Gabby Dizon is cofounder of Yield Guild Games, an organization that helps its members make money playing blockchain-based play-to-earn games. As a long-time game developer and player, Gabby had long dreamed of a game guild owned by its members.
Gabby Dizon is cofounder of Yield Guild Games, an organization that helps its members make money playing blockchain-based play-to-earn games. As a long-time game developer and player, Gabby had long dreamed of a game guild owned by its members.
Intro: [00:00:00] From Silicon Valley, the heart of startup land, it's Getting2Alpha, the show about creating innovative, compelling experiences that people love. And now, here's your host, game designer, entrepreneur, and startup coach, Amy Jo Kim.
Amy: Gabby Dizon is the co-founder of Yield Guild Games. An organization that helps its members make money by playing blockchain-based play-to-earn games.
As a long time game developer and player, Gabby has dreamed of a game guild that was owned by its members. So when the first wave of NFT games like Axie Infinity came out, he started Yield Guild Games. And he structured it as a DAO so that all members could share in the profits.
Gabby: It's not a company, it's a DAO, but even though we raised venture capital, we actually reserved 45 percent of the token supply to our guild members.
The [00:01:00] analogy is, what if the Uber drivers in 2009 received Uber equity for each ride that they made, right? Then they would have captured the upside instead of still hustling per trip or per hour as they are now. But that was central to the philosophy of what we started.
Amy: Let's listen to Gabby's visionary thoughts from August 2021, when Axie was on the rise and the world of NFT games was just getting started.
Thanks for talking to me. You're in the Philippines, right?
Gabby: That's right. I'm in Manila.
Amy: So I'm a long time game developer. I work with startups a lot now in the gaming space and also around that space. And one of my clients was in crypto and in researching the space for that client, I discovered Axie Infinity and then saw what you were doing.
I see [00:02:00] a lot of stuff in crypto that I don't think is particularly above board and I feel is very speculative and a lot, I see a lot of promises not getting kept. And then I see Axie. And it just feels very different than most of the other things I've seen in crypto. So I really just want to get your perspective.
Do you see that too? Or is it like there's a lot of stuff like that? I want to understand what your company does. Yuild Guild Game. What is the business there?
Gabby: Okay. Quick background on myself, I also come from the game industry. So I've been a game developer for 18 years now. Okay. was making mobile games from 2014 with my own studio here in the Philippines. 2017, we discovered Ethereum and smart contracts, and we were experimenting with smart contracts to see how it could possibly disrupt the game industry then.
And then while we were doing that, Cryptocadiz came [00:03:00] out in late 2017, brought down the Ethereum network. And popularized the non fungible token. And I said, yeah, this is it. NFTs are what's going to change the game industry. Uh, the two years, like 2018 to 20 were super difficult because it was the bear market, funding had pretty much dried up and it was really hard to keep on going.
But somehow we were able to survive. We released a game called Battle Racers in the central land, which, uh, like an arcade racing game that had NFTs. I also joined the Axie community as a player in late 2018. And what was remarkable about Axie even then was that they really gave away most of the economy to its players.
And so you have players who are just very on board with the game's mission, very welcoming to new players, and most of the economic gains that went to the, to Axie itself, when people bought their saltmix, went to the players, because instead of the typical [00:04:00] game in a purchase model, where you pay for a dollar app store takes 30 percent developer keeps the rest.
Where Axie really only makes money is by its marketplace, where it takes a 4.25 percent fee, which means over 96 percent of the value goes to the players. And so Axie has always had a very loyal player base. And what happened last year was a couple of things. They introduced the SLP token because Axie had a breeding mechanic, which they actually got from CryptoKitties where you could breed two Axies and then create a new one and CryptoKitties.
This resulted in overinflation because people could just breed as many NFTs that they wanted. To control inflation, they, they introduced the SLP token, which is a game resource that could be mined by winning matches inside the game, but then you had to use it as a resource, you had to spend it.
