Bored ape “Free food and drink inside.” A bouncer teases the crowd waiting to enter New York’s Pier 17, a concert venue in Manhattan’s Seaport. “But there are no bathrooms.” Thousands of people have gathered here for the fourth and final night of Apefest, a party for members of the Bored Ape Yacht Club (BAYC) and their invited friends. He waits a beat, then laughs. “Nah . . . I’m just fucking with you.”
Yuga Labs, the company that conceived of the collection of 10,000 cartoon ape avatars that unlock membership to BAYC, would never forget the bathrooms. The backstory that members bought into when they purchased their digital apes was that these primates congregate in the bathroom of a seedy yacht club—set in a swamp in the middle of nowhere—to scrawl irreverent jokes and shit-talk as the only relief from the boredom of their expensive, crypto-fueled lifestyles. Members who got in early paid less than $250 in cryptocurrency for the NFT (non-fungible token) that gave them their ape avatar. If they joined at the peak last spring, just a couple of months before Apefest, they may have paid more than $400,000 to be here. (Fast Company attended as a guest of an ape holder.)
Everything about this rooftop party in late June oozes exclusivity. To enter, one had to show a digital ticket with morphing pixels to weed out gate-crashers who could screenshot a standard QR code. There’s a VIP curtain, behind which 7’1″ Minnesota Timberwolves player Rudy Gobert is hiding (a few nights ago, Jimmy Fallon dropped by). The crowd has traveled from as far away as the United Kingdom, Germany, Romania, and Singapore to be here. Attendees mill about, eating free tacos and drinking banana milkshakes, or checking out the latte machine that swirls your own ape’s image into the milk froth. Snoop Dogg and Eminem duet onstage, while a hype man dressed up as Snoop’s Bored Ape—named Dr. Bombay—struts across the stage in an army helmet and pimp coat, as Snoop twangs “ApeCoin-oin-oin.” Everyone’s wearing the same $120 splatter-painted BAYC hoodies. Nobody’s bored.
Since forming in February 2021, Yuga Labs racked up $100 million in profit in its first year (according to a leaked presentation) and raised $450 million in seed funding in March, valuing the company at $4 billion. It has attracted celebrities and companies—from Gwyneth Paltrow to Adidas—to associate their brands with Bored Apes, and debuted a preview of its metaverse game, Otherside, in July. If anyone you know outside of the crypto universe has heard of an NFT project, it’s the Bored Ape Yacht Club.
But even as Bored Apes have achieved a measure of cultural ubiquity, Yuga’s story has remained largely a mystery. No one knows its future ambitions, nor that the company’s success and direction are primarily the product of just four people: the two idea guys, the operator, and the Hollywood legend. Cofounders Wylie Aronow and Greg Solano, strategic-adviser-turned-CEO Nicole Muniz, and talent manager and producer Guy Oseary have each had a profound effect on Yuga Labs and its trajectory from art project to controller of the most valuable NFT brands—with the intention of taking them mainstream. “We’re all involved. We’re all invested. We all love each other,” says Muniz of the moment in the fall of 2021 that she and Oseary joined the founders as partners in Yuga. “Let’s just do this thing.”
“This thing” has become a bellwether of how one feels about cryptocurrencies in general and NFTs in particular. To some, owning a Bored Ape is a major flex, a sign of discernment and respect for the value of one’s digital identity and the future of online communities. In this view, NFTs are golden digital tickets that admit the owner to a new world, perhaps the fabled metaverse. Even as crypto values declined approximately 70% between November 2021 and September of this year—and NFT trading volume has dropped even more precipitously—global brands such as FIFA and Reddit continue to launch NFT projects. To others, BAYC epitomizes the cringey, oppressive effort to popularize cryptocurrency and financialize aspects of the internet. When Snoop and Eminem reprised their Apefest act during MTV’s Video Music Awards in August, transforming into their respective apes during the performance, the public reaction was overwhelmingly scathing.
