Founder of USV: Art, Business, and NFT

Author: Andy Weissman

Original Title: 《On art and business and context and mirrors》

Translation: Nevermind, H.Forest Ventures

Preface:

The author Andy Weissman is the founder of USV, a venture capital firm where the author of the Fat Protocol was once located, which early invested in well-known institutions like Twitter, Coinbase, and Meetup. The philosophical ideas in the text are numerous and profound. Through reflections on art and business, it further explores the value and significance brought by NFTs. It is hoped that this can provide readers with a new perspective on viewing and learning about NFTs and Memes.

Jean-Michel Basquiat - Untitled, 1981, Estimated Price $300,000-400,000

1. In the past, value could be determined by scarcity

The fewer things there are, the harder they are to obtain, and the more valuable they become when you get them. The value of an item is even more related to its allocated scarcity than to other measures of value. We can define value through the following equation:

Value (V) = Scarcity (S) * Quality (Q)

Of course, Q is largely subjective and immeasurable; but S is not, and S acts as a multiplier of value.

However, one of the superpowers of internet technology, "the network," has eliminated scarcity as much as possible. Connected networks have made once-scarce things abundant, expanding access. Eliminating scarcity is a way to create new value.

Translator's Note:

Scarcity acts as a value multiplier, which explains why the NFT market so easily sees sky-high transactions. Of course, it does not mean that every form of scarcity will have value; if the market defines its quality as zero, pure scarcity will also have no value, and after excessive speculation, most will return to zero. But this does not affect scarcity's role as a value multiplier, which can significantly amplify the market value of some things that originally possess "quality."

2. What is art?

People can imagine art as anything—images, music, videos, GIFs, text, Memes, anything at all.

Art is also a mirror that reflects the world back to us, allowing us to see it more clearly. In this way, art is not only important but indispensable. The Velvet Underground's first album listed artist Andy Warhol as the producer. The album includes the song "I'll Be Your Mirror":

"I’ll be your mirror, reflect what you are, in case you don’t know."

This suggests a potential primary principle: the more people can easily access more art, the better it can only be.

Translator's Note:

The author refers to all products created by people as art, including Memes, and states that the essence of art is a mirror reflecting our true selves. The Meme phenomenon is something many people cannot understand, but perhaps we can set aside our inherent and limited perceptions and view all of this as a true reflection of the world, acknowledging its existence rather than denying it or rushing to define it.

3. Perhaps digital art and non-fungible tokens (NFTs) are relevant here

A digital file, when interacted with the internet, can be seen by each of us. NFTs further promote this concept through diverse mechanisms such as ownership distribution and community operation. NFTs spread the concept of scarcity more widely into a richer world.

Since there are no limits to the creation of NFT assets, the combination of NFTs and the internet has made the ecology of scarce things richer and more prosperous.

Translator's Note:

NFTs serve as a specific tool for creating scarcity, while the original internet is an existence that eliminates scarcity (mainly referring to digital assets). The combination of the two allows for the easy creation of scarce items while also enabling widespread dissemination and circulation, making it easier for more people to access them. This will significantly enrich the market for scarce items in the online world in the future.

4. NFTs and crypto-economics (tokens) allow everything to be managed by the market

This is neither good nor bad, but it is very different and worth deeper contemplation.

Warhol envisioned and predicted this over 50 years ago. He clearly stated that art means business, and business means art. In a reversal (or provocation) of the concept of artistic creation, he referred to his studio as "The Factory." He also said:

"When the check clears, you know that’s art."
"Doing business is the most fascinating art."
"Making money is art, working is art, good business is the best art."

Another artist (Jay-Z) reflected this concept in his 2005 lyrics:

"I’m not a businessman; I’m a business, man."

It is not new for artists to take control of their own economy. Perhaps what is new is: once again, on a large scale and diversity, more people can try this concept of artistic institutions.

Translator's Note:

I appreciate the author's perspective on art and innovation. The author believes that the innovation brought by NFTs to artists is not the commercialization of art, but rather making it easier for art to become commercialized and more widely disseminated. The further large-scale and diversified artistic economic landscape may be the true innovation of this revolution.

5. I love Warhol's Campbell's Soup Cans; I could look at them all day

Not because of the brushstrokes (all are silk-screened), but because of the world they reflect. Warhol's soup cans look exactly like real cans; they attempt to tell us about business and ourselves. Warhol himself condemned nearly all concepts of creativity and agency in his work through technology:

"I find it easier to use a screen. This way, I don’t have to deal with my objects at all; anyone can replicate the same design as much as possible."

Here is an artwork and a related NFT work, "A PNG file containing 0 bytes of information—the smallest NFT in the world," created by artist shl0ms:

This reminds me of John Cage's piece 4′33″—a score that "instructs the performer not to play their instrument throughout the piece."

Mamet once wrote, "A fine meal fades in reflection; everything else is gained." I think he meant that what matters is not the things themselves, but the process surrounding them, how you experience them. NFTs enhance this by providing a way to simultaneously understand the text and context (as well as the monetary context).

6. Reflection

Five years ago, I wrote an article about a certain company that asked us some questions: "How do you showcase the things behind digital items, understand them, and pay for them?" This still feels fresh today:

We might be able to find out the identity of the photographer, send her a small payment, see which social network it originated from, find more of her pictures, and anything else.

At that time, there were really no tokens or NFTs. So now, when you own a digital product driven by NFTs, more new questions arise: Should I own it, display it, transfer it, trade it, or sell it?

These questions may force us to look in the mirror again.

Translator's Note:

Art is a mirror reflecting this real world. At the same time, art is closely connected to business. NFTs not only bring better tools for creating scarcity but also introduce more connections to these contents, enhancing the narrative and the things themselves. This article has given me a deeper understanding of art, NFTs, and Memes, and I hope it does the same for you.