In order to breed two new Axies, [00:05:00] two Axies to create a new one. So now if I wanted to breed Axies, I needed to be either playing the game and winning matches so that I can get enough SLP, but I could also sync the balance to the blockchain, which means that SLP becomes a cryptocurrency, a token in my wallet.
And once it's a token in my wallet, then I can then transfer that to someone, send it back to Ether. Or eventually sell it back to whatever currency, um, is being used by the person.
Amy: So SLP is one of two main currencies, correct?
Gabby: Yes, that's correct. SLP is a game resource that is tokenized. So that's the way to take a look at it.
Amy: And what kind of game resource does it act like? Does it act like energy in a game? Does it have the dynamic of any particular resource?
Gabby: Not really energy. I think it's more like wood and lumber and rocks to create something. It's more like that because when you like, you need SLP to create [00:06:00] new Axies. So it's really a resource that you have to earn in game.
And then you have to spend it in game to be able to produce something.
Amy: So that just sounds like a currency. Why is it a resource and not a currency?
Gabby: Because, uh, it's not a universal currency that you use. Well, there's no in-game store, but even then in the marketplace, you don't pay with SLP, you pay with Ethereum.
Amy: So what you said earlier is that they introduced it to manage inflation.
Gabby: That's correct.
Amy: So, were, did they introduce it while you were playing? When you started in 2018, what was in the game?
Gabby: There was a game that you could play, and then you could breathe pretty much without SLP, so that, yeah, you could breathe pretty much as you wanted.
Amy: Were there battles?
Gabby: Yeah, there were battles. It was as much simpler battle system than there is now.
Amy: So what's changed since then? There's SLP, there's more complex battle system.
Gabby: Yeah, that's right. And [00:07:00] then there's AXS, which is the governance token, which the way to think about it is like an equity token.
Amy: A DAO?
Gabby: Yeah. Yeah. Part of a DAO that is launching soon. Yes.
Amy: Okay. So not a DAO, but part of a DAO.
Gabby: Like, we'll be a DAO soon.
Amy: So one of the things that's really fascinating to me about the game is the loop of how new Axies get created. And the game makers made a decision that new Axies for new players would be created by experienced players.
Obviously there's a cold start problem. Like somebody has to start right now. Do players make all the new available Axies? Does the, that's what I figured. Was that also the case in 2018 or was there like a shift where they were still making some?
Gabby: It was only in the very start that they did an original pre-sale.
And then the pre-sale was to get what are called [00:08:00] origin Axies. And these origin Axies were the ones that you had to start to breed. So after the original kind of selling event, it was all players from there.
Amy: That's really interesting. It's sort of like CryptoKitties meets Pokemon.
Gabby: Exactly. That is exactly.
Amy: Okay. So initially it was like CryptoKitties meets Pokemon, Simplified Battle System, and then it's developed since then.
Gabby: Yup.
Amy: And was it always on Ethereum?
Gabby: Yes. It was always on Ethereum.
Amy: Cause it's programmable?
Gabby: Yes, that's right.
Amy: Okay. And how did the idea and then the reality of Yield Guild Games emerge?
Gabby: Okay. So back to last year during early lockdown, I was playing the game. Axie probably had less than a thousand players at that point. And the players are, I would say, mostly Western, mostly like people from like US, Europe, who had money to spend on NFTs. I was probably one of the [00:09:00] very few people in Southeast Asia and probably the first in the Philippines who was playing back then.
But what happened was that there were, uh, people who got played off here in the rural Philippines and they, they had no job, they were stuck at home. Um, they were looking for ways to make money, and they had tried searching online and they found Axie Infinity. So they were able to buy the game, buy three Axies, start playing, and then they realized that the economic opportunity in this game, the money they could earn was actually higher than the jobs that they were laid off from.
So for context here in the Philippines, a minimum wage job in the province is probably something like 200 a month. And with Axie, they were, like, basically getting somewhere between 300 to 500 a month.