And yet, even as skeptics crow that crypto and NFTs are “dead,” Bored Apes continue to sell for well over $100,000. Both sides have to wonder: What the hell do those people know that I don’t?
A month after Apefest, on a sweltering day in late July, Aronow and Solano sit on a low velvet couch in the lobby of a swanky Lower Manhattan hotel to tell their origin story. The pair, who prefer to be called by their screen names Gordon Goner and Gargamel (typically shortened to Gordon and Garga), have the energy of a classic comedy duo, with the larger, louder, and more gregarious Gordon often dominating the slight, bookish Garga in conversation. Six months ago, BuzzFeed revealed their real names against their wishes, and they’re still a bit antsy about this interview—they request that we do not publish the name of the hotel. Our meeting place, favored by celebrities for the privacy it affords, suits their desire to cling to their anonymity. Also, the air conditioner in the Yuga Labs office is broken.
Gordon and Garga, both in their mid-thirties, had been friends for a decade before deciding to start Yuga Labs last year. They didn’t exactly have the pedigree of typical tech cofounders: Garga was an editor at a small division of Simon & Schuster focused on video-game and sci-fi books, and Gordon, well, he had never really had a traditional job as an unspecified illness in his twenties kept him largely bedridden. The self-described literary bros like to share how they met and became friends after arguing over the merits of David Foster Wallace’s Infinite Jest in a Miami dive bar. Gordon has a tattoo of Kurt Vonnegut on his arm, but much like BAYC’s imagery, it’s hard to tell whether it’s sincere or ironic.
Despite losing thousands of dollars in the 2018 crash known as the first crypto winter, they remained believers. In particular, they admired CryptoPunks, the OG NFT collection of pixelated human avatars released in 2017 by two former Google employees, which established NFTs as art and created the conceit of a project filled with 10,000 different characters. (“They’re absolute geniuses, complete trailblazers,” Gordon gushes.) But in early 2021, as NFTs just started to enter the public consciousness, there had yet to be a project that captured the appeal of the punks but also added value. What do you do with the things?
Gordon and Garga’s initial idea was to tap into the emerging trends of using NFTs for art as well as for personal expression. “We started thinking about [Piet] Mondrian and [Joan] Miró,” says Garga, evoking the Dutch painter and Spanish surrealist’s aesthetic of “line drawings and all this crap.” Owning one of their NFTs would unlock a shared digital canvas exclusively for buyers to draw their own creations. “It was a little pretentious,” Garga says. “We thought that’s what serious collectors wanted,” explains Gordon.
Their main connection to the tech world was Gordon’s old friend Muniz, whom he’d met at a Starbucks in Miami when he was in high school. Muniz had spent the last decade working on strategy for the likes of Facebook, Google, and startups such as Oscar Health. “I’m not the person who’s gonna come up with a creative idea,” Muniz says of her skill set. “I’m the person where if you bring a creative idea to me, I can help you execute it, make it make money.” And Gordon was always running moneymaking ideas past her.
When she heard their shared-canvas idea, she recalls responding, “The people who are gonna buy this are internet people. It’s gonna be penises [on that canvas], because if I bought it, I would draw a penis.” Still, at least this project had promise—if they ditched the highfalutin art concept and set their sights a bit lower. “This was the one thing that I was like, ‘Okay, let’s do it,’” Muniz says.
Gordon and Garga decided the project would pay homage to their crypto exploits and the pals they made along the way. Out went the Spanish surrealism, in came the swampful of bored apes. In crypto, to “ape in” is to bet all your money on something without doing much research. Plus, Gordon just liked primates. One hazy night, he stayed up until 4 a.m. scribbling down the narrative backstory for BAYC. Then Garga, the editor, refined it.
