Babe, Are You Okay? You Haven't Even Liked My Dazed Zombie NFT Yet...

This is The Startup Breakdown, the newsletter where we breakDOWN startUPs (just had to make sure you appreciated the word play). By joining this growing community of dozens of interested people, you're getting firsthand access to my observations and opinions on the current state of startups and venture. If you'd like to receive these newsletters directly in your email once a week, go ahead and subscribe to never miss an email!

Happy Monday, folks.

Whatever type of cereal you've been eating recently, keep eating it. Markets have been greener than Dublin in March, and everything from big tech to travel stocks have been feeling the good vibes. For your sake, I hope it's Cinnamon Toast Crunch.

In more good news, inflation continues to drop it like it's hot. Last week, the latest CPI reading in at 6.5% YoY, down .1% MoM. This might not seem significant given it's still far above the 2% longterm growth rate which the Fed targets, but it's still the smallest annual increase since October 2021... Masks were still required on planes, Bitcoin was still at $61K, and Georgia hadn't won a national championship in 30 years.

The falling index was mostly driven by lower energy prices, but food also became a whole lot cheaper. At this rate, you'll be able to have a vegetable (once per week) to supplement the all-instant ramen diet.

Not all foods are created equal, though, and possibly the craziest food to follow has been eggs which peaked at nearly $6/dozen over the last couple of weeks, a ~55% increase. However, unlike the rest of the selections at [your local supermarket here], the price increase wasn't primarily driven by the government's Oprah-generous stimmie program.

Instead, chicken farmers and domesticated bird watching enthusiasts were impacted by a devastating rage of avian flu, a disease so contagious that it requires entire flocks to be killed off if even a single bird is infected. Hopefully, the outbreak is soon contained, thus ending Tony the Tiger's temporary monopoly on the breakfast tables of Americans everywhere.

Unfortunately, like that sixth drink that tips the fun tipsy feeling to "I'm gonna be sick", the positive sentiment didn't last as it was another grim week on the layoff front. Countless big companies announced further layoffs, adding tens of thousands of new members to the unemployment count. This week's headliner was Goldman Sachs who released 3200 employees.

Layoffs are tough. It's a sign of the state of the economy that even the largest, most profitable of companies are unable to retain staff, and things could only be getting worse over the next few months. However, despite the temporary hardships imposed, this might actually spell promising times for the future of the economy as a whole.

Various studies have found that recessions and times of economic turbulence tend to be some of the best for startups and innovation as some of the brightest minds are freed from spreadsheets and patching bugs to instead apply their much-needed skills to fresh new ventures.

If you've always had dreams to start something or have some huge new idea, pursue it. We need more of our brightest minds to innovate and build the companies which will shape the society of the future.

In fact, if you have some of these ideas, I'd love to hear about them. Just shoot me a reply and we can chat. I love hearing about these awesome ideas and have a few ideas of my own that I'm always interested in discussing and potentially exploring with interested folks :)

Unlike most things in life, less is absolutely never more when it comes to startup newsletters. As such, I'm going to do you the solid of recommending StarKeys, another weekly startup newsletter bringing you some of the most exciting coverage in the startup newsletter game. Check them out below:

Last week, I was spending my time in the most responsible way I know how in scrolling through OpenSea when I realized that my Twitter profile would be greatly improved if I were to change my name from "trey" to "trey.eth."

I opened ENS, the app to purchase rights to Ethereum domains (think .com, .org, etc), to check the domain's availability and found that it had already been taken. No worries, I thought, I'll just shoot the owner a message and check whether he'd be willing to sell.

But alas, all I could see was a 42-character hexadecimal Ethereum wallet address. Even when clicking on the address to check what else the wallet held, all that was visible was a page of NFTs. Luckily, I was able to find the guy on Twitter (plz respond to my dm i absolutely need this domain), but I'm fairly certain that my good fortune was the exception to the rule.

Even for NFT projects that I've random people I've talked to (because I'd never be so irresponsible) have been involved in before, there were times when despite being active on the community Discord, I they was unable to find who owned the specific NFT that I (okay it was me) was interested in.

