WEBVTT - Cashing In On Sports Without A Jersey w/ Kai Bond 0:00:00.120 --> 0:00:02.720 Hey, so a little We're gonna be in Brooklyn August. 0:00:03.320 --> 0:00:07.080 I'm so excited about this, man, check us out. The 0:00:07.200 --> 0:00:12.640 first Black Effect Podcast Festival was happening Sunday August in Brooklyn. 0:00:13.840 --> 0:00:17.400 Take us available Black Effect dot Com Forward Slash Podcast 0:00:17.520 --> 0:00:21.320 Festival Live podcasts from your favorite shows. Black Tech, Green 0:00:21.360 --> 0:00:24.680 Money's gonna be there for sure, and I'm super excited 0:00:24.680 --> 0:00:26.400 about this because it's the first time I've ever been 0:00:26.440 --> 0:00:28.880 able to do a live podcast. So come check your 0:00:28.920 --> 0:00:31.280 boy out. Eighty five show is gonna be there. All 0:00:31.320 --> 0:00:34.040 this moments gonna be there. Get six today Black Effect 0:00:34.080 --> 0:00:39.560 dot Com Forward Slash Podcast Festival. I'm Little Lucas Mrs 0:00:39.640 --> 0:00:43.600 Black Tech, Green Money. I'm gonna answer to some of 0:00:43.600 --> 0:00:46.800 the biggest names, some of the brightest minds and brilliant ideas. 0:00:47.080 --> 0:00:49.320 I feel black in building are simply using tech to 0:00:49.320 --> 0:00:57.480 secure your bag. This podcast is for you. Ki bous 0:00:57.520 --> 0:01:00.600 And investor, founder, and entrepreneur who serves his partner of 0:01:00.720 --> 0:01:04.960 Course i VC, which focuses on sports, gaming and fitness verticals. 0:01:06.360 --> 0:01:09.480 I asked about the differences between sports of yesteryear and 0:01:09.520 --> 0:01:12.360 the sports of today and why the sports is today 0:01:12.520 --> 0:01:15.480 is right for innovation in ways it's never been before, 0:01:16.319 --> 0:01:18.800 and how that opportunity creates a lane for people like 0:01:18.920 --> 0:01:22.160 me and you to capitalize. Sports used to be a 0:01:22.200 --> 0:01:27.520 game and now it's culture. When you look at you 0:01:27.560 --> 0:01:31.280 know what's going on with CAP what you see in 0:01:31.319 --> 0:01:34.920 the English Premier League, UM, where players are taking a 0:01:34.959 --> 0:01:39.679 knee before every game. UM. When you think about the 0:01:39.880 --> 0:01:44.959 power of sports in society, it's one of the things 0:01:44.959 --> 0:01:47.640 that can bring us together. It's one of the things 0:01:47.640 --> 0:01:52.920 that divides us. Sports and sports figures, athletes. You see 0:01:52.920 --> 0:01:56.960 it today in social media, their influences outside and you 0:01:57.000 --> 0:02:00.080 know the shut up and dribble, you know, conversation and 0:02:00.360 --> 0:02:04.400 that had that happened. You know, we're talking about individuals 0:02:04.880 --> 0:02:08.640 who are transforming society at a faster pace, I would 0:02:08.680 --> 0:02:12.040 argue than politicians are because they're at the forefront of 0:02:12.040 --> 0:02:15.000 the discussion every day. And so when we think about 0:02:15.080 --> 0:02:18.359 sports and investing in sports, a lot of people put 0:02:18.440 --> 0:02:21.200 us in a bubble of sports, technology and fitness and 0:02:21.240 --> 0:02:25.120 what goes on. But I think you cannot invest in 0:02:25.200 --> 0:02:30.000 sports and be blind to the fact that we are 0:02:30.040 --> 0:02:34.519 talking about cultural movements that are happening within this space. UM. 0:02:34.520 --> 0:02:38.799 And that's been true for years right, Um, ever since 0:02:38.880 --> 0:02:42.000 the raised fist that the Berlin Olympics when Hitler refused 0:02:42.000 --> 0:02:46.520 to shake hands like these literally on a podium, right, 0:02:46.760 --> 0:02:49.000 you know, this is this is where we are as 0:02:49.000 --> 0:02:52.160 a society. And with the amplification of the voices through 0:02:52.240 --> 0:02:55.640 social media, UM, you know you're seeing sports really playing 0:02:55.680 --> 0:02:57.639 a huge part of culture, not only in the U. S. 0:02:57.680 --> 0:03:02.000 BU globe. And I remember Canna um delaying Partnell, who 0:03:02.040 --> 0:03:04.880 you know is one of the