Edmund Berkmann - How self-Tokenization will disrupt creative industries

Thank you everyone for your time. So my name is Edmund. I will be talking to you guys today about self tokenization. So I just want to start very simply with uh who am I? So my name is Edmund.

I'm a masters in entrepreneurship and I used to make music for a long time. Uh Ravi over here is my co-founder um who's COO and was a music manager for a long time as well. And so we are basically have been working on this project for three years and I will basically walk you through the thesis rather than the project but the project will be the case study to explain everything. So to start very simply I want to create a bit of an a bit of engagement. Um if you don't mind putting your hands up if you are a creator if if you are creating content you are a musician you are a painter whether you are monetizing it professionally or doing it for fun.

I would just like to see a little bit to get it engaged. Okay, so it's like two, three people in the room. Um, what about the other side of the coin? Do we have fans of arts? People who consume arts?

People who consume, you know, let me sit down so you can see the screen. But, um, do we have fans of arts here? It's like four. Okay, fair enough. And finally, are people here satisfied with the current state of the creative industry?

So, we're talking social media, we're talking monetization, we're talking freedom, ownership. Does anyone here feel engaged or happy with the state? No hands. Okay. So, um I would like to do something a little interesting.

If everyone could put their hands up for me. If everyone could put your hands up, I will show you some stats. And every single time you do not know the stat, I want you to put your hands down and I want to see who still has their hands up at the end. Okay? Can everyone put their hands up if you don't mind?

Everyone in the back, I see you're a little bit locked clocked out. Everyone in the back, can you put your hands up? Yeah. If you do not know the stat I'm about to show you, put your hands down. If you know where, keep your hands up.

Okay. Stat number one. 1% of the top Spotify artists make 80% of all of the revenue of the industry. Who knew? Okay.

Still a few hands up. Second one, about 43% of creators make less than twothirds of the minimum wage. So the majority of them require a second job to make a living. Still a few hands up. Third stat, social media basically takes everything that you post on it and they own it.

We now have even problems with companies like Caput who decide that they can monetize your content and if there's a problem with the ownership, it is your responsibility, not the businesses. Um, now more stats. Did you know that twothirds of fans feel overwhelmed and that up to 80% of Gen X or Gen Z feel absolutely stressed over social media rather than getting joy from it? Everyone's got their hands down. So anyways, we'll just keep going.

Um, 45% of fans feel disconnected from their favorite creators. They don't feel like they have a means of communicating with them. They don't feel like they can engage with them. So there's a huge disconnect from the fan to f uh to creator relationship. And finally, about half of all of the money that fans are giving to creators, especially tips, donations, are generally taken by the business and the platforms.

So that means that when you think you're giving some money, most of it actually doesn't get to the creator. Cool. So this is the this is kind of the the problem of the industry. You know, you have transparency issues, you have ownership issues, you have monetization issues, and the majority of creators in the world just cannot make a living. So here's what people around in the industry have been trying to create as forms of solutions.

So we have on one side we have people building around the royalty industry. So they're trying to take streaming and finding ways to decentralize the streaming industry. So Royal for example allows you to create NFTs that will represent some of the streaming revenue and a portion of that will go to your token holders. You also have Opelus which u basically allows for music collection uh NFTs and just ownership. So think of it a little bit like an iTunes but they also allow you to uh get advances from your your crowds your your fans and you will repay that advance.

So it's crowd sourcing and you'll repay it with streaming. So as you make streams they will get a portion of that. And then you have the more traditional ones which are basically the iTunes and Spotify and Soundclouds of today. So Audius and Sound.xyz XYZ they just allow you to buy songs directly as NFTs or the streams that directly are monetized as NFTs.

You also have a few other um you know memorable uh mentions uh and we have some people in web 2 who have tried to make a difference uh though you know they're not crypto you know they're not using tokenization um but there's a lot of people attacking the problem and honestly not many of them have created a dent in the problem. It's still exactly this that small are getting worse every year. So here's what we have been trying to do. We've come up with a new concept which is self tokenization and a lot of people have kind of played around with the concept but self tokenization the idea of it is we are basically oh you know what before I go into the concept our platform is a social media that helps musicians turn their fans into active supporters. Okay, the way we do that is we first have the bazaar which is a marketplace where people will be listing their NFTs and those NFTts represent their value as a creator.

There you will be transacting, you will be discovering. You then have the second key feature which is the mosaic. You want to think of it like a glorified Tik Tok. Okay, so you will be browsing horizontally between creators and vertically to go deeper within a single creator's content. here.

Once you own the token of a creator, you directly unlock exclusive content. So, it's basically like, think of it like a Patreon and a Tik Tok mixed together, but based on the bizarre marketplace itself. And finally, we have the village. The village is like a discord or a telegram. It's basically a glorified group chat.

And once again, once you buy the token of the creator, you automatically get access. And when you sell the token, you get kicked out of the group chat. So coming back to the thesis and the creative economy, what we are basically creating is what we call ste these tokens are ERC699 which was built by unis swap which we're building with um and as you've seen earlier we got accolades with um unisop part of their incubator but basically the 699 tokens will be deployed at a rate of 500 tokens per creators and those tokens will become a representation a stock equivalent representation. So think of it, you have businesses today who are seeking investments. They will be um they create an IPO.