At the time, Muniz was running a consultancy called Something New—“McKinsey, but for startups,” as she describes it. “I introduced them to a ton of people so they could actually start building this out,” Muniz says. One of those people, the illustrator Seneca, developed the line drawing of the monkey and some of its signature expressions. Three other freelance artists then drew the rest of the traits, from rainbow suspenders to a slice of pizza dangling from an ape’s mouth, which were then scrambled at random into 10,000 distinct, computer-generated avatars.
The Bored Apes did not arrive with a bunch of hype, and as per crypto tradition, the actual BAYC images were hidden for most of the weeklong sales period in April 2021 (buyers received only a brief description from the creators). Sales were slow. “I was pacing around my mother’s backyard feeling down about myself because nobody was showing up,” Garga says. Gordon, by contrast, says, “Even when there was no hope in the world, I was like, ‘This is gonna work.’” But on the seventh night, after the apes were unveiled, they quickly sold out. When asked why he thought BAYC ultimately connected, Gordon credits people being able to find apes that spoke to their personality. This would later become problematic given that some Bored Apes wore racially stereotypical garb and imperial German military accoutrements.
The Bored Apes had a notable twist on the NFT model: When anyone bought one, “you own the underlying Bored Ape, the Art, completely,” the contract declared. This came to be interpreted as owners having IP rights to develop their own creative businesses based on their ape. “‘You own your ape’ was a good part of the narrative,” wrote Twitter influencer and crypto pundit Punk 6529 in a thread. But Yuga retained a slice: 2.5% royalties on all secondary market sales of the NFTs.
In addition, Gordon and Garga really believed that they were building a club, a digital swampland Soho House. They enlisted two technical partners, Kerem Atalay and Zeshan Ali, who go by the screen names Emperor Tomato Ketchup and No Sass, to erect the shared canvas they originally envisioned—although now it was a digital graffiti board dubbed The Bathroom—and they sought to create fellowship among ape holders with everything from virtual treasure hunts to a BAYC Discord chat server. These private messaging platforms often have a toxic reputation, but “we were getting memed for being the Care Bears of the space,” says Gordon, who was by then working 16 hours a day. “We were there every single night for months just talking with our community.”
The bond they forged gave owners a reason to believe in the apes. “We hadn’t seen any collections that had a road map. There was just, okay, you buy the thing. That’s it,” says Gordon. “The main thing was that it was a club. But the second thing was that road map. What utility can we design for them?”
Gordon and Garga promised club members everything from a lo-fi hip-hop internet radio channel to exclusive apparel. They quickly made good on their first vow: paying their moms back for fronting them the money for BAYC. The initial sale of 10,000 apes had netted them $2 million, and while many crypto founders would’ve taken the money and run—horror stories abound of scam artists making off with a project’s funds, never to be seen again—the duo diligently ticked through the items on their road map. Their splurge? Pelotons, which sit unused and gathering dust in their homes.
At this point, Gordon and Garga thought of Yuga as “Web3 Supreme,” Gordon says, a crypto-powered streetwear brand that would sell official BAYC T-shirts to Bored Ape holders. “But like even cooler than that,” he adds, because the blockchain meant that they’d be able to verify membership and that “only you get this T-shirt.” Of course, the duo knew nothing about fulfillment, and when they made the first run of BAYC-branded gear, they foolishly decided to handle the shipping themselves. “There are these photos of us looking totally miserable packing [merch] in the sun,” Garga recalls. “My mom wouldn’t let us inside because of COVID restrictions. She didn’t understand what we were doing.”
Muniz did, though. Days after the BAYC NFTs sold out, she was already working with the founders on a new collection, the Mutant Ape Yacht Club (MAYC). The BAYC concept got weirder: Ape holders could now “breed” their ape using a “Mutant Serum,” which would morph the avatar into what Gordon describes as a “Thrasher magazine version of the apes,” rendered in resplendent flesh-melting, brain-spilling detail. Yuga gave 10,000 of the serums to ape holders as a reward for their loyalty, and sold another 10,000 ready-made mutants in a public auction. Muniz worked closely with the founders on the drop strategy, pricing, and, crucially, how they could use mutants to expand the club without it feeling any less special. “Mutants could have gone terribly wrong,” Muniz says. “It was also really important to everyone that it didn’t feel like a cash grab, because it wasn’t.”