biggest um E sports 0:03:05.000 --> 0:03:09.639 gaming companies around right now, growing really fastest from play 0:03:09.760 --> 0:03:13.880 Versus and I remember him saying that historically for a 0:03:13.960 --> 0:03:16.440 kid to get a varsity letter, they had to be fit, 0:03:16.520 --> 0:03:18.400 they had to run fast, they had to hit hard. 0:03:18.919 --> 0:03:21.760 And now you can be a great gamer and when 0:03:21.880 --> 0:03:25.919 a state trophy because of companies like play versus UM 0:03:26.040 --> 0:03:28.680 And I maybe it was Mark Injuries and who said 0:03:28.720 --> 0:03:30.760 this next thing, but he said something about like how 0:03:31.280 --> 0:03:36.600 when the user interfaces become very mature, that's when they 0:03:36.600 --> 0:03:39.600 get massive. That's when technology gets mass adoption. When you know, 0:03:39.760 --> 0:03:43.320 when user interfaces are difficult, people don't grasp onto it. 0:03:43.320 --> 0:03:47.040 But when the user interfaces fluent, um, more people can 0:03:47.160 --> 0:03:49.800 use it because it's easier to use. Um, I'm still 0:03:49.880 --> 0:03:52.880 not sure and maybe I'm wrong. I'm still not sure 0:03:52.960 --> 0:03:57.160 we've seen mass adoption with regards to gaming yet as 0:03:57.160 --> 0:04:00.120 an industry, and I could be wrong. Um, but what 0:04:00.160 --> 0:04:02.760 would in the position I come from, what will it 0:04:02.840 --> 0:04:07.600 take to get more parents to see past the idea 0:04:07.680 --> 0:04:10.200 that little Billy isn't just playing games, but he is 0:04:10.280 --> 0:04:15.520 playing games. But there's a large opportunity there. Yeah. Yeah, 0:04:15.760 --> 0:04:18.040 I think the most powerful thing that Mark Andrew has 0:04:18.080 --> 0:04:20.080 never said in my perspective, and software is eating the 0:04:20.120 --> 0:04:23.400 world right. And I think today I would argue that 0:04:23.480 --> 0:04:26.120 gamings eating the world right. He just took the board 0:04:26.120 --> 0:04:30.120 seated Acti Infinity. Um. Acti Infinity is a game where 0:04:30.120 --> 0:04:34.080 you can play to earn real money in the game. Um, 0:04:34.200 --> 0:04:36.720 they're creating a massive economy. The economy will be larger 0:04:36.720 --> 0:04:39.000 than some countries. Some people are putting their jobs just 0:04:39.080 --> 0:04:43.560 to play this game all day, right, And so I 0:04:43.600 --> 0:04:48.800 think the way that we view gaming is transformative in 0:04:48.920 --> 0:04:51.440 terms of and I wrote a long blog host about this, 0:04:51.520 --> 0:04:55.320 but the next big social network, the next big Facebook 0:04:55.600 --> 0:04:57.479 that we think of today and TikTok is going to 0:04:57.480 --> 0:05:01.040 be in a game that that's already happening right fortnite. 0:05:02.400 --> 0:05:07.240 Kids growing up today are their first social experiences in roadblocks, right, 0:05:07.360 --> 0:05:09.839 That's how they're meeting people. This is their social network. 0:05:10.880 --> 0:05:14.599 Tweet it was roadblocks is their LinkedIn. That's that's where 0:05:14.600 --> 0:05:20.040 you go. Right. And so when I think about generational change, right, 0:05:20.480 --> 0:05:23.960 so I'm forty two, when I you know, my parents 0:05:24.040 --> 0:05:27.479 idea of playing games was going to an arcade, It's like, 0:05:27.800 --> 0:05:30.680 this is what you do on a Friday night at 0:05:30.760 --> 0:05:34.000 nine o'clock and somebody when you play arcade game and 0:05:34.320 --> 0:05:37.280 you know, the Chucky Cheese era, right coming up, Like 0:05:37.320 --> 0:05:40.200 this is a family entertainment experience. You go to do 0:05:40.240 --> 0:05:45.919 it if you just look at the our generation. I 0:05:46.000 --> 0:05:49.640 was part of the console generation, right, so Super Nintendo 0:05:50.520 --> 0:05:54.440 and yes you know, and then you've got report you 0:05:54.480 --> 0:05:58.960 know your game boys, right, um, and today I argue 0:05:59.000 --> 0:06:01.520 that everybody is carrying a console in their pocket. Right. 