April 25, 2022

How Brands Are Using NFTs : The Food & Beverage Industry

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NFTs have become perhaps one of the most talked-about digital investments. Although NFTs have been around since 2014, last year was the first year that NFTs truly became mainstream. Over the course of the past few months, NFTs have evolved rapidly, and recently, restaurant and food experiences have started to utilize NFTs and web3 to engage with their customer base in a more meaningful manner than web2 platforms.

Last month I attended "SimulATE: The Food Metaverse & NFT Mini-Summit," the first-ever food-meets-metaverse-meets-NFT-meets-web3 event where chefs, entrepreneurs, restaurateurs, hospitability brands, food and beverage brands, and other individuals in the food-tech industry met virtually to discuss how food intersects with the metaverse and web3. The event was sponsored by The Spoon, an organization that provides daily analysis and reporting about the food-tech revolution. The presentations focused on how virtualized worlds, mixed-reality, the metaverse, and NFTs are shaping the future of food and how new developments in food-tech are being leveraged by food businesses and the consumers they serve. When people think about NFTs, what usually comes to mind is the digital art that is minted and sold, like when Mike Winkelmann, aka Beeple, sold his NFT Everydays: The First 5,000 Days for $69 million at Christie's. What's interesting about the food and beverage industry is how brands are shifting their focus to emphasize the community aspect that comes with web3 and finding specific utility for the NFT token-holder. This article discusses how some companies in the food-tech world are thinking outside-of-the-box and successfully using NFTs and utilizing web3 to promote their services and products to consumers.

As we reported earlier this year, Flyfish Club is the world's first-ever member's only private dining club, where membership is purchased on the blockchain as an NFT. By using NFTs, the creators of Flyfish Club, VCR Group, developed a system that converts a regular membership into an asset that the NFT token-holder can utilize. Unlike other membership programs, Flyfish Club members own their membership and can do what they wish - enjoy it, sell it, or lease it. Unlike other NFT projects, Flyfish Club is a utility-based project. This is a project where the NFT token-holder receives something tangible instead of simply having digital artwork stored in their crypto wallet or displayed as an avatar on social media platforms. In addition to receiving a fish or sushi-themed NFT, token-holders also have a membership to the Flyfish Club restaurant located in New York City and access to real-life pop-up events such as Super Bowl parties and renting out a yacht in Miami. The focus is on building a community of people that love food and enjoy exclusive culinary experiences.

The Flyfish Club NFT drop was also ground-breaking. The VCR Group developed an extremely successful financial model - they generated more than $14 million on the initial mint, with ongoing sales reaching an impressive $21 million. The company has no debt and no investors. By offering membership as an NFT, Flyfish Club returns equity directly back to the token-holder, and the token-holder can capitalize on their asset by selling or leasing their membership if they so choose. The VCR Group emphasized that they did not intend to create a financial passive income stream from token-holders leasing their membership, quite the contrary. Their intent is heavily concentrated on community and providing as much value for the token-holder as possible. The leasing concept was designed so that if Flyfish Club members happen to be out of town for a few weeks, the restaurant remains filled with customers, and people who are not token-holders can benefit from the Flyfish Club experience and maybe become a token-holder in the future. Flyfish Club is scheduled to open in the first half of 2023.

BurgerDAO is another exciting utility-based NFT project. If you missed it, we spoke about DAOs (decentralized autonomous organizations) in our article about Snoop Dogg's very first NFT. DAOs are quickly becoming another buzzword in the NFT community, and BurgerDAO is a food brand that utilizes DAOs to make decisions as a community regarding the brand. Inspired by MrBeast Burger (a virtual restaurant brand that delivers burgers and fries across the United States), BurgerDAO has no physical locations and instead utilizes cloud kitchens (see REEF KitchensVirtual Dining ConceptsNextbite), restaurants that create food on behalf of digital brands. BurgerDAO offers hamburger-themed NFTs that provide the token-holder with several tangible benefits, including the opportunity to collaborate with other members of the community to create and vote on proposals that have a direct impact on the brand, naming rights for franchise locations, a monthly code for free burgers, and access to members-only Discord channels. This is just another example of how food brands are coming up with creative ways to sell NFTs and also deliver a physical component that provides tangible value for the consumer.

The Bored Breakfast Club is a web3 NFT coffee subscription company. In addition to providing the token-holder with digital artwork that depicts unique breakfast scenes, the company also provides utility because the NFT unlocks a tangible item - a coffee subscription. The Bored Breakfast Club partners with an existing coffee roaster and regularly ships coffee to its members. Like the Flyfish Club and BurgerDAO, the Bored Breakfast Club was designed to give back to the community. The founders created a concept called the Community Coffee Wallet, which is funded by a royalty on secondary market sales and a percentage of profits from coffee and merchandise sales. Once the community wallet reaches a certain threshold, the Bored Breakfast Club distributes a new coffee blend to the Bored Breakfast Club members. The funds pay for packaging, roasting, fulfillment, and free shipping worldwide to token-holders. The story behind the creation of the Bored Breakfast Club is also unique. The Bored Breakfast Club founders are also Bored Ape Yacht Club (BAYC) members. As another organization that provides utility to the NFT token-holder, the BAYC allows the individual token-holder to have the commercial right to utilize their specific NFT in any way they wish. The Bored Breakfast Club founders decided to use their apes by featuring them on Bored Breakfast Club packaging materials. The artwork for the Bored Breakfast Club NFTs are essentially derivative works of the BAYC, where the digital art depicts breakfast scenes of an ape sitting down to breakfast. Although the Bored Breakfast Club founders are BAYC owners, the Bored Breakfast Club project is not affiliated with BAYC or Yuga Labs.

This article highlighted just a few noteworthy projects in the food-tech world. Still, as you can see, there is a lot of exciting innovation related to NFTs, with new projects being released continually.

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