Still, the mutants generated a ton of money, close to $100 million after selling out in an hour, having gone on sale at a starting price of nearly $10,000 each. (The sticker shock wasn’t quite so bad when compared with the going price for a Bored Ape, which by then was at least $150,000.) The timing was perfect. Bored Apes had started to proliferate as Twitter profile pictures; even The New Yorker had taken notice of the trend. Current BAYC members loved MAYC, too, as it was a valuable perk of holding their Bored Ape rather than flipping it as the price rose. In crypto, a free mutant qualified as utility. Plus, owners now had more commercial rights to exploit, and they started to create novels, virtual rock bands, and hot-sauce lines using their apes. All of it helped disseminate Yuga’s apes into the culture, while Yuga itself had just a handful of staff and freelancers in addition to Gordon, Garga, Emperor Tomato Ketchup, and No Sass.
In the NFT world, when the artist Beeple randomly DMs you on Twitter, you respond.
Back in July 2021, the digital artist, who had recently auctioned an NFT collage at Christie’s for a record $69 million, messaged BAYC’s account. Gordon replied. It was the first time the two had ever interacted. Within five minutes, Gordon had been looped into a phone call with Beeple’s friend and business partner, Guy Oseary, the music manager to such artists as Madonna and U2, as well as the producer of the Twilight films.
Oseary, calling from Hawaii where he rode out COVID-19, was exploring whether the duo could help him with an idea for an NFT project. They declined—and the initiative never took off—but a bond was formed.
“It was kind of an amazing courtship,” says Gordon. “We didn’t know what to make of him at first.” They claim they had no idea that he had invested in Uber, Airbnb, Affirm, and Lemonade, as well as NFT startups Dapper Labs, OpenSea, and SuperRare. (Oseary’s passion for NFTs was so profound that in April 2021, the same month that BAYC started, he was shopping a Shark Tank–like TV show titled NFTs: The Pitch.)
Instead, they connected over music. The 33-year industry veteran won their trust through a shared love of the old-school rapper KRS-One and Bad Brains, a hardcore punk band for whom Gordon had dedicated one of his many tattoos. “I was like, That’s our dude,” says Gordon. “He wins.”
“Initially, I came on as a manager,” Oseary says, his Zoom setup framing him in front of large windows overlooking greenery at his Los Angeles home. “I thought these four dudes were like a rock band. You want to make sure your music [NFTs] is heard by the right audience,” one that might include the actors, comedians, and musicians that Oseary counts as friends. Muniz calls Oseary “this juggernaut of a human being,” and he immediately started delivering for Yuga. He secured a Rolling Stone cover story, timed to come out as the nascent NFT industry gathered in New York in early November for NFT NYC. He also put his imprint on the inaugural Apefest scheduled for that same week. Originally conceived as a chance for the company to convene its ape holders in real life, Oseary transformed it into a star-studded, multinight Crypto-chella featuring Questlove, the Strokes, and Chris Rock.
A flurry of deals and celebrity endorsements followed. Just days after Apefest, Jimmy Fallon announced during an interview with Beeple on The Tonight Show that he’d bought a Bored Ape, telling his audience that he did so through MoonPay, a startup that he called “PayPal for crypto.” Oseary had invested in MoonPay that same month, and a lot of the famous people who would soon announce that they now had a Bored Ape also credited MoonPay for facilitating their acquisition.
Famous Apes: Celebrities associating their brands with Bored Ape Yacht Club elevated the NFT project.
