Need Help: Should We Persevere, Pivot or Change Our Crypto Startup?
We are six lifelong friends who went to the same high school. Then, we all went our separate ways for college, but the pandemic brought all of us together again. We started gaming every night, and that’s when the crypto market started booming.
Each of us had around $3k from the money we’d saved from work, and we started investing in crypto. But not Bitcoin, Ethereum, or things of the like. Instead, we went deep into the rabbit hole and settled on buying play-to-earn NFTs, heavily focused on the game Axie Infinity. We started playing and earning, and were among some of the best from ~3M players.
From the start, it felt like all the stars aligned for us. Finally, we settled on the big thing that would help all of us quit our jobs, be our own bosses, and slowly but surely make a business that would set us financially free. Coming from a relatively poor country, this felt like our ticket to break free from the chains of the modern world.
What’s play-to-earn?
Play-to-earn is a new business model where real money can be earned by playing video games centered on blockchain technology. By actively participating in these virtual economies, players can earn rewards such as in-game assets and tokens, which can then be traded or sold on an open market if the player chooses to do so.
Gaming is eventually going to switch to a tokenized approach. With talks about GTA VI having a play-to-earn aspect, and the gaming industry raking in 100+ billion dollars every year, the potential is here, but it hasn’t hit the mainstream yet.
Axie Infinity is a turn-based card game where Pokemon-like creatures fight each other. With every win in Ranked Mode, you get SLP – a crypto token. We invested $10000 and got our money back in a few months. Instead of taking profits, we reinvested everything. We created a crypto gaming guild and invited our friends to play in exchange for 50% of the profits. Then, we moved on to lending Axies to players from the Philippines. And then we wanted to scale even more.
TechStars and Helping Break A Guinness World Record
At an all-time high, we had around $40k in tokens and close to 100 people playing for us. One of the co-founders got a free ticket to a TechStars event, and four of us got in a car and drove over to Ohrid to see how we could turn our side hustle into a full-blown business.
It was our first attempt at pitching, and we received a special reward from Howitzer (another startup that started here on IndieHackers, now they’ve pivoted to be Heyreach). They gave us $5000 in AWS credits and the motivation we needed to keep going.
Over time, we refined our pitch and participated in an event called The Longest Pitch Marathon. The goal of the event was to break the Guinness World Record for the Longest Business Pitch.
We spent two weeks creating the perfect pitch. The event lasted for two days, and it was the highlight of our year. We didn’t sleep, and kept practicing the presentation, every slide, and every potential question from the jury.
After 30 hours and 2 minutes of hearing pitches non-stop, the jury came out. They broke the Guinness World Record, and it was time to announce the winners.
We won first place and received a $25000 investment from the sponsors of the event. It felt like magic and that all of our dreams will come true.
Now, let’s get into the startup and what we’ve been doing for the past year.
The Startup
CryptEarn is a platform for connecting play-to-earn gamers and investors. You can buy, rent, and deploy digital assets to gamers, receive a share of their in-game earnings, and monitor their performance.
We handle the management, and you get a share of the profits. It's like owning a piece of a sports team, but in the esports world.
The problem we noticed, like other gaming guilds, was that gamers in third-world countries suffer from massive inflation. They can earn money by playing blockchain games, but they don’t have the money to buy the required digital assets. They have the time and the skills but no way to enter the market.
Crypto investors have the money to buy digital assets, rent them to gamers all over the globe, and share the profits, but they have to do it manually.
Our platform connects gamers and crypto investors and automates the entire process.
You buy a package, we buy gaming NFTs for you (from games like Axie Infinity, Battle For Giostone, Star Atlas, Illuvium, and others), lend them to a gamer in our guild, and you receive 20% of their earnings.
We’ve got two versions of our landing page.
This is the first one – www.app.cryptearn.co
This is the second one – www.cryptearn.co
Which version resonates more with you and why?
Please tell me any suggestions or missing things so we can change them ASAP.
