Live Q&A with the Community 1/24/22
Dear Xillionaires,
We wanted to recognise a well thought out list of questions generated by Eddie, one of our most active community members, that was put forward to the team in our telegram channel. What was planned to be a one hour session ended up being three informative hours that helped clear up a lot of questions you guys had for us. Please find the highlights of the conversation below along with the response to the list of questions raised by Eddie.
Since the more relaxed format was received so well, we are looking forward to hosting more live Q&A sessions on a regular basis. So please come join us in telegram to keep up to date - https://t.me/Official_ProjectX
Community Q&A Talk 01/24/2022
Question N°1:
- It seems you are no longer confident in reaching the $50m, $100m and $250m milestones, with the CEO even mentioning a potential $1bn market cap from an earlier AMA session. These ambitious targets were one of the reasons I invested, why did you feel the need to omit the forecast market cap from each quarter of your roadmap?
We are still quite confident that we can achieve those numbers and even a $1bn MC. However, I don't think it is a good idea to include any of those in the Road Map, because the market is changing rapidly and when we were making those projections, we expected quite a different growth trajectory than the market has been showing during the last several months. So, we aim to achieve those numbers, but don’t feel comfortable to include them into the Road map. That’s a common approach these days in the market.
Since we are working on the product first of all, the community building, user acquisition, as well as we are trying to get as large as possible market share, so that’s why we’d like to focus the attention on the metrics we can control. Rather than focusing only on the market cap numbers.
Talking about the point Eddie made “users have to understand how ambitious you are“ so, I think our current road map shows how ambitious we are, even without those numbers.
Also, I’d like to add that we are looking for long term investors only, that’s our position. And they aren’t really taking these numbers too seriously. Nobody can predict a market cap for a brand new startup on the brand new market, even relatively precisely.
I know that for sure, because as a VC we’ve been around since 2016. Since that time we had made over 170 deals. We co-invested with NGC, Fenbushi, Binance Labs, a16z., Alameda research, Coinbase Ventures and dozens of other VCs. Among our portfolio companies you can find names like: KuCoin, Decentraland, Huobi, BlockTopia, Sandbox, Audius, Flow, Reef finance and the vast majority of successful projects that RedKite and PolkaStarter launched during the last 18 months as well.
So for the venture capitalists, a long term vision and focus on the product are essential things.
I think we are all venture capitalists rather than speculators here, right? 😀
Question N°2:
- You have mentioned the strategy in the recent article by stating DAOs will send a percentage of their tokens to the XIL treasury and this could generate substantial value. Why do you feel so confident in future DAOs after the two you launched yielded such poor outcomes? Have lessons been learned?
Two of the first pools that have been launched were fractionalized NFT pools rather than DAOs. Those are two super different types of assets with completely different patterns and growth potential. For the fractionalized NFTs, people buy tokens mostly for one reason - swap them for the NFTs from the pool later. And the secondary market performance itself has nothing to do with our efforts to be honest, it depends mostly on the issuer, being DJ SODA and fashion designers (Prada, Burberry etc.) in our case. So, if their community thinks that the current token price reflects the current value of the underlying NFTs, then it’s true. But at the same time, we all need to understand that when DJ SODA and designers begin doing more PR activities around those collections of NFTs, their value can potentially grow. But I'd agree with the point that we can get more value from this kind of partnership for XIL holders in the future , since it’s a great way to get exposure to millions of new users. We will try this new approach on InstaDAO soon.
However with the DAOs, it is a completely different story. Any of the DAOs we have already announced will be quite different. For example, their tokens’ utility, the value of the token, business model of those DAOs etc. So they would be more like real companies, rather than just fractionalized NFT pools. And of course, to be a part of this DAO will require you to hold tokens. For example, Gaming and Metaverse DAO as well as Investment DAO and NFT DAO are proven concepts, and you can check YGG, BitDAO, Whale and many others and make sure there’s a demand for these kinds of products. Leading DAOs from those segments have 50MM - 200MM + market caps.
Of course, there’s nothing guaranteed as well as nothing is guaranteed for any types of assets you can see at the market. It might be successful as well as it might fail. That’s as we all know how the venture investments work, some of the projects skyrocket immediately, for some of them it takes way more time to start shining. But we will never know it before we launch them. From our end, we’re committed to all do our best to push those projects and are looking for relevant curators for all of them to make sure each DAO has it’s dedicated full-time curator and team (responsible person/team), so they can be moving forward quickly.
Question N°3:
- We have discussed the importance of communication and community engagement on Telegram over the past few days, the team has responded well to concerns but these issues were ProjectX related. Even though you have created some marketing material, we haven’t really seen much engagement from DJSD and WOLFC supporters. How do you plan to attract new people to future DAOs who would form a passionate and active community of supporters?
