AJ Vaynerchuck on NFTs: Too late to invest now?

Full-Length Interview with Gary Vaynerchuck about NFTs – All Resources linked down below

JH: AJ, I appreciate the early morning in New York. Thanks for taking the time. Yeah, with the German audience to kind of discuss a couple of exciting things that are happening.

AJ: Awesome, no Julian, thanks for having me on.

JH: Hey, I want to dig right into it. With the question, how did NFTs come up for you? What was the first experience, maybe share a bit there. What was the time? When was this? Kind of walk me through a bit there and then, how did you stumble across this? Were you immediately like, man, that’s like the next thing, or were you a bit skeptical, like: ‘what, digital stuff can be valuable’? Walk me through that a bit.

AJ: I’ll go back a tiny bit, because I think a little bit of context will help to explain my experience with NFTs. So, you know, first off, it starts with bitcoin for me.

JH: Really?

AJ: Just a blockchain and cryptocurrency, you know right? When I say that, it’s just more so, my career has been at the intersection of business and technology. You know, I started a social media ad agency first back in 2009. And that was heavily reliant on things like Facebook, Twitter, Tumblr, what then became Instagram, Snapchat etc. And so because of that background and having interned in the silicon valley area during college… met a lot of really smart people in terms of just the technology and the future of technology. And so bitcoin was first introduced to me around 2013. Admittedly I didn’t fully get it, but I trusted my friends enough to say, you know what, I should buy a few coins. Same thing with Ethereum, you know, I understood that Eetherum was a platform. I bought my first Ethereum in 2014. I understood it was a platform but I didn’t quite see the use cases that we see today. But I just trusted my friends and went that way. Then about three years ago, my brother and I did an investment in a company called Roll. Roll is the digital currency platform, probably best known now for being the platform behind whale coin. And so we made an investment in Roll seed stage.

JH: Three years ago? 2018, or when was that?

AJ: Yeah, that sounds right.

JH: First of all, how did you get in touch with the founders? How did you get what they were doing? To me that’s super early. Like 2017, it was the first time NFTs come up, everyone writes them off as like CrypoKitties. It’s going to go away. You made this investment in 2018, I mean, that’s just powerful.

AJ: You know, it’s all about relationships and network, right? So a friend of ours Alex Exold, an entrepreneur and investor, introduced us to Bradley Miles, the CEO and co-founder of Roll. We sat down with Bradley and it started just by taking an intro from somebody that you know and trust, right? So I think Gary and I saw the vision for the blockchain in general and Bradley’s company. Just because I am a firm believer in the digitization of just about everything. I am just a believer that technology will continue to move us forward. So with the virtual currency side, there’s already so much insight into human behavior, willing to utilize digital currency and put value into digital currency. I think gaming is a great example of that, if you go quite a bit earlier than even virtual currency and some of the games that are happening now, like things like FarmVille and Candy Crush. Obviously more recently, most young teenagers are caring about Fortnite and Roblox and things like that. It’s centred around just a fundamental belief that virtual currency was something that was going to continue to get into the mainstream and that the blockchain was a great platform for that. And so Roll was something that my brother and I saw, and believed in, and I think with NFTs… again back to my brother Gary, he first put CryptoPunks on my radar and I have to admit, initially I was a little bit skeptical.

JH: What year was that? I mean they started 2017, they were not even on Ethereum standard. So that’s like…

AJ: We were not crazy early to NFTs. I’ll admit that. This was probably December of 2020. This was three, four months ago.

JH: Okay.

AJ: Yeah. We were not crazy early. But we had been looking for this and we’ve been wanting this. And I think NFTs sang to us, generally speaking, because we pride ourselves at sitting at the center of technology and consumer. And NFTs are just so consumer facing. I am convinced in NFT art and NFT collectibles, because there’s obviously a lot of use cases for NFTs. Art and collectibles and maybe collectibles even more than art, will be the gateway for normal people to get into the blockchain and into cryptocurrency. And so that is what got us so excited. So I saw Punks, immediately I was a little bit skeptical – not necessarily of digital art, but my whole thing was ‘why Punks?’ at first. But it wasn’t the cheapest of all time… I mean, because we weren’t that early. It was still like 8,000-11,000 dollars for a Punk. That’s like not crazy, that’s not 7.5 million for an Alien, but that’s certainly not the cheapest thing I’ve ever seen either. And so when it really clicked for me, was NBA Top Shot. Probably a week and a half later – again my brother, credit to him, he deserves a lot of the credit – sent me NBA Top Shot. I went on NBA Top Shot and I was like, ‘okay, I can digest this more’, because these digital moments correlate to something that actually exists and people care about. And it also maps to a behavior that already exists. Like this is a behavior that I grew up with and that I personally care about. I bought trading cards as a kid, I buy trading cards now. And I said okay, I looked at the trading card experience. Let’s use this Tyler Herro card again, so a very popular player for the Miami Heat. I buy a pack of cards, right, and I pull this Tyler Herro. First off, in order for me to redeem the utmost value for this card, I need to get lucky, that the printer printed it perfectly. Because there’s different guidelines and you want to get a perfect grade. But sometimes that perfect grade is not in your control. If you ding a corner. No disrespect to Tyler Herro, but you know, I ding this corner, right?

