Zach
@zherring
If the founder can't make money with the app they're building, they are probably building the wrong thing.
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Zach
@zherring
Written by a founder who built an NFT lending tool that never made much money lending to NFTs. Many such cases.
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Zach
@zherring
Transporting myself back to that time, it's really interesting to think about why I didn't use existing lending platforms as much as I could have. In sum it was entirely because I was cost sensitive. I never really "made it," so I never had much money, so the size of the loans that I could execute on existing platforms like NFTfi et al were small, and because transaction costs were so high (this was during the dark ages of ethereum L1 and nothing else) even a loan for a hundred bucks. Had a 15% - 20% transaction "tax" on it (to mention these were the wrong kind of loans to understand the use case I was building for).
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Zach
@zherring
Two paths to a better product I should've taken? 1) Once we got funded, take $10k-50k out to get _very_ good at motion of profitability. This was the path Metastreet took and it worked out pretty well for their NFT lending era (they were dominant on NFTFi before they launched their own protocol).
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Zach
@zherring
2) Find who made the most money and custom-build a solution for them and them alone. This solves for the cold start problem as well as distribution. And even if you do #1, you should probably do #2 as well. Blur went this route with NFT _trading_ (I have no idea of Pacman ever traded NFTs successfully) to a lot of success, and then expanded into lending since they had distribution. We ... actually we thought we were doing this, but there were a few trip-ups we didn't realize until 8 months down the path. It boiled down to where the co-design process sat: the lender informed the _app_ ... but the protocol was already mid-audits. By the time we finished, we found a few micro-decisions at the protocol level that tripped up our GTM with the power-lenders we partnered with.
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