Alibaba's Joe Tsai invested in a Web3 video platform

Source: Huxiu

Alibaba's Executive Vice Chairman Joe Tsai has recently shown considerable interest in Web3.

On December 8, 2022, the Web3 video platform Shibuya (Japanese surname: 渋谷), in which Tsai participated as an investor, raised $6.9 million in seed funding, marking Tsai's first publicly disclosed investment in a Web3 startup.

This is not Tsai's first intersection with Web3 and Crypto. On December 28, 2021, Tsai tweeted: I like crypto. To this day, Tsai's Twitter profile still features a pinned tweet about crypto: "What is the equivalent of a $0.1 cryptocurrency?"

Tsai joined Alibaba as early as 1999, when the internet industry was still in its infancy and bubble phase. He gave up a high-paying job on Wall Street to return to China and follow Jack Ma in entrepreneurship, demonstrating a keen sense and foresight for technology. So why is he interested in Crypto and Web3 now? What exactly is Shibuya, this Web3 video platform? How did it gain the favor of Tsai and other angel investors?

"The name 'Shibuya' originally refers to a famous neon-lit intersection in Tokyo," said founder Emily Yang.

Emily Yang has loved animated films since childhood. As her understanding of blockchain and cryptocurrency deepened, she hoped to create a Web3 film project or platform that allows filmmakers to rely on fans rather than the traditional Hollywood investment and distribution model.

"Contrary to popular belief, Shibuya is not a strictly NFT video platform (NFTs are a form of Web3 representation and a type of digital asset). It actually produces long video content through community co-creation, where NFT holders contribute content and vote to decide the direction of the story, while the official team takes the lead," Fisher, an entrepreneur in the Web3 content platform, told Huxiu.

Unlike traditional streaming platforms, Shibuya prioritizes decentralization and uses blockchain technology to securely publish monetized content, allowing users to participate in film production as if they were playing a game.

Fisher stated that the long video production process at Shibuya is divided into several stages, with each stage issuing an NFT called Producer Pass (which can be purchased on the NFT platform Opensea). Once users own the NFT, they can vote on the direction of the content, and the platform automatically distributes tokens to users based on their votes, which become the users' rights.

"Distributing rights to users through tokens, rather than NFTs, allows for a more detailed division of rights," Fisher added.

Shibuya's Web3 content creation model goes beyond this. Emily Yang mentioned that the next chapter of the film "White Rabbit" currently being launched by Shibuya will introduce new interactive mechanisms, adding that the company has been "thinking five steps ahead" about new ways to interact with NFT holders.

Recently, Shibuya also collaborated with the well-known NFT project Azuki, allowing NFT holders to vote on which Azuki character will make a cameo in "White Rabbit." It is reported that Azuki has many loyal users worldwide, including well-known singer Jay Chou and the founder of Chow Tai Fook, Cheng Yu-tung's grandson, Cheng Chi-kong. Introducing Azuki's character into the film will undoubtedly attract more participants.

"Jenkins The Valet is a particularly obvious case, attracting the attention of the entire Bored Ape community by incorporating the image of the Bored Ape (currently the most famous NFT avatar) into this content creation platform," Fisher said. In this regard, Shibuya is similar to Jenkins The Valet, where a New York Times bestselling author wrote a novel about Bored Apes, and 3,000 Web3 community members came together to drive and decide the creative direction of the work.

The film "White Rabbit" is co-directed by Emily Yang and another visual artist, Maciej Kuciara, and will be released in three to five segments, telling the story of a young female protagonist, Mirai, who ventures into a world full of mystery and danger. The film is an allegory set in the future, where the development of computers has threatened blockchain, and Mirai strives to protect it.

Although the film is free to watch, the producers have added an "economic system" that allows users to participate, fund, decide outcomes, and become owners of the long video content.

Users will determine the direction of the story by purchasing NFTs (Producer Pass) to vote/stake. If users vote for the popular side, they will receive $WRAB token rewards, and early voters will also receive additional $WRAB tokens.

After the film is completed, Shibuya will store the final film on the blockchain, and the community holding $WRAB tokens will become the actual controllers and owners of the film, with each member of the community holding tokens having corresponding rights.

Through this mechanism, viewers also become "owners" of a film and decide its direction.

This model has attracted the attention of well-known Silicon Valley venture capital firms A16Z and Variant Fund, as well as Alibaba co-founder Joe Tsai, NBA star Kevin Durant, entertainment star Paris Hilton, and Aave founder Stani Kulechov. With investments from institutional investors and angel investors, Emily Yang will continue to develop more interesting user interaction models based on Ethereum-driven Shibuya and attract more new content creators to participate.

She hopes Shibuya can become the "Web3 version of A24," an independent film studio with an internet mindset that often produces niche films that fit specific market segments, with representative works including: "Everything Everywhere All at Once," "Ex Machina," "Moonlight," and "The Farewell."

Shibuya is not the only company attempting to challenge traditional film and video production methods with Web3.

In recent years, due to issues with censorship, revenue distribution, and advertising models on centralized video platforms like YouTube, a number of decentralized Web3 video platforms have emerged.

Some Web3 video platforms, like Livepeer, focus on providing uncensored video content to users; others, like DTube, offer cryptocurrency rewards to active registered users and video uploaders while eliminating the advertising fee model; and some Web3 video platforms, like 3Speak, emphasize that the platform's assets and community ownership belong to users, and the more tokens held, the more voice they have in platform governance.

Of course, Web3 film and video platforms are still in a very early stage. "The co-creation model of Web3 has the advantage of community participation but the disadvantage of varying quality among community participants, making it difficult to achieve detailed participation rewards, which limits this model to small-scale experiments," Fisher said.