JH: AJ, ah.

AJ: It’s for the greater good at this point.

JH: Sure.

AJ: I ding this corner and this card probably just went from like 30 bucks to three bucks, right? But what’s even crazier is, before I ding the corner.

JH: Or maybe, because AJ Vaynerchuk did it, it went from 30 dollars to 300 dollars.

AJ: We’re going to NFT that clip and we’re going to make it better, but before I even open this pack of cards, it might be slightly off-centred and not perfect value. Nonetheless, pretend I didn’t bend the corner. I sent it to PSA or BGS the grading card companies. I have to wait like three or four months to get it back. I hope I got a perfect grade. I get a perfect grade, I post it to eBay or StarStock or StockX. I sell it. I have to ship it back in the mail, for a second time. I send it to the seller. Seller says they didn’t get it, now I am going to dispute with PayPal and eBay or whatever. Whereas with NBA Top Shot, if I got a Tyler Herro moment, it’s coming in perfect condition and there’s zero friction for me to click a few buttons and have it live on the marketplace and when it sells, it sells. There’s no disputes with PayPal or eBay, there’s no waiting to see. I recently sold a really high value card for a few thousand dollars on eBay, and then I just never got paid. And 10 days later I decided to relist it. That doesn’t happen with NBA Top Shot, and so then I was like, okay, because at the end of the day, and it was Mark Andreessen who first said this I believe, this card that was 30 dollars before I bent the corner, realistically it’s worth about a quarter. Less than a US dollar. Because of the cardboard and the ink and whatever, but we as a society place an extra 29 dollar of value on it, and that’s essentially done digitally. There’s no physical value beyond the few pennies associated, so we can do the same thing with a video in my opinion. So that’s when it all really clicked, and then I went back to CryptoPunks and I am actually big on CryptoPunks, because now I understand that CryptoPunks are very much considered the OG of the NFT space. There’s only 10,000 of them and so I just think the supply and demand and the scarcity of it … and I think CryptoPunks are not just art, but I think they’re museum-like art, because of the historical significance of them.

JH: Okay, I am going to go back to that. But first I want to ask another question, and that is, can you walk me through that thought process in that moment, when either you or Gary come up with this new revolutionary thing. And I think 99.9 per cent of the people just go, ‘ah, whatever, that’s just crap’. And most of the time it is. But then, how do you differentiate between, ‘wow, that is something’ or, ‘this is crap’? What is different in your thought process? Walk me through there, because I think that’s what really distinguishes you guys from winning over and over again and so many other people losing.

AJ: I think that one is, there is no value, there’s no business or monetary value at least directly correlated to being right, when you say something is not going to work. So just because, you’re like, you know, what’s the value, you know what, this is stupid. CryptoPunks don’t make sense to me, and you just make this argument and it’s like, you know what, they stink, I can print it out, I can take a screenshot. It makes no sense to me, and so on. Let’s say you’re right. Congratulations you made zero dollars. So I think that’s the first part. It’s like the economic upside of being completely negative and a naysayer, of course you can save yourself money. But the way I look at it, when you’re running the line of technological innovation you don’t need to go one for one. And so if I was right, I am making up numbers, these are not my actual numbers, let’s say I invested 50.000 dollars into CryptoPunks and I was wrong. Which so far, I am not. But it could be hypothetically fall apart. Let’s say I was wrong. And I lost 50 grand. Okay, I am down 50 grand. Next thing comes up. I was lucky enough to be a pretty early investor in Uber and I put a hypothetical 50.000 into Uber at the time that I did. Again not the same numbers that I did. And that time I am right. That’s a seven figure return. And so just because I was wrong. You know, when you’re wrong on something, you’re not wrong financially at the scale for how wrong you were. It’s defined. You’re wrong for 50.000 dollars. You’re not wrong. I think if I lost, based on how wrong I am. It would be a different story. If I am like super, … . Am I allowed to curse on this by the way?

JH: Dude, of course.