1/12 Mark Cuban Day job: Entrepreneur/ investor/Shark Tank judge. Aped in: May 2021 (Gift). [Photo: Jason Bollenbacher/Getty Images for SXSW]
When Oseary is asked about how he was on seemingly every side of this transaction and the accompanying promotion, and whether this conflict was ethical, he’s bewildered. He’s just trying to help people! It’s in his nature. To illustrate, he shares a story: “Eva Longoria put out a tweet that she wanted to buy an NFT. So I called her and said, ‘Let me connect you with MoonPay and they’ll help you do it,’ and she ended up buying a World of Women NFT.” He represents the World of Women NFT collection, too—but says that never crossed his mind. “I just make the connection. It’s not just a Yuga thing. I don’t know any other way to do [business].”
Oseary quickly became a partner in Yuga Labs, in November 2021, at the same time as Muniz. “At some point, it went beyond management,” Oseary says, “and became, ‘Let’s just build a company here.’” The events that month created a sense of heightened velocity for the Bored Apes, which aligned with what would in hindsight be crypto’s peak. The global crypto market capitalization soared to nearly $3 trillion last November. The hype seemed deafening, with headlines like “Crypto Is Cool. Now Get on the Yacht” in The New York Times. Evangelists could counter the “NFTs are stupid” argument by using the celebrity ties as proof that NFTs were driving culture. Then there was the money: All the attention helped elevate the floor price for BAYC from $150,000 to $220,000 by the end of the month, and MAYC rose from $15,000 to $28,000.
It’s mid-August, New York is still stiflingly hot, and Yuga’s AC remains broken. So Muniz prefers to meet in yet another hotel, this time near her home in Dumbo. She has just returned to work after an attenuated maternity leave—less than one week. “You only have a first baby once,” she says, tapping one heel of her Manolo mules against her other foot, “but you can only affect the next wave of the internet once.”
After November 2021’s Apefest, “Gordon and Garga were like, ‘Why don’t you just come in as CEO?’” she recalls. Muniz demurred, but after her consultancy took on more Yuga-related work, she relented. She took the reins in January.
Much as Muniz reset Gordon and Garga’s original plans from surrealism to simians, now she wanted to upgrade their ambition. “People were still talking about us as monkey JPEGs,” Muniz says. “We were never gonna get to the place that we wanted to be if we were just an NFT collection.”
Out went Web3 Supreme, and in came “Web3 Disney,” as Muniz describes her vision. The goal now is to build a company with iconic IP assets that it monetizes across a sprawling, interrelated network of games, books, movies, and shows. It’s a significant leveling up of the mission, albeit a common one. Everyone from LeBron James to the creator of Angry Birds has harbored dreams of creating the Disney of the 21st century, while Disney itself remains the leading contender for the honor.
Her first move was acquiring what she calls her Marvel and Star Wars—properties with built-in fan bases and “their own lore and mythology.” In March, Yuga bought the only two NFT projects that could rival Yuga’s: CryptoPunks and Meebits, from the creators that Gordon and Garga idolized.
“I think the original idea [for the acquisition] came from Guy, our partner,” says Gordon, “and he was the one who helped facilitate that deal.” Oseary is more cryptic, saying, “I’ve spoken to everybody. These [CryptoPunks] guys are quality people, and these [BAYC] guys are quality people, so I thought, Wow, what if they all worked together, and it just kind of snowballed into what happened.” A Yuga spokesperson disputes this, saying that the decision was “a group effort.”
Yuga’s acquisition of CryptoPunks and Meebits wasn’t as informal as Oseary suggests. Two global law firms with significant IP practices—Pillsbury Winthrop Shaw Pittman and Fenwick & West—negotiated the sale. Yuga did not disclose the value of the deal, but the rumor mill put the price at anywhere between $100 million and $500 million. When the top end of that range is floated by Muniz, she does a double take: “I’m not sharing specifics . . . but wow, I’m surprised by that number.”