0:06:01.600 --> 0:06:07.160 In mobile gaming now globally seventy billion dollar a year industry. Right, 0:06:07.240 --> 0:06:09.279 gaming is a hundred and sixty billion dollar a year 0:06:09.320 --> 0:06:14.880 industry annually. So you can take the box office music 0:06:14.920 --> 0:06:19.839 sales in television without the streaming services, and it doesn't 0:06:19.839 --> 0:06:23.720 add up to that that total TAM. And the misconception 0:06:23.800 --> 0:06:25.839 is that you know, you can ask somebody, you know, 0:06:25.880 --> 0:06:30.480 particularly you ask a middle aged man, old woman, are 0:06:30.520 --> 0:06:33.600 you a gamer? They say no, Well do you play 0:06:33.600 --> 0:06:36.320 games on your phone? Yes? What do you play? I 0:06:36.360 --> 0:06:39.159 play golf clash, I play words with friends. I only 0:06:39.200 --> 0:06:41.320 play a little bit, you know, during launch and then 0:06:41.400 --> 0:06:43.479 after where I'm going to commute home. And I'm like, 0:06:43.600 --> 0:06:45.479 you played thirty minutes of games a day, but you 0:06:45.480 --> 0:06:50.280 don't consider yourself a gamer? Right, So you know, you're 0:06:50.360 --> 0:06:53.240 seeing the acceptance of my generation that grew up with 0:06:53.279 --> 0:06:56.440 consoles now saying well, gaming is not actually bad, Like 0:06:56.480 --> 0:07:01.000 it didn't lead to the detrimental things that people thought 0:07:01.040 --> 0:07:03.359 it would, right, you know, the early days of g 0:07:03.520 --> 0:07:05.680 t A, the early days of first person in shooters. 0:07:06.120 --> 0:07:09.360 It's it's just not. The stigma associated with it is 0:07:09.400 --> 0:07:12.520 still there. But the industry is massive, and I think 0:07:12.520 --> 0:07:14.920 that we've seen a generational change of people who grew 0:07:15.000 --> 0:07:17.559 up playing games in a home, and now we're starting 0:07:17.600 --> 0:07:19.960 to see people play games anywhere. Right, And that's why 0:07:19.960 --> 0:07:22.600 you see the growth and mobile. Mobile will surpass the 0:07:22.680 --> 0:07:27.720 total revenue generated in gaming, then console and PC combined 0:07:28.360 --> 0:07:31.120 next year, um and that you know, when we have 0:07:31.160 --> 0:07:35.840 an investment in India, very little console penetration, everybody's playing 0:07:35.880 --> 0:07:38.960 mobile games. India's by far the world's largest gaming market 0:07:39.040 --> 0:07:41.360 with the exception of China, and if you look at 0:07:41.400 --> 0:07:43.720 the numbers in the sheer amount and it will surpass 0:07:43.800 --> 0:07:46.320 China given the recent regulatory changes that have gone in 0:07:46.360 --> 0:07:48.800 limiting the amount of time kids can play games. So, 0:07:49.240 --> 0:07:51.880 you know, I think we're in a moment in time 0:07:53.000 --> 0:07:56.560 where we talk about them Ataverse, we talk about the 0:07:56.560 --> 0:07:59.760 Pokemon Goes, you talk about roadblocks, you talk about Fortnite, 0:08:00.360 --> 0:08:02.560 that this is the way people are going to socialize, 0:08:02.760 --> 0:08:05.280 and this is a game we were a digital native generation. 0:08:05.880 --> 0:08:10.280 This is a game native generation. Interesting so particular to 0:08:10.400 --> 0:08:12.680 let the things that we talked about with the roadblocks 0:08:12.800 --> 0:08:16.760 and Fortnite. You know, I have little kids and for them, 0:08:16.800 --> 0:08:19.960 you know, they think nothing about spending real dollars to 0:08:20.000 --> 0:08:23.880 have dollars in the game, right, And I wonder what 0:08:24.000 --> 0:08:28.920 your perspective is on how they will grow up, you know, 0:08:29.000 --> 0:08:32.120 being let's say sub twelve, sub twelve years old. And 0:08:32.160 --> 0:08:33.240 I don't know if you have kids or not, but 0:08:33.280 --> 0:08:35.960 like you, you study this, so how how will they 0:08:36.080 --> 0:08:39.520 grow up in a world how were they're they're thinking 0:08:39.640 --> 0:08:46.120 be structured around value? So is me having a whole 0:08:46.280 --> 0:08:50.719 twelve football ten ft high full of sneakers and boxes 0:08:50.800 --> 0:08:54.680 of you know old