AJ. Okay. If I am super fucking wrong, I don’t lose a million dollars. I just lose 50.000. It’s capped. If I am super fucking right, I can make millions. And so people are looking at it, it’s like, nobody’s going to bet a thousand. It’s impossible to bet on innovation and technology and bet a thousand. Nobody’s ever done it. The same way with baseball, you play baseball and you’re a hitter and you’re one of the greatest hitters of all Tim. Ted Williams, Tony Gwynn, those guys batted 400, meaning they were right or they executed perfectly four out of ten times. Venture capital execute one out of ten times and you’re a goat. And so, I think that’s something that people need to wrap their head around. The upside of being right is so much bigger than the downside of being wrong. The downside is capped. That’s a big deal. And then I think, the other thing is, I’d be lying to you if every time I’ve seen something really innovative, I didn’t have some sort of initial skepticism. But I think there’s a lot of strength in battling your own skepticism and looking for the upside and trying to see the future for how big it can really be. That’s a big factor too. A lot of times I test my plans on normal people. My wife, my friends that don’t dive into this world, my parents. I remember when we decided to do Uber, back in 2010, so many people were like, I am not going to get into a strangers car and drive with them. I am like, but you already do. You don’t know the taxi driver, when you grab a taxi. You just accept the fact that because it’s a yellow car and it’s got a light on top, that it’s regulated. The same thing can apply for Uber, if not better, Uber is tracking your whereabouts, has a profile on the user. I don’t know, I guess the last thing I’ll say is, it’s just a passion too. Like I love this NFT ride, these last three to four months have been some of the most fun I’ve had. It reminds me so much of the mid to late 2000s in terms of web 2.0 and social media.

JH: Really?

AJ: Oh, yeah, so much. And a big reason for that. Probably the most fun part about this journey is, you know, I’ve been very fortunate, I made a lot of friends along the way, but you know, life happens, distance happens, pandemics happen. I am getting text from people, that I haven’t talked to in five or six years, because my wife has given birth to three kids in the last four years.

JH: Congratulations, that’s awesome.

AJ: Thank you, it’s a zoo, thank you. I bet one of my kids makes a cameo at some point.

JH: That’s awesome. All good.

AJ: It’s like, I’ve been in the sports business lately, and a lot of those friends of mine are in the tech world don’t really have that care for the affinity for sports, but I’ve gotten so many texts from people. I was texting with a friend last night being like, man, this feels like 2008. And he’s like, yeah, why do you say that? I am like, well look at us right now, we talked a lot in 2008. We didn’t talk so much from 2014 to 2020. And so I think a lot of really smart people just see the upside in this thing, the same way iPhone apps and social media companies and things like that, it reminds me a lot in that way.

JH: May I ask how old you are?

AJ: I am 34.

JH 34. So 2008 that’s what?

AJ: Like in college.

JH: Yeah, college.

AJ: In 2008 I spent the summer in San Francisco and did an internship at a company called Revision3which was a sister company to a company called Digand Dig was one of the very early web 2.0 companies started by a guy named Kevin Rose. I was out there and I couch surfed the whole summer, I stayed with like eight or nine different people and just went out every night and just met a ton of people and it was awesome.

JH: Cool man. Let me ask about NFT. So I am going to throw in a bit of a controversial statement. I am a big fan of NFTs, I haven’t invested a single dollar yet. I’ve been early in bitcoin, made tons of money, more than hopefully I will ever be able to spend and now I am looking into this NFT space and I approach it the same way as I did with bitcoin. I want to talk to smart people, I want to talk to people about NFT, where I really feel they are probably way earlier than me and understand this way better and I want to kind of pick their brain and that’s why I am so glad that you’re taking the time here. To me, the way people invest in NFT or the reasons they’re investing in an NFT right now, for example digital art, to me is a bit wrong, because they’re investing for the art part and not investing for the story. They’re not investing for the emotional part. So for example the Beeple piece right now, right? I think the reason this thing is so valuable right now is not the 5.000 little pics, it’s the story around it. You know what I mean? How do you see that? Do you agree with me there? Let’s say you disagree, fine, then I would love to hear why. But if you agree, then I would challenge that maybe crypto art is probably going to have a struggle as a NFT. And maybe other forms would be more relevant. I am just throwing these in here.

AJ: Yeah, so I agree with the first part and I maybe slightly disagree with the second part. You heard me before, I was initially skeptical of Punks, but then I came back around and secured a real chunk of Punks, because of the story. And the story being and I have an investor brain. So that’s going to skew it a little bit and it’s not always the right way to look at things. And I am sure there are plenty of things I am going to miss out on because of that. But I circle CryptoPunks in particular, because it’s going to go down as the history of NFTs. You can’t tell NFTs story, without CryptoPunks. And that’s why.

JH: I agree.

