs, successful drops, sale dynamics, digital museums, physical NFT displays, impact on artists, and the response from the legacy market. I really enjoyed this conversation with Duncan, and I think you will as well. But before we get into this episode, I want to quickly talk about our sponsors. First up is Remote.com. In 2021, every business is a global business.

• 0:46Anthony Pompliano?

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• 1:30Anthony Pompliano?

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• 2:15Anthony Pompliano?

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• 2:57Anthony Pompliano?

  And one more thing, you know how I feel about this, but if you have a pro that manages your money, don't take any BS. Choice has tools for them, too. Take back control today and visit retirewithchoice.com/pomp. Again, retirewithchoice.com/pomp. All right, let's get into this episode with Duncan. I hope you guys enjoy this one.

• 3:18Speaker 01

  Anthony Pompliano is a partner at Morgan Creek Digital. All opinions expressed by Pomp or his guests on this podcast are solely their opinions and do not reflect the opinions of Morgan Creek Digital or Morgan Creek Capital Management. You should not treat any opinion expressed by Pomp as a specific inducement to make a particular investment or follow a particular strategy, but only as an expression of his opinion. This podcast is for informational purposes only.

• 3:49Anthony Pompliano?

  All right, guys. Bang, bang. I am here with only one of the two Cockfosters twins. I don't know where the other one is, but Duncan is here. Thank you so much for doing this, man.

• 3:59Speaker 02

  Thanks, Pomp. Thanks for having me back.

• 4:01Anthony Pompliano?

  Of course. All right. Last time we talked, things were getting hot. They got real, real hot, though. I feel like you guys saw the future. You guys were way ahead of the curve. What has happened? Just give us like a state of the union of the NFT market from your perspective. Where are we and what's happened so far?

• 4:18Speaker 02

  So honestly, I think, I think we're kind of in the first phase where people are like really realizing the potential. And from us, from our perspective, it's been completely insane. The stat I always like to give about this is November 2020 last year, we just, we hit a million dollars in monthly volume for the first time. And we were thrilled because that was already 20x what we had done five, six months ago. And we were happy. We were like, okay, we just grew 20x in five or six months. You know, things are moving along. It's a bit hectic, a bit crazy, but like, things are growing steadily. And then last month in March 2021, we did 140 million. So if you told me back in November that we'd, you know, go on to do 140 times our, our volumes in the next five, six months. I just like, would not have believed you. And uh,

• 5:04Speaker 02

  yeah, it's been like, it's been completely, completely insane for us and everyone in the NFT space. I, I always thought it was gonna happen. I, I did not think it was gonna happen this like quickly or suddenly. But I guess that's just like, that always happens with, with new technologies, so.

• 5:18Anthony Pompliano?

  Absolutely. So when you start to think about um, kind of the NFT market, uh, you have a key piece of infrastructure, right? And Nifty Gateway, uh, there's a bunch more infrastructure that's popped up. Uh, how do you think about how you guys are differentiated from everybody else?

• 5:34Speaker 02

  Honestly, you know, from the beginning, our, our perspective was always, we're gonna make NFTs as easy to access as possible. You know, we, we wanna build NFTs on top of a truly decentralized network like Ethereum. But we wanna make them as easy for people to buy as it is buying something on Amazon. And I, you know, that honestly, when you look back at the history of crypto, it's kind of amazing how many businesses are, are started with that same intent. Because crypto is this incredible technology that, that people just have a difficult time accessing. It's just really, you know, hard to use for the average person. I mean, this is like, I was, this is the same thing that motivated Coinbase. They were, they were basically said like, you know, crypto is gonna be huge, but you know, regular people need an easy way to access it.

• 6:17Speaker 02

  So honestly, that, that's always been our, our drive and our motivation, making um, NFTs built on Ethereum, a truly decentralized network, making those as, as simple to access as possible.

• 6:29Speaker 02

  And I really think that that's been like, that's been enormous in our success so far. Because, you know, most of the, most of the people that we talk to, most of the people that are, are collecting NFTs on Nifty Gateway,

• 6:41Speaker 02

  you know, they. They're not ready to go with the full like on-chain experience, external wallet they control. They need like a simpler way to access it. And I really think that's been just like a huge part of our success.

• 6:54Anthony Pompliano?

  Yeah. So when you talk about early access or easier access, not necessarily early, but easier access, what are some of the things specifically that you guys have done that you think has kind of manifested that access?

• 7:05Speaker 02

  Yeah, it's a great question. We, I mean, we really had to iterate towards this. The first thing that we did was just let people buy NFTs with a credit card. And that was back in, in 2019 that we, we launched that and we worked with CryptoKitties and Axie Infinity. From there, we decided, you know, we had to take it a step further, which meant we, we had to build a system where you could sign up and get started collecting NFTs without ever onboarding into cryptocurrency, you know, without signing up for an external wallet, just signing up with an email address and password. And so that's really the, that's really what we've reached now. But that's what I think is so important to Nifty Gateway's success is that if you want to access NFTs, all you have to do is sign up with a username and password, throw in your credit card, and then you can start collecting.