Yes, our two pools have already launched and aren't showing good engagement levels with their communities. Additionally, we provided them with all of the details, recommendations, and guidance and for sure will provide them with some resources and help when needed.
We don’t like this situation at all, and for all of the next launches we will require a certain level of marketing effort from all of the projects which we will be doing launches for. For example, in the InstaDAO pool, we require them to launch a regular AMA, make a certain amount of posts every week, make a dedicated content (mostly video), etc.
Question N°4:
- Why have you omitted the TikTokers pool from the roadmap? Is this not proceeding and why?
This pool is ready, so we have removed it from the Road Map only because of 2 reasons.
The first one is that we are trying to make it more like a DAO style, rather than a fractionalized NFT pool (like DJ SODA or WOLFC). For obvious reasons, we believe that would work way better. So, we are re-negotiating with those KOLs, about this new business model because this includes their revenue-share and tokenization of all of their assets (such as IPs), so it will take some additional steps from them.
Second reason, which is even more important, working on the legal side of this launch. The vast majority of those TikTokers live in the US, and here we have some concerns from the SEC regarding fractionalized NFTs in general (they consider it more like securities), so we are trying to make it happen and to help them successfully pass the regulation requirements, but it depends on the SEC rather on anybody else.
This is actually a big barrier for all of the launches with the US-based celebrities. SEC has clarified and significantly changed their position about fractionalized NFTs several months ago, when we already have negotiated several big launches such as TikTok Pool, Hip Hop Pool, NBA pool. So that was a big surprise for all of the involved parties, including celebrities, their agencies and ourselves. We are doing all our best to help them to overcome those concerns and get the approval and green light from the SEC, but as I said, that’s the most severe regulator in the world, so the best we can do is to help them to prepare all the paperwork, give them our law firm as an additional support, and hope the regulator will allow them to move forward.
Dealing with celebrities this way is getting more and more complicated and difficult due to the regulation. That’s why we are diversifying our pool of DAOs.
Regarding a TikTok pool, it will be launched even if it was removed from the road map, more likely in Q1 - Q2. In the old format like Soda, we can do it even in February - March, but we really want to make it more valuable and do it like a DAO not like fractionalized NFTs. I mean with real governance for their fans, opportunities to tokenize the exact piece of content, revenue sharing, or at least buy backs and things like this included. So no worries at all about it, it’s still on Xillion’s table.
Question N°5:
- You have announced the Instagram models pool, which will include 3 models with a combined following of 20M. Although this seems like it will be highly successful due to the 18+ market generally being untapped, the pool seems to have replaced the Instagram influencers pool that was supposed to be launched by Q4 2021 consisting of 80M influencer followers. Would you agree that this could be construed as over promising and under delivering?
So first of all, for each pool / DAO we (will) have a curator. It is a firm or a person who is responsible for bringing those celebs / assets to the pool. For this Insta DAO, we have a curator called WhoKnocks. They had an idea to include more bloggers to reach the 80MM mark, but at some point of time changed their mind and added just 3 influencers with 20MM in total. They changed it due to their internal reasons + due to the fact that some of the influencers might be added later to this DAO to boost the value on the secondary market.
So, as you all understand we depend on the curators, and when we announced this Pool for the first time, their vision was 80MM, so now it’s changed. We think the current pool looks interesting and solid with those 3 influencers, even though it’s an experiment and nobody has done it before.
Regarding the marketing, for the InstaDAO we expect to massively promote the platform among this new audience (for example one of those influencers has 16 or 18MM followers and really super popular) so we wanna get exposure to them, and what is more important, it wouldn’t be just a promo, we are trying to make those who want to participate in the DAO to buy XIL to get access to the platform. Still negotiating but hope we can make this condition work. So we’ll see together how that would work.
- A DAO based on movies/cinema/TV shows would be huge
Absolutely, just imagine it could really change the way people fund movies, books or music.
Like, you launch a DAO, raise funds, let your DAO users vote for some of the things in the script or let them vote for a cast like to select actors, give them early access to the premier, and share some of the revenue from the streaming for example as an airdrop.
And that’s just a quick super high level example!
Question N°6:
- You seem to be targeting a very small number of pools in 2022, do you feel these will generate enough traction for the project to succeed?
First of all, we consider quality over quantity. Secondly, the DAOs we have already announced are those that were confirmed at the moment of publishing the Road Map. We definitely aim to launch more DAOs during 2022, but at the same time we want to announce only those that are confirmed, rather than randomly mention 100 different DAOs.
Question N°7:
- How many DAO pools are you forecasting to launch on the Xillion platform on a monthly basis in around 12 months time?