AJ: So that’s a big part, right? I think CryptoPunks, there could be a crypto museum you know, the same way people go to the Louvre or the MoMA in New York. There could be a CryptoPunk museum, and the dope part about the CryptoPunk museum is, that they can do like, first of all, depending on timing, talking about AR and VR, but even if it’s just the physical, you know, things like infinite objects and other companies that are taking your NFTs and making them, for example. This is something called infinite objects, this is an NFT, that’s a physical frame, right now, right, like this is already happening. So whether that’s done through something like infinite objects or VR and AR, the cool thing is like a CryptoPunks museum, doesn’t necessarily physically need my Punks. Right, I can basically, if Larva Labs or whoever does the museum, say, ‘hey, we want to display your Punks’, I can just say, ‘yes, that’s fine, deal’. I can do a smart contract and they can have the rights to display it and things like that. And so I think that’s pretty damn cool. So that’s where CryptoPunks come big for me. The other area where I’ve been investing is… it’s funny, you hit the nail on the head… I am looking for stories behind my NFT investments. And when I say story, I am also probably looking for a subset of justification for the relevance and the significance moving forward. Another example is like, I am, and this one is an interesting place right now, I have a few different EulerBeats, which is an on-chain generative music NFT. And the reason why I like EulerBeats is, because I think, they have an ability to potentially make an everlasting impact on the music industry based on their model, where you know, they created 27 beats, they allowed users to create 27 beats, using the chain to create that music actually. And the first 27 that were minted, those are considered the masters. And then people could buy prints, up to 120 prints of the master. And every time a print is bought, the master owner actually makes money. Which is very much a publishing model that exists in music. And so I just thought that EulerBeats being the first, kind of take that approach had historical significance. Another one that I like, that I thought was really interesting was Hashmasks. What I liked about Hashmasks was just that they were the first one to have this really interesting playground of significance. Where there’s all these hidden… it’s like the daVinci Code, there’s all this hidden meeting behind mask and there’s all these attributes that haven’t been discovered yet. And people are finding easter eggs and I thought that was important and significant. What else, I can look at my wallet.

JH: Have you, like… the key interesting investment that I see at the moment, would be those that are truly digital and have no utility in the physical world. But the utility comes from status or comes from this true story. “My first 5.000 days” there’s no utility in the real world, it’s pure status. And someone is willing to pay 69 million dollars for that, right? To me, that’s groundbreaking.

AJ: Absolutely. But at the same time it’s groundbreaking from the perspective, it’s groundbreaking for the NFT industry, but it’s not groundbreaking for the society. Some other person spent 69 million dollars on a physical painting last year. Humans have done this. This has already been done. And the way I explain NFTs to people that I know that are skeptical, I do it this way. It’s two quick sentences, I say, hey, I am going to explain NFTS to you. Let’s start here, do you accept the fact, that there are people, that are wealthy, that have willingly, and will continue to willingly spend seven to nine figures on paintings and sculptures in society. And you have to say yes, if you don’t say yes, I just end the conversation, because you’re not willing to have a conversation, right?

JH: Yeah.

AJ: Yes. Next, are you willing to accept the fact, that my 11 year old nephew, the only thing that he wanted for his birthday, was Microsoft store credit so that he could buy Fortnite skins? And if they say no, I say, well then you should probably go look into the fact, that that’s a multi-billion dollar industry. That there’s literally billions of dollars a year being spent by kids and adults on non-utility based digital currency.

JH: Yeah, I think you have to add that it’s non-utility. I think for most people it’s unbelievable.

AJ: Sometimes people were like, well do Fortnite skins give you like superpowers and I am like, no, you just look different and you look cooler. And it’s literally no different than buying this hat. It’s a form of self-expression and so when my nephew plays with his three friends and he buys a new outfit, it’s him expressing himself to his friends and his opponents. And beyond that, there’s no utility. And that’s a multi-billion dollar industry for epic games. So if you understand those two things, you can understand NFTs. You can understand why somebody spent 69 million dollars on a Beeple.

JH: Yeah. I am not sure if Gary always uses that statement, but I’ve heard it a lot. Don’t look for the fastest horse, try to figure out the car, do the innovation there. Do you feel at the moment, that is a bit of my feeling right now, I feel at the moment, that many artists and so many people are still trying to find a faster horse. But probably there has to be some innovation happening. I made a tweet that said, right now, NFTs might be a bit overhyped, over the next 10 years they’re totally under hyped. Do you see this a bit similar? And what do you see there, where do you think the car might be? In comparison to just a faster horse.

AJ: Yep. So I agree with the point, that NFTs are probably over hyped in this second but under hyped in the long run. I expect a lot of projects to suffer, and for a lot of people to lose money. And that’s just the reality of capitalism, it’s a free market. You know the same way, when the dot.com bubble happened and you had things like pets.com. But Amazon was birthed too, right. When Facebook and Twitter and Uber were born, there was a lot of failed startups and a lot of millions of dollars lost. And so there’s going to be winners and losers. I think where I am so bullish on NFTs in general, is that I think you and I for the first half hour of this conversation have focused primarily on the art and then a little bit on the collectibles component. But NFTs, you know, it’s a little bit of a misnomer in the way we’ve been using it and how most people are using it. Like NFT technology, non-fungible token, really speaks to the back end and the smart contract on Ethereum, my platform of personal choice. There’s other platforms, I think Ethereum eventually figures out it’s environmental issues, with layer two and things like that. And I think Ethereum ultimately wins. And so where I get excited about NFTs is, how is NFT going to impact other industries. For example, in sports. Mark Cuban who owns the Dallas Mavericks, he came out and said hey, I think we’re going to NFT our tickets in the stadium. Because right now, and this is in America and I believe this is probably similar in Europe, the owner of the team sells a ticket to a consumer. And let’s say the consumer buys it for 100 dollars. If that consumer then goes to the secondary market and sells it to somebody else for 200, the team owner makes nothing on that secondary transaction. Now you’ve got platforms, like StubHub and SeatGeek in America, that they take their fee from the commission but the original owner doesn’t. But now if any team owner in any sport, all over the globe says, you know what, we’re going to put our season tickets, we’re going to make them an NFT. And so, if Julian buys a ticket to our football match, and he resells that ticket to AJ for that same football match, since it’s an NFT and it’s on the blockchain, and we’re going to utilise a Smart Contract so that the original IP owner gets a royalty, Mark Cuban or any team owner, can actually make money on the secondary market. That’s disruptive.

