So, here I am listening to an episode of “Invest like the best” with gaming investment legend Mitch Lansky, and I start to get jazzed up because he’s saying exactly what I’d been thinking, feeling and reading weeks before.

Before a deep dive into my seminal thesis “I’m a Trend Spotting Savant” (I called Huggies pull ups and WWF action figures a mile away) let’s do a quick review of where we were in the gaming, IP trends and superhero philosophy…then…and where we are now/where we’re going.

THEN

Gaming: Fade in: it’s the 1970s…bell bottoms, yacht rock, soul train and the NY Mets think they’re going to win a world series this decade. (they will not and I’m bummed) Most importantly, we’re in a world of pay to play video games. Here’s the deal, a game developer designs a game, sets it in stone (like a financial statement snapshot) and sells that game to you to play on a console. Atari, Nintendo, etc. Got it? This is called pay to play and I can also purchase downloadable content (DLC). This goes on until the late 2000s. During this time, supply chain and distribution was the key factor. You want my disk!? I ship you the disk! Pricing was, during this time, inelastic. Meaning, the same person who plays for 1000 hours pays the same for the game and console as the person who plays 10 hours and never picks it up again. We can see where this is going and why elastic pricing is important. Like, if I’m a Bruce Springsteen super-fan, won’t I pay more for tour items then someone who only knows ‘Born to Run’? Obvi. (Great song, but a tragedy for those that only know one song by ‘The Boss’)

It’s now the late 2000s…the Iphone comes out in 2007, JayZ and Beyonce first become a thing earlier in the decade, the Olsen twins grew up and the Wii was the most popular Christmas gift of 2006. Here we are, free to play starts to kick in. So, the game developer gives the game away for free now, (massive shift in business model btw) and money is starting to be made by in game purchases, DLCs, skins. We’re now all familiar with this. Fornite, Roblox, etc.

Jump cut back to the 80’s!

IP TREND: Popular action figures like He-Man, The Smurfs, Care Bears, et al usually follow a very similar ‘characters first’ then narrative and background of the character model. Basically, I buy an action figure then the producers make a tv show of said character and I watch it, get more enamored and buy more stuff. This was of course made famous by Disney characters, however, my childhood memories were of me buying (ok, my parents buying me) a He-Man action figure and then watching a tv show to tell me who that character was and what they liked to do other than standing with a sword raised above their head permanently. Pretty straight forward. I buy the memorabilia and this IP was owned by studios, publishers. All proceeds would go to that company. Didn’t matter if I had a cool He-Man themed birthday party where I set up the full Castle Grayskull, did all the voices and entertained my friends for hours on end, I could not financially benefit from this glorious performance as that IP was owned by Mattel. (I’m not bitter)

Superhero Philosophy: Mostly in the west. A kid gets bit by a spider and is now awesome. Captain America, too small to make a difference, is injected with a serum and is now bigger and unstoppable. Same with the Hulk. Smart guy? Not good enough. Radioactive material in your blood? Hulk smash. Boom, hero material now. The green lantern (a ring), Batman (I’m rich) you get the point. Basically the lesson from the superhero narrative from the west is you’re going to become powerful overnight, now, how do you deal with this responsibility. Again, not a bad lesson, and candidly makes sense with America’s sudden rise to global power seemingly ‘overnight’. However, at the individual level, most of us are not overnight successes. So, where are the heroes for those of us that aren’t massively changed overnight?! (we’ll come back to this)

NOW

Games: We’re all getting along, nobody’s polarized and developers continue to make money from in game purchases, to the tune of ~USD 120B/yr. And now, players can even make money from esports and streaming. However, there’s still an existing problem, which is, the game developers have control of the assets and the game. (no NFTS, or UGC) This is a similar narrative to how Facebook owns your photos! (Boo, I need to own my pictures of Jamaica spring break)

With the advent of ‘Play to Earn' (P2E)…(also loving ‘Free to Own’)…developers can monetize the games and players can own the assets through tokens and NFTs. For more on where we are check a16z’s NFT CANON

IP TREND I recently started watching Arcane on Netflix and am completely blown away by the show. The animation is bananas good and the story line is so rich. For those that don’t know, Arcane is a show that won 4 Emmys and is based on the popular forever game, League of Legends. (LoL) Hmmm, where have I seen this before. This is exactly the path that I described earlier with He-Man. Popular action figure turned into a tv show that essentially helps you sell more of the items, increases your stickiness within the game/world and is a great marketing vehicle for your IP Universe. It just so happens the action figure in this example is a digital game avatar. However, what’s different with NFTs and digital items is that in this universe, the IP can really be owned by YOU! Makes sense right. Instead of Riot Games owning LoL and you not being able to create any derivations therein, now if you own the NFT or Digital Asset, you own the IP and you can create the backstory, the narrative and build out your own universe with the upside of an economy connected! You become your own tv/film studio.

