Yuga Labs launched the Bored Ape Yacht Club (BAYC) NFT collection in April of 2021. It was barely a year ago. However, in this short amount of time, the company has seen massive growth. And that’s putting it mildly.
Bored Ape Yacht Club is the world’s most valuable NFT collection. If you took all the NFTs in the collection and sold them, you’d make more than 1.09 million ETH. That’s about $3 billion dollars (at time of writing). As such, it’s not really surprising that a leaked pitch deck showed Yuga Labs made a net revenue of $137 million in 2021.
For 2022, they set their targets much higher. Ultimately, the company aims to bring in nearly half a billion in revenue, setting its targets at a very healthy $455 million. But how can one company possibly hope to achieve so much when, just a year ago, they effectively didn’t exist?
By taking on Mark Zuckerberg’s Meta and dominating the metaverse.
Setting sail for a new land
Just days ago, Yuga Labs raised a staggering $450 million to build a metaverse ecosystem around NFTs. The funding was led by venture capital firm Andreessen Horowitz. In an interview with The Verge, Chris Dixon, who leads Andreessen Horowitz’s crypto arm, spoke about Yuga Labs’ plans to take on Meta. “There’s a dystopian future where Meta is this kind of dominant digital experience provider, and all of the money and control goes to that company,” he said.
Yuga Labs’ massive metaverse initiative will begin with virtual real estate.
Their forthcoming virtual world is called “Otherside.” The team bills it as a MMORPG (Massively Multiplayer Online Role-Playing Game) that’s connected to the NFT ecosystem and more. In this respect, Otherside is more than just a virtual world. It’s a metaverse. “We want to build something that expands the universe of the BAYC, but also invites the larger NFT community (and those priced out of BAYC membership) to join,” the company explained in its leaked deck.
Yuga Labs plans to begin this initiative by selling virtual land as NFTs. These will be linked to plots in the Otherside metaverse game. In each case, the plots will come with distinct traits, like unique natural resources, artifacts, and rare characters. In the deck, the team noted that 200,000 plots will be distributed in two sales in March and August.
From these two sales alone, the company projects they will earn $356 million dollars.
There will also be an in-game app store that Yuga Labs plans to use to increase revenue and expand its reach in the metaverse. Individuals will be able to use the system to create characters from NFTs they own. They will also be able to accessorize these characters using NFTs.
The long-rumored ApeCoin is here
Yuga Labs has also built a wider media empire around the BAYC NFT series. They recently launched their much-hyped ApeCoin, which is called the $APE token. It will be their primary token for all of their products and services.
Notably, Yuga Labs launched this token in coordination with a host of other major players, though the company has a sizable voting share when it comes to the governance of ApeCoin. Yuga Labs also gets a significant chunk of the money earned from the coin.
These partnerships are critically important, as the partners will also be using the tokens in their projects. For example, one of the world’s largest blockchain game developers, Animoca Brands, announced that it will let users purchase NFTs in its play-to-earn (P2E) game called Benji Bananas using ApeCoin. More games and projects will likely be making similar announcements in the coming months, enabling Yuga Labs to extend their reach into the metaverse even further.
Yet, although ApeCoin will be used as in-game currency, the token will likely be more impactful as a general-purpose digital currency. ApeCoin will get listed on exchanges like Coinbase, Voyager Digital, Binance, Gemini, and eToro. The team plans to use a portion of the money it raises from it to create merchandise and events, which (of course) only increase their revenues and brand loyalty.
Can Yuga Labs compete with Meta?
According to Statista, Meta generated about $115.66 billion in revenues through its family of apps in 2021. Their most notable apps (Facebook, Instagram, Messenger, and WhatsApp) dominate both the social media and communications ecosystems.
At the present time, Yuga Labs can’t really compare to that. But remember, they have only been around a year. And they’ve already started to consolidate by acquiring their competitors. This year, they bought both CryptoPunks and Meebits from Larva Labs. Although it’s too soon to predict who will ultimately control the metaverse, there is good reason to suspect that Yuga Labs at least has a fighting chance.
It remains to be seen whether they will be just and equitable rulers.