• 7:50Speaker 02

  It really makes the, the experience something that anyone can understand. And I think that's, you know, that as we've seen with crypto before, it's really important to have that, that easy accessible layer to, to make something mainstream. And honestly, I don't think that we would have anywhere near the same amount of traction that we do today if we hadn't focused so hard on that, that core piece of user experience.

• 8:11Anthony Pompliano?

  Yeah. And then one of the other things that you've done is you've got this curation approach, right? So you one made it easy to access, but then you've also taken a very heavy curation. Some people would argue, right? It's like a critic would say, oh, that goes against everything in the open ethos of crypto, right? Kind of just build the platform, let whoever wants to transact there. But I know that this has been really crucial to your success. And so how do you think about curation? Why did you choose to do that? And then what's kind of been the benefit of it?

• 8:39Speaker 02

  Yeah. So we, when we, back when we first started, all, most of the NFT players were sort of taking what, what we say is like the classic tech approach, or even like the classic crypto approach, which basically is like, we're just going to build a platform and then we're going to try and convince you to sign up for it. And then you use it, you don't use it, like, we don't really care, we're hands off after you sign up. That's sort of like the traditional, like, everyone wants to be a platform because they think it's the easiest. Like Airbnb, you just sit in the middle, people sign up, they rent houses, you take money. And yeah, that that seems like the easiest. And that and that's the approach everyone was taking in the NFT space.

• 9:17Speaker 02

  What we what we thought about was, okay, if you look in the art and collectibles world, you you kind of don't see that, like, people are almost explicitly not a platform. And instead, it's much more of like, okay, we're gonna go out and and select the best artwork. We we have a ton of knowledge in the space, so we're gonna curate artists who we think are promising. And then because we curated them, their their reputations will grow. Like, we're basically, basically what art galleries do is they lend their brand to the artists that they present. And we thought, okay, NFTs, NFTs are the future of art and collectibles. It's likely that we'll see that same dynamic replicate itself in the NFT space.

• 9:53Speaker 02

  There were already curated platforms back then, platforms where you had to apply and and get in. But we took it a step further and we said, okay, we're gonna, every single release that we do on the primary market, we're gonna curate. And every single release we do, we're gonna talk one on one with the artists. We're gonna help them figure out their pricing, help them figure out their quantity, like, help them monitor the the health of their market and really like be a true partner to them. That was always our vision, that we wanted to be a true partner to the artists that we we partnered with. And then I I think that that has also been really, really important. You know, Nifty Gateway, the the artists on Nifty Gateway are the highest earning on average out of all the other, all of all the NFT platforms. Because we, you know, we spend so much effort partnering with them and and really trying to

• 10:36Speaker 02

  help them grow their careers and help them monitor the the health of their market.

• 10:41Speaker 02

  And so, yeah, I I think that approach has also been enormous for our for our platform. And, you know, it's part of the reason that, you know, we we have all the traction that we did. And I think it it sort of came from going against the grain and saying, okay, everybody wants to be a platform, but maybe that's not the right approach here, because maybe this market will work differently.

• 11:00Anthony Pompliano?

  Yeah. And so when you start to think about how that market has been receiving this, it seems like, one, not only did they say Nifty is quote-unquote "the winner", right, in terms of this curation type of approach, but it's also brought a very different type of artist to the table as well. You know, a lot of the digital artists who have been on multiple platforms, they have different styles, they have different approaches, but they fall under what I would call a digital artist bucket, right? Whether it's just artists who are becoming digital artists or the digital artist. It seems like you guys have really found a niche, not only with the digital artists, but also with people who kind of come out from outside of that world. And so was that an intended strategy? Or did that just kind of naturally happen?

• 11:40Speaker 02

  Yeah, it was an intended strategy. From the, you know, from the beginning, we were always trying to figure out ways to get more people into NFTs and into the world of NFTs. And we thought one of the best ways to do that was to go out, find artists who had a fan base outside of the NFT space, enlist them to make work on the platform, and then the artist would introduce their audience to NFTs just by the fact that they were releasing work on the platform. I think that honestly, it was kind of slow-going at first. It's hard to explain what an NFT is. But, you know, by the time an artist does their second or third release, you really start to see their people who are fans of their physical artwork getting into their NFTs. And honestly, we've seen some go the other direction, where people who are collecting NFTs on Nifty Gateway

• 12:23Speaker 02

  start buying the physical artwork of Nifty Gateway artists, artists that they found through Nifty Gateway. So it's really like a pretty powerful effect. And I think it was a really important step in NFTs evolving and, you know, becoming a more, becoming a more like well-known and mainstream phenomenon, which is, you know, artists who are, a lot of artists are multidisciplinary, like, you know, some of the best, like, you know, Picasso sculptures are some of his most famous as well as, as well as his paintings. So it makes sense that a lot of them are, you know, would be creating in digital. And it's certainly cool to, it's really cool to see them creating on Nifty Gateway.