Let’s say books. My brother writes a lot of books for example. I believe that books, will have a physical component, moving forward and continue to. But then also the NFT component. And so you not only have the physical book, but you have an NFT related to the book and it can do a few things. I think the most important and logical point that I am making here is, you sell the book and as it gets resold, the original author can still make a royalty. The other thing too is, you have data on your costumers through the NFT. So you can actually reach them with messaging and bonus chapters and promotion of your next book. I just think the Smart Contract really becomes disruptive for music, publishing, concerts and sporting events, and on and on and on.

JH: How do you guys at Vayner Sports, for example, plan on using NFTs? I mean it’s funny that you mentioned Mark Cuban. I spoke with him a week ago or something. I had him on the show as well and talked to him about NFTs. Because he was so vocal about it. And I’ve been in touch with him since 2017. Always writing back and forth and I said, dude, we need to get together and do something. And it was very interesting and he shared exactly those things. And I asked him about the sports aspect, so what are you guys doing?

AJ: Yeah, I mean for our athletes right now, we’re being incredibly patient. I think something that’s really interesting is, I think everybody expects my brother to do an NFT.

JH: Is he?

AJ: You know, it’s something that we’re actively discussing. But what I think is cool, is there’s been a lot of NFTs come out from personal brands. Over the last two weeks in particular. And nothing against those NFTs, but I think the way Gary is looking at it and I am helping him think through his thinking is, sure it’s nice to be first and sure it gets some PR headlines. But we’d rather do it right than do it first. And so we’re just being patient, we’re having a ton of conversations internally about our athletes and how they should be doing in NFT. And there’s already been a few athlete-related NFTs and listen, we could have had the first NFT for an athlete. That would have been no problem, but we wanted to do it right and we wanted it to be consumer first. We didn’t want to just put out an image of one of our athletes and sell it for 100 dollars and say it’s limited to 250. And just make some quick money. I think something that you and I have touched on in this discussion is utility and I would say, I am personally a big believer that a lot of the NFTs that are going to fail, are going to fail because of the lack of utility. I think a lot of the NFTs moving forward, that are going to succeed is because of a consumer first utility, that actually matters.

JH: I am personally also interested in doing an NFT as well, but like completely giving the money away to charity. I think it would be such a cool thing. But I am also, I am 100 percent struggling in this thing not being a cash grab or a money grab, even if it goes to charity, even it it if for a good purpose. But at the end, I really want someone buying this NFT, to have like an amazing experience and be like, super proud for the next decade. I don’t know what you want to share, but I would be really curious on your thoughts.

AJ: I am probably not ready to share too much yet, because it’s still a work in progress. I am still trying to figure it out. But like I said, I think utility and I think through things that you can do with utility. With the Smart Contract you can track loyalty, you can reach the consumer, you can upgrade the NFT. Like I said bonus chapters and things like that. And so we’re thinking a lot about, what are the benefits of Smart Contracts and to us. And then in turn, how can we take those benefits and give that back to the consumer. That’s where a lot of our energy and our thinking is right now.

JH: I mean Cuban went this route in allowing them to unlock an email address, where he recorded a video for the buyers. Was this something you guys discussed? Or selling Garys time or something? Or is this not the route?

AJ: That’s all on the table.

JH: Okay, these were all the things I also thought through.

AJ: Yeah, it’s all on the table. I think our number one thing is just, we’re not going to do a cash grab. So we are taking our time and we’re figuring it out and we only will do it if it’s right.

JH: Really cool. So far we talked a lot about art, we talked a little bit about utility in the NFT. Are you guys investing in any other things, where you’re like, okay, this is an NFT, maybe aside from that, I don’t know, any kind of gaming related NFTs, or what are the other things you guys are watching at the moment?