E.g. I own a CryptoPunk and all the IP associated. Now I can create a backstory and memorabilia, merchandise, partnerships for the brand that I own, even as it’s a part of the larger Punk ecosystem and lore. I love this! This is where we’re headed.

Superhero Philosophy: As the west starts to celebrate more stories and stars from the east, (Crazy Rich Asians, BTS, Squid Game) we will hear and see more of the Wuxia superhero narrative. TL;DR is that Wuxia, translated to “martial heroes'“ is usually where a main character trains and trains and is only granted the superhero status after years and years of training and proving that he or she is worthy. This as compared to a western superhero is made instantly and learns to control it along the way, (some exceptions of course)…I really felt this while watching “Shang-Chi and the Legend of the 10 rings”, but is also present in the Kung Fu panda series that we’re all familiar. (and many others) I’m massively simplifying this and I have much to learn, but I really enjoyed seeing this narrative emerge more and like the message it sends to kids. Work hard, train and good things come.

Another way I like to look at this narrative is to talk about Michael Phelps. So, the question is, when did Michael Phelps become a champion? When I first was asked this question, my answer was “when he won his first gold medal in the olympics or the world championships”…this solidifies him as a champion right?! Well, hold on now. How about this? Michael Phelps became a champion when he made the commitment and delivered on it daily to get up super early in the morning and train all those years with often nobody cheering him on in the pool. Day in, Day out, when he didn’t feel like it, when he loved it, when he hated it, when nobody was holding him accountable except himself. That to me is when Michael Phelps became a champion, and the winning of 23 Gold Medals, was merely recognition of what he was training to become all of those years. That is the message I want kids today to hear.

I see an acceleration of all three of these areas within Gaming, IP and superhero narratives and invite you to play or be a fan. “But Adam, I don’t have time to play video games.” Totally get it. I don’t have time to play Ice Hockey but I love watching Ice Hockey during the playoffs. This is similar. Gaming, IP and superheroes will continue to evolve into a sport/entertainment universe that whether we play or not, we can love and appreciate from east to west and from then to now.

And heck, maybe NOW I can finally charge money to do voices with action figures at my birthday party like I always wanted to…

So, here I am listening to an episode of “Invest like the best” with gaming investment legend Mitch Lansky, and I start to get jazzed up because he’s saying exactly what I’d been thinking, feeling and reading weeks before.

Before a deep dive into my seminal thesis “I’m a Trend Spotting Savant” (I called Huggies pull ups and WWF action figures a mile away) let’s do a quick review of where we were in the gaming, IP trends and superhero philosophy…then…and where we are now/where we’re going.

THEN

Gaming: Fade in: it’s the 1970s…bell bottoms, yacht rock, soul train and the NY Mets think they’re going to win a world series this decade. (they will not and I’m bummed) Most importantly, we’re in a world of pay to play video games. Here’s the deal, a game developer designs a game, sets it in stone (like a financial statement snapshot) and sells that game to you to play on a console. Atari, Nintendo, etc. Got it? This is called pay to play and I can also purchase downloadable content (DLC). This goes on until the late 2000s. During this time, supply chain and distribution was the key factor. You want my disk!? I ship you the disk! Pricing was, during this time, inelastic. Meaning, the same person who plays for 1000 hours pays the same for the game and console as the person who plays 10 hours and never picks it up again. We can see where this is going and why elastic pricing is important. Like, if I’m a Bruce Springsteen super-fan, won’t I pay more for tour items then someone who only knows ‘Born to Run’? Obvi. (Great song, but a tragedy for those that only know one song by ‘The Boss’)

It’s now the late 2000s…the Iphone comes out in 2007, JayZ and Beyonce first become a thing earlier in the decade, the Olsen twins grew up and the Wii was the most popular Christmas gift of 2006. Here we are, free to play starts to kick in. So, the game developer gives the game away for free now, (massive shift in business model btw) and money is starting to be made by in game purchases, DLCs, skins. We’re now all familiar with this. Fornite, Roblox, etc.

Jump cut back to the 80’s!