People go and buy the the the shares of the business and hopefully as the business grows they can get dividends or they can get profits. Here the creators and their creative success and the strength of their community is quantified and rewarded through those these tokens. What that really means is that on every single transactions of those these tokens, a proportion of their value is redistributed to the community, the token holders and the creator themselves. What that actually creates in terms of benefits is for creators. Firstly, you got freedom.

You get actual uh input on analytics, direct access to a community. You don't have to obey to certain platforms. We're quite liberal about how we uh enable people to share, communicate, and distribute their content. And also stable monetization because the payments are instantaneous. We are taking a very fair cut which generally speaking is 2%.

And uh that means that you are actually enabling creators to make a living from their craft. The 500 tokens that you start with initially will be 3030 euros which means that an initial creator starting on our platform will make about 15 grand in the first year which is basically with other streams that they already have whether it's merchandise streaming and all of that will actually allow them to make minimum wage for the first time for many artists in their lives. On the other side of the coin, you got supporters. What actually allows you to have is a community which has the art and the creators at the heart of them and where all of the connections happen with that value at the at the core of it. It also means algorithm algorithmic changes.

I think not many people are very satisfied with how algorithms work today. Whether it's on the Instagrams, the Tik Toks, the YouTubes and everything. um there's a huge proportion of people not actually getting seen by the audience that already follows them. There's also a huge uh disparity between your ability to connect with the people who you try to reach out to and what actually ends up happening at the end and your ability to monetize that as well. So we are trying to create a system where discoverability is based on taste is based on equitable fairness and it's not based on your ability to pay your way into having your content in front of everyone.

So there's no ads on our social media and we don't require ads in any shape or form and that means that there's no ways to pay your way into being in people's faces. So what does that mean on the long term? How are we actually going to be disrupt disrupting the creative industry? So the the first step is simply put we will we will allow people to make a living that will actually change the power dynamics. Something that is very important to understand today is that record labels and third party um companies, corporates like DSPs, Spotify, we're talking Universal and all of those kind of huge corporates tend to control everything.

They tend to have uh line shares of all the revenue. They tend to control how you are able to monetize yourself, promote yourself, present yourself. And so being able to allow people to make a living in the first place completely eliminates the the the need to kind of sell yourself which a lot of people may be familiar with in the sense where you know we have a lot of artists who start a certain way and within two three years as they try to achieve a more mainstream appeal they tend to change who they are. They change the art they make they change how they communicate. A lot of people in front, you know, in the in the audience don't know what's happening.

But behind the scenes, what hap what's happening is the record label is telling you you have to shape yourself this way to promote yourself. You have to do you have to change who you are to appeal to a different audience, which means that you're al alienating your key audience and you're also lying to yourself about your art and a lot of the times it leads to mental health issues. It leads to alienation of communities and it creates a lot of problems that go way deeper than just money and way deeper than just arts. So it goes into actual, you know, society and how people interact. So our goal is really to to change that to a point where one day hopefully record labels will either have to go bankrupt or change how they work because valuation of creative success will be done in a way that is inherently, you know, uh, symbiotic with how people want to engage and how artists hope to be able to interact with their fans.

So the creator journey is very simple. Um, we're quite big about um, frictionlessness. We don't actually think that the mainstream audience, the average person is interested in how wallet works. They're not interested in how ERC tokens work. They're not really interested in how crypto works.

And most of the time, they don't even want to know, even if you make it super simple for them. So, we've basically created a way to create a wallet without having to interact with it. You create a free social uh, media. Some other platforms do that. Uh, but it allows you to be fully self-custodial.

create your account with your Instagram or your Gmail and um there's also referral links. So that means we create a network effects but it mainly means you can create a token yours deploy it to your audience as a creator without knowing anything about crypto with the the the protection the legal protection that still comes uh with the rest of the industry at that level of standards. And ideally that means that over time you should be able to regain ownership of your career, ownership of your art and hopefully independence without having to sell yourself. On the other side again for supporters what it means is you're once again creating an account very simply with your Gmail or Facebook or whatever it is. You will have an invisible wallet created for you and you will basically once again through this uh algorithm that we use a system called um emotional um uh taste profiles.

It means that we're not actually looking at numbers. We don't care if your post is blowing up. That's not the reason why we show it to people. We show it to people because when they interact with it, the type of interactions they have aligns with who they are as a person. And the content that we show them aligns with who they are.

If you're into music that is empowering, if you're into paint paintings that make you feel a certain type of way, this is what we push towards you and and that's what creates the best spaces and the best interactions. And so you will be discovering a lot of people. And network effects are also very important. So on the app, we we very much promote collaboration. uh the people who collaborate on every piece of content on the content feed will be one of the very first things you will see just below the likes and the comments.

So it's all about the community and and allowing those those network effects to to pile up. Uh but in a way that is absolutely web 2 friendly. So a lot of people will not even realize that we have crypto involved. Uh we will be educating people about it but it's not really something we we require them to understand. Um and so yeah basically Ste is um three years in the making.

We're about to launch very very soon and uh I'm very happy to answer any questions if anyone has uh curiosities or misunderstandings or anything. Thank you very much.