AJ: I just sent an email yesterday to a friend of mine. And literally the topic of the email was, NFTs and gaming, I know you’ve been on it and I am lacking, can we catch up on Monday. So I literally have a call on Monday, because I see it. I see things like Gods Unchained, I see the metaverses like Decentraland and Sandbox and Cryptovoxels. I would say, where I am a little bit behind but I am addressing it, beginning on Monday, is the gaming component as well as the metaverse component. And one that I just decided to re-dive into, that I am excited about is an NFT game called ZED.ZED is blockchain based horse racing. I am a big fan of going and betting on the ponies and I probably do that once a year. And there is even a video game, there’s an incredible video game, that would be at the arcades, where it was like a digital horse racing game and so I saw ZED and I poked around a little bit yesterday, but I need to dive in deeper. But I think these, whether it’s like video game style or simulation style gaming through the blockchain, I think is an incredible use case and application. I am personally behind on it but I plan on playing some catch up. But again, there’s going to be a ton of losers in that space. And there’s some big, big winners in my opinion.

JH: When do you see the really large gaming producers actually go into that space? In 2017 I discussed NFTs and I was 100 percent sure in 2018 we’re going to see Electronic Arts, just someone going into that space. And we haven’t seen anyone.

AJ: Are you familiar with Sorare?

JH: No.

AJ: Sorare is similar to NBA Top Shot in some regards. It’s football, American soccer. It’s global, it’s soccer football. And it’s similar to Top Shot in the sense that you are buying NFTs related to real athletes. What’s a little bit different is, you’re buying a digital trading card, not a video clip. And two, when you own the NFTs, the individual player NFTs, you then actually utilise them into a fantasy sports type mechanism. But recently, I want to say 10 to 14 days ago, Sorare announced a deal with Ubisoft.

JH: Oh wow.

AJ: So I don’t know yet how they plan on collaborating. But my belief, and this is speculation, my belief if you just think it through is, that Ubisoft is going to create a video game but the gameplay in the video game and your effectiveness in the video game is going to be customised and personalised to your wallet. And your wallet of the Sorare trading cards that you hold. So the way I imagine it, is, that I own a Mbappé Sorare card and if I am playing Ubisoft video game, there is a mode, in which my Mbappé card impacts the act, like I can actually have Mbappé in the game. If I don’t have the Mbappé card, I can’t utilise Mbappé in the game and I think that is going to be very interesting to see how NFT speak to the traditional video game model.

JH: Cool, any NFT area that you think we’re going to see maybe this year or next year, that wasn’t enough focus on right now, but you feel like, man that’s going to be super disruptive or that’s going to be super innovative?

AJ: You know there is a company that I met with, called cent.io and what they’re trying to do is basically become a layer of instant NFT marketplace, for social content platforms. So they started with twitter and if you’re listening this, there’s a very good chance, that you have heard of cent, but through the headline that it created and not so much the company itself. They got an enormous amount of traction. I met with them, maybe two or three weeks ago and like five or six days later Jack Dorsey, the creator of Twitter NFTed his original tweet.

JH: I also sold one, unvoluntarily, someone just offered to pay.

AJ: So what cent did was, they basically just said, all right, we’re going to instantly take the entire library of twitter. Every tweet every created and we’re going to instantly become the layer between the creator and an interested buyer and we’re going to say, okay, if you’re a buyer, you can make a bid on any tweet. We’re not promising you, that you’ll ever be able to buy it, but you can make a bid. And if the original creator comes onto our platform, authenticates their twitter account, they’re going to have an inbox of bids. And they can come in and accept your bid. Right, so when my brother first logged on, he had a bunch of bids.

JH: Yeah, of course.

AJ: It didn’t require him being on the platform, which is, what I think, the interesting part. But in order for a transaction to happen, it did require him to be authenticated on and opted in. And so I think that’s pretty interesting and the way I look at what cent is up to is, I think the NFT value of cent is twofold. One like we talked about before. I think it can be a collectible in the form of history. A copy of the declaration of independence just sold for 2 million dollars. I think Jack Dorseys first tweet, last I checked, 2.5 million dollars. You’re buying a piece of history, if you’re buying Jack Dorseys first tweet. The cool thing is, how many times have we said as a society, when something crazy happens and everything happens on twitter, right? We always say, man, imagine twitter existed back in 1982 when this happened. Well, moving forward and forever, it does exist and so you’re able to capture digital documents of history. And so I think that’s an interesting NFT marketplace, I think that’s how people are going to look at it. They’re buying important documents, that’s how I see it. And I think Jack obviously jumpstarted that narrative and I think it’s got a real chance to pick up some steam.

JH: Cuban mentioned that his biggest roadblock, that he sees at the moment, is the on-ramp into the crypto ecosystem. How do you see that and how do you see this being solved?

AJ: It’s absolutely the biggest hurdle. It’s part of why NBA Top Shot has been so successful, is because they’ve done a really nice job.

JH: Yeah, they have it seamless there.

AJ: Because you can just put in at least in America, you just put in your…

JH: Credit card.

AJ: Credit card, and you can do it. And that is absolutely the biggest hurdle. But I’ve probably had in the last three weeks 10 to 15 conversations with entrepreneurs that are developing for the NFT space and they’re all working on or talking to people about how to make consumer onboarding easier. Like, yes it’s the biggest hurdle, but I would also say that the developer community sees it as the number one opportunity. When that happens, it gets solved and whether it takes six months, nine months, 12 months, 15 months, it’s going to happen. I am sure, that we will eventually make it easier for people. I mean think about the internet and then netscape navigator. Think about AOL made it really easy for people in the 90s and so it’s going to happen. It’s inevitable.