Amy: But then how much did they have to put up front?
Gabby: So last year, a game cost something like 200.
Amy: Where would they get 200 to get started with?[00:10:00]
Gabby: That's probably, like, last savings or borrow from somebody. So instead
Amy: of taking your savings down to the gambling parlor, you put it into this game? Yeah. And, and they make money by breeding and selling Axie?
Gabby: No, they made money by playing the game, earning SLP and then selling the SLP.
Amy: So they weren't breeding Axie?
Gabby: Yeah, because they were new players. It's like, if you're a breeder, you're most likely an experienced player. So I was a breeder during that night. Okay. So I had a lot of,
Amy: It's like an elder game in gaming.
Gabby: Yeah, exactly. It is an elder. It's interesting.
Amy: And so the newer players can just grind for SLP.
Gabby: That's right.
Okay.
Amy: I understand. So the game is designed so you can grind for SLP through battles. Yes?
Gabby: That's correct. Okay. Yes.
Amy: And how strategic is it?
Gabby: The game itself? It's pretty deep. Okay. There's a meta game. There is competitive battles. There is like a tournament scene.
Amy: Okay. [00:11:00] And then to sell the SLP, you have to convert it to ETH and then sell the ETH, right?
Gabby: That's correct.
Amy: So rural Filipinos were figuring out how to do that.
Gabby: Out of desperation.
Amy: Were you watching that happen? It like right before your eyes?
Gabby: Yeah, it was around like August, September. Yeah, it was mind blowing. And what happened was that when people cashed out, they would take a photo of the wad of cash that they cashed out and then the, the stuff that they were able to buy, like the food they were able to buy with it, they take a photo of it and then upload it to Facebook and they're like, this is what I bought playing this game.
That's what drove the growth of Axie was these people posting that they were earning money, playing this video game, and then taking a photo of what they bought and then uploading on Facebook and having other people see that and come in.
Amy: How did the people in the rural Philippines find it? Was it like young tech [00:12:00] savvy people?
Gabby: Um, we, we released a documentary. I don't know exactly how they found it, but they found it somehow. And I think there is a little bit of tech background there.
Amy: There's a lot of friction to getting that flywheel going, so it's an amazing story. As a game designer and a system designer, because system design was my background, looking at Axie and both the systems built, the way the team evolved it, the economic decisions.
And then the emergent systems of scholars. So you're telling me the story of how Yield Guild came about, started to get discovered. Then what happened?
Gabby: Yep. Okay. We have to talk about the scholarship system first. So the scholarship system was an emergent, um, phenomenon that happens. So the Axie team actually didn't plan for it, but there is an interesting quirk in their architecture in that there are two ways to log into [00:13:00] your account.
One is a username password login. And the other one is to sign in with your crypto wallet. So obviously if you sign in with your crypto wallet, then you have access to your assets and then you can buy them, sell them, get them to someone else. Like you can do whatever you want with your Axies. If I log in with my username password, I can access the game, but I can't touch the assets.
So some people in the community figured out that I can do that to fashion a makeshift rental system. I would give you my login. You'd be able to access and play the game and accrue SLP, but you wouldn't be able to run away with my Axies. And then at the end of a 15 day period or a month. I would just do a revenue share on the SLP earned.
So that was how scholarship started.
Amy: I love that story so much. Emergent systems are, like, I do multiplayer gaming, MMOs, large scale multiplayer games, and like, systems. And those kind of emergent things are usually the most interesting [00:14:00] things. And then the way a team responds to it is so important. Do they try and squash it or do they?
Gabby: Do they shut it down? Yeah, yeah, yeah, yeah.
Amy: So that, the fact that it's basically a hack of the system and the way the system is structured could be seen. As a bug, but it's actually a feature. How does the person doing the work know they're going to get paid?
Gabby: Oh, they have to trust the manager.
Amy: You have to trust the manager. So there's probably some scams running.
