One of the largest music companies in the world, Warner Music announced their partnership with Dapper Labs, the company that stands behind CryptoKitties, all in order to create a new blockchain called Flow.
The music giant that stands behind Ed Sheeran, Cardi B, Bruno Mars, as well as some other prominent celebrities, eventually decided to go on blockchain, joining an $11.2 million investment in above mentioned Dapper Labs.
Just for a reminder, back in 2017, in December, CryptoKitties, the app that lets users combine (or breed, as they call it) unique digital representations of kitties and trade them, almost spoiled Ethereum when they decided to single-handedly do transactions on the public Ethereum blockchain and that exploded literally overnight.
As per Jeff Bronikowski, who is the senior vice president of business development at Warner Music, if the transaction volume issues can be solved, the CryptoKitties technology, that is actually pretty much similar to Bitcoin (but for other digital assets), could be modified to generate distinctive, negotiable products featuring the company’s listing as the one of the best.
What really happened is that Dapper Labs managed to accumulate $11 million in funding for their project, including investment from Warner. The whole round is led by Andreessen Horowitz, including some other major venture firms as are Union Square Ventures, Digital Currency Group, Venrock and Accomplice who also wanted to participate.
Venrock’s employee and famous gamer, David Pakman, commented that Flow is aiming at a specific games use-case:
“Ethereum and pretty much every other Layer 1 smart contracts platform [is] attempting to build scaleable networks for transactions — like payments. Decentralized gaming and things like cryptocollectibles place different scaling requirements on blockchains that sharding fundamentally doesn’t fix. So, Dapper is building Flow to allow decentralized games to scale to tens of millions of users.”
He added that the collectibles industry needs a purpose-built blockchain in the case that major brands like Warner and the NBA decide to participate, and bring their fanbases along for the ride.
Jeff Bronikowski, SVP, Global Digital Business Development and Head of Innovation and Emerging Technology at Warner Music Group said that Warner Music is always searching for new opportunities for artists and has dedicated itself to exploring emerging technologies to enable these.
“When we met with Dapper Labs, they immediately understood our vision so we sought to solidify the partnership through this strategic investment.”
Dapper Labs really grew out from $12 million venture round they had back in 2018 and that allowed them to spin out from the parent company – Axiom Zen. A little bit later they took in an additional $15 million in VC cash, working with many of the same funds.
The company explained that Flow is especially “designed for composability where one developer can use code from one application in a wholly other one”.
“Flow empowers developers to safely and easily build on top of each others’ code, creating entirely new products and services at an accelerating pace. This feature of blockchain, known as composability, has the potential to unlock a new approach to software development.”
Ethereum, on the other hand, has been constantly progressing to the point where it meets growing demands for the network capacity. In the meantime, some other blockchains with smart contract capabilities, such are Kadena, EOS and Harmony, have risen up, composed to pick up users in the case where Ethereum might trip over in their mission to become “the world computer.” Flow is also the latest to join that line-up, but the first one that stresses keepsakes.
Also, this round should incorporate a unique construction where backers in the early stages receive equity that can be changed to tokens later for use on the chain (pending, as ever, approval by the Securities and Exchange Commission).
This is a construction that is almost identical to what is known as a convertible note, where there is debt swapped for equity. All being well, Dapper Labs plans to launch Flow in 2020.