• 12:59Anthony Pompliano?

  For sure. Talk a little bit about the impact on some of these artists, right? Everyone knows the story of, let's say, Fawcett is seventeen years old, ends up making enough money to not only leave their home, but ends up actually building an entire living out of it, right? Beeple, same thing, has now made millions and millions of dollars. But I think outside of some of those big stories, there's also seemed to be a pretty positive impact on every artist who starts to do this. And so what are either some of your favorite stories or just some of your takeaways as you've seen artists enter in and have an impact on their careers?

• 13:29Speaker 02

  Yeah, honestly, I mean, I think the Fawcett story is my favorite story. Where, you know, he could move out and buy a house. He's so young and so talented. And like, he's really able to, to make a living doing what he loves at, at this young age.

• 13:44Speaker 02

  Uh, yeah, we, we basically have seen, I mean, the, the stories are too, are almost too numerous to like, repeat here. We, we have a Slack channel called Feels Good, where we just post like, you know, happy tweets from artists or artists being like, thank you so much. I think one actually that really touched me was from Matt Gondek. He, uh, he, he did a sale on, on Nifty Gateway. I can't remember, it was a few months ago. And he grossed over 1.8 million in sales. And I think what he tweeted was, um, my, my parent, my dad had a stroke last year and they need to move down south to like be in a sunnier climate. You guys just bought them a house. Like, thank you so much, Nifty Gateway family. That was like a really powerful, I mean, that, that to see like Nifty Gateway changing an artist's life like that and, you know,

• 14:28Speaker 02

  helping him support his dad who was like sick, that, yeah, that was pretty amazing. I, I think honestly, yeah, it's, it's really my favorite part of the job and like most Nifty Gateway employees, it's, I think it's like their favorite part of the job too, just seeing an artist like have their life changed like that.

• 14:44Anthony Pompliano?

  Yeah, you guys have multiple ways that an artist can do a drop. Maybe let's start just at a high level with like, what makes a successful drop from your experience?

• 14:53Speaker 02

  Honestly, you know, what I what I try and emphasize to artists, I think we're in a tricky moment right now where there's this huge group, this huge new influx of interest in the NFT wave. And it seems like you can't even open Twitter these days without seeing NFT written somewhere. But a- as we've seen before, you know, it can be, it it can sort of generate unhealthy dynamics when things grow too quickly. And, you know, you can sort of get away from the, from the things that made things work well in the first place. So what I try and emphasize to artists is that your secondary market sales are, are like, you know, probably the most, the most important thing for you. And, you know, you really should think about your career on a long-term basis.

• 15:32Speaker 02

  A- as an artist, you should really be thinking about this on like a five-year, 10-year basis and trying to design your, your, um, your drops to reflect that and really less is more when you're, when you're releasing on the primary market. The most successful artists that I've seen, they've done a really good job building demand alongside supply. And then, you know, eventually, by the time of their third or fourth release, they're really, really popular, they have a great collector base, they're, they're really well-known on the platform. And then they can do like a, a large release and, you know, gross a really high amount. But, but yeah, really what I would say is like, um, come in, make sure you're thinking about this as a long-term project.

• 16:14Speaker 02

  Make sure you're thinking about NFTs for five years, 10 years. Um, not just when it comes, the work itself is obviously incredibly important, but there's a lot of strategy to, you know, the release structure as well. Um, and yeah, the long-term is like, is far more important than the short-term. I think that's the most important thing for any artist to remember, especially an artist just getting started.

• 16:35Anthony Pompliano?

  For sure. Uh, and you have multiple ways that somebody can sell. So you can do kind of a one-of-one auction. You can do a direct sale, you can do these like, uh, open, uh, series. Talk through, uh, kind of the pros and cons of each one, or kind of how you guide artists to think through, uh, which type of sale mechanic they should use on a specific drop.

• 16:55Speaker 02

  Absolutely. Um, the one-of-one obviously is the most scarce sale dynamic you can do. The, the pros of that are it keeps your supply really low. You know, it's a great way to just get started. The cons are, you know, only a very few, only a very small number of people can afford one of ones. So, you know, they tend to be much higher in price, which means like your collector base is limited. And honestly, I think one of the coolest parts about NFTs is they're sort of democratizing art. Like fine art is very inaccessible for most people. NFTs are way more accessible. So one of ones are are awesome, but you know, you you do have to be really rich to afford them. Then the other, the other thing that artists can do is limited edition sizes.