The Marketing
Regarding marketing, the crypto market crashed when we got our investment, and everything tanked. Finding clients is hard, and we experienced a few roadblocks.
Because of the state of the market, we thought that focusing on SEO and writing blogs and articles would be the best way forward because there were loads of scams, and people were losing trust in new projects. By sharing our knowledge, we will get inbound leads and close them. That was a mistake because it takes a lot of time, and we need immediate returns.
Next comes social media. Trying to gain traction for a crypto social media account in a bear market is like dragging yourself through broken glass. Yet, we found a lot of people who are active, and we got our Twitter (X, sorry) to 2900 followers. Through our social media efforts, we secured a spot in Ready Player DAO Community’s Creator Bounty program. We created videos about new gaming projects, and received $700 in rewards for doing so. People started interacting with our posts, and we believe the quality of our content is great.
But it doesn’t lead to sales.
Then we tried an outbound approach through Facebook ads. We created a video explaining what the platform does, and our ad got rejected for setting unrealistic expectations, and now we’ve got a restriction on the company account.
Our next idea is to get leads through another ad in the form of a quiz. The quiz will be about ‘What type of an investor are you?’ and people will go to our website and answer a few bullet-point questions. To get the results, they’ll have to give us their email. Then, we’ll do an email sequence leading them to a webinar, aiming to teach them how to make money from games without playing them. And then, I’ll do the webinar based on Russel Brunson’s Dotcom Secrets guide.
We also have an ebook ready about teaching people how to play Axie Infinity and all of the basics, but we haven’t marketed it at all.
The Pivot
We’re running out of time to get clients because we have runway until December. We either need to get clients or secure another investment.
We made some classic mistakes.
We reinvested everything and didn’t take profits.
We built the product, and the market shifted.
We focused too much on the gamers, not securing clients.
What should we do next?
We value the Indie Hackers community and genuinely seek your insights. Your feedback could be the turning point for our startup.
Also, if you need any more information from our side, or if I wasn’t clear in some sections, I’ll answer in the comments.
I'm a lurker here at Indie Hackers and your post made me create an account to comment, so kudos on that.
Now, a lot of people are telling you to pivot, change, it's the markets, blah blah.
The same thing in crypto has been happening ever since Bitcoin was created. No one believes in it for 3 years, and then they all believe in it when it pumps. It happened in 2017 when it jumped to 20k, and it happened when it pumped to 70k.
You need to find out a way to stay afloat until the next bull run, and your efforts will pay off.
Eventually, blockchain will power the world, and the biggest use case for NFTs is in gaming. You mentioned GTA VI, and there will be many more like it.
You might be five years early with your idea, but the time will come for it to make an explosion. You don't want to make the mistake of seeing someone else create it during the next bull market and curse yourself for not sticking true to your roots and regretting it every day when you wake up (happened to me).
People make money selling pretty much everything. Change your audience if it isn't working, raise money for marketing, and blow it all on testing, talking to people, and promoting yourself.
It's a good idea, a good project, and a good site. Do what you can, but give it your all before you pivot or change. At least you'll sleep better!
Wow @EricETC thanks for sharing!
I'd love to chat with you to find out more about what you did, and how you're looking at the crypto world in general.
We created the platform because we wanted to make diversification easy, which is why we charge a percentage of the gamer's earnings. That way, we're making it fair for the clients too.
And when you don't depend on a single game, it's better for everyone.
Thanks for the comment! Really appreciate it!
Starting a passion project and it leading to a business in your early-twenties is a great experience. You go through challenges and unique experiences with your comrades.
But when reality hits, like it has hit you, it's a good time to look at the big picture and not focus on tactical things. It's ok to put everything you've built aside, even say farewell to a few people, and focus on what you think is important in life. Slack started after their gaming project failed, and they focused on solving a real problem. This could be the same for you.