Gabby: Oh yeah, there are some scams.
Amy: Right. So you have to trust the manager. You can't build, you can't make a smart contract.
Gabby: No, because the, the Axie team is building a guild feature in the game right now. But with just the way that the, the architecture work, like I, the manager on the Axies on the wallet.
So I would have to be the one to disperse the, the SLP.
Amy: So you have to trust the manager. Yeah. So then what [00:15:00] happened?
Gabby: I had a dream of creating a blockchain gaming guild, basically, that would, that would be like a World of Warcraft guild, but you would own the NFT assets, and the guild members would own it.
I realized that it was now possible to do so. And so I started writing up the concept, recruited a couple of my co-founders. One of them was a smart contract programmer who's also deep into the Axie community, and the other one is a more finance, fintech oriented who's been in the crypto space for a while.
So the three of us started creating the concept for Axie, started benching it to investors. And then bought our first few hundred Axies so that we could start breathing them and then offering them to scholars. The key difference of what we're doing versus what all of the other scholarships are doing is that it was engineered to scale from day one.
First of all, our breeding is automated. All of the other functions of sending Axies to wallets, the revenue share, all of that are automated. So we're not [00:16:00] doing any of it manually. Second is that we're actually not handling any of the scholars directly. We work with the managers, the independent managers who become kind of part of our system.
And then we're the ones that breed, so they don't have to put out the capital to do so. And we take away all of the kind of manual processing that they're doing. Everything's automated in our end. And then in exchange, they take a lower cut. So for example, if they were managing scholars directly, it would be like 70, 30, 70 in favor of the scholar, 30 to the manager.
For us, it's 70-20-10 - 70 to the scholar, 20 percent to the manager, 10 percent to the guild. So they're giving up 10 percent in exchange, like it's completely automated.
Amy: So is it like you bought a big fleet of cars and they're all the Uber drivers?
Gabby: Yeah, exactly. So for an Uber driver, it would be expensive for them. That is actually very much on point.
Amy: So you put up the capital and do some of the work and the blah, blah, blah, [00:17:00] to own Axies, which are breedable and which are revenue-producing assets.
Gabby: Correct.
Amy: So here's another loop. Maybe you could speak to this Axies or revenue-producing assets as long as there's always new players coming in. If new players fall off a cliff, Axies are no longer revenue producing assets, correct?
Gabby: That's correct. That's still producing SLP except that it would lose its value.
Amy: So the whole system is propped up by, in gaming terms, a shared magic circle that assumes that there's always new users coming in and more than before.
Gabby: For now, yes, that's correct.
Amy: For now. So, there's a part of it that's structured exactly like an MLM or pyramid scheme in what we just talked about.
It emphasizes getting in early and the whole thing counts on new recruits all the time. I do not think it's [00:18:00] like a pyramid scheme. I think it's actually producing real value in a really interesting way.
Gabby: It's a growth loop, like it's basically like all of the marketing that Silicon Valley does, except that like the value is externalized to the players.
For example, like, PayPal is famous for like, I can email 10 to someone, then you have to sign up and claim that 10. So I see that kind of growth loop, uh, the same way. I just want to get technical about what a kind of MLM is, because the MLM basically promises a cut, right? Of what the people that you've referred were earning.
So they don't do that, which I think is critical for the integrity of the system. So it is a growth loop. It is pyramid in structure because it requires new players coming in, but honestly, any startup that especially early in the growth curve, it is absolutely dependent on new users coming in.
Amy: One of their key brilliant moves is creating [00:19:00] a growth loop economy and giving a big cut of it to the players because of what that does.
Yes. Shining the incentive systems. And I think that's part of why you've…
Gabby: Exactly. Yes. Oh, it's so refreshing to talk to someone about this from a peer assistance perspective.
Amy: Yeah, same. So now you had this idea to start the company. You own these income-producing assets. And you are going to open up that for a revenue cut, which is the business model already established by the game.