• 17:39Speaker 02

  So additions, they can pick any addition size they want. And then they can either release them up for auction or they can do a price. Honestly, I think a really strong way to enter the space is to do an addition of a hundred and price it really low. And then the the collectors who win, you know, who get to buy that piece, they have a great premium where that that piece can trade up because it was originally priced low. So yeah, that's the second release format. You can, you can fix an addition size and you can fix it at whatever size you want. You could fix it at 10, you could fix it at 100. Usually 100 is sort of the high limit, but we have had some people who fix their addition sizes at 500. And then you can either release it as a, as an auction where people place bids on it. Or you can just do a drawing where you say, I'm going to sell these for $10 each.

• 18:23Speaker 02

  And then it's random who gets selected to buy the pieces. And then, yeah, the third, the third main type is the open addition. The open addition is where you set a price and you say, anyone can come buy this piece for a period of time. Maybe five minutes, maybe 10 minutes. And then the the addition size is determined by how many are sold. So the, the key advantage of open additions are they do make your work far more accessible to, to regular people. You can set a price where you know people will be able to afford it. With all the other release formats, you know, some people may get outbid and they won't be able to afford it. Or maybe they'll get unlucky and they'll lose the drawing. But with an open addition, you know, you can guarantee that people who follow you will be able to collect your work.

• 19:05Speaker 02

  You know, open editions are also the the freest release format, you know, that that means that people, a bunch of people could buy your work. And maybe they're just speculating on it. Maybe they don't really want to own it. So they sell it for a loss a week later, and that makes you look bad as an artist. So I think open editions are, they they can also be one of the scariest release formats to do. Because you're basically, you're letting anyone do whatever you want with with your artwork. At least with an auction, you know, the the person buying it is the person who wants to own it the most. So their intentions are probably pure. But of, yeah, those are, those are basically like the the main release formats that we do.

• 19:39Anthony Pompliano?

  For sure. And so what are people doing with the NFTs they're buying, right? There's all these artists, and I think that part of the beauty of NFTs and the infrastructure is really that there there's been this democratization of the ability to sell, right? And and get your art and digitize it and do all that. But there's obviously in the marketplace, there's buyers on the other side. And so what exactly are people buying? Is it speculation on price and they're looking at it as an investment? Are they displaying it somewhere? Just what do you see them doing?

• 20:07Speaker 02

  Yeah, I honestly, I think, especially with the huge run up, people really tend to, they tend to like look at NFT collectors as a monolith. And they tend to say like, oh, this is all just speculation. Or, you know, this is just everybody doing everything. Different collectors have different hurt intents, like, you know, that like people buy NFTs for a lot of different reasons. And this is what I always try and emphasize to people, like, there's not just one reason that people buy NFTs. It's the same way with physical art. There's really like a lot of, a lot of different reasons that people buy NFTs. Personally, I, my favorite thing to do with them is is display them in the screens that I I have in my house. And I love to show them off when people come over. It used to be a bit more challenging because I had, in order to show them off, I had to first explain what an NFT was.

• 20:51Speaker 02

  And then explain that I was showing off an NFT. But now, like, so many more people are familiar with them. I actually had a task where I would come over to my house the other day. And she walked in and she saw my screens and she's like, oh, those are NFTs. And I was like, oh, my God, I, this is going mainstream. I can't believe it. But, uh, yeah, personally, that's my favorite thing to do is is show them off the same way that people would show off physical art. I honestly think that everybody exists on sort of an investor-collector spectrum in the NFT world, which is exactly what you see in the fine art world as well, where some people are doing it mostly to collect, some people are doing it mostly to invest, and then there's like, there's really just like a mix of in-between. But I don't think

• 21:35Speaker 02

  almost everyone who's buying NFTs like has some sort of emotional attachment to them. And the crazy part is, even the people who do it mostly as an investment, when they buy art, they talk about how like sad they feel whenever they sell a piece, and this like feeling of like, you're like, damn, I can't believe I let that go. Even if you're selling it for way more than you bought it for, it really is like a sad experience to sell a work of your art. So yeah, I think, and the other thing that I should mention is that people are building these like beautiful museums in digital worlds, in the metaverses, and people are just like showing off their NFT, you know, like tweeting about an NFT you bought is honestly a pretty good way to show it off. So yeah, I really do think that people tend to view NFT collectors as a monolith, but the NFT collectors are like

• 22:20Speaker 02

  a large group of people who really do it for a variety of different reasons. Some of them like to collect, some of them do like are more into speculation and do just view this sort of like an asset to be flipped. But really, there's like a wide variety.

• 22:34Anthony Pompliano?

