OpenSea’s CEO sees greater opportunity for NFT use cases to grow (w/ Devin Finzer)

Hey everyone it's Jacqueline melanic Welcome to chain reaction a show that Unpacks and Dives deep into the latest Trends and news breaking things down Block by block for the crypto curious This year we're doing monthly series Diving into different topics and themes In crypto and to start things off this Month we're focusing on nfts I'm Interviewing some of the biggest nft Players and Founders about how they've Weathered the booms and bus in this Sector what they're focused on and what Could be next for the industry hope you Enjoy [Music] Today's guest is Devon finser the CEO of Nft marketplace openc Devon co-founded Openc in 2017 and it quickly climbed to Be one of the most well-known and Well-funded nft marketplaces two years Ago it raised $300 million in a series C Round at a 13.3 billion post money Valuation bringing its total total Capital raise to over $400 million some Of it investors include firms like Andrew and Horwitz and Paradigm as well As celebrities like Kevin Durant and Ashton Kutcher despite the NF markets Trading volume falling from all-time Highs in late 2021 early 2022 openc is Still pushing forward even though other Marketplaces like magic Eden has popped Up and challenged their dominance but as

The tides change pun intended we're Interested in hearing what the company Has been up to and how it's mapping out Its road ahead with that said Devon Welcome to the Show thank you so much for having me Yeah and before we get to everything nft Related we' like to start by asking Our Guest can you tell me about one of the Most interesting people you've met in The past 12 months in crypto and what Did you learn from Them oh man that's a good question um Let's see most interesting people that I've met in crypto in the last 12 months Um well I I won't give a specific name But I think one one sort of category of Person and individual is just the um the Luxury brand uh the head of luxury brand Sort of Dipping their toe in the nft Space I've been having um some meeting With with various Brands this is this is Kind of um top of Mind recently and it's Just interesting kind of the whole Spectrum of things that you can do in The luxury space we tend to sort of Think of um the physical world of luxury Um but there's this whole kind of Digital universe that is really just Starting to be explored but it's Impressive um what some of these Brands Like um lbmh for example have started Doing with nfts and um you know the I Think the general theme that uh I I I

Think just sort of um dominates the nft Space is that well you know certainly The market has changed a lot The Innovation and the amount of activity Just on the ground floor of um people Building stuff you know everyone from Smaller web 3 creators to midsize gaming Projects to bigger Brands The Innovation Just continues to be really strong so um Yeah I always I always feel like every Time I meet a partner who's coming in From um outside of crypto and into the Nft space I'm just kind of Blown Away by You know just the level of awareness and Education and um sort of thoughtfulness That these bigger partners are are Bringing to the space especially as it Compares to a year or two ago when People were just first kind of wrapping Their head around it so I'm glad you Brought that up because I actually have A question on that later but before we Get into that I want to dial back to Like day one of openc yeah as I Mentioned you launched it years ago back When nfts weren't really a big deal like At all uh I don't know if you felt Differently sure there were crypto Kitties and crypto punks and things like That in the air but it was really tiny So I guess the question I have for you Is like what did you see then that made You want to start open SE Yeah and I think it's a great point

Because um you know while nft it's it's Certainly true that nfts were really Tiny back when we started in late 2017 And really just the first use cases were Uh coming about um I would actually say That the market is still really early Right in terms of what we saw back back Then um we were really excited about Nfts as this highly generic technology That could be used to represent any Digital item right um that could be an Item inside of a game it could be a Piece of digital art um it could be an Event ticket it could be a domain name It could even be a digital Representation of a physical item and so We really you know from the beginning we Saw this as more than just um Collectibles and profile pictures Actually in the beginning we didn't even Really think that profile pictures would Be a thing it was sort of a brand new Market that kind of emerged organically Um but we always had this really big Vision of like nfts can represent all Sorts of different things um and it's Funny that you know as you fast forward To 2023 and 2024 um well we've seen this Explosion in the nft market particularly In 2021 um with profile pictures and art And all these exciting you know early Use cases we still have so much further To go in terms of representing um all of The kind of wide array of things that

Nfts can represent and you know gaming Is an example of the category that's Still really early um uh so so anyway You know to to answer your question more Directly what we saw was this really Powerful basic primitive and all of These different use cases that could be Represented and that just got us really Excited and you know we always kind of Technologists um and startup Founders Are always a little more willing to kind Of play around with the early toys even If they haven't gotten Mass adoption yet I think that's kind of what makes Founders unique is that they tend to be Really early into markets and certainly We were really early into open se but we Were just so inspired by the opportunity And kind of the um Innovation that was Happening in the space that we ended up You know continuing to build from 2017 2018 2019 2020 and then finally into 2021 when we really saw the uh rocket Ship growth of the space yeah do you Think openc followed the initial Vision That you guys had for all the Opportunities here or has it kind of Shifted into more focus on those like Pfp aspects like you Mentioned I would say we we've actually Really stuck to the original vision and I think that's a a unique thing among Startups it's not always the best Approach but it has been uh for us and