You're just mirroring the same model, correct?
Gabby: We're mirroring it. What the community did, we, we designed it to scale from day one. And by the way, it's not a company, it's a DAO. So it's, so Guild itself is not a corporation, it's a DAO. And the ownership of the DAO is represented by the YGG [00:20:00] token. And the whole philosophy behind it is that we wanted the workers themselves to be owners of the Guild long term.
So even though we raised venture capital and a bunch of investors, have, have a significant amount of our token. And we actually, in our white paper, reserve 45 percent of the token supply to our guild members. And the analogy is what if the Uber drivers in 2009 received Uber equity for each ride that they made, right?
Then they would have captured the upside instead of still hustling per trip or per hour as they are now. But that's central to the philosophy of what we started.
Amy: Got it. So, I've watched a few DAOs play out and what I've seen, it's very early. What I've seen is something that I wonder how you think about, which is when it actually comes to decision making, nothing replaces leadership.
What is your take on that? I [00:21:00] get the DAO idea and I like the DAO idea because incentives aligning is a good thing, right? But decision making with committees and voting often just turns into people with backdoor power doing it in a hidden way. And because nothing replaces leadership, groups don't actually make decisions.
So distributed wealth and upside, but that there's like the decision making part. What is your take on that?
Gabby: Again, a hundred percent agree from a systems perspective. We actually are not promising decentralized decision making. Our first promise is decentralized economic opportunity, and especially like a greater opportunity to those people who are doing the work.
We basically never promised that they would really steer the ship in terms of how the vision is concerned. So what we're promising is that with these assets inside the game. We're going to form [00:22:00] sub DAOs of it where there's like a sub DAO of people playing Axie T, for example, or League of Kingdoms. The players themselves get to govern how the assets are used inside the game.
But at the top level, driving the vision, the products that we have to support it, it's pretty much run by the team and yeah, myself as, as the leader. Okay.
Amy: Yeah. So that makes sense to me. I've experienced a lot of what looks to me like Naive belief in distributed decision making and voting. Just give people votes.
Having wrestled with running online communities, that seems very naive to me.
Gabby: A lot of people who are, I would say, decentralization maximists, they think that decentralization is like a magic pill. And if you've ever run like 10 people playing a game together, you know, that's not true. And again, like going back to systems design, there needs to be a strong vision [00:23:00] and the willpower to carry that through.
You can still be absolutely consultative. You can be truthful and open to your community, but yeah, buck stops here. I make the decision. If it goes wrong, it's my fault. If it goes well, then yeah, we made a decision as well.
Amy: So why make a DAO and have shares versus just give people shares in a company like any other startup?
Gabby: So equity is analog. It's, it's basically old software. There is no better way to distribute ownership than a natively digital token that you can easily send out to even people you don't know around the world. As long as you have a proof of their contribution to the network. I can send you tokens. I don't have to know who you are.
I don't need to KYC you. I don't even know what country you're from. And for equity, there's always usually an upper limit by which you are, um, considered a public company. I think that that limit is like 500 shareholders in most cases. And our guild is now like [00:24:00] 45,000 people. So for us to be able to send like maybe a few hundred bucks worth to the 40,000 people, that's just not possible in equity land.
Amy: Okay. So you had this idea, you had a couple of co-founders, you got started, and now your guild is up to 45, 000 people. How did this happen?
Gabby: How did it happen? Uh, so we, we started partnering with some of the, like better known scholarship managers that were doing things independently, and we basically brought them under the guild It was great for both sides because for them, they weren't constrained by capital anymore.
The administration was automated. So they are still their own like independent scholarship program, but they're running with the guild resources. So this was our primary way of growing. And, and now as Axie started becoming more popular, especially in the Philippines, people just started [00:25:00] finding us. Like looking for scholarships.
If you look at Twitter, every time I make a post, there's maybe 50 replies looking for scholarship. And yeah, just got really popular via virality.
