Monkey Business

The licensing landscape surrounding NFT images is highly fragmented. That is because, in the most popular NFT projects, owners of each unique image typically retain the right to commercialize that image and its derivative works (e.g., slightly manipulated versions for use in merchandise). Many of the licensors do not know how to go about licensing their images, and it can be difficult for licensees to find and connect with the various IP owners to put together a merchandise program. As a result, a number of different business models have emerged to help ease the process for both parties.

One example is Yuga Labs’ NFT project, Bored Ape Yacht Club, and its sibling projects, Mutant Ape Yacht Club and Bored Ape Kennel Club, around which many licensing programs have launched. BAYC has been one of the most popular NFT projects to date and was a pioneer in allowing owners to customize and commercialize their own images. The original BAYC project encompasses 10,000 NFTs that mix 170 different distinguishing features, including facial expressions, headgear, and background colors, in one-of-a-kind ways.

Some of the primary methods the owners are using to extend their properties into merchandise include:

• Collectives. These are groups of IP owners that monetize their images under a collective brand, typically represented by licensing agents; the brands are not affiliated with Yuga Labs and do not include any official BAYC branding. For example, NFIP Holdings’ Bored of Directors is represented by Brand Central as its master licensing agent, with several sub-agents on board. Licensees include Bioworld, Poetic Brands, Concept One, Just Funky, Trends International, Bravado, and many more. Separately, MetaGallery.Ltd’s Advisory Bored works with Blonde Sheep as its master licensing agent, with a growing list of sub-agents. And Army of Apes’ licensing activities are handled by U.K.-based Global Merchandising Services, with Maurizio Distefano Licensing assisting in Italy. Its licensees include Imagination Gaming for an Ape-Opoly “bored game,” Hype for unisex t-shirts and hoodies, and Mundart Studios for apparel and footwear.

• Marketplaces. These serve as virtual matchmakers for IP owners and licensees. Mousebelt’s Bored Jobs has posted all 10,000 BAYC NFT images on a searchable platform that allows potential licensees to find images they want to “hire” and NFT holders to claim ownership of their images. (It does the same for IP owners involved with other NFT projects.) Some of the licensees that have worked with Bored Jobs on BAYC product collections include PureArts and Erve. Meanwhile, Farmhouse, operator of WeedClub, a platform that enables marijuana professionals to connect and discover products and services, pairs the NFT community with established brands in the cannabis industry. It facilitated a deal to put Bored Ape #2186, Oro Blanco, owned by Ape-In Productions—a virtual community developing NFTs into metaverse music artists—on a strain of marijuana at Urbana retail locations. Another agreement was with Genius Pipe for a collection of four pipes, each featuring a different Bored Ape.

• Solo licensing deals. Some IP owners license their own images independently to one or more licensees, often opportunistically. Ashley Smith, a.k.a. Bored Becky, licensed a start-up company called GMGN Supply Co. to create a cereal called gm (an abbreviation for good morning used in the NFT world). GMGN got the idea from a joking suggestion from a member of a Bored Ape fan community, which resonated with that person’s fellow fans, and reached out to Bored Becky. In another example, VaporFI licensed its Bored Ape #3442 to a wine maker, Blind Horse, for a red blend.

• Product lines managed by the IP owners. A number of entrepreneurs and companies have purchased a Bored Ape NFT for the purpose of exploiting it commercially. A restaurateur named Andy Nguyen started Bored & Hungry, a pop-up quick-service restaurant whose packaging, cups, and the like all feature the image of a Bored Ape that Nguyen purchased for $387,000 for this purpose. Brad Klemmer, founder of branding and digital design studio Clay, introduced the Bored Breakfast Club, a coffee subscription service where the package of each blend, supplied by Yes Plz Coffee, features a Bored Ape or Mutant Ape purchased by the company. A percentage of sales goes toward funding the next NFT purchase and blend development. In another example, sportswear brand Li Ning purchased BAYC #4102 in April 2022 with the intent of using it on products, and it introduced the first collection, along with a pop-up shop and other activations in China, the following September.

There are many other examples of BAYC licensing efforts—and programs based on other leading NFT projects—that follow one of these templates or use another model to enter the world of merchandise. Yuga Labs itself offers merchandise drops in collaboration with its community of IP owners; its latest round of merchandise was unique in that it could only be purchased using APEcoin, the brand’s own cryptocurrency.

Even with the crowded market and the fact that the different licensing projects all look similar to one another—at least to the untrained eye—these properties are appealing to licensees. The projects, and many of the individual images and their owners, have a passionate and engaged community of followers. They are easy for marketers to reach and ready to purchase merchandise, and they are happy to give their opinions on the specific kinds of products they would buy. These are characteristics that increase the chances for success for a licensed merchandise launch.