Um you know we haven't built a lot of Features that uh that only apply to the Sort of collectible pfp Art Market we Have built built some um but a lot of The features that we build we view as These more generic building blocks that Work across all sorts of different use Cases and even though some of those use Cases are still more in their infancy we Think that eventually they'll you know It's really the approach of kind of Letting a thousand flowers bloom um and Letting some of these earlier use cases Experiment with the platform um and see How they can take off so we've really Yeah I'd say that we've we sort of Started with this belief that nfts would Be Super General and super generic and Every single feature we build is either You know a generic horizontal building Block or it's something that can at Least be used across you know a couple Of different verticals um and so you Know particularly over the next um year We'll be building more and more of these Um you know vertical specific use cases But we tend to build them in a pretty Generic ways you talked about event Tickets before and some of these things That you just mentioned I'm curious what Are the expansion efforts going forward Uh like where where does openc see the Future for its core product

Categories yeah so um a couple different Areas um the first is gaming is an area We've always been really excited about Really from day one um if you remember Back to 2017 the first use case as he Mentioned was crypto Kites and it was a Game um and from there you know the Gaming Community it was the the web 3 Gaming Community was really small but it Was sort of the most passionate group of Folks who were interested in kind of Pushing the space forward now gaming has Grown to be huge there's been um Billions of dollars invested in web 3 Gaming um and a lot of the sort of Investments that were made in 2020 2021 Are just starting to come to market and Just starting to kind of actually find Product Market fit with real us users um So so that's an area where we're really Excited um you know we we've been Involved everywhere from just you know Supporting new primary launches for Games with our primary drops product to Building out some of these sort of Utility um oriented features like the Ability to redeem an nft on open C and Then just all the kind of generic Building blocks like um onboarding and Um user experience that benefit the Gaming industry so I'd highlight that as As one of our bigger bets um and then You know things like physical items Represented as nfts I could go on and on

About as well but um there's a whole Sort of host of other things that we're Excited about but i' highight gaming as As a really big one so do you think Gaming will be the big nft driver for 2024 I think that is a really good shot Yeah I mean the interesting thing about Gaming is that um you know it doesn't Necessarily always show up in the volume Numbers because sort of inherently a Game economy does thrive on having you Know Gamers being able to come in and Buy something for $1 or two dollar and So it's not necessarily going to have Sort of the um flashy effect that maybe A profile picture project selling for Thousands of dollars uh each might have And um and so sometimes it actually Flies a little under the radar and it Takes a it also takes a while for games To develop and find you know find really Good fit with their audience so I see it As more of this kind of um you know it's Less of that um uh you know hype cycle Based Trend and more just the the Gradual development of the space and the Maturation of the types of games and if You look at like you know a snapshot of The type of the types of gameplay Experiences that you can have in web 3 Today versus just last year it's like It's night and day so I in some ways I'd Argue it's already kind of um you know Driving web 3 adoption it's just maybe

Not as sort of of um uh you know visible As uh other other use cases for Nfts yeah I agree with that we've had Guests on in the past who have talked About web 3 gaming and how it's kind of Like either baked in and like you don't Even realize it's a blockchainbased game Or web 3 game whatever you want to call It or it's like very prominent in your Face you know you're using like a web 3 Game and I I think to your point that These things will take time because it's Not easy to make a game unless it's like Something like Angry not angry Birds the One with the you know what I'm talking About little pigeon Flappy Birds yes Exactly yeah I I think I definitely Agree with you on that point um you've Been in this space for longer than I Have longer than a lot of people I'm Curious what do you think has been the Biggest surprise for you being in the Nft ecosystem after the boom Maybe after the boom um I think one you Know pleasant surprise was post nft boom You did see some larger companies sort Of um you know move on from the space For sure but generally I would say that Um even the bigger Brands uh who you Might expect to be sort of um fair Weather friends of of nfts continue to You know and I think the ones that are Most dedicated and most interest in Space just Contin to build things so you