Amy: So, I noticed that whenever I post about Axie, I'm besieged by people looking for scholarships. Why are so many people looking for scholarships that aren't finding them?
Gabby: Because there's just so many more people that, that want to play games for 800,000 a month, then you can produce Axies, right? Because to produce Axies, there's a certain cost, there's also a breeding time, so you need capital, and you need to be organized to produce a huge amount of Axies. And this just opened up basically a new class of gig work with a very low bar to get started.
Like I need to know how to play a video game and have internet access in my home. And it proves to be a gigantic market. And the reason that Axia has value [00:26:00] is that It's not easy to produce NFTs, right? You need SLP, you need to breed. It takes a few days to breed. If you could just produce Axies as fast as you wanted, then they wouldn't have any value.
Which is what they solved with introducing SLP in the first place. So the friction of breeding, of cost of SLP, of having to grind in the game, is actually what gives it its value.
Amy: And the fact that new players need them in order to play.
Gabby: Correct.
Amy: It's a brilliant loop. Yeah.
Gabby: It is a brilliant loop.
Amy: It's a brilliant loop.
I, I just am glowing with admiration for that loop.
Gabby: The funny thing is a lot of game investors passed on Axie because they couldn't see the loop for what it was. And to be fair, like if you look at Axie at first glance, it doesn't look like a AAA game. It doesn't look like there's anything particularly innovative.
So they experienced game investors. They all passed on it and it was more of the kind of crypto native ones that could see the beauty of that [00:27:00] loop that, that invested in them.
Amy: One of the things that I think is important to tease out here is that it's actually a good game. It's got some depth. It's got some strategy.
That's...
Gabby: Definitely.
Amy: That's a big deal. Can you speak to that a little bit?
Gabby: Yeah. So we see a lot of games, right? And we're always evaluating games that we could invest in. And a lot of people who don't understand Axie from a deep level, it's easy to dismiss because it doesn't look like your polished AAA game.
It doesn't even have live ops at this point, but the game itself, it's fun. There is a depth to the metagame and deep enough that there are tournaments around it. And without that fun. It is actually impossible for a game to be as successful as it is. So there are games right now who are trying to be blind copies of Axie and they're not fun.
They just copied what's on the surface. And after a month, the price of their token goes up, but it's pretty much a Ponzi and then after a month, [00:28:00] everything comes crashing down because it's not fun. One of the most interesting things about AppSee that I'm sure you'll appreciate is that it has 30 day retention of 90 percent and nobody else in the industry has that.
People who are looking from the outside in who are maybe experienced game industry insiders, or they look at it and say, Oh, it's not fun. Like the retention doesn't lie. Like whether it's fun for you or not, it's fun for a lot of people. Otherwise I wouldn't be at 90%.
Amy: That happens a lot. Sometimes any of us who have experience run into that.
But I remember when Minecraft first came out, I was fascinated with it because I have kids and they were into it and it's beta. Uh, I found it fascinating because you could do a lot in it, but it looked really blocky and it challenged all these assumptions and all that. But there's Games Industry Insider 123 on video talking about how stupid it was.
A lot of people reacted to it like that. [00:29:00] Roblox too. Although Roblox took a long time to turn into what it is today. But that's also part of the story of Axie is it didn't spring like this as it is. It really has evolved. When I saw what was going on with it, I was like, I, and I watched that documentary, excellent documentary, and then I watched other documentaries because there's a lot about Axie, but it's clear that it's fun.
It's got some strategic depth. Like you said, they took these known loops of growth loops, growth hacks.
Amy: An economy that mints things. But they added something extra to it, which is they turned the people playing the game into the source of new resources. And they did it in a way that created an elder game.
I have this book where I have a whole section of a chapter on elder games and just like that journey. It's really hard to do a good elder game. Like all of us who do MMOs [00:30:00] always think about that. It's okay, once they're at level 80, then what? And you don't want to just grind the same game.
