Vault co-founders Nigel Eccles and Rob Jones previously put together a small project known as FanDuel, so he knows a thing or two about building disruptive technology. He left in late 2017 to build what became Vault, a mechanism to connect with fans and later monetize them. Vault is built around music and art, taking the old-world idea of a locked, key-protected vault and updating it in both online connectivity and crypto space.
The company was established in 2018 and has raised $9 million in part thanks to Nigel and Rob’s earlier success. They have a development team of 50 people based in the UK, working to create the tools that power Vault. They chose the Solana
Ultimately, everything Web 3 has to do with community, and Vault has an interesting game. The current model of selling art, music or NFT gives ownership but not exclusivity. The articles are available online for everyone to see or enjoy. Vault builds a paywall, in that the items contained in the vault, like the items contained in a vault, are only accessible to the holder(s) of the key. This is the leadership team’s intention and Vault’s differentiator.
Exclusivity is always a good marketing strategy. Vault’s proposition is that there is something contained in the vault you buy that is only accessible to keyholders. Each safe is unique and the concept is that your key gives you access to everything in it. Currently, the key unlocks a single safe that contains a specific piece of art or music. Therefore, the keys are fungible.
However, this is not an evergreen restocking content set. It is what was there is what is there. New content will go into a later vault which also requires acquiring this key. This is a new version if you want to have the new recording you have to buy it. The old disc remains exactly as it was when pressed.
When building a relationship with fans, it’s important to know how to sort them out. There are casual fans, occasional fans, and those who feel a deeper connection to the artist and the work. These “true” fans tend to collect both the artist’s output and the merchandise, signifying to others that they are in tune with the art. This is true whether it’s a Grateful Dead Skull t-shirt or a limited release yellow vinyl pressing. With art and music creating more digital releases, there is a need to find new ways to denote ownership of what otherwise lives in the cloud.
This is where the key aspect of Vault gets intriguing. There have long been private clubs that only admitted those who belonged to them. However, it was the Playboy Club, with its vaunted key, that captured the public imagination. Certainly, the intersection of exclusivity and sensuality was essential to attract attention, but the use of a key as a marker of belonging should not be overlooked.
The Vault key has similar properties. It unlocks everything in the safe and only keyholders have access to it. In this new digital world, the key can be bought or sold on the Internet. These keys have certain cryptographic properties in that they are governed by smart contracts that give 8% of the sale price to the artist whose material is contained in the vault.
The first Vault artist is Thomas Pipolo “Pip” who created a vault in which he put his eight-song EP with a music video and some “explanatory” videos about his songs. Pip understands the value of the proposition of getting superfans to buy items that put money in artists’ pockets rather than just letting streaming platforms build their base on the music they pay next to nothing for.
Pip’s Vault can only be accessed by 500 keys, which were selling at the rate of 50-75 per week. Pip thinks big label artists could make better returns by doing a limited release in which the keys are sold to a chest containing a new release rather than splitting revenue with labels and covering distribution costs.
Vault may very well be a mixture of the fan club model and the streaming of material that few have access to. For artists, it allows them to understand their direct fanbase and design both artistic and ancillary products to better serve them. It is more targeted than social media as these algorithms require constant drops of songs, videos and social media content.
My conversation with Nigel and Pip was enlightening. It’s below in video and audio podcast format.
What the Vault team is currently doing in the space will create leverage in the future as they can trade services. It’s hard these days to build something that consumers will pay for. Vault’s nod to the idea of ownership in the crypto space sparks interest, and the exclusivity of the product available only to keyholders makes it stick.
Pip says that many artists come to him to ask about Vault. They have big record deals, make a living, and are always curious about Vault. This is indicative of the offer. Demand remains to be seen, but again FanDuel’s adaptation has been quicker than anyone thought, so the track record is in.
The underlying premise of Vault aligns the financial interests of creators and fans. The fungibility of specific vault keys and the ability to buy or sell them freely makes the economic proposition attractive both to collectors who can monetize their collection at any time, but also to creators who share the proceeds of each sale. This kind of mutually beneficial ecosystem tends to survive and thrive. Who knows, maybe we will discover that both in art and in music there is a repository of value. It may not be at the end of the rainbow anymore. Instead, it is now accessible to those who hold the key to a vault.