IP TREND: Popular action figures like He-Man, The Smurfs, Care Bears, et al usually follow a very similar ‘characters first’ then narrative and background of the character model. Basically, I buy an action figure then the producers make a tv show of said character and I watch it, get more enamored and buy more stuff. This was of course made famous by Disney characters, however, my childhood memories were of me buying (ok, my parents buying me) a He-Man action figure and then watching a tv show to tell me who that character was and what they liked to do other than standing with a sword raised above their head permanently. Pretty straight forward. I buy the memorabilia and this IP was owned by studios, publishers. All proceeds would go to that company. Didn’t matter if I had a cool He-Man themed birthday party where I set up the full Castle Grayskull, did all the voices and entertained my friends for hours on end, I could not financially benefit from this glorious performance as that IP was owned by Mattel. (I’m not bitter)

Superhero Philosophy: Mostly in the west. A kid gets bit by a spider and is now awesome. Captain America, too small to make a difference, is injected with a serum and is now bigger and unstoppable. Same with the Hulk. Smart guy? Not good enough. Radioactive material in your blood? Hulk smash. Boom, hero material now. The green lantern (a ring), Batman (I’m rich) you get the point. Basically the lesson from the superhero narrative from the west is you’re going to become powerful overnight, now, how do you deal with this responsibility. Again, not a bad lesson, and candidly makes sense with America’s sudden rise to global power seemingly ‘overnight’. However, at the individual level, most of us are not overnight successes. So, where are the heroes for those of us that aren’t massively changed overnight?! (we’ll come back to this)

NOW

Games: We’re all getting along, nobody’s polarized and developers continue to make money from in game purchases, to the tune of ~USD 120B/yr. And now, players can even make money from esports and streaming. However, there’s still an existing problem, which is, the game developers have control of the assets and the game. (no NFTS, or UGC) This is a similar narrative to how Facebook owns your photos! (Boo, I need to own my pictures of Jamaica spring break)

With the advent of ‘Play to Earn' (P2E)…(also loving ‘Free to Own’)…developers can monetize the games and players can own the assets through tokens and NFTs. For more on where we are check a16z’s NFT CANON

IP TREND I recently started watching Arcane on Netflix and am completely blown away by the show. The animation is bananas good and the story line is so rich. For those that don’t know, Arcane is a show that won 4 Emmys and is based on the popular forever game, League of Legends. (LoL) Hmmm, where have I seen this before. This is exactly the path that I described earlier with He-Man. Popular action figure turned into a tv show that essentially helps you sell more of the items, increases your stickiness within the game/world and is a great marketing vehicle for your IP Universe. It just so happens the action figure in this example is a digital game avatar. However, what’s different with NFTs and digital items is that in this universe, the IP can really be owned by YOU! Makes sense right. Instead of Riot Games owning LoL and you not being able to create any derivations therein, now if you own the NFT or Digital Asset, you own the IP and you can create the backstory, the narrative and build out your own universe with the upside of an economy connected! You become your own tv/film studio.

E.g. I own a CryptoPunk and all the IP associated. Now I can create a backstory and memorabilia, merchandise, partnerships for the brand that I own, even as it’s a part of the larger Punk ecosystem and lore. I love this! This is where we’re headed.

Superhero Philosophy: As the west starts to celebrate more stories and stars from the east, (Crazy Rich Asians, BTS, Squid Game) we will hear and see more of the Wuxia superhero narrative. TL;DR is that Wuxia, translated to “martial heroes'“ is usually where a main character trains and trains and is only granted the superhero status after years and years of training and proving that he or she is worthy. This as compared to a western superhero is made instantly and learns to control it along the way, (some exceptions of course)…I really felt this while watching “Shang-Chi and the Legend of the 10 rings”, but is also present in the Kung Fu panda series that we’re all familiar. (and many others) I’m massively simplifying this and I have much to learn, but I really enjoyed seeing this narrative emerge more and like the message it sends to kids. Work hard, train and good things come.

Another way I like to look at this narrative is to talk about Michael Phelps. So, the question is, when did Michael Phelps become a champion? When I first was asked this question, my answer was “when he won his first gold medal in the olympics or the world championships”…this solidifies him as a champion right?! Well, hold on now. How about this? Michael Phelps became a champion when he made the commitment and delivered on it daily to get up super early in the morning and train all those years with often nobody cheering him on in the pool. Day in, Day out, when he didn’t feel like it, when he loved it, when he hated it, when nobody was holding him accountable except himself. That to me is when Michael Phelps became a champion, and the winning of 23 Gold Medals, was merely recognition of what he was training to become all of those years. That is the message I want kids today to hear.

I see an acceleration of all three of these areas within Gaming, IP and superhero narratives and invite you to play or be a fan. “But Adam, I don’t have time to play video games.” Totally get it. I don’t have time to play Ice Hockey but I love watching Ice Hockey during the playoffs. This is similar. Gaming, IP and superheroes will continue to evolve into a sport/entertainment universe that whether we play or not, we can love and appreciate from east to west and from then to now.

And heck, maybe NOW I can finally charge money to do voices with action figures at my birthday party like I always wanted to…