A few days after the news of the purchase, what appeared to be Yuga’s pitch deck for investors leaked online, revealing the startup’s success in startling detail. The slides stated that Yuga generated $137.6 million in 2021 revenue and $127.1 million in profits—a 92.4% margin. The company also outlined plans for what it called an “interoperable gaming metaverse” called Otherside, which would make “all other metaverses obsolete.”
Yuga’s Potent Six-Pack: Yuga Labs controls the top four–and six of the most valuable dozen–NFT projects.
1/6 CryptoPunks** Type: Avatar. Aesthetic: Pixelated Pistols. Launched: June 2017. Starting price: Free. Highest sale at auction: $11.8 million (June 10, 2021). Top 2022 floor price: April 4. **Acquired by Yuga Labs on March 11, 2022. Sources: NFT Price Floor, Christie’s, Sotheby’s. [Image: Courtesy of Yuga Labs]
The leaked presentation presaged Yuga’s first fundraising from venture capitalists. In late March, the company announced a $450 million seed round that valued the company at $4 billion. Oseary helped recruit participants, including the most coveted crypto investor of all, Chris Dixon of Andreessen Horowitz (A16z). Yuga decided to raise money because both Gordon and Muniz sensed that a bear market was coming, and they wanted significant reserves. “We were extremely profitable,” Gordon says, “and there was no real need to raise.” Dixon—known for making early bets on Coinbase and Dapper Labs—likens Yuga’s metaverse ambitions to “that rebel alliance that’s trying to create this world that’s gonna get created,” he says via Zoom, with an A16z NFT as his background. “But do it in a way that’s owned by the people and in conjunction with the people.”
As Yuga achieved its star status within the NFT world, controversy followed. First came the viral Twitter threads comparing Bored Ape imagery with racist and Nazi iconography. “Everybody we talked to said, ‘Don’t respond.’ It’s ridiculous,” Muniz says, still visibly agitated by this controversy. The company’s wan efforts to tamp it down did not work, nor did the Anti-Defamation League’s conclusion that BAYC wasn’t anti-Semitic, although the organization acknowledged that a few apes exhibited prejudicial stereotypes of Black hip-hop and Japanese culture. In May, Ryder Ripps, the conceptual artist who had first popularized the accusation, launched his own NFT project based on the Bored Apes, generating $1.8 million. Only then did Yuga sue him for trademark infringement and false advertising.
Then came the eyebrow-raising transactions. After the February news that Justin Bieber paid $1.3 million for an ape, popular Substack author Dirty Bubble Media found blockchain transactions showing that Bieber’s ape actually cost him no money at all. It was funded by the sale of other NFTs that he had been gifted for free and was effectively closer to a swap. In the days before Yuga officially acquired CryptoPunks and Meebits, the floor price for Meebits nearly doubled as some people in the NFT world had been whispering about the impending sale in Discord channels. Three months later, in June, CryptoPunks mysteriously surged in value, hours ahead of news that the team had tapped Noah Davis from Christie’s to be its brand manager. “Who’s getting that information, and where is it coming from?” asks Jon Rogers, an NFT licensing executive and former Disney brand manager. “It has to be coming from within the investors or company, and Yuga has a responsibility to get in control of it. Otherwise, they’re going to open themselves up to investigation from regulators.” When asked about this activity, a Yuga spokesperson states, “Crypto is not immune to some of the same market fluctuations that rumor and speculation cause in a traditional market such as the stock exchange,” adding that “any allegations of misuse of information would be investigated thoroughly.”
Ape holders have also been such a frequent target of scams to steal their NFTs that one victim’s misfortune inspired the popular “All my apes gone” meme. “The frequency with which Bored Apes are stolen is noteworthy,” says Molly White, whose website, Web3 Is Going Just Great, keeps a running tab of how much money has been lost to Web3 hacks, grifts, and Ponzi schemes. Many of the NFT thefts emanate from classic phishing scams, where someone impersonates a Yuga employee to access where they store their ape. These victims are Yuga’s customers and its community members—at least until their ape gets stolen. Then they’re on their own, as actor Seth Green discovered in May when his Bored Ape was stolen—just as he was developing a TV show around it. No NFT meant no commercial rights, which also meant no show, and Green found himself having to buy the ape back off the market, paying twice for the same property. Yuga did not respond to requests for comment about the thefts.