Now that you're older, have many more experiences, and have a much better world-view, it's a good time to think about you and your teammates, as individuals, want. If you love working with them and everyone is committed, then do that. If there are a few of you who don't pull their weight, cut them out. If there is even a shadow of doubt about your mission, have the courage to put everything aside and start from scratch.
There is no right or wrong answer to the question you're asking. In some ways, these dilemmas are what it means to live. The only method to find what you want to do next, is find dire need in the world, and solve it. If you have no ideas, maybe it's a good time to take a sabbatical. Go back to your hometown, solo-travel, travel together as a team... whatever you enjoy.
Now as for my opinion – building a tool that incentivizes people to spend more of their time gaming, is not what I would call solving a dire need. It would be much more inspiring if you could help others spend their time building something like the six of you did. But that's just my two-cents.
Thanks for the comment @esfahani. Just like you mentioned, this past year has been the most fun we've ever had building something together. We figured out how to work together, everyone's strong and weak points, and if we could do it for a lifetime, it would be like a dream come true.
Thanks for confirming what we thought! We are going to make something together, but life is long and we'll figure it out eventually!
Hey Stefan,
The question for you is whether or not other people are successfully selling something similar?
In other words, do you have competition who are actually making money with the product you sell?
If the answer is no, then the issue is there. Even those entrepreneurs with the most money and experience fail 99% of the time when they try to build a new category - look at the Google graveyard of products for many, many examples.
Building a business is hard enough as it is, you're just making life much harder for yourself if you handicap yourself at the very beginning by trying to create demand.
Hey @TheBLUNTMethod we have two main competitors: LootRush and PlayDex.
LootRush raised 12M last year, and they just started with their marketing and gained about 1k users in a week or so. But they've got enough money to buy influencer promotions, which is their main strategy, and it works in this bear market. One of Axie Infinity's co-founders is part of the LootRush team too, which is a major bonus for them.
We have about 10k left, which is not even enough to scrape what they've spent on a single influencer.
PlayDex on the other hand has been around for a while, but they've got a similar product offering. They aren't too successful, but they're not bad either.
I believe that if we don't push through, we can be late to the party.
What are your suggestions for us to do?
Hey,
The question is are they really making money?
LootRush raised and have users - but are those users generating revenue for the company?
Same for PlayDex? What's their revenue look like?
If nobody is really making money, you're trying to create demand. Which is super hard.
That's a good point @TheBLUNTMethod. We'll check that over the coming days and see how their revenue looks like! Thanks for the info!
That is not going to work during the bear market. Speaking from experience.
Hey @Starinin curious to know, what's your experience, did you build something similar?
I have been in crypto since 2011. In 2022, I spent almost 8 months developing a P2E game, talking to different actors in the space. I think you should pivot heavily, talk to customers, start getting first money aggressively
Thanks for the info @Starinin, we actually got our first client through this post, and I started posting on Reddit too!
It was completely unexpected because we only wanted feedback, but now we'll see.
Dm me on Telegram @Starinin
I will introduce you to some P2E infra projects
Added you on TG
I think the whole web3 scene last year was a bubble, the current stage is the actual reality, if you cannot survive in this market, then probably time to drop it and move onto something else that has a better potential of making money
Hey @jzli, bubbles often rebound, especially crypto because it moves in 4-year cycles.
We had this same thought before we started, that this exact scenario would happen and that we would be stuck for a while until the market recovers.
But is it better to build something and wait for a new bubble, or leave it and come back to it if the bubble starts rising again?
I believe that something with true value should be able to survive the bear market. A lot great companies were built during economy downturn. Whether you can survive a bear market is actually a way to test if a business is legit or not. If it does, when bull market comes, it can go big.
Crypto market has a lot of speculations and bubbles, definitely more than other industries. Unfortunately I didn't see much intrinsic value in the whole web3 scene so I didn't build anything during the boom last year.