Know I think whenever there's a hype Cycle in crypto have a rush of people Who get really excited about it because Maybe the price is moving up or like you Know they hear about it from their Friends or whatever and then as the Market kind of cools down you have a lot Of those people leave um but I was Surprised that just I think what's What's really captivating about nfts is In contrast to some of the other areas Of crypto where it really is purely About um Financial you know uh services And speculation and prices and all those Sorts of things with nfts the technology Itself is just so invigorating and so Exciting that when you sort of join the Space and get interested in it for the First time you tend to stick around for The the sort of long-term opportunity And the technology and that was actually You know that's kind of what um my story As well in in sort of a maybe at a Smaller scale I I got interested in Crypto because um you know a lot of a Lot of my friends were talking about it And you know it was true that the price Of ethereum and price of Bitcoin was Going up so it's like okay what you know What's going on here um but then as I Read the ethereum white paper and Particularly as I learned about use Cases like nfts I was like okay this is Interesting purely from a societal

Technological like Trend and um I think I've been pleasantly surprised at the Degree to which that has resonated with Companies building in the space from the Really small you know startup to the Larger like brands that you know are Maybe a little more traditional and more Conservative I I could partially agree with you on That I think you know nfts have that Speculative nature some people really Buy into them because they want to like You know make the next board ape Yacht Club buy and then there's also the People who end up becoming the quote Unquote community members which is kind Of like a joke that you bought something You thought it was going to do well and Then you just become a Community member Um and as you mentioned with the brand Aspect we've seen social media platforms Like Instagram commit to nfts then Decommit uh we've seen other web 2 firms Launch nft Collections and then do Nothing after but then we've also seen Ones that are like extremely committed Like you said so I guess on that front What needs to happen to keep these Brands and industries and also just like Retail investors engaged in the long Term and not just seeing this as a Fad yeah I think one thing um where it's Been a mixed bag we've both made a lot Of progress but we still have a lot of

Room to grow is making web 3 as Accessible to regular users um as the Rest of the web and the rest of E-commerce and what I like to kind of Call the the Holy Grail of uh of web 3 Or or nfts or crypto which is like Getting the same you know onboarding Experience the same smoothness of user Experience that you know you certainly Can get if you go fullon web 2 and you Just have like credit cards and like you Know you sort of fake the nft experience All custody you know those sorts of Things but that real amazing user Onboarding experience combined with the Benefits and and core native value Propositions of web 3 which is like Interoperability across different Platforms the ability to own an item and You know resell it on a you know a third Party Marketplace all of those really Amazing ownership of your own data like All those sorts of things um so I think The opportunity for the space from our Lens is um building a feature set that Allows people to get into web 3 both Really easily but also in a way that They can experience the benefits um and That was not true in 2021 it really was The case that in order to participate You had to be you had to sort of level Up your expertise and you know download Metamask or download your own wallet Figure out how to get crypto into it

Figure out how transactions work all Those things um and as we build during The sort of nft barket market now the Infrastructure is at a place and Actually one thing I mention was just Transaction costs right like to to buy An yeah it is still expensive on Ethereum but we have Layer Two Solutions Now which reduce that cost significantly So um so point being what I think I Think one of the building blocks that Needs to really mature and it's sort of Our core Focus uh of the company is um Again getting that Holy Grail where we Have really amazing user onboard in Experience and user experience generally Combined with the sort of power of um Web 3 and the interoperability and you Know Marketplace activity associated With it there's actually something that Uh someone said to me recently where Developers are building now for users And use case as opposed to like Blockchains and I feel like it kind of Applies to that for sure um I'm curious On that front we kind of talked a little Bit about like speculation and Everything how much does nft sales Volume have an impact on your business And like how do you navigate that if it Is Substantial yeah I mean it certainly has A an impact on sort of the revenue of The business and the and the business

Model um but it isn't something that we Are laser focused on I would say what We're laser focused on is really Improving you know core product Improvements we we really do view this Space as early and um as such like so Many of the things that we get to build Are you know if you work at a Traditional tech company you're like you Know you're tweaking the text on a Landing page or you're like optim AB Testing you know different sign up flow Or something like that for us we're Literally like going from like you got To download metamask and and have a seed Phrase to okay you can actually just Sign up with an email and actually make A purchase right so we're we're making Those like really big step function Product improvements and um and so we're Less like okay we need to you know do This because it's going to like change Our volume numbers or something like That if you know if there were kind of Things that we you know could do that That were kind of like that it would be I'd say it' be a different a different Type of business um and uh and then the Other thing that we really focus on is Just you know as opposed to just volumes Um how are users engaging and are users Going from signing up to transacting are Users coming back and using the product Are using users buying interesting new

