Variant purchased a number of Nouns, and we’re excited to share why. 

Nouns is an experiment in “bootstrapping identity, community, governance, and a treasury that can be used by the community.” The Nouns themselves are generative NFTs, but the project more broadly represents a new form of brand and community building, where the goal of propagating the “meme” (the Nouns images) creates a market mechanism for funding community projects and public goods initiatives.

As new Nouns owners, we thought it only made sense to introduce ourselves in a Nounish way: via the questions in the Nouns’ “Introduce Yourself” forum. Below is a copy of our responses (the original can be found directly in the forum). Our answers elaborate on the thesis behind our investment.

What first brought you to Nouns?

It’s hard to pinpoint what first brought us to Nouns, because so many people on our team have interacted with the Nouns community in various ways. What grew our collective excitement, however, was simple: we think it’s one of the most actively engaged, creative communities in all of web3. 

In particular, NounsDAO pioneered the following designs for building strong, credibly neutral communities:

  1. The continuous auction mechanism. One Noun is minted each day in perpetuity, which means there’s an equal opportunity for entry into the community, protected over long periods of time. It also means there’s a continuous source of funding to sustain the project.
  2. A treasury governed by Noun holders, denominated in ETH. Whereas many projects today sell NFTs for the benefit of a central company, Nouns are sold for ETH that accrues to a treasury governed by Nouns holders. ETH is money, Nouns are governance. While many DAO treasuries are denominated in their native token, unbundling the job of money and governance streamlines NounsDAO’s ability to activate funding for community efforts: using ETH avoids the risk of price-related sell pressure while also ensuring that funding does not result in unnecessary dilution of governance power. 
  3. A CC0 model of open, permissionless tools & design parameters. Doing so creates another equitable access point for community entry by eliminating financial and legal barriers that may normally prevent a project’s users from becoming owners. The benefits are clear: Nouns continue to organically and authentically proliferate faster than its peers because community members feel empowered and supported in their contributions.  

Combined, these design choices form the basis of NounsDAO’s self-propagating meme machine: the proceeds from each auction fund the treasury, the treasury funds projects to propagate the meme, and perpetuating the meme increases demand, which in turn funds the treasury. It’s a robust, positive feedback loop. This works because the meme is meaningful: it acts as a continual schelling point for community-driven projects, for everything from public goods efforts to educational workshops to in-person events.

There are plenty of experiments and projects happening in the Nouns ecosystem, which ones are interesting to you?

Nouns’ unique structure, culture of funding public goods, and process governed by user-owners gracefully coordinates economic and social incentives in a way that few other communities have achieved. In particular, the experiments outlined below highlight ways in which Nouns is actively scaling its impact, exemplifying our thesis at Variant that user-owned networks can grow bigger faster, in more sustainable and equitable ways than centralized alternatives.

  1. Funding for public goods. A second order effect of the self-propagating meme machine is that Nouns can fund public goods, so long as they also serve to raise awareness about the project. Examples include a trash cleanup in Nairobi with people wearing Nouns shirts and the provision of care packages in Nouns-branded bags to children in hospitals. We’re excited to see these efforts continue to scale with Nouns.
  2. NounsDAO setting a standard for how communities form and evolve. Nouns Builder, for instance, allows anyone to easily deploy a Nounish DAO – i.e. a DAO that uses Nouns’ coordination and mechanism primitives – in minutes. We expect adoption of the NounsDAO design will continue to grow and become a default for decentralized communities.

If you could teach everyone on Earth one thing about crypto, what would it be?

  • “Crypto represents a potent combo of ideology and incentives, and has a rich and diverse array of ideologies represented therein. One lens to view crypto through is as an experiment in shifting from shareholder to stakeholder primacy” –Li

Quick! What’s something Nouns is missing?

  • “A theme song” –Alana
  • “Its Burning Man variant” –Jesse
  • “Its own ski resort” –Li

What kind of music are you listening to lately?

  • “TikTik bops” –Mason
  • “Lake Street Dive, 2000s pop” –Alli
  • “Migos” –Spencer
  • “Ritviz, Kali Uchis, and Piff Marti” –Medha
  • “Interpol, White Lies” –Derek

Barbarian, Bard, Druid, or Rogue?

  • “Bard” –Mason        
  • “Rogue” –Derek
  • “Barbarian/Druid” –Geoff
  • “Druid” –Spencer


Disclaimer: This post is for general information purposes only. It does not constitute investment advice or a recommendation or solicitation to buy or sell any investment and should not be used in the evaluation of the merits of making any investment decision. It should not be relied upon for accounting, legal or tax advice or investment recommendations. You should consult your own advisers as to legal, business, tax, and other related matters concerning any investment. Certain information contained in here has been obtained from third-party sources, including from portfolio companies of funds managed by Variant. While taken from sources believed to be reliable, Variant has not independently verified such information. Variant makes no representations about the enduring accuracy of the information or its appropriateness for a given situation. This post reflects the current opinions of the authors and is not made on behalf of Variant or its Clients and does not necessarily reflect the opinions of Variant, its General Partners, its affiliates, advisors or individuals associated with Variant. The opinions reflected herein are subject to change without being updated.