Jordan's. They will have a virtual 0:08:54.760 --> 0:08:59.360 world of you know, digital chatch keys, like you know 0:09:00.040 --> 0:09:03.600 gyms that they got in two thousand twenty. You know, 0:09:03.640 --> 0:09:08.560 it's like, how how will they think about these things? Yeah, 0:09:08.600 --> 0:09:12.160 it's a great question. And so we're investors in stock 0:09:12.160 --> 0:09:15.240 ax out of fun one. Right, And if you're a 0:09:15.240 --> 0:09:17.920 sneaker head, you've got kicks, you've been on Goat, you've 0:09:17.920 --> 0:09:21.400 been on stock X. You don't see your sneakers as 0:09:21.760 --> 0:09:26.440 a utility, right, you see them as a luxury iity um. 0:09:26.480 --> 0:09:30.920 And what we saw in this last ten years of 0:09:31.000 --> 0:09:36.719 innovation internet space, particularly around a gig economy in ownership, 0:09:37.040 --> 0:09:39.439 like the fact that you would say, yeah, I'm just 0:09:39.440 --> 0:09:41.840 gonna put my crib on Airbnb. Like people were crazy 0:09:41.840 --> 0:09:44.160 when the airbnb came out. People are like, are you insane? 0:09:44.200 --> 0:09:46.840 You're gonna stay at strangers? You're gonna let somebody stay 0:09:46.840 --> 0:09:49.320 in your crib? Like, Nah, that's not possible, that's not 0:09:49.320 --> 0:09:51.880 gonna happen. Right, And now it's like I'd rather stay 0:09:51.920 --> 0:09:55.480 at an Airbnb in a hotel, right, And so the 0:09:55.559 --> 0:09:59.640 idea of ownership is changing rapidly in our society. And 0:10:00.040 --> 0:10:03.040 again I go back, it's generational change. What was cool 0:10:03.080 --> 0:10:06.920 for my parents generation was a Ford Mustang, a muscle car, 0:10:07.320 --> 0:10:10.040 like that was who you were and that representative piece 0:10:10.080 --> 0:10:13.000 of your identity. This generation grew up and was like, 0:10:13.360 --> 0:10:15.040 who cares about a car. I can take an Uber anywhere. 0:10:15.080 --> 0:10:16.480 It's gonna cost me less. I don't have to worry 0:10:16.520 --> 0:10:19.720 about maintenance and parking and alternate side. I'll just take 0:10:19.800 --> 0:10:22.560 Ubers everywhere and it's gonna cost me less on a 0:10:22.600 --> 0:10:28.760 monthly basis. So this leads us to a game native generation. 0:10:28.840 --> 0:10:33.120 So Fortnite generates two point one two point three billion 0:10:33.160 --> 0:10:38.120 dollars a year selling skins. That's it, that's their business model. 0:10:38.640 --> 0:10:41.520 Why because if you buy an NFL jersey or you 0:10:41.559 --> 0:10:44.520 buy a Marvel character jersey to skin your character in 0:10:44.559 --> 0:10:48.800 the game, that's the representation to your peer group, no 0:10:48.920 --> 0:10:51.640 different than owning that Mustang or having a pair of 0:10:51.720 --> 0:10:55.520 Yeezys or having a skin in Fortnae. So when people 0:10:55.559 --> 0:10:58.640 talk about, oh, I'm believing n f T s, this 0:10:58.679 --> 0:11:02.120 stuff is fleeting. I'm like, you're not in touch with reality. 0:11:02.160 --> 0:11:06.319 You don't understand how you view digital assets. You might 0:11:06.320 --> 0:11:08.960 have dope artwork on your wall. Well guess what I 0:11:08.960 --> 0:11:11.640 got an n f T in my virtual world. It's 0:11:11.679 --> 0:11:15.440 no different. It's the exact same thing. It represents who 0:11:15.440 --> 0:11:19.280 you are, it's part of your identity. And so you know, 0:11:19.320 --> 0:11:21.280 we're very bullish on the n f T space, and 0:11:21.320 --> 0:11:26.640 I think even more so. Digital has this unique opportunity 0:11:26.679 --> 0:11:29.400 that we're going to see emerge in fractional ownership. So 0:11:29.440 --> 0:11:31.000 in the same way we had a gig economy, and 0:11:31.040 --> 0:11:32.880 the same way you treated an asset and you're willing 0:11:32.880 --> 0:11:36.520 to sell it or lease it, digital opens up completely 0:11:36.520 --> 0:11:38.679 new opportunities. And so when you talk about n f T, 0:11:38.840 --> 0:11:41.120 s oh, I created an original piece of art as 0:11:41.160 --> 0:11:43.480 an artist, I'm not but to say I did, and 0:11:43.800 --> 