  And so when you start thinking about where we've gotten to in this market, you saw this much, much earlier. I'm guessing that you probably didn't think it was going to happen this soon, right? But are we still in the early days? Is this something that feels like, no, you know, that we're going to have this like long winter? Just how do you think about market dynamics and timing? And, you know, for many people, they're just now discovering NFTs and they're just now learning about them. Does that suggest that there's still kind of a really long runway? In 10 years from now, it's going to be much bigger than it is today? Or just how do you think about it?

• 23:08Speaker 02

  Yeah, absolutely. And and actually, you know, a lot of people don't realize this, but like there was an NFT winter before. And that's really when I got into it. I mean, the first NFT, the first NFT project that really got sort of major traction or major attention was CryptoKitties. And that, you know, that got written about. It was in like all the major media outlets. It was all over Twitter. It was famous for sort of crashing the network. The Ethereum network. But then immediately after that, I mean, CryptoKitties usage plummeted. There are all these CryptoKitties copycat apps that came up and most of them just folded. There, there are a few like big NFT companies that raised venture money. And, you know, I think most of those companies ended up just like shutting down the doors and returning the money. That, that's when I started Nifty Gateway.

• 23:53Speaker 02

  There, there was already like an NFT winter that we saw before. And what I like to emphasize is that Nifty Gateway has had. I mean, we, we've had days where we, we did close to as much volume as CryptoKitties did in its entire lifetime. And, and NBA Top Shot has had days, I think, where they exceeded CryptoKitties lifetime volume. So like, yeah, there was this, before we saw this dynamic in NFTs, where there's this huge run up in interest. Um, there was this sort of winter long period, but now here we are a few years later, we're literally a thousand times larger than the peak was back then. That, that's just how these go. I mean, like this is, it's, it's really not too dissimilar from crypto. Really, my, yeah, I, my view on this is like, uh.

• 24:33Speaker 02

  What, what happened in the wintertime was the, the winter, it sounds so dramatic, but what happened in the NFT winter is that the people came in, coming in like really formed strong attachments to the NFTs that they were buying. And they really started to like love them for the art's sake or, or for the collectible sake. And that formed like the, the solid foundation of a, a healthy market. And so that's really what we try and focus on at, at Nifty Gateway. We're, we're really trying to do more to educate, educate people and, and tell them like, hey, you're, you're best off buying NFTs that you really love. And that you're really proud of, because we think that's one sort of like the solid bedrock of a, a strong collector community.

• 25:08Anthony Pompliano?

  Yeah. Talk to me about digital museums. We talked a little bit about what people do with them. I keep hearing people talking about digital museums, virtual world, kind of the metaverse, all this stuff. What are you thinking there? Have you spent any time looking at digital museums and do you think it's interesting or not?

• 25:24Speaker 02

  Yeah, I mean, I've spent a little time looking at the Museum of Crypto Art, which is in Somium space. I think it's one of the most incredible NFT collections. I still don't have a VR headset, so I haven't been able to experience it in all of its glory. But yeah, I do think it's a really fascinating, I mean, it's really like a cool way to show off NFTs. And you can do so much more in a virtual space than you can in a physical space. So yeah, it's not an area where I've spent a ton of time, but it seems to be like a great use case of NFTs. And honestly, I mean, that's, that's what I think the best thing to do with art is, right? Like you should put it in a museum and let people admire it. I actually think, I really think that we need to open up a physical NFT museum.

• 26:09Speaker 02

  Because here's the thing, like NFTs, we've got all the young people, like we have all the people who are like on social media. You know, like imagine how many people would come visit an NFT museum, like there's so many, these artists have so many fans, like the, you know, we have a lot of followers, like so many people are so into this that we could drive so many people to a physical museum. And honestly, like, you know, I think like, I think the art that we sell is just like way more exciting. And like five, seven years from now, if you like, put us right up next to the Momo or the Met, I'd imagine like most people in the next generation would be like, no, I want to go check out the NFTs. Like, I don't want to see the boring old like modern art, like I want to see the like new exciting stuff. So I think we need a physical museum to compete with all the physical art museums.

• 26:54Anthony Pompliano?

  I tend to think that you're probably right on that one. When you start thinking about physical, I know that you've got some physical displays. You were actually probably the first person who ever told me about this a year ago or so. What are you thinking there? Have you seen any interesting innovations in the physical NFT displays? Or what do you think people should be building if they're interested in that?