JH: Coinbase IPO are you an investor, or are you like, nah, just going to leave it.

AJ: Well, Gary and I were very fortunate to write a check, quite a while back. We did their series, was that series c that we did? We did well there. So that’ll work out.

JH: What was the evaluation? I mean it’s public anyways.

AJ: I think it was a 400 million dollar post.

JH: Nice one.

AJ: I think that was the C or the B. We did that, whatever the 400 million dollar post round was. That’s what we did.

JH: Cool.

JH: It’s at least 200x now, depending on what it’s posting.

AJ: I think it’s going to be less, based on dilution.

JH: Ah, yeah, true. But I mean at the moment, they’re talking about a 90 billion, right?

AJ: It’s going to be good. We’re excited for that direct listing.

JH: Yeah, congratulations.

AJ: I am a buyer, and by the way, we don’t have any intention of selling right at IPO, and we can, because it’s a direct listing. We can, hypothetically, liquidate our entire position on day one. But that is not the plan.

JH: Who pushed for that investment, that just surprises me, because from whatever I’ve seen from Gary, he was always super skeptical when it came to cryptocurrencies. Did you push for that?

AJ: For the record, Gary and I both were Coinbase users, before we were Coinbase investors. We bought bitcoin and here’s the thing, and it goes back to what we talked about before. We both were skeptical and really unsure of the underlying technology, but it doesn’t pay to be right, when something doesn’t work out. So we still bought bitcoin in 2013. Now we would have bought a lot more.

JH: Everyone.

AJ: What I mean, we still made a bet and did really well. The Coinbase deal was sourced by one of our partners Phil Torano. He brought the deal to us, because again, it was the series B or the series C and we were already familiar with the deal. He was able to find us and let us know that hey, we can get an allocation if we want. We discussed it in the boardroom and to the credit of the five or six people that were in that room, there was nobody against the investment. And the mindset behind it was like, listen, at this point, cryptocurrency as a whole has already made real progress. And it just went to the notion like Coinbase has a great product at the time it was the leader as far as our perspective in terms of, if you want to go on and exchange some US dollar or any sort of FIAT for crypto, primarily bitcoin at that time and ethereum and a few others, litecoin maybe. It wasn’t a difficult internal conversation. Phil brought it to the table, we were all familiar, we were all users. We all agreed that listen, we have this size of a fund for us to have a small portion of the fund dedicated towards a crypto related investment. Doesn’t hurt us, honestly our fund strategy was opportunistic and we just felt as if it was calculated risk that the downside, it goes back to what I said before. Downside is, we lose a chunk of our fund. The upside is, that one check returned the entire fund. So it was a worthwhile investment that’s for damn sure.

JH: Cool. I would love to ask you a personal question if you’re open to that? So I have a five months old son. I come out of very average family background. Not rich, not poor, just average. And so now I am always a bit worried on, I have this massive drive, massive hunger and I am always worried that my son doesn’t have that. What do you do with your kids? What kind of values are you trying to distill them?

AJ: That’s a great question. My upbringing was an interesting one. My family’s personal financial situation evolved as I grew up. When I was first born, we were probably slightly below middle class. Then when I was probably like seven, eight, nine, ten, we were firmly middle class. When I was 10 to 13 we were probably upper middle class and then, when I was 14 to 18 and beyond it was upper class. So I literally lived my parents and my families financial growth, in this really interesting situation. Really hard to replicate, nobody can plan for that. You can’t plan for that. I take a lot of value in that, I think that I am so fucking lucky. I got the benefits of not being super comfortable as a youth but then like got to watch my father and obviously my brother played a big role, what the work ethic was and what the execution was to being successful. I got the full gamut of the American dream basically. Honestly, I miss the lower class. Because when my family first came to America, they immigrated from the former soviet union, and my brother and sister, they’re a lot older than I am. My brother is 11 years older, my sister is eight years older. So their youth was lower class and I never experienced that. When I came around eight years later, we were pretty much middle class or a shade under it. So I didn’t get the lower class component. And my brother and sister remind me of that sometimes. But to go back to your question. First off my daughter is three and a half, my son is almost two and third, my second daughter is not even three months old.

JH: Congratulations, that’s nice.

AJ: It’s three under four. I mean for my two year old and my newborn, the work hasn’t begun yet.

JH: Of course.

AJ: We’re instilling values, we’re instilling things like kindness and empathy and manners. But I am not instilling work ethic.

JH: Yeah, it’s too young.

