Decentralized autonomous organizations leverage blockchain technology to take venture capital into the metaverse.
DAO stands for Decentralized Autonomous Organizations, which are investor-directed venture capital funds that use cryptocurrency and blockchain technology to make major investments, frequently faster than a regular VC round procedure.
In 2021 alone, decentralized finance startups have raised more than $10 billion through a DAO-style structure. Major mainstream VC firms like Andreesen Horowitz, Dragonfly Capital, and Kleiner Perkins have joined DAOs to fund enterprises in the blockchain and cryptocurrency industries.
DAO initiatives are beginning to make a real-world impact, with PleasrDAO buying the only copy of Wu-Tang Clan’s 1-of-1 Once Upon a Time in Shaolin album for $4 million last month. It spent $4 million on the original “Doge” meme NFT in June. Another organization, called ConstitutionDAO, plans to purchase the last privately owned first edition of the US Constitution for $5 million.
The Krause House, a decentralized autonomous organization dedicated to purchasing, owning, and operating an NBA franchise, is now attempting to do so.
The group boasts nearly 1,200 members and has more than 2,000 followers on a group Twitter account. It boasts over 1,200 members attempting to join the ultra-exclusive club of 30 NBA owners, according to its founder, “Flex Chapman” — a nice reference to former NBA player and viral Twitter star Rex Chapman.
Soccer clubs such as Manchester United, Juventus, and Borussia Dortmund are among the many sports teams that are publicly traded. The Green Bay Packers have been a publicly owned non-profit company for nearly a century in the US, with more than 300,000 stockholders and more expected to join in an upcoming stock offering seeking to raise another $90 million.
However, no comparable organization has attempted to acquire a major sports team in the manner that the DAO-themed Krause House has.
There are a lot of NBA teams out there and they are all worth a lot of money. For someone to buy an NBA team, they need a lot of money. They also need the governors of enough teams to say it’s okay for the new company to join.
Make no mistake, though: Whether or not Krause House’s initiative succeeds, the era of DAOs and blockchain-powered Web3 is upon us.