0:11:47.720 I sell that and now it gets resold for ten 0:11:47.960 --> 0:11:50.800 X because there's a smart contract associated with it. I 0:11:50.840 --> 0:11:54.080 get a portion of that used that that secondary transaction 0:11:54.280 --> 0:11:56.280 or the third flip of that item as it goes 0:11:56.320 --> 0:11:59.440 up over time. So it unlocks additional value the same 0:11:59.480 --> 0:12:01.839 way stock x unlocks value, which is you can buy 0:12:01.840 --> 0:12:05.000 a pair of kicks, hold them, flip them, and you're 0:12:05.040 --> 0:12:08.760 gonna get the proceeds. Now, the artist, the creator, whoever 0:12:08.800 --> 0:12:11.319 it is, can actually you know, accrue that value. And 0:12:11.320 --> 0:12:13.920 I think that's gonna be something lasting in the ecosystem 0:12:13.960 --> 0:12:18.080 that really changes the way, you know, art and assets 0:12:18.080 --> 0:12:21.000 are monetized over time, and so we're very bullish on 0:12:21.400 --> 0:12:23.880 you know, digital art. You know what n f T 0:12:24.040 --> 0:12:28.280 s mean, digital ownership over time because again, it is 0:12:28.320 --> 0:12:32.280 just an item you own that represents your identity. Just 0:12:32.320 --> 0:12:35.000 because it's in the virtual world, it doesn't mean it's 0:12:35.040 --> 0:12:37.520 any less or more so than the artwork or the 0:12:37.600 --> 0:12:41.960 kicks that you wear. When you you specifically are looking 0:12:42.000 --> 0:12:46.119 to invest in gaming, is it game developers you're particularly 0:12:46.120 --> 0:12:48.880 looking for? Is it e sports platforms? Is it leads 0:12:48.960 --> 0:12:52.000 that you're interested in, Like what's interesting to you that's 0:12:52.000 --> 0:12:57.000 happening in the space. Yeah, we have a very diversified 0:12:57.000 --> 0:12:59.800 approach to gaming because I think you know, people tend 0:12:59.800 --> 0:13:03.839 to lump gaming into here's the studio creating a game, right, 0:13:04.040 --> 0:13:08.000 and we do that. We we we certainly invested in um, 0:13:08.040 --> 0:13:11.840 you know a handful of studios. UM. We love the 0:13:11.920 --> 0:13:15.079 idea that you know, to me, gaming is not that 0:13:15.120 --> 0:13:19.160 different than somebody who's creating an album or a movie. Right, 0:13:19.200 --> 0:13:21.720 You're creating a new piece of work. You're putting your 0:13:21.720 --> 0:13:24.160 heart and soul in it, and you hope somebody loves it, right, 0:13:24.640 --> 0:13:27.800 And it's a creative endeavor. And so you know, from 0:13:27.840 --> 0:13:29.520 our perspective, that's where most of the money in the 0:13:29.520 --> 0:13:32.280 ecosystem flows today. So we'll continue to make investments in 0:13:32.280 --> 0:13:36.520 that space. Um. We tend to put the second bucket 0:13:36.559 --> 0:13:40.559 as what are we investing in terms of social and community. 0:13:40.800 --> 0:13:42.920 The sports is part of that. Right. When you look 0:13:42.960 --> 0:13:45.439 at one of our early investments, we were early investors 0:13:45.480 --> 0:13:49.000 in hundred Thieves. Um, they're any sports team, but they're 0:13:49.040 --> 0:13:52.160 really a lifestyle brand, right you you you see they're 0:13:52.280 --> 0:13:55.360 making money not only from competing, but they're making money 0:13:55.400 --> 0:14:00.280 from march right, from content. Um, it's an entertainment in 0:14:00.600 --> 0:14:04.000 a brand business. Um. And so you know, we'll invest 0:14:04.000 --> 0:14:05.720 in the sports. We invest in a lot of real 0:14:05.720 --> 0:14:08.280 money gaming. So you know, there's a lot of regulatory 0:14:08.360 --> 0:14:11.599 change going on in the ecosystem across the US to 0:14:11.679 --> 0:14:15.160 allow legalized gambling. Um. You know, we play it that. 0:14:15.240 --> 0:14:17.920 It's the intersection of sports and gaming, right, It's what 0:14:18.040 --> 0:14:20.640 keeps people engaged in the game. Where you might be 0:14:20.640 --> 0:14:22.920 watching a three and a half hour game, there's actually 0:14:22.920 --> 0:14:25.600 thirty minutes of action. What are you doing during that time? 