I think following bubble is dangerous, instead, one should probably follow true value and first principles
Thanks for the comments @jzli! We'll keep that in mind as we figure out what to do next!
The second link doesnt seem to be working for me.
Hey @alexkayaian, could you please try again, I don't know why it stopped working for you, but it takes a while to load.
Here's the link so you don't have to look for it: https://cryptearn.co/
If it happens again, please tell me the error so we can look into it some more?
Working now! Thanks.
Great to see some web3 builders here!
Regarding your product I think its quite difficult right now in this market.
Markets may recover, but its hard to predict where the web3-gaming industry will evolve.
Because of many uncertain factors, I would not recommend going this path now.
Hey @s7rukk, thanks for the feedback!
Are you also building during the bear? If so, would love to know how you're approaching the market and situation?
Also, do you have any recommendations of a pivot, or something you've seen from personal experience that could keep us afloat until the next bull comes along?
Hey Stefan!
First off love your well thought out post! Funny enough I would be directly within your target audience. As someone who plays games a lot and has decent knowledge of web 3 and crypto, I should find your offer irresistible.
I really commend you for how hard you and your 5 other friends have worked. But I am going to be really honest here, and I hope it can be helpful in directing y'alls company. Pay to Earn will never work. Not in the gaming market. Being a video game developer and marketer myself, the #1 reason for video game engagement and sales, is escapism. Pay to earn is in direct contrast and opposition to that end. #2 is community, and pay to earn doesn't directly complement it.
If I were you, I would make 1 of 2 pivots. Either go all in on Crypto and hyper target that audience. Or go all in on the video game space and hyper target those customers. The market for what your targeting is not large enough and has incredible turn.
Now upon focusing on a single audience you can restructure your business and your product so that it can be sustainable.
For example if you go all in on Video Games, I would say keep the project not to big just very very fun so yall can pump it out fast. All the while create Dev Logs so that you can build brand and when the game goes up for sale you already have an audience that is willing to buy. This worked very well for me personally when I made my first game in 2021 and is only getting better for people who do this now.
However if you go all in on the crypto space, focus on that target audience and build brand however and were ever you can.
I am just telling you your boat will not float with Play to Earn gaming. The concept is antithetical to the actual customer in the gaming market. And everyone who has already tried it may have done well, but only for a short time until the audience leaves.
Sorry this message is kind of brash. I really hope it was helpful for yall. If you need any help I'd be happy to lend a hand. I am a professional designer by trade but I have a decent background in gaming and game dev as a hole. Again I hope this was helpful. Best of luck to yall!
Hey @Owen_Wine wow, thanks for the comprehensive comment, I really appreciate it! And your take has a lot of weight too.
A lot of people in the comments agree with your take, and I've noticed the same thing on crypto Twitter for the past few months. It's like people are locked in a bubble and marketing loads of games to the same audience.
But, I'm even more interested in your take about pivots. How would you approach them because you mentioned two examples? How could we make a change that keeps true to what we started, keeps the investors happy, and brings us profits?
Also, fun fact, thanks to this post, we got our first client yesterday, so we're pretty happy about that, at least someone thought it's a cool idea.
Finally regarding your experience, I'd love to get on a meet and chat to pick your brain for a few minutes. Recently Lootrush started with their marketing (they are our competitors and raised 12M last year) so I'd love to know your thoughts on that too.
Hey @stefansavevski
Wow really glad your post was able to blow up my man! You got a ton of great comments! Also congrats on the new client man! And thank you for the kind words!
Ya you are totally right the market is a bit to saturated in the gaming space. And this just causes the audience to be super picky about what they engage in because the supply is so high right now!
Ya about pivots obviously with investors involved your going to need to please them before anyone else. But my marketing / designer brain is just yelling at me when I see yalls stuff to, "Profile Customers". I feel like if yall took a minute and came up with a customer profile or two and really honed in on the unique pain point that you could address I feel like you could really make it big. For example if you really wanted to get that juice broad audience of the gaming market I would heavily focus on marketing yourself, and branding yourself as "The New Cutting Edge place of gaming". If you allow a low barrier to entry for game producers and get some to start using your service then the audience will start to follow.
