The liquidation of Metonymy Machine GmbH brings a shift to our web3 journey.
This is about our Web3 journey that despite many efforts, ultimately falls short of expectations.
As we navigated the tumultuous waters of 2022 and the challenges of the web3 landscape, we are now forced to make difficult decisions and undertake fundamental changes due to financial setbacks. This long read shall be one of reflection, where we will also share our struggles as a team.
“1 year in NFTs feels like 10 years in real life” so goes the adage, and it is not far from the truth. The founders and team have experienced an incredibly challenging past two years, particularly in the first half of 2022. The decisions we are compelled to make are not taken lightly and are made with great care.
Today we have to announce that we are going to liquidate our mother company Metonymy Machine GmbH in March 2023. In this in-depth exploration, we will provide an honest and transparent account of the significant changes and the reasoning behind them.
Key topics in short:
- It is with a heavy heart that we announce that the flagship company, Metonymy Machine GmbH, will be undergoing liquidation due to financial constraints. The liquidation proceedings will commence in March 2023. Despite this setback, we are determined to persist in certain endeavors through different means and entities.
- In 2023, EveryNFT will undergo a metamorphosis, evolving from an “NFT Launchpad” to a “European Web3 Collaboration Hub,” under the stewardship of Cem and his creative studio.
- The EveryNFT Mintpass will continue to serve its purpose as a Partnership Minting Pass for the future, and utilizing Tell.ie, we will create exclusive token-gated content accessible only to Mintpass holders. The minting of Mintpass has been suspended, as of now.
- The artistic and technical aspects of Cyclops will be placed on hold until further notice until we have the financial means to move forward. All NFTs will be anchored to IPFS. All Cyclops holders will be eligible for a complimentary WHC claim per wallet.
- The Women Hackers Club IP will continue to be overseen by the creative producer CCEEMM and artist GIZEM WINTER, however, the minting of WHC will conclude with a final Dutch Auction by mid-February. The IP will be further developed in the form of a graphic novel, TV series concept, and other mediums, but technical development of any form will be paused until further notice until we have the financial resources to proceed.
- The EveryNFT Discord will be streamlined as is for now while all special channels for Mintpass holders will remain active. The Discord of the Women Hackers Club will remain as is for the time being.
- As the two founders embark on separate web3 ventures, they will continue to maintain their close friendship and collaborate on other creative projects such as film production. Cem will continue to search for venture capital funding with a comprehensive 25-page pitch deck and a prototype for a new “Access and Reward” app, which would also have a positive impact on the Women Hackers Club and EveryNFT. He will also lead the transformation and further development of the Women Hackers Club brand. Fritz will continue to offer consulting services for web3 technical development but will not have any operational roles on a day-to-day basis.
Past, Present & the Future
In a critical retrospective, we will not only look back on the events of the past year, but also offer a glimpse into our plans for the future and the steps we are taking.
It’s clear that much progress has been made and that a significant number of goals have been set. While some successes have been achieved, it’s also true that we’ve fallen short on a number of objectives. The question of whether or not we’ve failed is multifaceted and requires a deeper examination.
One by one:
When we formulated our goal to co-built projects with artists as their Launchpad Partner in 2022, and while artists were approaching us to share their ideas with us, the following services as our offer emerged:
1.) Technological infrastructure (Collectibles, Generative Process, Frontend Design & Development, Mint process and Tools)
2.) Strategy development (Blockchain strategy, Storytelling, Utilities, etc.)
3.) Community docking with EveryNFT & community management.
4) Art direction & further development of the project.
5.) Know How Exchange the NFT Community and the current trends
In the beginning, we did not think too much about the question, if the business model was suitable for the long term, but we knew that we wanted to be in this world of web3, whatever it takes, and were sure that some of the projects we would help to launch would be successful.
Spoiler: Financially, none were.
We want to be transparent and open with you about the investments made into our company. Our founders, Fritz and Cem, have personally invested a significant amount of money (around 35k€) and also lent the company additional funds. They have not received any salary at any point and have not benefited financially from the company’s gross. We are going into detail on this front due to the many frauds and rug-pulls we have all experienced in the web3 scene and clearly want to make sure that the founders did not personally receive any form of compensation from any NFT sales whatsoever, but have lost their initial investment and more.