0:14:25.640 --> 0:14:28.400 So we think you know, m prop bets and and 0:14:28.520 --> 0:14:31.880 you know in game wagering in real time social around 0:14:32.080 --> 0:14:35.640 sports is a fascinating area. UM. And then we invest 0:14:35.680 --> 0:14:38.280 in infrastructure, So what are the core teching tools needed 0:14:38.800 --> 0:14:41.600 in a new generation of gaming? You know, gaming gets 0:14:41.680 --> 0:14:47.040 big and you see outsized returns on investments at the 0:14:47.080 --> 0:14:49.280 intersection of a new form of distribution in a new 0:14:49.400 --> 0:14:52.480 form of monetization. See, you're going from a city dollar 0:14:52.520 --> 0:14:55.400 console game, going to free to play Facebook games where 0:14:55.520 --> 0:14:59.680 making micro transactions, to mobile distribution within that purchases and 0:14:59.680 --> 0:15:02.520 now the we're in a cloud computing era and we're 0:15:02.520 --> 0:15:05.240 moving into this you know monetization framework of play to 0:15:05.320 --> 0:15:08.120 earn in crypto as part of the currency of the games. 0:15:08.600 --> 0:15:11.520 This is the moment in time where you'll see really 0:15:11.560 --> 0:15:14.440 outside returns for investments in gaming. And so we're looking 0:15:14.480 --> 0:15:17.960 at all aspects of the game ecosystem UM, and we 0:15:18.000 --> 0:15:21.680 look for you know, founders with unique insights into why 0:15:21.840 --> 0:15:24.320 the i P they're creating at this moment in time 0:15:25.000 --> 0:15:31.000 can leverage the cloud mobile global distribution with new fundamental 0:15:31.040 --> 0:15:34.120 economics that not only are allowing users to spend money 0:15:34.120 --> 0:15:36.200 in the game, but earn money in those games as well. 0:15:36.560 --> 0:15:38.800 And so that's kind of the broad strokes of of 0:15:38.800 --> 0:15:41.600 how we look at investing in the gaming ecosystem. Now, 0:15:41.640 --> 0:15:44.720 I was reading an article and you said before that 0:15:45.000 --> 0:15:47.040 you want to meet a founder who can see a 0:15:47.120 --> 0:15:50.359 trend and has the knowledge, network and ability to execute 0:15:50.400 --> 0:15:53.920 on their vision. UM. Can you talk to me about 0:15:53.920 --> 0:15:57.040 an investment that you made, UM, whether it was in gaming, 0:15:57.080 --> 0:16:00.800 sports or fitness, where the operator had, you know, a 0:16:01.000 --> 0:16:04.320 unique vision about what the future looked like that caused 0:16:04.320 --> 0:16:09.520 you to want to invest in You ultimately probably did invest. Yeah. 0:16:09.600 --> 0:16:12.840 So it's a really good UM company here in New York. 0:16:13.240 --> 0:16:17.080 They're based in Brooklyn. It's called players Lounge. UM. Austin 0:16:17.720 --> 0:16:22.200 Um is a phenomenal founder. You know, he created a 0:16:22.240 --> 0:16:26.960 gaming platform that allows you to connect with somebody else 0:16:27.000 --> 0:16:29.840 in the network and play them in a console game 0:16:30.000 --> 0:16:32.440 or a PC game. UM. So I can challenge you 0:16:32.440 --> 0:16:34.120 to a game of Madden, I can challenge you to 0:16:34.160 --> 0:16:38.480 a game of FIFA two K Fortnite. I'll put up 0:16:38.520 --> 0:16:40.400 ten bucks. You put up ten bucks. You know, the 0:16:40.400 --> 0:16:43.000 winner takes eighteen the house takes their ten percent cut 0:16:43.040 --> 0:16:48.440 on that transaction. You know that. You know, four or 0:16:48.480 --> 0:16:50.880 five years ago people would be like, that's crazy. I'm 0:16:50.880 --> 0:16:53.280 gonna you know what we did in the door room 0:16:53.440 --> 0:16:56.280 in college, Like we sat down and we had consoles 0:16:56.480 --> 0:16:59.480 and I'm like, I'll play you like loser Bys and 0:16:59.520 --> 0:17:02.640 Ford you like, this is where right, and now you 0:17:02.640 --> 0:17:04.960 can do And I always say when people ask me 0:17:05.000 --> 0:17:08.119 about Players Lounge, I'm like, Austin was a hustler, Like 0:17:08.720 --> 0:17:11.080 he was going and setting up game nights in bars 0:17:11.080 --> 0:17:12.600 in Brooklyn. He's like, oh, you got a trivia night 0:17:12.640 --> 0:17:16.080 on night, Like I cannot bring in a group of 0:17:16.240 --> 0:17:18.760 FIFA meet up group and connect the consoles and have 0:17:18.800 --> 0:17:21.280 them come in and play. I'll guarantee you have foot 0:17:21.280 --> 0:17:23.479 traffic on a night that would be like for you normally, 0:17:23.800 --> 0:17:25.679 and they're gonna drink and spend money. I'm gonna get this. 0:17:25.680 --> 0:17:27.879 And then he's like, why am I doing this in person? 