As Long as the games are good, players will come.
I really think you need to start branding yourself as almost a gaming brand. A very interesting market you could start to target is the indie dev space. Being one myself if you went about offering to help indie devs freely integrate with your system, then their audience of committed followers would come along for the ride. Indie devs that make content about their games make huge followings. You could really use them to your advantage and help them and their audience. But ya just a thought.
Ya if I can help I would totally be done for that. Ya I saw Lootrush's marketing push. I think they are starting to do a good job in marketing themselves as a "Gaming Brand". If you can pull this off it will really attract the average gamer to your service. But ya would love to chat if that would help!
God bless man, keep up the hard work!
Hey @Owen_Wine, that's actually a great idea! Since Lootrush is going in on the mainstream games, we can definitely work with Indie devs as a workaround and create some collabs and partnerships.
Would love to chat about your ideas, what you're building, and how we can work together! Let's chat these days and see what we can do!
@stefansavevski
Sorry for the late response! Hope your doing well! Ya I think that would be a very good idea to go after indie devs. Low production, low risk, but high returns if you market right!
Ya I would totally be willing to see if there was a way we could help each other out! Is there a good way I can contact you? Have a blessed day man!
Hey @Owen_Wine if you are on Telegram add me @savevski, or on twitter: SSavevski.
Looking forward to chat with you!
I'd pivot, as P2E sector is unlikely to take off any time soon.
Hey @tyomych thanks for the comment. I'm just checking the comments and a lot of people are saying the same thing. I'm curious to know your personal experience and thoughts about it, why do you think so?
Oh and great news, I think it was because of this post that we got our first client yesterday (we're ecstatic at the moment), so if you were in our shoes, how would you react and keep moving forward?
I'm just monitoring the sector and would say that P2E is rather dead than alive. Having the first customer is really great, if you believe you can steadily attract new ones with good CAC then I'd probably follow that line. It's all about scaling, I had to abandon a few businesses with customers just because of the vague perspective of growing it fast enough. What I normally do is set my deadline, e.g. if I can get X customers within Y days, then I continue, otherwise leave for something else.
Navigating the challenges with CryptEarn is no small feat. Regarding your landing pages, testing both could offer insights into which better communicates your message. In the current market, focusing on trust-building and leveraging your educational content may attract clients. Consider partnering with established industry players to widen your reach. Evaluate if a pivot or concentrated effort in a specific area could drive the necessary growth, given your timeline until December. And about your preference, the landing page at cryptearn.co is a solid choice with its engaging and user-friendly design.
Best of luck,
Thank you for the feedback @karanbhakuni! We're on the lookout for established partners at the moment, so if you've got any recommendations, I'd love to reach out to them and network!
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Essentially it comes down to your decision and understanding of your own market. Since we are not the market expert, we might not see things as you do. But you need to be honest with yourself and really make sure either the space have chance to survive or not.
My rule of thumb probably if you are young and can spare some more time, and you have some strategy to try out. Maybe you should try it out.
Because starting again on other industry probably will take sometimes and understanding also which will cause you to meet a dead end.
You have to trust yourself and prepare to face the consequences of the decision. That all.
If you really want to check on the nitty gritty of pivot preserve or quit, checkout this article : Pivot, Preserve or Quit. How to decide which one is for you
Hey @aquidor223 just read the article, and it hits all the pain points we've struggled with. The correct solution is one of the three, and we still don't know which one it is.
We love the crypto space, the people, the community, and that we can actually help people in need. If the business works out (and we got our first client thanks to this post) we'll change a lot of people's lives for the better (which is how I personally see business).
All it takes is one bull market to lift it all. But no one knows when it will start, and whether we should pivot, preserve, or quit. Thanks for the comment!