All of the income from the projects was invested in structure (Netlifly, Github, Discord, Security Tools) and in the technical and artistic team. The artists have always received a good portion of the income from primary sales to compensate them for months of work. Additionally we have made a wrong choice in not selling all of our ETH at $3800, but our decision was formulated as: “We will only sell ETH when we need Euro to pay bills”. This was a bad decision in retrospective, and we underestimated clearly that the bull-run might end faster than anticipated. And obviously we could not have known what bad actors such as Terra, SBF and all the other criminals (in spe) were doing and that the market would crash so hard.
I am sure you can all understand that it has been frustrating for Fritz and Cem to put in so much time, energy, knowledge + money into the company without seeing any personal financial benefits at all.
Our idea was that we would manage to sell out Cyclops or Women Hackers Club. With one or both projects selling out we were also sure that the Mintpass would become a success and overall we would have the Brand power to reach out for partnerships and gain the momentum and traction a web3 project needs, also with Royalties from secondary sales.
While all projects had different reasons, none sold out — not even close! They also had common mistakes, which we will encounter later. In Bobos case (which we were only acting as Launchpad) it was mostly due to the huge financial crisis in Turkey at that point (the project was mostly for the Turkish market due to Bobo’s reputation). In case of the Women Hackers Club the mint was pretty much placed right at the peak of the Terra Luna Crash.
Our timings were all quite unlucky— not to name it as the only reason — but it surely did not help us.
TEAM & TECH
In core, we were always quite a small team, and tried to scale up maybe too quickly, without financial resources or success.
Scaling without financial resources became our dilemma.
Being a startup is tough, especially without funding. While the beginnings can be easily managed by a small team, as the product or outputs grow you need to scale up the team. However, not knowing if the product (in our case the NFT projects) will bring in financial success this can break your neck (and it partially did).
Besides the two founders, we had two to maximum of four developers working on various tasks. Additionally, we had UI/UX Designers, two advisors, four community managers, and one business development manager and we were creatively managing six active different artists/projects with briefings and more and also looking to add more projects for the future.
While we have been successful in creating great smartcontracts, optimizing gas and building smooth mint processes, we were slower in delivering new technological innovation. For example the Ha$hpowr idea took almost two months to develop. Why? In general because of the overhead that was building up. As we never had the financials to add “lead” positions to our team, the overhead on Fritz & Cem grew big, very fast with 18 hour (!) work days, 7 days a week (no joke!) and the decision-making process and revision process slowed down dramatically.
Building a NFT project or a web3 company is quite complex. Besides a lot of “new tech”, you need to keep up communications very high, deliver high artistic output and always make sure your security levels are on high alert.
Just to remember: Even Manifold with Pak screwed up M$1.6 only due a mistake in the smart contract. Remember Akutars $34M smart contract lockup? This was always a work that needed calm and precision and mistakes in security & co. could be irreversible.
Below you can see some portion (around 60%) of the workload of our Tech Team alone to get an idea. Most of those were running simultaneously or were at least overlapping.
The Cyclops project has been a labor of love for our team. From the story and artwork to the high-end 3D promotional videos and 3D GLD objects for use in virtual worlds like Cyber.Io, we have poured our efforts into every aspect of the project. We have also reached out to over 100 potential partners and collaborators, but have unfortunately seen limited returns on these efforts. Despite using paid influencer tweets, we have struggled to generate interest and engagement within the community.
Marketing the project has been a challenge, and we have had to come to terms with the fact that the somewhat brutal artwork may have limited its appeal.
So what, now?!
We have been grappling with the question of how to move forward with the Cyclops project given the current financial considerations and market situation. We have applied for grants and funding to support the further development of the game, but have not yet received any assistance. We also recognize that introducing a new minting of the project would likely fail due to the lack of collectors for the main edition. While transitioning the project to a CC0 and community-driven model is not an easy solution, we want to ensure that our artist, Cansin, has a strong say in the direction of his artwork.
Given these challenges, we do not have any other option than “pausing” Cyclops until we can secure financial stability or further funding. We understand that this may be disappointing news, and we share your disappointment. Our dream was to elevate Cyclops to a global brand on the same level as Deadfellaz, but unfortunately, the financial realities have made this goal unsustainable for us at this time.