These events could be rationalized away by BAYC members because they only affected a small number of them. Then Yuga introduced ApeCoin. The company’s metaverse requires creating “a whole new economy,” according to its pitch deck, and in crypto that means adopting a cryptocurrency for all transactions within Otherside.
Yuga insisted that it would not control ApeCoin: Technically it was launched and run by a decentralized autonomous organization (DAO), and the tokens are used to vote for proposals. But as was noted in a Bloomberg report, ApeCoin distributed 37% of 1 billion tokens, worth more than $5 billion at the time, to Yuga’s founders, Yuga Labs itself, and “launch partners,” including Yuga investors such as Andreessen Horowitz. (Andreessen’s Dixon denies that his firm received any ApeCoin.) By contrast, Bored Ape holders received 15%. The DAO’s five-member governance board has four known investors in Yuga, including a partner in Oseary’s Sound Ventures.
Gordon, Garga, Emperor Tomato Ketchup, and No Sass had drawn straws to pick their Bored Apes, and Gordon and Garga have only one each. Muniz, who set BAYC in motion as an adviser, hadn’t gotten around to buying an ape the week they were on sale. On the last day, she was at a wedding with spotty Wi-Fi and doesn’t have one. (She has a mutant.) Introducing their own cryptocurrency with this governance structure seemed to run counter to their egalitarian beliefs. The industry’s widespread suspicion is that crypto projects issue their own token—and then allocate a large share to investors and insiders—in order to allow them to generate a quick windfall by selling their holdings on crypto exchanges when the price peaks. ApeCoin’s rules seemed to guard against this behavior by vesting the tokens over a four-year period, but still, it revealed that Yuga may be more conglomerate-like than it wanted people to believe. (Yuga reiterates that it does not control ApeCoin, nor do its investors. In October, another Bloomberg story revealed that the U.S. Securities and Exchange Commission had opened an investigation into Yuga Labs, examining whether its NFT trading had violated securities law, as well as its distribution of ApeCoin. In a statement to Fast Company, Garga says that he’s “not surprised,” adding, “policymakers want to learn more about Web3. It’s new, it’s uncharted waters. We have the opportunity to work with the rest of the industry and policymakers to help shape the ecosystem.”)
Gargamel (Greg Solano), cofounder [Photo: Benedict Evans]
When asked about ApeCoin and these concerns, Oseary is irritated. “I don’t accommodate any of [those suggestions],” he says. “It’s important for me to walk you through who and why and where, but I’m not going to be able to do that in just a sound clip.” But the question didn’t deter Oseary from suggesting that Fast Company use ApeCoin for payments via another crypto payments startup, BitPay, in which he’s an investor. “BitPay now accepts ApeCoin. So if Fast Company wants to let their subscribers pay in ApeCoin, which I would love, because it would be great for the [feature’s] launch, I would then say . . . go to BitPay. [Yuga] doesn’t have a working relationship with BitPay—although I am an investor—but I’m just helping people figure things out.” A few minutes later, the singer Morrissey is on the line for Oseary, and he has to go.
More than 4,000 people swarm into a digital world of palm trees and murky water, a hazy tropical landscape befitting the inaugural demonstration of Yuga’s metaverse. Dubbed Otherside First Trip, Gordon and Garga’s high-low influences are evident throughout the 90-minute, mid-July experience. The squat aliens, called Kodas, that are central to its save-the-world narrative were inspired by a conversation the friends had about ethnobotanist Terence McKenna, an early experimenter in psychedelic plants, who described being guided through hallucinatory trips by what he called “machine elves.” There’s also a profane, wisecracking emcee. (Fast Company gained access from an NFT holder who passed up a slot.)