• 27:15Speaker 02

  I I tell whoever I whoever I meet that this is like a billion dollar company waiting to be started. So I maybe I shouldn't share. I'll I'll share my plans on the podcast because like I I'm too busy. I would never be able to start this. But yeah, I think there's like an amazing NFT display company out there waiting to be started. I actually think the way that it should be approached, every whenever anyone thinks about an NFT company, the first thing that they think about is hardware. They're like, okay, I need to go out and build a hardware device and then sell it to people to display their NFTs. But I actually think that's wrong. I mean, building hardware is is enormously difficult, like very difficult to get right. You're going to deal with all these issues. Instead, the the way to start it would be as a services company. And instead, what you do is all the people, you know, like

• 28:00Speaker 02

  we we have people we're talking to that are trying to do NFT art shows. As as in order to do an NFT art show, you have to figure out a way to display the the NFT. Or say you're starting in a hotel and you want to show off your NFTs. You need a good solution, someone who can just come in and be like, yes, we are the experts in displaying NFTs. We'll get everything set up for you. Just pay us a flat fee. I think this would be the this is the company to start. You you start like a services company that rents out the screens, charges people a monthly fee, and then make sure that the screens work 100% of the time. Make sure that the NFT displays are are perfect and beautiful. That that's how you could gain a foothold. And then from there, you would basically own all the demand. You would know everyone trying to build NFT displays. And then you could start selling the physical devices.

• 28:44Speaker 02

  And the thing is, like, people really underestimate this market. I mean, people, there are so many art museums around the world. There are so many like corporate offices. There are so many hotels. Displaying physical art is a much bigger industry than people realize. So I actually think that this is sort of like a a great company sitting there waiting to be started. If you're listening to this podcast, feel free to take my idea and use it. Just make sure that you call me so that we can integrate with Nifty Gateway. Because this is really what we want. We want someone to go out and like build a great display solution so that we can sell it to our customers.

• 29:15Anthony Pompliano?

  Before you call uh uh anyone at Nifty Gateway, make sure you call me so that I can invest. And then we'll go to Nifty Gateway and then we'll have a a great solution. No problem. All right. So when you look at the last 12 months or so, what's been the most surprising thing for you through this uh this chaos?

• 29:33Speaker 02

  Oh, boy. Um. Honestly, the

• 29:38Speaker 02

  Yeah, the I would say the most surprising thing is is basically like the the level of like famous people that we we like talk to or that or that just like want to call us now. Um, I I really was not seeing that coming. When we first started at the gateway, it was like we very much had to go out and like pound the pavement in order to get people to sign up and use the platform. And now the inbound requests we get are like just ridiculous, you know. Um, and the people that we're releasing content with, I I frankly would never, I like, those are the people on our our dream list. You know, like six, seven months ago, we were like, oh, my God, maybe one day we could get this person launching NFTs. And now they're like blowing up our phone, being like, hey, can I launch you? It's it's just a it's a really crazy experience to go through.

• 30:21Anthony Pompliano?

  Who who's the most famous person that you've been on the phone with that you've just been like, oh, my God, I cannot believe this is happening right now. And it was just surreal.

• 30:31Speaker 02

  Um, I so I don't want to say because the their project is so a surprise, but um it, yeah. I I don't want to like, I just

• 30:41Anthony Pompliano?

  All right, who's somebody you can say?

• 30:44Speaker 02

  I mean, honestly, uh, Steve Aoki, Calvin Harris, like those were Zed, these were all the DJs who I like listened to in college and everyone like their music was like incredibly popular. The other day Zed retweeted me. I was like, holy crap, I can't like this is insane. You know, if you told me this like five, six years ago, when we were just like listening to Zed. Yeah, and actually, yeah, I I do think the music DJs is also like the DJ NFTs are another interesting thing worth worth talking about if you want to go into that.

• 31:13Anthony Pompliano?

  Yeah, well, why do you think those are interesting?

• 31:16Speaker 02

  Well, the we we basically had this phase where like three loud or or Blau you know, he's still not sure which which it which

• 31:26Anthony Pompliano?

  It's Blau.

• 31:27Speaker 02

  Wow, yeah.

• 31:28Anthony Pompliano?

  Yeah.

• 31:29Speaker 02

  Wow, well, I was the one who started it all and and Blau's a great friend. He's like a real like I love the guy. He's a real innovator. Um, and he really saw this. You you was another person who I think like saw this whole thing happening before everyone else. Um, so like

• 31:45Speaker 02

  Yeah, he started it all and he was the first DJ to really like launch NFTs. And now a lot more DJs are getting into it. And I actually think it's really interesting for the art personally. Like I, I think DJs can really make fantastic art that they've never been able to make before. But a lot of, a lot of the way their collections perceived is they're just sort of perceived as celebrities. And people are like, oh no, there's this celebrity coming in and like making NFTs. And they kind of think like, oh, it's a cash grab. But really, I, I, I think like, again, like these musicians, musicians are artists. You know, they're not, they're celebrities, yes, but like they're artists first. And like the stuff that they're creating in the NFT space, like genuinely has a lot of artistic value, I think.