Despite this, the project’s artwork remains available and we hope that it continues to bring joy and appreciation to those who have supported us. While we may have failed in our efforts to sustain the Cyclops project, we know some of you really love and appreciate this project and the artwork and we hope that the artwork serves as a small comfort and a testament to our efforts.
EveryNFT & Mintpass
For Beginners, these are the assets and creations:
EveryNFT Mintpass: https://opensea.io/collection/mintpass-everynft
EveryNFT was the first NFT launchpad in Germany and we are proud of this achievement. Our goal was to add more projects and artists to the platform, build strong brand partnerships, and develop further technology such as auctions and dutch auctions. However, we soon realized that the Mintpass alone would not be enough to fully finance these plans.
Even at 1,000 Mintpasses selling at around $200, the total would only be $200,000. As we are based in Germany, we also have to pay 19% tax for every NFT sale, which leaves us with around $168,000. From this amount, we also have to deduct corporate income tax and trade tax, leaving us with a total of $130,000. With a burn rate for a highly skilled marketing and communication team, this amount would only last for around 6 months.
To overcome these financing challenges, we needed to work with high-class brands. We have designed prototypes, were in negotiation, and send out presentations or pitch decks. However, the ultimate crash of the crypto and NFT market did not help us to push the last meter forward.
At this point, we need to accept that EveryNFT in the form as it was planned, will not be able to continue. Especially as the Manifold’s or Bueno’s of web3 have been building more effectively the products we had in mind.
The Future of EveryNFT
From here on EveryNFT shall transform into a Collaboration Hub for Brands, Artists, and Projects. It shall become a licensee and/or licensor for content partnerships.
Many web3 projects struggle to find brand partnerships. On the other hand brands are continually entering the web3 market, slowly but steady. Within that Europe has been picking up as well. We plan to bring these two together as a form of consultancy agency.
This idea is also coming from the base structure of the Mintpass. We want to make sure the Holders do profit somehow in the long-run besides the two aspects that they could mint Cyclops and WHC to a reduced price.
Is this a great business?
This is not a highly scalable, classical startup business. We are aware of that. However CCEEMM owns a creative studio/agency with exciting brands as customers and it simply makes sense to align this within that range, considering that there is no financial resources for EveryNFT to continue otherwise.
Once we roll-out parts of the new product, we will keep you in the loop.
Women Hackers Club
For Beginners, these are the assets and creations:
The WHC PFPs: https://opensea.io/collection/women-hackers-club
The WHC Specials: https://opensea.io/collection/womenhackersclub-specials
The WHC Airdrops: https://opensea.io/collection/women-hackers-club-airdrops
WHC Omnichain LoFi Airdrops: https://opensea.io/collection/lofi-women-hackers-club
When CCEEMM reached out to Gizem Winter and made a “deal” to work together, we were incredibly excited. Gizem’s visual style is highly recognizable and the market for women-led NFTs was just starting to pick up. However, we were not able to pay Gizem any up-front payment and had to respect that she had multiple other projects in the pipeline. It took some weeks and months to finally get going with the project.
We had a very good feeling about the community, the riddles and the partnerships from Ledger to Robotos. However, if we were to show you the list of over 100+x projects and influencers we reached out to, negotiated with some of them in a quite late stage but suddenly they just did not return, you would understand our frustration that the final output of partnerships felt just very small compared to what we had in mind.
While the momentum still felt good at that moment, when the crypto and NFT market started crashing, it became clear that we had a problem. It was not only that most of our buyers were in the same circle, we could not break out to new Twitter/NFT circles. And although we even spent more than 2ETH for promo tweets and “NFT marketing influencers,” it did not bring anything in return. Nothing!
When the WHC did not sell out (it’s currently at around 30%) of the first batch, our financial struggles became clear.
Despite the financial struggles faced by CCEEMM and the challenges of the crypto and NFT market crash, the team will continue to work on the WHC project.
In the roadmap, even without any further financial incentive for now, we will keep creating a graphic novel, pitch TV streamers with a TV series concept that is already 80% ready, and continue to build brand partnerships.