Nfts um are and how much Innovation is There at the product development phase For projects right like are the games Getting better um are uh are the art Projects getting more interesting um are New brands coming in all of those Signals I think are actually healthier Things to look at than just you know did The price of B8 go up you know and then That sort of led to higher volumes for For the company for for the Company I think accessibility is Definitely something people look for Especially new entrance to the web 3 World um I know for people in my life That are not in crypto if they had to Download a metamask wallet and send Crypto to it just to buy an nft I think I'd lose them at the first word metamask Like we wouldn't even get to step two or Three you know and now the fact that you Could just go and buy it makes it Extremely more accessible and I think That's something that some platforms Don't have um so on that note how does Open C compete with other nft Marketplaces to stay stand out whether It's through accessibility new offerings Features products like we talked about Earlier and kind of like remain Competitive to have that market share And trading volume because you want People to use openc totally um so I Think a couple things one is um we've

Built uh enough um services on openc That that our platform really can be a One-Stop destination One-Stop shop for All of your sort of n to use cases right You you know um we've made significant Improvements in accessibility around the Wallet layer and just user onboarding so You can I think openc is kind of the Best place to start for new users also Just on the you user education front um So articles about um you know learning About what nfts are and like what are The use cases all those sorts of things Um so you know it's a it's a great place To start and then it's also a really Great place to um build out both your Sort of portfolio of of your inventory As a user um and also if you're a Project um you're you're sort of One-Stop shop for um what we call openc Studio which is um the ability to go you Know launch uh or create a contract um Create nfts create a drop and do a Primary launch on openc um as well as Have the secondary Marketplace on openc Um the other thing that I would Highlight here is we've made a lot of Investments over the years in trust and Safety so a big problem in the nft space Is you know people will have and this is A problem that was was pretty part Particularly difficult for us early on Because we had so much of the sort of Eyeball share of um of people coming to

The space you know people would Basically create an nft that looks Visually identical to you know Bard ape Or whatever it is um and try to kind of Pawn it off as um you know as the real Thing we've invested a lot in um Ensuring that any sort of fraudulent or Problematic collections get Automatically removed from the website Um so I think the combination of all of Those things um really make openc this Kind of place where you can reliably you Know come come to the platform and kind Of get all of all you need from it Whether you're a user you know a First-time user curious user um or even More of an advanced user um or your Creator or project that wants to go and Launch um you can you can kind of you Can rely on us for um for sort of the Full spectrum of capabilities and Functionality do you kind of see openc As uh nft Marketplace for earlier crypto Users or like the seasoned like experts Or it's for everyone Then I would say for everyone yeah I Mean um so we have both a um a platform You know the openc prop ER which is more Um sort of dedicated to someone who's Newer or curious or more of the Collector type then we also have openc Pro which is dedicated to the more um Advanced user one thing that we'll be Doing over um the next couple months is

Unifying these platforms so that it's Easier to move between um the sort of Collector experience and the advanced Experience right now they're two Separate platforms you can obviously Connect both your wallet to to either One um but there's a little more uh uh You know discontinuity between moving From one to another um so yeah I mean Our goal I know that um you know there's There's a lot of value in Focus as a Startup and really targeting um a Specific user base but we really do Think that nfts are early enough that um We can service you know the full Spectrum of users and obviously they're Going to be people who want you know a a Certain type of UI that maybe isn't Quite what open C is um and and those People you know there are other options Um but we really do want to provide a Platform that's generic enough that It'll appeal to um the full spectrum of Users yeah that's right you don't have To make everyone happy Devon exactly Okay on that note we're going to take a Quick break before we get into the rapid Fire Segment and we are back now is time for Our rapid fire segment where we asked Devon some quick questions and hopefully Get some quick responses to start Devon What was the nft or nft project that you Remember first getting you really

Excited about getting into this Space definitely crypto kitties um yeah I just thought it was really fun it was Uh like the the crypto kitties were Really cute and uh I thought it was Interesting do you own One uh yeah a bunch all right what are The three most surprising used cases You've seen for nfts if you had to list Them software license was a really Interesting one um so basically the Ability to you know own a piece of Software and use that software as long As you own the nft um super cool um I Think just seeing like crypto conference Tickets uh catch on um I think it's I Think it's a really cool one because you Already have people who are in crypto And um you know being able to it's it's A little easier than needing to kind of Go directly to mainstream with um with Like mainstream concert tickets or Concert uh Music Festival tickets so so Targeting crypto conferences I think is A is a really use cool use case um and Then the third one uh generative art I Think is just really cool I mean we Obviously have profile pictures and Collectibles and all that stuff but There's just been so much interesting Work being done on like using the Attributes of the blockchain itself um To generate unique art um and it's it's Something that has gotten um you know