• 32:26Speaker 02

  Um, so I think that this is one of the, the most underrated like aspects or like one of the most underrated NFT categories is like music NFTs. So many people are just seeing them as celebrities, but really they're artists who like know how to artistically innovate. And like know how to build, like they really understand the dynamics of NFTs pretty well. So I, I think that they're sort of like a, a good group to keep, keep eyes on.

• 32:51Anthony Pompliano?

  For sure. And so when you think about, uh, the difference between a musician and a digital artist, like to me, they're just creatives, right? They're just creating, uh, there actually isn't that big of a difference, it sounds like, especially in this new format.

• 33:04Speaker 02

  Yeah, uh, so I, we've, we've kind of struggled here, right? Cause you know, it, it used to be, it used to be like the only people coming into NFTs were just like authentically interested in the medium. But now it's become this big thing. It's all anyone talks about. Now in the community, there's like, people are anxious. They're like, we don't want celebrities coming in and doing a cash grab. We want to maintain the authenticity of the community. So that's like a new element that people, like, we didn't have to deal with that five or six months ago. Because the only reason people were into NFTs is because they like authentically found it interesting. Now people are, are thinking about like, hey, how do I sort through, who's an authentic creator? Who's just trying to like, who's just a celebrity trying to monetize their brand? And I actually think a lot of musicians have like gotten caught up in this.

• 33:48Speaker 02

  Cause yeah, musicians are artists. They're not just celebrities trying to monetize their brand. They're artists creating in this exciting new medium. But a lot of them have sort of been like mislabeled as, as just celebrities. So yeah, I think that's definitely like, I think they're sort of an underestimated category of NFT creators right now.

• 34:05Anthony Pompliano?

  Talk to me about the response from the traditional market. We've obviously seen Christie's do the auction with people. Sotheby's, I think, is doing an auction with PAC and it just seems like more.

• 34:17Speaker 02

  It just finished today, actually. It was on Nifty Gateways.

• 34:20Anthony Pompliano?

  Okay, and so talk to me a little bit just about like, what do you see from that traditional market?

• 34:27Speaker 02

  Look, I honestly think it's great that they're getting in. I think it's huge validation of the NFT space that Christie's and Sotheby's are selling NFTs. You know, it really shows that this this thing is here to stay and it's not just a fad. And, you know, where it's like getting recognition from some of the largest players in the art world. You know, I think it in some ways like the NFT platforms right now are they're very much internet native businesses. You know, they're they're very different than Christie's and Sotheby's. Christie's and Sotheby's are auction houses that have moved online slowly and steadily. But they're not really businesses born of the internet.

• 35:05Speaker 02

  Whereas the NFT platforms are, they are businesses born of the internet. And so they're, you know, the the stuff that we do on Nifty Gateways is pretty different from the stuff that Sotheby's and Christie's do. Like, I almost think it's it's so different that I don't even know if I would consider us in the same category. Because like, you know, Nifty Gateway is all about creators collecting, connecting to their fans, like artists, you know, doing all sorts of interesting releases and artists doing surprise releases and saying like, hey, if you if you've collected three pieces of mine, like, I'll give you an extra award. It's a sort of like living, breathing, like, very dynamic experience. Whereas Christie's and Sotheby's are, you know, they're they're just like, yeah, they're just like normal auction houses where you put up

• 35:48Speaker 02

  stuff for sale. So I really do think they are sort of categorically different businesses.

• 35:55Speaker 02

  And so, yeah, we don't really think about them as competitors. We think it's awesome that they're getting into the space.

• 36:00Anthony Pompliano?

  What are you most excited about moving forward? More artists? Is there a specific milestone that you're like waiting for? You're like, this will be another inflection point? Just when you look forward, what do you get excited about?

• 36:10Speaker 02

  Oh, boy. I mean, this will be a boring answer, but I'm most excited about hiring more engineers at Nifty Gateway and making the platform work extraordinarily well. The thing about like the growth we experienced is it just really broke our, it broke our system. Which in retrospect, I kind of think that was inevitable. Like, I don't know if we could have managed it in a better way. You know, because we were just, we did not expect the growth that happened. Like, we were just like not prepared for that to happen so quickly. So we really ended up in a place where like way more stuff was broken than should have been. You know, our system, some of the code that we have is like still written by Griffin and I. You know, so what I'm most excited about is just like, you know, robustness,

• 36:54Speaker 02

  engineering excellence, growing the team and really making Nifty Gateway like a high quality, like truly mature company, which is kind of a boring answer. But, you know, I guess that's like, I really think that's like the key to success, you know?

• 37:09Anthony Pompliano?

  What type of engineers do you need?

• 37:12Speaker 02

  We need backend engineers. Our backend is written in Python and Django. Front end, our front end is written in React. And then specifically, we're looking for people who have experience dealing with botting and fraud issues. So, yeah, all those categories. And then we're also looking for product people as well. So if you're a product manager, you can shoot me an email at [email protected] or just go on our careers page and apply. And, yeah, that's a, I really think that's the number one thing we need to push the company forward right now. Kind of a lame answer, you know? I should be saying like some huge key launcher, like, yeah.