Crypto Twitter is enthralled, with people gushing over the game’s whimsical backstory, striking graphics, and impressive technical specs. As with all things Yuga, the small team, which now totals about 70 employees, did not do this by itself. Otherside is being built by Improbable, a decade-old metaverse engineering company with approximately 1,000 employees that’s backed by A16z. It was Oseary, of course, who referred Yuga to Improbable.
Although the demo soared, Yuga’s efforts to broaden its ambitions have put the company in a bind. Web3 and Disney is an incongruous pairing. One can’t go 10 minutes talking to someone working in Web3 without them espousing its core ethos of decentralization, which deems that communities like BAYC should be built by and for its members and not overseen by a single sovereign. Whether they actually believe it is beside the point, but these values do not jibe with a corporate megalith that protects Mickey Mouse and the rest of its IP with authoritarian fervor. “I don’t think they’re trying to hold themselves to that standard,” says Rogers, the former Disney licensing exec, when asked about Yuga’s fealty to decentralization. He predicts that Yuga will be the first of several multi-brand NFT “super studios” to emerge in the coming years.
When this apparent contradiction is broached with Yuga’s founding duo, Gordon says, “I hear you that we’re quite large in the NFT space. But in the grand scheme of things, we’re the little guy.” Separately, Garga posits that “decentralization is not an on-off switch. . . . It’s a sliding scale.”
But as Yuga has turned its focus to Otherside, it appears to be acting more like a traditional media giant, securing additional rights for itself and alienating the NFT-world people it needs to woo with its metaverse. When Otherside’s virtual land NFTs came out in April, the contract language had been tweaked from the Bored Ape NFTs to make explicit that NFT holders owned only commercial rights and not full IP for the game’s Koda characters. Furthermore, new clauses stated that the license could be restructured or even terminated by Yuga. “This is the most centralized product Yuga has launched, by a wide margin,” noted the influencer Punk 6529 in another widely shared Twitter thread. “Maybe that is needed to do the gaming things they have planned. Maybe not.” A Yuga spokesperson points to the company’s track record, specifically how it transferred commercial rights for Cryptopunks and Meebits, as evidence of its commitment to its NFT holders.
Muniz says that Otherside is “a game, but it’s really a platform,” and when articulating Yuga’s business model, she reiterates, “We’ll also be introducing more platform thinking into the ecosystem and how we run the company.” It is difficult to reconcile this statement—which is redolent of Meta’s command and control over Facebook et al.—with any kind of interoperable metaverse that isn’t explicitly under Yuga’s control.
Much of the gaming community has professed nothing but hate for Web3, and efforts from Ubisoft and Electronic Arts to integrate NFTs have faced fierce player backlash. “There’s a perception from gamers, that’s like, ‘I don’t know why I would buy that monkey JPEG for this amount of money,’” Gordon acknowledges. Ever the optimist, he adds, “I think that’s gonna shift very fast.”
But even people inclined to like both gaming and Web3 remain wary of Otherside. “The people who are going to get hurt are not so much Yuga or A16z—it’s the people who bought into it,” says Lars Doucet, cofounder of a blockchain game consulting firm. “Centralization is a danger,” he says, citing the risk of putting so much hope into a standard bearer. “If it crashes? The massive stink of something like Yuga Labs going down would be a disaster for [crypto].”
The skepticism only seems to fuel Yuga’s cofounders. A month after Otherside First Trip, Gordon, Garga, Muniz, and Oseary gather on a Twitter Space to celebrate the milestone of garnering 1 million followers on the platform. There’s no specific news, but Gordon and Garga tell the crowd to brace for more to come. Because as Gordon says, “The reality is, we’re kind of bored of low-effort stuff.”