On May 28, 2020, the internet-infused streetwear brand Neue Goods became the first creator to drop with Foundation. As soon as markets went live, there was a flurry of activity as collectors grabbed tokens representing unique T-shirts and “mystery boxes.”
Just over two months later, Neue Goods has done $22,272 in trading volume through more than 293 transactions, which you can track through Foundation Terminal
—a transparent dashboard of our market activity. As of today, Neue Goods’ founder, Matthew Vernon, is ready to open up redemptions and deliver the goods.
We sat down with Matt (which was admittedly pretty convenient since he’s also Foundation’s Co-Founder and Head of Design) to get an insider’s take on how digital tokens can become physical items sent around the world, straight to buyers’ homes. Here he discusses how he designed his Foundation market, what he learned from the experience, and how he’s incorporating those learnings into improving the core product for other creators.
How Neue Goods got started.
Back in 2015, I had just started working as a designer, and I wanted to apply those skills toward starting my own business. Growing up, I was super into skateboarding and streetwear, and was wearing brands like Supreme and Palace. I appreciated those brands and wanted to contribute to the culture around them, but I was this kid in Sydney, working at a design studio, spending nine hours a day behind the computer, designing websites, and hanging out on the internet. So, I decided to create Neue Goods as a streetwear brand that was grounded in digital culture.
On designing Foundation, and being its first creator.
As an overall approach, I always want to work on projects and products that I would want to use myself. When we started Foundation, I asked myself, “How do I make this something that I would use as a creator?" That was massively important to me. So as a designer, I wanted to get into the product and understand the entire experience end-to-end. I’ve always been a fan of “Me at the zoo
”—the first video ever to be shared on YouTube, uploaded by its co-founder Jawed Karim. I figured dropping Neue Goods on Foundation could be our “Me at the zoo” moment.
Being the first to drop limited-edition goods on Foundation ensured that the product would really work for creators, since I’m putting their experience at the center of the design work. This approach has helped me think through so many things with a deeper level of clarity, from making sure that our Creator Onboarding process gives them everything they need to make their drop a success, to figuring out what kind of information the Creator Dashboard (something we’re currently developing) should feature in order to make it as helpful as possible.
How it feels to turn a creative idea into crypto.
I’ve always been interested in pushing the boundaries of a clothing label and experimenting with monetization, and so much of the Neue Goods brand was already grounded in crypto. So for me, dropping with Foundation only amplifies the experimental aspects of Neue Goods. I was happy that the process of turning my design ideas into unique tokens was fairly easy, and now that they’re live and people are buying and trading them, it’s been exciting to see how it’s added a deeper layer of connection between the Neue Goods brand, and my audience.
How Matt designed his Foundation market.
Prior to dropping with Foundation, I had a pretty good sense of my existing audience, and price points for my products. Using this information, I decided that my starting price would be the cost price of the goods (how much the manufacturer charges me), and then the ending price would be a stretch goal—something I’d like to be able to sell a T-shirt for in the future. This model rewarded early adopters to come in and get the market started, and then anything beyond that helped cover my costs and turn a profit.
Why Matt earned more money selling with Foundation.
In the past, when I sold my T-shirts for a static price through my website, I was usually able to recoup the cost of manufacturing them and would make a small profit.
With Foundation, we’ve designed the product to help creators make more money, and this was certainly the case for me, for a few different reasons. First, I think the excitement of buying with crypto and trading the markets brought a lot more interest in my products. Second, thanks to early collectors coming in and pushing up the prices, right now they're all selling well above what they used to retail for, which has allowed me to get a better sense of the true market value for my products. Third, as a creator on Foundation, I’m able to capture revenue each time a trade takes place in my markets in the form of a fee paid by the buyer. So far I’ve made over $500 just in trading fees—which is an entirely new revenue stream for me, and an added bonus on top of the revenue I make from the actual sales of the products.
Overall, Foundation helped me understand what people are actually willing to pay for my products. So with that plus the trading fees, I'm definitely making more money selling through Foundation. As the platform’s designer, and as someone who wants to empower all types of creators to be fairly paid for their creative labor, this feels like a big win, and is something I’m excited to open up to more creators.
Beyond trading: How redemptions work.
We’ve designed Foundation to have two phases: a market phase, and then a redemption phase. The market phase is when a creator drops their pieces as tokens, and collectors buy and trade them. This usually happens while the limited-edition goods are still only an idea, similar to how crowdfunding works. During the market phase, as more people buy and trade tokens, the price fluctuates according to supply and demand.
Once a creator is ready to start shipping their pieces, that’s when they can shift into the redemption phase. This is when collectors who own tokens can come in and redeem them for the actual piece. In my case, anyone who owns one of the Neue Goods tokens I dropped back in May can come back to Foundation and redeem that token to have the T-shirt or mystery box delivered to their home. When collectors redeem their tokens, this is also when the creator unlocks payment from anyone who bought their token using crypto. So in a sense, redemptions complete the Foundation lifecycle.
Essentially, opening up redemptions just means I’ve made the shirts, and now anyone who immediately wants to own the physical item can get it as soon as they redeem a token. For users who aren’t quite ready to dive into crypto, we allow people to skip right through the market phase and just pay with a credit card. With this route, a buyer is opting in to purchase the item at whatever price it is currently trading at in the market.
What can Neue Goods collectors who redeem their tokens expect to receive?
Most of my work is done in the digital space, so when I actually do get a chance to make something physical, I consider every aspect with a lot of care, from the way the shirts are produced to how they’re shipped. In staying true to Neue Goods’ values, every design is printed by Aisle6ix Industries
—an arts-focused speciality printer here in Sydney—on high-quality, heavyweight cotton T-shirts that are made in the USA. Before each package goes out, I write the buyer a little thank-you letter, so they know how much I appreciate their support. The items are then sent around the world in an entirely carbon-neutral way, in mailers that are compostable and biodegradable. As a designer, I feel good knowing that I'm getting the T-shirts into the hands of people who are excited to wear them, and I’ve done the best job that I’m capable of, every step of the way. That’s what it’s all about.