0:17:27.920 --> 0:17:30.960 I can do this online and created a platform behind that. 0:17:31.359 --> 0:17:33.560 But it was the vision of taking some things saying 0:17:33.600 --> 0:17:36.960 like people like playing games for real money, right, like 0:17:37.080 --> 0:17:40.840 Vegas exists for a reason. Um, you know the lava 0:17:40.920 --> 0:17:43.439 in the US nine billion dollar a year. People like 0:17:43.520 --> 0:17:45.359 to play games for money. It's a natural part of 0:17:45.359 --> 0:17:48.200 what we do. And you see that with the regulatory 0:17:48.200 --> 0:17:50.800 and environerships and you know, uh, New Jersey just hit 0:17:50.800 --> 0:17:53.320 a billion dollars in wagers one state billion dollars in 0:17:53.320 --> 0:17:55.800 wagers in one month. Right, so you talk about the 0:17:55.840 --> 0:17:57.719 amount of value that's going in and he was like, 0:17:57.840 --> 0:18:00.280 I'm gonna take it and apply to console games, right 0:18:00.359 --> 0:18:02.639 for hardcore cats who really like playing. And I consider 0:18:02.680 --> 0:18:04.240 that the new Poker Night used to get together with 0:18:04.240 --> 0:18:06.199 people play poker, you hanging out with your friends. Now 0:18:06.240 --> 0:18:09.240 you're just connecting online and you're playing games that you 0:18:09.240 --> 0:18:12.320 you normally would and so for for real money. And 0:18:12.400 --> 0:18:14.360 so that's the type of founder you know that at 0:18:14.359 --> 0:18:16.280 a unique insight that was like, oh man, I got this. 0:18:16.520 --> 0:18:19.480 How do we scale it? How do we execute? Phenomenal 0:18:19.480 --> 0:18:25.119 investors on the cap table, venture funds, athletes, celebrities you know, 0:18:25.320 --> 0:18:28.119 coming into co invest alongside. And I think those are 0:18:28.119 --> 0:18:31.560 the types of investments where it's almost brain dead simple 0:18:31.600 --> 0:18:35.320 and obvious, like why isn't this happening? But somebody can 0:18:35.400 --> 0:18:39.719 see a broader transformation in the market that allows them 0:18:39.760 --> 0:18:42.480 to scale us to you know, tens of millions of 0:18:42.520 --> 0:18:46.480 dollars in re You know, we often talk about founders 0:18:46.760 --> 0:18:51.760 finding market opportunity to solve problems. UM, I don't necessarily 0:18:51.800 --> 0:18:56.639 think about creating gaming as like solve a problem solved. 0:18:56.640 --> 0:18:58.520 Maybe you do, and I'd love to hear your thoughts 0:18:58.600 --> 0:19:03.000 on that, UM, Like, are there yet still a lot 0:19:03.040 --> 0:19:06.640 of problems to be solved in this? If there are problems? 0:19:06.720 --> 0:19:11.560 Or is this is this entertainment? How do you position this? Yeah? Yeah, 0:19:11.600 --> 0:19:13.959 I mean we just made an investment in a tools business, 0:19:14.359 --> 0:19:18.560 UM that can take a two D image and create 0:19:18.960 --> 0:19:20.919 a three D asset that can be used in a 0:19:20.960 --> 0:19:24.000 game or in the metapath. And so if you look 0:19:24.000 --> 0:19:27.200 at gaming, you have a two D artist sketching something out, 0:19:27.520 --> 0:19:30.880 three D artists, you have an animator, right, the process 0:19:30.920 --> 0:19:32.840 for creating really high quality art. I mean, if you 0:19:32.880 --> 0:19:37.920 play games nowadays, you see how real right the players are. Um, 0:19:38.000 --> 0:19:42.080 you know, there are tons of infrastructure and technology business. 