An Introduction to MetaFactory – Meta Factory

An Introduction to MetaFactory – Meta Factory

MetaFactory is a crowdfunding platform for the creation of community-owned brands with an initial focus on fashion/apparel. It curates and manages the brand ownership (IP) and product auction marketplace, as well as handling product production and fulfillment on behalf of its brand partners.

MetaFactory aims to solve incentivize misalignment between fashion designers, labels and their customers. Apparel pricing is often set by perceived value, driven primarily by emotion, hype and information asymmetry around material/production costs and product quality. This has contributed to weak retail sales, struggling brands and dissatisfied customers. By representing products as tokens and selling them along a bonding curve, we enable organic price discovery based on free market dynamics.

Additionally, consumers are starved for meaningful, authentic relationships with brands — particularly those that reflect their lifestyle and culture. Brands that have focused on building robust, inclusive communities or ‘belonging’ have seen significantly greater brand loyalty and growth in recent years. In fact, ‘more than half (58%) of consumers aged 25 to 34 say they’d be likely to spend more money on a brand’s products and services if they are part of meaningful brand communities.’ Through direct incentive alignment, enabling individuals to participate financially in brand success, as well as help to govern future brand product direction, MetaFactory believes it can cultivate more successful brands through higher-engaged communities.

MetaFactory hosts bonding curve auctions where brand creators auction off fractional ownership of brand IP / governance, as well as dedicated product auctions for the apparel produced by each brand. MetaFactory acts as a curator, only selecting brands that we believe have the creative skill and operational leadership to succeed. In addition to facilitating brand and product auctions, MetaFactory also manages the relationship with product fulfillment / logistics / shipping partners, allowing artists to focus on creating great designs and developing their label.

We work closely with the label designers and/or creators to define the auction parameters including starting price, ending price, number of participants, as well as initial genesis product line. Designers designate how much of the original brand IP to retain and how much they are willing to sell to auction patrons. With all the parameters defined, the brand and its assets are put up for auction including a claim to the genesis product(s) of that brand. The auction is conducted via a reverse bonding curve with earlier buyers receiving a higher share of both the label IP and claim to future governance, but at a greater premium.

This is achieved through the creation of a DAO (decentralized autonomous organization). MetaFactory will deploy a dedicated DAO that will act as a governance body for the label. The DAO will own the IP and auction participants are actually purchasing a portion of the voting shares in the DAO. In this way, the patrons also get to vote on the future direction of the label including new product releases, additional designs and potential licensing opportunities. Buyers who participate earlier in the auction receive a greater percentage of the DAO shares and respective vote weight, along with a claim to their share of the brand IP. Each auction participant will also receive the genesis product(s) to be listed in the store for sale. MetaFactory takes a small share of each brand’s DAO shares for managing the auction platform, vendor relationships and product fulfillment.

All brand products/apparel items are also sold at auction and represented by their own unique, digital $TOKEN. Each product $TOKEN is listed on the MetaFactory marketplace and sold on a bonding curve. $TOKENS may be freely purchased and sold with each exchange increasing or decreasing the price accordingly along that product’s bonding curve. Ownership of a $TOKEN entitles the owner to one (1) of that specific product including shipping.

When a $TOKEN is redeemed, the product is produced and shipped to the buyer along with a representative NFT (with special benefits). Product $TOKENs can be burned by the brand DAO (reducing supply and increasing the value of each remaining $TOKEN) or sold back to the market with any profit deposited to the respective label’s DAO bank. Label DAOs can choose to how many product auctions to host and the specific parameters for each. In order to capitalize on the profits of a label, DAO members must sell their shares (also known as ragequit), effectively exiting the DAO. This reduces the brand’s DAO bank balance, but also subsequently increases all remaining DAO members proportionate claim to both IP/profits and governance.

Published at Tue, 31 Dec 2019 17:09:56 +0000

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