Depending on the type of those DAOs, we target to have a mixed pool of DAOs (large DAOs with the long term goals like Gaming and Metaverse DAO, as well as single-purpose DAOs (like DAO to buy something specific, like a Constitution DAO for example), as well as Celebrities DAOs etc. So this number also depends on the market conditions, if the market will get bearish, so obviously the number of launches will be way less, than if that’d be bullish. One more important factor is how many solid curators will come to us with their DAOs. For example, you mentioned you have your community, so you can launch a DAO on our platform, like investment DAO (decentralized VC) or NFT DAO (like Whale and others). So the more people like this we have, the more DAOs we launch.
Realistically, for the first 2-3 quarters more likely it would be no more than 1 launch / per month on average (which means in some months we can do 2-3 launches, in some 0-1). We don’t want to launch unsuccessful projects, so that’s why we’d like to firstly make sure the concept is valid, there’s a demand for this particular DAO, and the curator is of quality, etc.
Question N°8:
- I mentioned to Josh around 6 weeks ago that you have the obvious sports like football, basketball, baseball, American football, etc but Cricket is an untapped market for this concept that the team need to look at getting into. The Indian market in particular could be worth $billions. If you can form a partnership with the Indian Premier League (IPL) it could be massive. There are similar leagues in the Caribbean (Caribbean Premier League), UK (The Hundred), Pakistan (Pakistan Super League), Australia (Big Bash League), etc. to grow into but first mover advantage in these areas is key seeing other international sports are already gaining traction. Have the team looked into this untapped market?
Yeah that’s true, I have a lot of friends from Indian’s VCs as well as some of the Indian tycoons who are LPs in our VC. So, all of them love cricket very much, I'd say way more than any other sport such as basketball or soccer. So, considering how big and lucrative his market might be, we definitely would love to explore this avenue and moreover we are already waiting for some intros.
Question N°9:
- Another suggestion I made to Josh was to create a tier system for signing up celebs, athletes, musicians, artists, KOLs, etc. If you take soccer as an example - Tier 1 can be for current players, Tier 2 for recently retired players and Tier 3 for players who have long retired. For a new project like this, signing individuals in the Tier 3 category would make more sense as it would be cheaper and player expectations / demands would be lower but you can gain similar levels of publicity if you choose the right type of players. Some former players are national heroes in their countries. Obviously once established you can move to Tiers 1/2 and the model can be applied to all pools. It’s important to create benchmarks and proof of concept to attract the big names. Josh didn’t respond but what do you think of this idea?
That’s actually a great idea. By the way, we are working with the ex-VP of the NBA who’s helping us with onboarding some athletes, and he suggested quite the same way to work with the EPL, like to start with Tier-3 guys + some of the legends like, for example, Ashley Cole, prove the concept and expand it to their Tier-2 / 1 athletes after that. So yes, that’s what we want to do.
One more about sports, which is a huge market for DAOs and NFTs: We are exploring a lot of ways on how to sign some deals out there.
It’s not easy, considering how much some projects are paying to the leading athletes. Like really millions in advance for the single NFT drop. But we have a unique tech, and very different approach. So they like it, especially the DAO aspect, so that helps us to compete.
Question N°10:
- Is ProjectX getting the attention it needs from the CEO and other team members who are involved in other projects?
Yes. If people weren’t spending enough time in the telegram group in the past , it doesn’t mean they weren’t working and weren’t paying attention to the project. Those of you who have ever launched any startup, know for sure that small teams work almost 24/7 because everybody is serving like 2-3 positions to get the best results. So I can say everybody in our team including contractors are working above and beyond.
Question N°11:
- It seems the project is being used to market the team’s other projects like Legends of Crypto. What benefits are XIL holders getting from this partnership because it seems that the team is trying to create multiple success stories at the same time?
The partnership we made with Legends of Crypto, has the only one reason - to make DJ SODA and WOLFC NFTs even more valuable by adding them into an NFT game, therefore NFT holders will receive additional utility. So we simply tried to help DJ Soda and WOLFC curators and teams to add more value into their NFTs.
But, we are big believers in the promo via partnerships with other projects, that opens a lot of doors to new communities for relatively free and which is more important in a super native way so, with the right message and right materials we can get a lot of new members from other projects’ communities.
Question N°12:
- The wider market has been down recently but if you look at the 6-month or 12-month graph for most tokens, it will show an upwards trajectory. You have increased the circulating supply substantially while adding no underlying value that has led to a destruction in token price. Do you agree with this analysis and why do you think the XIL price has fallen so much in this period? What are you doing to try to reverse this?
So, there are two biggest reasons why XIL price has decreased are:
- Not enough buy side demand.
- Huge sales pressure from some of the private sale participants.
So to solve this, we mainly will be activating more marketing efforts, will be establishing more partnerships with other projects, adding more utility to the token (described in the article about our strategic vision).
Here’s briefly what we want to focus on in terms of the marketing strategy.