Gabby: So yeah, breeding is that other game.
So for what we do now at Guild Guild, I would say like the bulk of our day to day operations are in scaling Axie, but we do also run what is like the equivalent of a early stage game investing fund in NFBs. So we take a look at a lot of the upcoming play-to-earn games. And we invest in the NFTs and tokens of these games.
So yeah, we've, we're invested in 10 of these games now. And the idea is that any game that looks like it has a decent play-to-earn loop, we'll invest in it. We'll put maybe 50 to a hundred K in it. We'll turn over the assets to our players who play the game and they may be engaged. They may be making money. They may not.
But what it gives us as a guild is a heartbeat of like the play-to-earn economy. And eventually, we don't know when one of these games will start [00:31:00] breaking out like Axie. And we will be able to see that earlier than anyone else because we have an active player base in that community. And that will give us the chance to double down on our asset investment once we see that a new game is breaking out.
So that's how we think about it.
Amy: So you're investing money, not crypto.
Gabby: We don't own a bank account. All of the money that we have is in crypto. So we have basically USDC, which is crypto dollars. And we invest in the NFTs and the tokens of these games.
Amy: You're doing all of this within the crypto economy, which is also what's going on with Axie, except you can cash out in your fiat currency.
That's why it's a big thing in the Philippines.
Gabby: Yeah, that's, that's right.
Amy: That's really exciting. How has this impacted you just in your life? Do you have a lot more money?
Gabby: So even before this thing started, so I was there in the original land sale of Axie. I didn't [00:32:00] really have any money then. This was like January, 2019, Ethereum was like 120 and I was able to buy some lands there for basically a few thousand dollars.
Which is now worth over seven digits. The gameplay hasn't launched yet, but there is a land system in the game and there'll be more MMO type gameplay that will be releasing, I think next year. So you use the same Axies, you use it to harvest stuff in the land, build buildings and all of that. And they've been working on that gameplay for a long time, but these things take time to make, so it's not out yet, but the land itself.
It's gotten so much more valuable as the game has gotten more popular that like most of my net worth is now inside this digital pet game.
Amy: So you've sold land. You've sold digital land and made digital money which you could then convert into fiat.
Gabby: Yeah, that's correct. Okay.
Amy: And you're doing that in a completely [00:33:00] speculative land grab environment around a not yet shipped major new level from the devs.
Gabby: It's the same as buying into a condominium, like on pre selling mode.
Amy: Right. Except they haven't shipped the level. So all you know is, are they like showing you like demos or?
Gabby: There's been a demo out and it's also explained in the white paper of Axie that a huge percentage of the AXS governance token is actually going to be released via LAN gameplay.
So it's like you play the game and you earn the stock of the company. It's pretty much almost like that.
Amy: Wow. So that's, that's life changing.
Gabby: Yeah. My life has really changed because of Axie, like literally. Most of my wealth that I've developed now is because of this game.
Amy: Where are the devs based?
Gabby: The original co-founders are Vietnamese and then they added to, which later became co-founders as well.
Uh, the COO, Alex, is [00:34:00] Norwegian. And then the head of growth, Jeff, is American, like Korean American. So they're the ones that are public facing because I think it's also related to the communication skills. Like the Vietnamese have like pretty thick accents and they don't like to be public facing. So they let the Westerners kind of talk to the public while they run the show internally.
Amy: Some of my close colleagues, people that I've trained in our methodology are in Malaysia and also India and Singapore. And they've been talking to me about Vietnam as this rising tech economy. They're seeing it in their own business. This is the first time I've heard about a hit game from Vietnam, but I've...
Gabby: Me
Amy: too.
Big nose through my colleagues who are in Southeast Asia. About the potential of Vietnam, which they see as right on the brink of breaking out the way they talk about it. I don't know if that's how you see it or, but that's really interesting.
Gabby: Vietnam is extremely strong in [00:35:00] engineers. They're very weak in English, but as long as you can talk to them in math and code, like they do extremely well.