AJ: Yeah, it’s too young. But for my daughter, I think the biggest thing that I am trying to keep in mind for my oldest, Vivian, is, I really want to make sure. I think my greatest strength, both professionally and personally is problem solving. I am someone that, when there’s a problem, my immediate reaction is, I am equipped to solve this, so how am I going to solve this. That’s my natural gut instinct and I think that’s a blessing. I think a lot of people have a lot of different reactions to problems. And so that’s probably the biggest thing that I want to instill in her, now that she’s at three and a half, it’s like, when she faces micro adversity, I don’t want to just fix it for her all the time. Because she needs to be able to learn it herself. And I am talking about the stupid little things like, she’s struggling to put her shoes on. And she gets frustrated. And I talk her through it. I am not going to go over and put her shoe on. You know, sometimes I will. I am not leaving her out on an island and letting her melt down all the time. But I’ll say things like, Viv, you’re getting frustrated, what are some things that you can do to maybe be less frustrated. You could ask daddy for help, for example. That’s one, I don’t want that to be the number one solution but that is a solution. You could try a different way. Have you thought that maybe your sneakers are too small now and maybe you need a different pair of shoes. Things like that, probably the biggest thing that I am focused on right now. Because the concept of money and what money means is still too early I think for a three and a half year old.

JH: Yeah, no definitely. How do you get the spread between work and three kids?

AJ: Yeah, it’s really hard. I think lines in the sand, in a pandemic world. I haven’t travelled for a year. Not been on an airport for almost exactly a year. Like a year and a week, I guess 54 weeks. So when I am not travelling, which has been a lot lately, I am nearly damn religious about 5 to 7 PM. I make a real habit of 5 to 7 PM is, I come home, play with my kids. I eat dinner with them. We do bath time and we do bed time. And just that, lines in the sand and I am constantly like as trying to establish that line in the sand. I’ll tell people just explicitly like, hey, let’s catch up next week. Cool, I am generally available except for 5 to 7 PM eastern. And when people call me or text me during that time, because I won’t lie, I’ll check my phone from time to time, make sure there’s no emergencies. And if somebody hits me at 5.45 PM, I might text them back at 6:30, being like, hey man, I’ll hit you in a little bit and just for your information, you’re never going to catch me 5 to 7, Monday through Friday. Thats kind of a big important piece of it. And then just other things to mix it up. Like for example, usually I am in the office at 7 AM eastern, that’s another key, I grind early hours, so that I can justify that 5 to 7. I am usually working at 7 AM and getting stuff done.

JH: Yeah, dude, I mean you’re up at 7 today.

AJ: And I am working, I am, not just up at 7 but working at 7. 99 out of 100 times I am doing email and paperwork, because not everybody is working at 7 AM eastern. I mean, I do a lot of work with people on the west coast, that’s 4 AM in America, pacific time. And so that’s usually catching up on emails and doing work that doesn’t require another person. But that’s a big hack for me. I just forgot the third point I was going to make. But it’s just a lot of effort. The thing I was saying is, that I am actually taking my daughter to school today at 08:30. I am going to take an hour to take her to school. My wife and I kind of horse trade where I am like, listen, I need a certain amount of hours during the week and so I’ll probably work an extra hour this evening, that I wouldn’t normally do, to make up for that. But that allows me to have that experience of dropping my daughter off at preschool, which I cherish and will remember forever.

JH: Cool man. It’s really awesome.

AJ: If you work for yourself, that’s the luxury that you’ve earned. There’s a lot of pros and cons to everything in life. And my perspective is, when you’re an entrepreneur, when you’re a CEO and you have the weight of the world on your shoulders. That’s a lot of stress, that’s a lot of the con. But the pro is that nobody is going to tell me, I can’t take my daughter to school at 08:30 on a Friday.

JH: Dude that’s awesome. AJ, I really want to respect your time, I really appreciate that. Where can I put people off to? I am going to link everything up below, your twitter account or where are you most active or what are the things that you want me to link up?

AJ: Twitter and instagram, it’s super simple.

JH: Are you more of an instagram or more of a twitter? Because to me, these are two totally different platforms.

AJ: I would say for the purpose of our conversation today, twitter. Meaning I am talking more about NFTs on there than instagram. I think if you want the insight into my brain, take a look at the tweets that I am liking. I am primarily liking things that I think are interesting or unique in the NFT world right now or at least in business in general. If you’re looking for what I am thinking about and how I am interacting. I don’t tweet a ton. A little bit here and there, but I am an active consumer, I am liking a lot of things, I am bookmarking a lot of things. That’s how I see it.

JH: I so appreciate that, cool. That’s really awesome.

AJ: It’s just AJV on twitter and instagram. Those three letters.

JH: AJV. I’ll link that up down below. Maybe we can do another session at some point, reflecting on what’s been happening.

AJ: I would love that. Let’s lock in like six months from now. Because I think, six months from now might as well be six years in this business.

JH: Definitely, we’re going to see us.

AJ: It will be fun to look back for sure.

JH: Yeah man. AJ, I really appreciate it, thanks so much. Stay safe, take care and all the best in the meantime.

AJ: As well. I really enjoyed this man. Thank you so much for the intro and the invite. Take care.