Sort of the the people who are deepest In the space really excited because it's Kind of nerdy and fun and and Interesting yes or no do you think nfts Need to be renamed to something Else not at this point no how many nfts Do you Own oh man um probably like a a couple Hundred or so but a bunch of them are Just you know me like fiddling around And testing stuff which one's your Favorite Um I I do really I like my cool cat Which is my uh which is my Twitter Profile here all right given that this Is a tech crunch podcast I've got to ask You Devon is openc looking to raise Additional Capital um not at the moment okay but When you guys do you you'll come to us Right totally there we go all right kind Of stepping out of Rapid Fire I would Love to know to wrap things up what Other core use cases for nfts do you Think will be the most prominent in 2024 Out of all the ones that we've Discussed yeah I mean I think gaming is The one that I'm most excited about the The other one that I don't think we Talked as much about um which I would Definitely highlight is um the idea of Physical items represented as nfts so You know the the sort of way that this Can work is you have a I mean if you

Look at existing marketplaces for rare Physical sneakers they're actually quite Vibrant right there's a whole community Of people that that um like to sort of Buy and sell um those sorts of physical Things and obviously we talked a little Bit about the the luxury Market as well Um and so one of the really cool use Cases for nfts is you know you take a Physical pair of sneakers you create an Nft you can buy and sell that nft um as Many times times is and it can move Around from person to person before it's Actually redeemed for the physical item Um and so we've been recently working With uh you know some platforms on Partnering and doing more launches in The sort of physical digital collectible Space and I think um you know I just Think there's a lot more opportunity to Explore and a lot more opportunity for Growth there as well and then looking Specifically at openc I asked about the Future of the company's core product Earlier on in the show but what would You say is your core mission that you Want to have in 2024 and Beyond yeah I Mean I think um long term our mission is Really to Foster open Digital economies Um and so it's a it's a very broad um Vision um but it does encapsulate the Fact that we're really building nfts As And we're building infrastructure around Nfts as a very generic building block

For all sorts of different economies It's not just about art and profile Pictures it's really about sort of Representing all sorts of different Things on chain you know all of the kind Of use cases we mentioned today and then You know some things that we haven't Even imagined yet um and in that world You know of sort of free market open Digital economies um you know it looks Very different than the the traditional Web 2 economy where users come on to Centralized platforms they sort of post Data onto those platforms for free but Then the platforms monetize them through Advertising or other other means but the Data is always owned by the platform Right in this new um economy users have A lot more control over their data users Have control over their nfts and their Digital items they can move between Different marketplaces and platforms um And ultimately we think that that's Really good for users and it it it Enables brand new use cases that people Haven't imagined it enables all sorts of Innovation it enables new jobs in the Future future um so you know nfts are we Really think of them as this kind of Generic building block for whole brand New digital economies um and uh you know That's I think we're we're still kind of At the beginning of that Trend yeah I Love that I'm excited to see what comes

Of that on that note Devon can you leave Us with a piece of advice maybe Something you've carried with you Throughout your time in crypto I mean Maybe advice for people who are uh Exploring web 3 and and crypto Um would be a to really go deep in the Space make sure that you like you're not Just sort of um uh reading about nfts at A high level but you know you're Actually going and like reading the code If you're technical or like obviously Using the products and you know buying Things and like trying them out and um And going into sort of the more maybe Esoteric use cases um but yeah just just The sort of depth of um you know I think If you if you just sort of read about it And you just like scratch the surface You don't necessarily get the kind of Nuggets of wisdom that you would get if You really go deep in the space um and Then the second piece of advice maybe For people who are either curious about Crypto web3 um or who are already in the Space is just yeah I think like thinking On long um time Horizons so that's Something that I I'm very proud of us Doing it open see we started building Really early on um but we knew that you Know people tend to overestimate how Fast technology you know gets adopted And um but then they you know on the Flip side they kind of underestimate how

Big those Trends can be right that's the That's the sort of age-old um uh quote So um you know my advice would just be Make sure that you're kind of operating And building on a long enough time Horizon that you can really be part of The you know the broader Trend I love that all right thanks Devon So much for coming on the show this has Been fun awesome thanks so Much we'll be back every week with the Top news on the crypto ecosystem Catch Us on Tuesdays for interviews with Experts in the web 3 space you can keep Up with us on Spotify Apple music or Your favorite pod platform And subscribe To our companion newsletter also called Chain Reaction links to the newsletter And the stories we talked about can be Found in our show notes and be sure to Follow us at chain reaction on Twitter