May 9, 2022 - Economy

Dirt raises $1.2 million seed round amid web3 push

Photo courtesy of Dirt

Dirt, the entertainment and culture newsletter that became one of the first newsletters to fund itself solely using only NFTs, has raised a $1.2 million seed round, its publisher Kyle Chayka and editor-in-chief Daisy Alioto tell Axios.

Why it matters: Most media companies that rely on web3 tech operationally also cover web3. Dirt aims to be one of the first digitally native media companies that rely on web3 tech but doesn't cover web3 topics exclusively.

  • "It's a pathway to having a media brand that operates more off of the streetwear fashion playbook," Alioto said.
  • She noted that for traditional media companies, developing a community typically means sending supporters mugs or tote bags. Web3 creates pathways for a super-fan of a traditional media company to be hyper-engaged.

Details: The $1.2 million in seed funding was led by Collab+Currency, alongside Offline Adventures, Flamingo DAO, Spice Capital, Unicorn DAO and Matt Hackett. Those investors are joined by earlier angel investments from Workweek, David Phelps and Jad Esber.

  • Chayka notes that having DAOs, or decentralized autonomous organizations, alongside other web3 groups as investors, is critically important as "they really understand the ethos of decentralization and see the long-term value in crypto."
  • With the money, the team plans to invest in more web3 projects, including selling more NFTs and expanding DirtDAO, its community of token holders that get exclusive access to Dirt content.

Flashback: The Dirt team has been working with Mirror, a crypto platform, to create NFTs that it has used to sell and fund its daily newsletter for the past year.

  • To date, the team has done more than $100,000 in NFTs sales.
  • Buyers of NFTs have been awarded "DIRT" tokens that give them special access to exclusive content.

The big picture: Dirt aims to carve out a path for traditional media companies that are looking to get into the web3 space.

  • "This helps us see what could work for media," Chayka said. "It could broaden the appeal of NFTs, web3 and crypto with what we already cover, which is digital content and entertainment broadly."
  • "It's important for us to be among the first to really define what this can look like and to do with a lot of integrity," Alioto said, noting her and Chayka's background in editorial.

Be smart: The crypto business model for media is very relevant as mid-sized publications get squeezed out, Chayka noted.

  • In the past few years, many media companies have consolidated, creating digital behemoths. As a response, many journalists have struck out on their own, creating smaller, independent publications via platforms like Substack.
  • While some traditional media companies, specifically Time Inc., have invested substantially in web3 technologies, others have just begun to dip their toes, selling a few limited NFTs, mostly as an experiment.

What's next: Dirt is panning its next big NFT drop later this year.

Go deeper: Journalist creates first newsletter funded via NFTs

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