Multicoin Capital: Why are we leading the investment in Render Network?
To truly expand the metaverse to billions of people, we still lack some key technological infrastructure.Source: Multicoin Capital Blog
Compiled by: Hu Tao, Chain Catcher
Over the past year, Fortnite has pushed the boundaries of large-scale synchronized online virtual worlds through concerts. In hindsight, these concerts will be seen as the first mainstream pioneers of a fully realized metaverse (paying homage to The Sims and Second Life, which attempted this before the world was ready).
However, the Fortnite concerts had many issues. Some of the most notable drawbacks include:
- The experience is completely controlled by a single entity, Epic Games, the creator of Fortnite.
- The limit on the number of people who can interact in a single space is around 150, meaning the vast majority of the audience participated in different versions of a shared experience.
- The IP of the event itself and any derivative outputs also belong to Epic.
I say this not to blame Epic. In fact, I applaud Epic for pioneering these efforts. Epic CEO Tim Sweeney has spoken about the necessity of building the metaverse, repeatedly emphasizing that it should not be controlled by corporations but should be a trusted neutral space.
Centralizing the mediation of these virtual worlds fundamentally contradicts the spirit of an open metaverse. Walled gardens create platform lock-in, intermediary costs, and, most importantly, make it harder for assets and experiences to be interoperable and composable with cryptographic primitives. Each of these limitations restricts the creation, participation, and monetization of new, ambitious media that we expect in the metaverse.
To truly expand the metaverse to billions of people, we still lack some critical technological infrastructure. At a minimum, we need:
- Scalable blockchains optimized for DeFi and maintaining composability (like Solana).
- Scalable public data storage for data-centric (rather than finance-centric) applications (e.g., Ceramic with Textile Threads).
- The ability to perform large trust-minimized computations on public datasets and user data streams (e.g., Fluence).
- Massive off-chain computation to render trillions of digital objects with high fidelity (e.g., Render Network).
- Permanent file storage for storing digital representations of assets (e.g., Arweave).
- Real-time indexing + query systems for on-demand data and file retrieval.
- Robust AR and VR modes.
Blockchain and other web3 systems are the foundation of the metaverse. We have been thinking about these issues for a long time and have written about the Web3 stack on many occasions. The stack is maturing and becoming increasingly capable of supporting metaverse experiences.
Today, I am excited to announce that Multicoin Capital has led a $30 million financing round for Render Network to address the fourth issue listed above. Our friends at Alameda Ventures, Sfermion, and The Solana Foundation also participated in this round, along with angel investors Vinny Lingham and Bill Lee.
Rendering Trillions of Objects
Creating 3D or holographic digital media is computationally intensive. Most digital art created today, including the majority of 3D NFTs, requires hours of dedicated GPU time. Rendering requires these resources to programmatically simulate light passing through surfaces, textures, and materials to generate realistic images in the original scene files. The computational demands of rendering are significant and grow exponentially with increasing resolution and frame rate standards to create high-fidelity virtual worlds.
For over a decade, OTOY has been at the forefront of rendering software. Their flagship application, Octane, was the first GPU-accelerated, unbiased, physically correct renderer and is widely regarded as the best in its class. All major film studios, including Disney, use Octane for VFX, along with thousands of digital artists, including Beeple, Pak, and FVKRNDR. The title sequence of Westworld, the music video for Lil Nas X's Montero, and the collection at the Frieze Viewing Room in Los Angeles were all rendered using Octane. Apple features Octane prominently on the fold of its Metal homepage.
Over a decade ago, OTOY's founder and CEO, Jules Urbach, envisioned the metaverse when he founded OTOY in 2008. Over the past 13 years, OTOY has built content creation tools and rendering engines capable of creating trillions of objects that will constitute virtual reality.
To build the metaverse, content creation tools and rendering engines alone are not enough. The metaverse will require astronomical amounts of computational power: several orders of magnitude more than all the data centers in the world combined.
The only way to obtain such computational power is to leverage the hundreds of millions of potential GPUs owned by consumers worldwide. Render Network was launched in 2017 with the aim of tapping into this potential supply. Render Network allows for the distribution and processing of GPU-based complex rendering jobs on a large distributed peer-to-peer network. This enables creators to compute at unprecedented scale and price, providing stronger privacy guarantees than any existing cloud provider.
In recent years, we have been investing in infinitely scalable Web3 primitives, most notably Arweave and LivePeer. Each of these primitives focuses on a very specific functional task. Arweave provides permanent storage. LivePeer decentralizes the video transcoding process.
Render Network is optimized to run bounded (non-open), highly parallelized tasks that do not require synchronized network connections. The most common workloads that meet these criteria are digital rendering and training models for machine learning.
Today, Render Network supports major digital content creation tools, including Cinema4D, 3DS Max, Unreal Engine, and Unity. In the near future, it will also support rendering engines like Arnold and Redshift, in addition to Octane. The ultimate goal of the network is to support any workload that complies with the network ORBX scene data standard and seamlessly connect with any number of signaling and marketplace platforms to facilitate the creation and maintenance of rich, immersive digital content.
Every increase in data and bandwidth product improvements, license expansions, and order matching enhancements expands the potential market for Render Network. In Apple's keynote in October 2021, Render Network produced physically accurate renders of Gene Roddenberry's Star Trek archives, Beeple's Everydays, and Star Trek scenes (29:19-29:38) much faster and more cost-effectively than using existing cloud providers. Render Network is live and is supporting some of the largest and most high-profile rendering jobs in the world.
Render Network also stores hashes of all assets needed to build source renders for jobs to be completed. This raw data, combined with permanent storage infrastructures like Arweave, has the potential to fundamentally change our collective understanding of the origins and ownership of digital objects.
Billion-Dollar Arbitrage Opportunities
It is well known that renting GPUs from any major cloud provider (AWS, GCP, Azure, etc.) is expensive and often impractical for large-scale rentals.
Capitalism demands that cloud providers respond to market demand. However, they have not. What is going on?
The cloud providers are not at fault. Rather, the issue lies with the hardware: NVIDIA does not allow their flagship consumer graphics cards (like the 2080 or 3080) to be deployed with cloud providers. Instead, they sell workstation cards under the Tesla or Quadro brands, which can cost up to 10 times more but only offer 20%-25% more computational power.
As a result, Render Network has capitalized on a billion-dollar arbitrage opportunity. By unlocking hundreds of millions of potential consumer-grade GPUs, Render Network can significantly reduce GPU-based computing costs, increase the total number of renders, and decrease the time required to complete rendering jobs.
Looking Ahead
Render Network was launched in 2017, but few cryptocurrency investors have heard of it. I only learned about it a few months ago. For the past few years, Render Network has been in closed beta testing. The Octane and Render Network communities have been optimizing the system for years to ensure the best experience for creators.
At the Breakpoint conference in early November, the Render team announced that they are migrating the RNDR token and key components of the Render Network to the Solana blockchain. This migration will occur throughout 2022, bringing a wealth of amazing opportunities as third-party developers build higher-level applications using Render Network.