• 37:49Anthony Pompliano?

  It's the truth, right? If that's what you need help with and that's what helps build the company and the product, then that's exactly what you should be saying.

• 37:56Speaker 02

  You know, honestly,

• 37:59Speaker 02

  When I first started Nifty Gateway, like you don't really think about like a startup as just being a hey, let's go out and like recruit as many talented people. Like you see the way startups succeed. It's like, oh, they built the best product. But so now I think so much of it is just like, oh, they got a team that like really made something that worked exceptionally well. And it works like 100% of the time. And so people can rely on it. That's the way I think about startups now.

• 38:25Anthony Pompliano?

  For sure. Talk to me about Gemini before I let you go. Obviously Cameron and Tyler bought Nifty Gateway. And you guys have been integrated into a lot of what they do. One, obviously they should get kudos for seeing a lot of this similar to how you and your brother did kind of coming. But talk a little bit just about how they've played a role in this, good or bad, and kind of how you think about Gemini moving forward.

• 38:54Speaker 02

  Yeah, honestly, I mean, I don't think that we would be anywhere close to where we are without Gemini and specifically Cameron and Tyler. You never really know what's going to happen after an acquisition. You know, everyone, everyone says things. It's kind of like that old saying where during a job interview, it's like you lie to them, they lie to you. And then like everyone, and then you sign the papers and like it's all done with. So we didn't really know when we started if they would actually give us autonomy and actually like really sort of carve out the space for Nifty Gateway to operate. But they they completely followed through and they really like, they really set up the environment perfectly for Nifty Gateway to succeed. So I think they deserve a ton of credit. Not only that, but they contributed in a lot of very specific hands on ways.

• 39:38Speaker 02

  You know, recruiting people to create on the platform, they were huge in that. They they had a lot of, you know, direct impact on the product and the strategy of the company. He hires, they were enormous. So they've really been like enormously influential. And yeah, I think I think it was sort of like a genuinely visionary move. And then they executed perfectly because they they basically let Nifty Gateway grow on its own and and, you know, grow to be the product that it is today.

• 40:06Speaker 02

  Which, yeah, I really think they deserve a ton of credit and I'm really happy to be working with them. They've been fantastic partners.

• 40:14Anthony Pompliano?

  Well, they speak just as highly of you. So it was a marriage made to happen. And obviously, you both all being twins still is one of the craziest freakiest things in the world, but it works.

• 40:29Speaker 02

  Yeah, that's still that's still what people love to talk about. I'm like, we're more than just twins, you know, we're people.

• 40:38Anthony Pompliano?

  Well, I think what isn't is not weird is twins. The weird part is twins acquiring twins. And but people always want to know, and they, you know, folks who have who know that I've had you on a podcast before, always asking me like, do you think that that makes them like each other more is because like they like twins? And I was like, I don't think they've probably thought about it at all. If not, maybe maybe they had one conversation once like, oh, you guys are twins too. Okay, cool. And like, then they went and got to work. But

• 41:05Speaker 02

  Yeah, it was much more like that. I mean, twins are just regular people, you know, it's not that different than having a brother. It's, you know, it's like, it's a it's a pretty similar concept.

• 41:16Anthony Pompliano?

  We'll start the Twitter campaign for twins or people too, and and hopefully get you guys some some credibility there. Awesome, man. Listen, what I want you to leave everyone with kind of your pitch to artists. I know that that's where your heart lies and the rest of the team. Just what's your pitch? If somebody's thinking about doing a drop, I should come do it on Nifty Gateway.

• 41:38Speaker 02

  Yeah, honestly, I think the pitch is navigating the NFT world is really difficult. Um, you know, careers are volatile. It can be really hard to make the right decisions. You know, you really you need someone with the experience and you need someone who's going to be a trusted partner. That's really our goal. Fully one third of the company is dedicated to artist relations. Like, those are people who just spend all day long working with artists, helping them come up with new releases. Um, and yeah, that's really like Nifty Gateway is is going to be a true partner to you in your career. So that's my pitch to artists.

• 42:12Anthony Pompliano?

  I think it's a good product, good people, and hopefully good times. So listen, man, thank you so much for doing this. I always enjoy talking to you. Hopefully, we will get you guys digital museums, many, many more artists. And next time we talk, it won't be 140 million in monthly sales. It'll be a billion. So keep at it and we'll do it again.

• 42:33Speaker 02

  And we'll have 1,000 engineers so that all billion in sales are executed flawlessly.

• 42:40Anthony Pompliano?

  Awesome. All right. Thanks so much for doing this.

• 42:42Speaker 02

  Thanks, Paul.