UpsideDAO wants fans to earn upside as brand ambassadors
Tyler Morrey, co-founder of Lehi-based UpsideDAO, loves his Kizik shoes and he wants everyone to know about it.
“I wear them every day, and I want them to know that I’m a big fan, and that I’m a community member at Kizik. I want everyone else to know that they should buy Kiziks too, because they’re sweet shoes,” he says.
Morrey doesn’t own any equity in Kizik, a private company, but with a platform like UpsideDAO, maybe he could in the future, just by doing stuff that he might do anyway. Morrey, along with Samson Burton and Jordan Volz, founded UpsideDAO, a self-described “first platform where companies and their communities can join forces to build and grow together, and everyone gets a piece of the upside.”
Apple, for example, is one company that has done a great job of keeping an engaged, loyal community, Burton says. Apple users are pretty loyal to their devices. When it’s time to buy a new phone, many people won’t even consider an alternative option to an iPhone, and in turn, the convenience of the integration with Apple Watch, Air Pods, and other products is pretty compelling.
According to a report from CIRP, Apple had a loyalty rate of more than 90 percent among its smartphone users over the past three years, based on the percent of new iPhone customers who upgraded from previous iPhone models. In the fourth quarter of 2021, Apple reported a record $83.4 billion in sales, up 29 percent year over year. Beyond the $800 a user might spend upgrading their iPhone, what’s really valuable for Apple is their continued support as an unofficial ambassador of the brand, Morrey says.
“You’re contributing value to the Apple community just wearing your AirPods around all over the place. And you talk about how much you love your AirPods, but that should be your contribution,” Morrey says. “The company doesn’t necessarily need your money. What they need is your passion and your desire to help grow the business and awareness, and that’s what you should be incentivized to do more of.”
Apple is a public company, so it has shareholders that do benefit if Apple performs well. But for private companies, there isn’t a system like this, the founders say.
“I would draw a line between what being a part of a community looks like right now vs. what it could look like on the UpsideDAO. Right now, you are already doing a lot of this stuff as a community member, as a passionate brand champion, or fan of a brand. You’re sharing it, you’re talking about it with other people, but when companies generally facilitate a community and facilitate that conversation, in the past that has been an extractive model,” Morrey says.
“They facilitate this for you so you can have a passion about something, but in the end, it’s the company that gets all of the upside. It’s not the people who helped create the passion and the desire to be a part of that community, which is the community itself. They don’t get a portion of that, and when you do give a portion of that to the community, all of a sudden, I want to do more than I normally do. I want to be more passionate about this.”
Burton also mentions that systems like this are also more common in the web3 space than the web2 space, which is something they’re hoping to change. Morrey brings up the “#WAGMI mentality,” or “we’re all gonna make it,” a phrase often heard in the crypto space with the intention of building togetherness, morale, and community, but it’s not common for traditional businesses.
“What we’re building, we call it a ‘DAO in a box.’ We’re building a turnkey solution for traditional web2 businesses to tokenize a piece of their cap table,” Burton says.
It’s not just about talking about and using products—using can start to look at it as creating fractionalized employees, Morrey says. Maybe someone who loves a particular brand is good at design work and could contribute in that way, or has a large social following that they could use to promote a product, or brings another skill to the table that could benefit a company they are passionate about. Without being a full-fledged employee, they can still create value for a company.
Still currently in development, the UpsideDAO founders are ready to start working with companies now and begin to help them build a community around their products. UpsideDAO’s beta launch is set for May, and will likely be limited to 50 companies on the platform at that time. Through the summer, UpsideDAO will work through their editing process with eyes on a full public token and platform launch at the end of September.
“We are ready to start talking to companies now, and getting them ready and prepared because it’s a process to learn how to build a truly vibrant community under this new paradigm,” Morrey says.