Amy: Wow. So right now this is your full time job. You have 45, 000 people that are in your guild. And so do you have to manage them?
Gabby: No, the scholarship managers manage them. We have a full time team of basically developers, finance, like any like startup team that creates the product and the technology so that we can run the guild, but we don't really manage the players ourselves.
We just have a structure so that they can organize.
Amy: And does it bring in revenue?
Gabby: Yeah, we produce a gross on a gross level. We produce 1 million SLP a day. So let's just say that's 200K a day of which 70 percent goes to the players, 20 percent goes to the managers, and then 10 percent goes to us. So we're in effect [00:36:00] making 20K a day, but more importantly, just in the last week, we paid out eight over 800,000 to our scholars and managers.
And imagine the kind of impact with a business model that pays out life changing sums of money to our player community every week. That's just what the business model does.
Amy: I'm imagining.
Gabby: Honestly, I never really thought that I would be able to combine games, which I love, like I've been doing this for almost two decades now, crypto, which is something I've been like endlessly fascinated to, and then like economic impact and help the world at the same time.
I. So for me, this is the best job in the world. I can't imagine anything better because I'm still in the game industry. I'm not making games anymore. I'm helping game developers by buying their assets. I'm investing in my friend's games. I get to be in crypto, which moves really fast and it's incredibly like intellectually stimulating and I'm basically helping the world at the same time.
Amy: [00:37:00] Wow. I'm, I'm fascinated and impressed. And this is a space to watch. There's, I, as you said, there's now a gold rush with a bunch of people rushing in to do games in this space. One last question for today. I really appreciate your time, by the way. What games are you seeing that look promising? You're seeing a lot of games and that means that you have the opportunity to notice patterns and we men, you hinted at the games that aren't impressing you, which is like direct rip off of Axie. Why would you play that? Right? Yeah.
Or something that just isn't fun. Maybe the game plays super lightweight. There's no depth. Have you seen anything that looked interesting? Have you seen anything that you thought? That kind of has that, Ooh, I want to know where that goes feeling.
Gabby: So I'll speak in general terms first before a specific games.
So now that the game industry has noticed and the game industry is coming in with like the game industry knows Polish, they have [00:38:00] experience, they know how to ship titles. I think the ones that have an edge are actually the, the MMO designers. And to a certain extent, the free to play ones, because they're used to dealing with virtual economies.
And the only reason to get into a blockchain game is to design a virtual economy of which part of it can be cashed out or owned by the users, like direct value transfer from the game economy itself to, to the player. So MMOs are good at that right up to, I guess the cash out point, but there's always been like black market or whatever.
Free-to-play is good at designing virtual economies, but it's been, I would say extractive. I would, I don't know if you'd agree with that. Yeah.
Amy: You and I are like, yes, I use that term too. Yeah.
Gabby: Yeah. So free to play designers know virtual economies, but they have to turn the value model. on its head from being extractive because that's just how free to play works.
And that's why I actually struggled with it. Like the [00:39:00] reason we went to the blockchain in the first place, we weren't successful with free to play at all. And then turn it into a model where you're actually giving value to the player instead of extracting value. That's what's needed to become successful in play-to-earn.
Amy: I really like your separation between delivering economic and Equity value. And decision making, although those may end up colliding, right? Sometimes people in equity feel that they should get to make decisions or have their voice heard, but you should be so lucky as to deal with that in the future.
Gabby: Yeah, I think people just want to be listened to and they feel like they need to be listened to. And then even if you disagree with them, at least they feel like you've heard them.
Amy: Totally. Thank you so much for talking to me.
Outro: Thanks for listening to Getting2Alpha with Amy Jo Kim, the shows that help you innovate faster and [00:40:00] smarter.
Be sure to check out our website, getting2alpha.com. That's gettingettingnumber2alpha.comore great resources and podcast [00:41:00] episodes.