Business Plans for the Web3

The most common Web3-based business model from the past two years is around an NFT collection. Even though significant participants in the industry started projects centered on creating a metaverse, making a movie, or branding the next Disney.

Token-gating a Discord community such that only those who owned one of your NFTs could join, a project would publish a 10,000-piece NFT collection and then wait to see if it would be successful in selling out.

Is this a long-term business strategy?

Numerous NFT communities have come to understand three things:

1. Traders and speculators supported the value of their NFT assets rather than those who supported the idea and wished to contribute to its advancement.

2. Although it sounds appealing, it’s actually very challenging to construct a community with 10,000 residents. Much more so than creating a close-knit group for business.

3. There is no more income when an NFT collection has been sold out.

Many of these NFT communities now rely heavily on recurring income from royalties obtained from sales of their NFTs on the secondary market. Because your only source of income comes from people leaving your community and selling their NFT to someone else, although this can be lucrative, it also goes against the idea of creating a community that people want to stay a part of.

What Web3 strategies will be successful and provide enduring revenue?

1. NFT Reserve Model

Start by selling 9,000 of your collection’s 10,000 NFTs while keeping 1,000 for yourself.
Focus on creating a community that attracts and keeps members to increase value.
You can release some of the NFTs that are kept in reserve when your project requires money.

2. Secondary Token Model

You can introduce a second fungible or non-fungible token once you have an established NFT collection and community.
This is a good choice, but it comes with a warning.
This strategy can set you up for failure if you’re establishing a second token because your current community need funding.
Building just one community (or business) and keeping its worth up is challenging enough.
You do increase your revenue when you create a second token, but you also have a second community (company) to look after.
Launching a second token can be the smart thing to do if your business or community is doing well and you just want to grow.

3. Subscription/Membership + Revenue Sharing NFT Model

Launch a Web2-based subscription for those who just want to buy your work.
An NFT collection for those who want to construct and develop with you.
Give the Web3 community a portion of the cash from the Web2 membership/subscription audience.
They will assist you in building your website, promoting your goods, and producing material for the Web2 audience.
And this is where Web3’s interoperability really shines.
In this hybrid model, each customer’s subscription fee can be controlled by purchasing an NFT .
This makes use of the Unlock protocol to specify that a recurring subscription price of X amount of money will be applied.

4. Cohort-Based NFT Membership Model

Cohort-based NFTs, which take advantage of supply/demand and FOMO, are the last type.
You introduce a $5/month premium subscription tier for your newsletter on Substack with the initial release of 500 subscriptions.
If that is successful and your audience keeps expanding, you introduce a second release (cohort) at a monthly cost of $10.
You raise the price of the monthly subscription each time you sell out.
Because you continue to provide all holders with the same value even as you boost your rates.
The value of the NFTs bought in your original release increases.
Just different people pay different amounts each month—some $5, others $10, etc.