BreederDAO raises $10m Series A led by a16z, Delphi Digital

BreederDAO, a Philippine-based specialist manufacturer of digital assets used in blockchain-based games and virtual worlds, announced that it has raised a Series A of $10 million.

The round was co-led by Andreessen Horowitz (a16z) and the ventures arm of digital asset research and design firm, Delphi Digital, with participation from Hashed, com2us, Morningstar Ventures, Mechanism Capital, Sfermion, The LAO, Emfarsis, and others.

BreederDAO will use the funds to scale its asset generation program. It will also make strategic investments in blockchain games with player-driven economies, where a large volume of high calibre assets will be required to fulfill rising consumer demand from the time of the game’s launch.

The DAO will also expand its core team to hire senior roles in engineering and business.

“Play-and-earn has laid the groundwork for a whole new gaming economy that enables the most active participants to benefit directly from its upside,” said Arianna Simpson, General Partner at a16z and an Axie Infinity board member.

“With demand for play-and-earn games rapidly expanding, quality NFT production and scholarship programs also need to scale up quickly, but asset liquidity remains a barrier. That’s why we’re excited to partner with BreederDAO, which will accelerate the whole ecosystem and unblock essential assets to help play-and-earn reach its full potential,” Simpson added.

In 2021, play-and-earn guilds raised $532 million primarily for the purpose of acquiring NFT gaming assets to be leased to new players under a revenue-sharing arrangement in blockchain games known as a “scholarship.”

However, according to public data, these guilds have only deployed around 60,000 scholarships to date. This represents less than 2% of Axie Infinity’s nearly three million daily active users, underscoring the growth potential if the supply of NFT gaming assets can be unblocked for the benefit of smaller guilds and retail consumers.

“Breeding is an integral mechanism for balancing play-and-earn game economies such as Axie Infinity. It’s a complex process involving many economic factors that can be difficult to scale. In an ideal world, these NFT assets can be optimised for the highest ROI to increase overall guild earnings. We’re very excited to be backing BreederDAO as it fills a critical gap in the market by introducing scalable supply-side liquidity,” said Yan Liberman, Founding Partner, Delphi Digital.

BreederDAO has deployed $600,000 towards breeding operations across three different game economies, growing this to $1.7M in value in the span of a month, representing a 180% return at a time when bitcoin had fallen by 20%.

The team is now building a platform to automate a number of its highly specialised programmatic breeding programs, not only in Axie Infinity, but other NFT games with strong play-and-earn mechanics, such as Crabada and Pegaxy.

The startup is led by Filipino co-founders Renz Chong, Jeth Ang and Nicolo Odulio.

“BreederDAO will play an important part in the global play-and-earn ecosystem that we at YGG are developing. The demand for scholarships is unending and BreederDAO will help to democratize access to top quality NFTs, while helping to accelerate the movement in Web3 gaming that has already positively impacted millions of lives,” said Gabby Dizon, co-founder of the world’s first play-and-earn guild, Yield Guild Games (YGG).