0:19:42.119 --> 0:19:45.440 I mean we're talking about Microsoft's cloud business in gaming 0:19:45.720 --> 0:19:49.040 being a ten billion dollar a year business. You know, 0:19:49.320 --> 0:19:52.520 the lift on the back and infrastructure to power that 0:19:52.640 --> 0:19:57.560 isn't incredible, right, most people think about epic games for Fortnite, Right, 0:19:58.040 --> 0:20:01.439 the Unreal engine powers most of the console games in 0:20:01.480 --> 0:20:04.879 the world. Right, So they have an incredibly powerful engine, 0:20:05.520 --> 0:20:07.359 and you know, I think that's part of the value. 0:20:07.400 --> 0:20:09.960 Look at Unity, publicly traded games company. It's a game 0:20:10.000 --> 0:20:14.040 engine for mobile um And so when I think about 0:20:14.720 --> 0:20:19.640 you know, problems in the uh the ecosystem around gaming. 0:20:20.119 --> 0:20:22.679 You know, having worked in studios and launched studios before, 0:20:23.280 --> 0:20:26.439 you have to really understand what it takes to create 0:20:26.520 --> 0:20:29.119 I P what it takes to deploy that to launch 0:20:29.160 --> 0:20:31.399 games as a service, right, all the ugly stuff. You 0:20:31.400 --> 0:20:35.439 don't think about leaderboards and player matching, and you know, 0:20:35.520 --> 0:20:40.399 nonplayer characters having really sophisticated are you know, AI behind 0:20:40.440 --> 0:20:42.120 them so you can interact with them in the game. 0:20:42.520 --> 0:20:44.400 There's a lot of core tech that goes on there, 0:20:44.440 --> 0:20:46.240 and so we try to pick off the pieces of 0:20:46.280 --> 0:20:49.159 the industry and say, okay, where are there's where is 0:20:49.200 --> 0:20:51.639 there a huge amount of dollars being spent, What are 0:20:51.680 --> 0:20:54.120 the biggest technological challenges and who are the right teams 0:20:54.160 --> 0:20:56.480 to solve those? Oftentimes they come out of studios or 0:20:56.480 --> 0:20:59.000 they come out of environments like a Riot games or 0:20:59.040 --> 0:21:01.080 they come out of Amazon on the scene. You know 0:21:01.119 --> 0:21:03.920 how much games are being powered on their cloud infrastructure, 0:21:04.520 --> 0:21:08.919 and UM, you know that's one part of the business. 0:21:09.359 --> 0:21:11.560 I think the fun and exciting part that people tend 0:21:11.600 --> 0:21:13.640 to be drawn to is, Oh, here's a new game 0:21:13.680 --> 0:21:15.639 that launched and we love it and we're playing it 0:21:15.680 --> 0:21:17.800 because there are worst in the game. But there's so 0:21:17.880 --> 0:21:20.439 much that goes on behind the door, behind the scenes 0:21:20.480 --> 0:21:24.919 in the studio to pull that off for her. As 0:21:24.960 --> 0:21:27.040 you say before that when you take a meeting, you're 0:21:27.040 --> 0:21:31.120 looking for ten slides in a demo, right, and UM, 0:21:31.240 --> 0:21:34.679 what are the top three slides you're lasering in on? 0:21:36.920 --> 0:21:41.080 Team is always first, UM, you know, we invest in 0:21:41.160 --> 0:21:43.160 the earliest stages of a business. I've been a founder 0:21:43.280 --> 0:21:46.960 three times over. It's the hardest thing in the world 0:21:47.000 --> 0:21:50.640 to do. It really is like running a successful startup. 0:21:50.640 --> 0:21:52.280 And I've only done it one out of three tries. 0:21:52.320 --> 0:21:56.800 So from experience of failure here, UM that that it's 0:21:56.800 --> 0:21:59.240 really challenging. So team is always first. Team can be 0:21:59.280 --> 0:22:03.040 repeat founder. Teams can be individuals who have domain expertise 0:22:03.080 --> 0:22:06.720 that's outsized. UM. In a unique perspective like we talked about. 0:22:07.800 --> 0:22:09.600 TAM is the other one, right, Like, what is the 0:22:09.640 --> 0:22:13.080 total addressable market that you're going after? Um, you know, 0:22:13.080 --> 0:22:15.200 if you're launching a game only in New Zealand, I'm 0:22:15.200 --> 0:22:17.720 probably not your guy, you know, Like it's just too 0:22:17.720 --> 0:22:20.400 small of a market. You know. We have to return 0:22:21.320 --> 0:22:25.000 you know, our fund to fifty five million dollars three 0:22:25.040 --> 0:22:27.399 times over, right, So I'm looking for a big market. 0:22:27.520 --> 0:22:31.239