This seems pretty bad for such a community-motivated space.

Luckily, it was not even a week later that Easy, the first "social wallet", announced it had raised $14.2 million to do something pretty darn close.

Easy allows users to connect their wallets from across chains to a single platform where they can then curate what tokens and community affiliations are publicly displayed on their social media-esque profiles. Much like other wallets like Coinbase Wallet or MetaMask, users can trade cryptocurrencies or NFTs directly from the app. It even offers a rating system for projects, introducing community vetting to the DD process like when you're searching for "galactic slime maker" on Amazon.

Adding social features to trading isn't a new idea, but allowing you to follow what projects and tokens your friends or favorite influencers are dabbling in introduces a sticky component which will allow Easy to keep users coming back for more than just crypto trading would.

This will also be particularly important for onboarding new users to the web3 space, something which the company is really trying to do with its socialized product. It's banking heavily on network effects and familiarization by tapping into the well-known patterns found across social media platforms.

Unfortunately, given the downturn in both crypto prices and interest (crazy that those are connected...) over the last few months and particularly recent events like the FTX ordeal, gaining traction will be a difficult task. Crypto investors are (rightfully) wary of trusting even the most respected of exchanges, much less new ones who are still at a higher risk of security flaws or rug pulls.

The company has yet to launch at full capacity, instead just launching its beta wallet to users last week. Prior to this, the company had conducted a 30-day private testing phase. The next few months of growth will be extremely telling for whether Easy will have an easy (lol) path to staying power.

The market for crypto wallets is rapidly growing. Already a $7 billion industry in 2021, it's expected to grow at a scorching 24.4% CAGR through 2030. Even if the company is only able to capture a small percentage of that, the opportunity for massive growth and millions of dollars in revenue is there. Rival ConsenSys, the company behind MetaMask, boasts a $7 billion valuation, and it only offers a fraction of what Easy is hoping to provide.

The wallet space is also a crowded one with some big, well-known brands at the top. It will be challenging for Easy to overtake industry market leaders like MetaMask and Coinbase Wallet, and the NFT marketplace has blown up with everyone from OpenSea and Magic Eden to now GameStop jumping into jpeg trading.

The company is betting on the stickiness of its social components, from following friends' trades to community-led due diligence, to stick out in this crowded field. It's also hoping that its UI/UX makes it stand out to new users who either haven't yet tried these more established names or were scared away by their relatively more complicated onramping process.

Given the app has yet to launch at full capacity, it's still far too early to tell whether it will accomplish this goal. However, the product is certainly unique enough that there's a chance.

CEO Mike Dougherty was a longtime successful investment banker before making the transition to corporate media. Then, he caught the founder bug as he started a radio advertising company which was acquired by iHeartMedia after raising $46 million. He founded Easy with longtime media founder and investor Gary Clayton before the two brought in Chief Product Officer Kevin Swint, a product guru with vast experience in executive management with everyone from Airbnb to Disney+.

The team is strong and has all of the experience, expertise, and drive to build Easy into the product that so much of the web3 community is clamoring for. Further, they've been granted legitimacy from a wide swath of investors in their seed round, including web3 VCs like Upside, Tapestry, and Scribble Ventures as well as social media experts like former execs at Instagram and Twitter.

It appears that the experts believe that they've nailed both sides of the crypto/social product. Follow for follow?

TLDR: Easy is looking to transform web3 from being disjointed and challenging to navigate to being a seamless, single platform experience through its social crypto wallet. Though competition (and general distrust) is fierce, the strong team and unique offering position the company to excel in a rapidly growing industry. These first few months will be instrumental in growing a large enough user base for network effects to take effect.

Again, if you wanna talk startup ideas, I'm just a button away. Alternatively, if you have industries or specific companies you think I should check out, let me know. Even if it's just tiny feedback on these puppies, I'm begging you to let me know what you people want so that I know I'm not furiously typing into the abyss.

Cheers to another day,

Trey

P.S. Interested in the business of college football? Make sure to check out Pigskin Economics, a once-per-week breakdown of the biggest topics going from the sideline to the executive suite.