Now, there have been some health setbacks and personal family matters, which we will not go deeper into, but please don’t forget: We are all humans, and always need to overcome personal struggles and problems as well. Those aspects, unfortunately, slowed down some of the creation of the WHC in the past months.
Limitations of the Current Financial Structure
Due to the financial structure, the WHC will not be able to create any technical innovation for now.
As the WHC will be the only IP going forward from EveryNFT, we will give holders of Cyclops and the Mintpass one free claim and will end the minting of the WHC with as low as 0.025 ETH with a 48 hour final minting phase mid of February.
The idea here is to try to add new holders to the project before the minting ends permanently. We will discuss the details of this with the community and will also consider other ideas.
The Challenges of Working with Non-Crypto and Non-NFT Artists
We have always worked with non-crypto or non-NFT artists, and all of our endeavors were their first encounters and projects with the technology. We underestimated the importance of having a pre-existing NFT community, and as a result, many of the artists we worked with had very little exposure to the NFT space. At the same time the founder's Fritz and Cem with low numbers of followers on Twitter were also new in the space, and especially it seems to have mattered that we were Germany-Based. Mattered because we could not participate in the US Clubhouses, US Twitter Spaces and might even had problems caused by the Twitter algorithm that did not show Germany-based company accounts to US users.
Underestimating the Importance of an NFT Community
This was a significant challenge for us as it became clear that having an established NFT community was crucial for the success of our projects. Unfortunately, by the time we realized the importance of this, it was already too late. The projects were already in development and had been greenlighted by us as producers.
Timing of Projects
The timing of our projects also played a role in this challenge. We did not consider the importance of having a pre-existing NFT community and the projects were already in development and greenlighted by us as producers by the time we realized the importance of this fact.
In conclusion, our past projects encountered challenges due to the fact that we had worked with non-crypto or non-NFT artists who had very little exposure to the NFT space. We underestimated the importance of having an established NFT community, and as a result, our projects did not perform as well as we had hoped. The timing of our projects also played a role in this challenge, as we realized the importance of having a pre-existing NFT community too late in the development process.
It has been a long and exhausting journey for the founders. It has been emotionally and financially tough to accept that we might have failed in our efforts. The worst part is that we have individuals who believed in us, and we could not deliver the results we had communicated or raised expectations for. In this hyper-attention, influencer market of NFTs, we did not make the right moves, and technology or art alone did not reach or persuade the larger community.
Yes, we have made friendships and shared laughs together, especially on our Discord. But ultimately, we also understand that while some were here only for the art, others also expected financial gains. We are sorry that we were not able to deliver on those expectations.
“Have we failed?”
This is a question that may come to mind when considering the financial success of a company. It is a tough approach within web3, but from our perspective, success is not solely determined by financial metrics. Other factors, such as the quality of the art, the innovation of the technological approach, being one of the first companies in Germany within web3, the positive connections within the community, and the emotional connection made throughout the art, should all be considered this rather philosophical question of “What is success in life?”. So, obviously, while financial success has clearly failed to perform as we aimed for, is it possible that we might have achieved success in other ways?! Is this a naive way of looking at things and life?! Maybe. But maybe it is also the only correct way of evaluating life after all.
Open Mic on Discord
We could keep on writing and writing but we are not sure you will be interested to make this an hour-long lecture. Therefore we would like to host an open mic on our Discord by the beginning of February to answer any open questions from you.
If you would like to join the conversation, hop over to our Discord:
Still, a Dynamic Market Situation
While all of the above is our current roadmap, we are still in a dynamic market. Yes, we are still in talks with VCs, we have reached out to some new folks only a couple of months ago and we have known and met investors along the way that might offer a change in path. Until we start the liquidation by March, things can change. If anything changes, we will communicate this with you, have no doubt about it.
A big “Thank You” to our supporters and friends!
Nevertheless, our journey until here would not have been possible without the great artists, without the great team in communications and development, and of course it would not been possible without our supporters. We want to thank each and every one of you for your trust, and your positive vibes, and hope that you will remember this journey as a positive one when you look back on it in a couple of years.
We appreciate all of you and are deeply sorry that this has not turned out to be different.