- Expanding our KOLs network, attracting more new KOLs from different regions. We want to focus the attention on mid-size KOLs with a highly-engaged audience, so we can make sure our message will be delivered to potentially interested people.
- We are rolling out an Ambassadors program. This program will allow everybody who has at least 100 followers to join and start distributing our content / bringing new people to the community. This way we can reach out to thousands of people through their friends and onboard more new members to the community, which eventually will boost the token.
- Partnerships with solid blockchain projects (games, metaverses, gaming guilds, DAOs, NFT projects, DeFi projects). By utilizing our extensive network of projects we want to start doing cross promo activities and reaching our more new users, who are not familiar with our project, but who potentially might be interested in using our products.
- Media exposure. We are working with some media outlets regarding getting publications with our product mentions as well.
- New fractionalized NFT drops with celebrities or influential people. By working with these kind of people we open a door to their multi million followers base, so that’s a great marketing channel that allows us to onboard many new users.
Question N°13:
- How is development on Xillion going and what is the grand vision with the platform?
Currently we are working on several key things in terms of the dev :
- Migration to Polygon to fix all the problems with transactions and displaying data we got from binance smart chain. Also we are partnering with polygon to get access to their ecosystem and the migration is an essential step in this plan. Also it will allow us to automate NFT minting and distribution process as well. And rid of this mess with the rewards distribution.
- Staking for access. This one is also quite important, we just discussed the idea to allow access to the DAOs on the platform to only those who lock their XIL on the platform. Plus that’s an important part of the future Xillionaires club platform.
- Also we are working on Xillionaires club platform (governance part, staking system, mini chats and some things like this).
- The domain name is “.one” because of 2 reasons, the first one is that it looks more modern I’d say. And the second one is that Xillion.com was already taken when we seeked registering the domain and it was on sale for several dozens of thousands of dollars. We decided that we have way better ways how to spend almost 100k USD on the project, instead of having a “.com" domain.
Question N°14:
- The new roadmap doesn’t seem very ambitious and there’s no clear indication on when holders can start to get a return on their investment. Do you think potential investors will look at this and be excited over the future of the project?
First of all, there aren’t any good projects that promise you any returns. When you make an investment in any asset in the world, you need to be ready that some projects skyrocket immediately, but for some of them it takes way more time to get the rifle traction and deliver like 10-100-1000x returns.
I do not agree that our road map isn’t ambitious to be honest. We mentioned several large DAOs that we consider as future competitors for YGG, BitDAO, etc. as well as a lot of features that will make our platform quite unique.
From our end, we will do all our best to execute it and deliver, but since we’re building a quite unique and relatively complex platform, we need to keep in mind that to get market traction is way harder than for just a P2E game for example. As we all know, a startup’s success in our market is highly correlated with the trends and waves of hype. Like if Metaverse is a big trend, then the vast majority of Metaverse related assets, even mediocre projects, will be following the trend and growing faster than even good marketplaces or DAO platforms.
Question N°15:
- Can you commit to a monthly update via Medium to inform holders how you’re progressing with the current roadmap?
Absolutely.
Question N°16:
- The Xillionaire Club was announced quite a while ago. Holders were excited about holding and trying to build their position to reach the next tier but there’s been no further updates. Please provide an update on the Xillionaire Club, the ambassadors program and inform on ways to streamline rewards for holders due to the fact the current process is not fit for purpose, is chaotic and inefficient.
Yep, sure. There are actually several topics, so let me go one by one.
First, we’re working on the platform for Xillionaires club so all the features and perks will be conveniently structured and everybody will be able to access them in a few clicks.
Talking about exact perks we want to provide you with:
- Guaranteed Allocations to all of the DAOs we launch.
- Exclusive NFT airdrops.
- Governance - that’s the most important one, where all of the Xillionaires club members will be able to vote / suggest regarding Xillion development.
- Access to the platform. (If you’re not in the club you can’t use the platform’s vast majority of features)
- Exclusive pools for swaps in XIL to any of DAOs’ tokens.
Second, the Ambassadors program. This one will be launched in this quarter as planned, currently we are working on the technical side of its integration with the 3rd party solution. Our key idea is simple. We will allow everybody to become an ambassador of Xillion and be able to spread our content and refer their friends in exchange for the rewards (BTC, XIL, NFTs, DAOs’ tokens).
The last one was about marketing, but I have included the answer about it into some of the previous questions I guess, so I don’t think it makes a huge sense to repeat it.
Question N°17:
- Do you guys have any competition in this space, if so what leverage do you have on potential competitors?
So to be honest there’s no direct competitors, I mean of course there are some platforms where you can raise funds for the DAO, as well as there are some platforms where you can do all the governance and management, as well as some other platforms where you can fractionalize NFTs. But there’s no all-in-one convenient platform for solving all of this. It’s a highly fragmented and super new market.
