When niche American artist Beeple, otherwise known as Mike Winkelmann, auctioned a digital collage at Christie’s for $69 million earlier this year, the sale struck a chord with Dubai entrepreneur Simon Hudson.
The sale in March – settled via cryptocurrency – awakened much of the planet to a game-changing acronym: NFT, or non-fungible token.
Mr Hudson, 38, brands the epic transaction a “sonic boom moment” for a technology with likely implications for numerous verticals, including bringing under-rewarded creatives better earnings.
His technology start-up Cheeze Inc is preparing to launch an app that enables other creatives to follow in Beeple’s online footsteps by easily minting their work as NFTs to trade on the blockchain.
Six months before his monumental Everydays – The First 5,000 Days NTF windfall, Beeple had reportedly sold prints for only $100.
“A fungible asset would be something like a dollar bill – we could both put $5 on a table and it wouldn't matter which one we took off because they are the same value,” Mr Hudson, the chief executive of Cheeze, says.
“A non-fungible asset is something that is unique … an NFT is really the ability to apply this uniqueness to transactional technology such as the blockchain.
“Essentially, you take an asset, whether a piece of art, an image, a title deed, you mint it – wrap it in a token, which means it becomes compatible to be distributed on the blockchain − and it has an underlying ‘smart contract’ associated with it, so it's trackable and traceable.”
In an art world haunted by fakes, that could be crucial to breakthrough talent when proving provenance and buyers declaring ownership.
Cheeze will be open to photographers, collectors and consumers. With its bespoke “minting studio” of Dubai engineers, it aspires to be the leading platform globally for photographers selling digital assets.
Creatives will have a fresh avenue to monetise their output, although marketing can still influence success.
“It comes down to how cleverly you tell the story behind the photo,” Mr Hudson says.
“An NFT allows you to take a flat asset, give it depth and that is really our focus at Cheeze – if you were to able to record audio or a podcast around that photo and give context, that then becomes more interesting.
“Cheeze and NFTs are about art and photography. If you have a good catalogue of photos, it is not going to cost you much to get them online … I reckon we will see some cool new artists coming out.”
The mobile-first app will take a flat commission from sales on the platform to cover costs and will employ talent to work with brands, entertainment and film studios, as well as photographers “to create a new vertical to launch campaigns”.
“We focused heavily on user experience, so the same way you post on Instagram, you can now mint an image on the blockchain,” Mr Hudson says.
“And we have our original partner programme for elite brands and professional photographers that will get certain access and brand strategy support, more features.”
Cheeze is working with Dubai's Dukkan Media as its sole representative for the Mena region to generate engagement.
“If individuals or brands would like to get their content minted, we are here to make it happen,” Dukkan partner Reem Hameed says.
“We want to get the region’s largest brands to experience the many benefits.
“We are also focused on bridging the education gap so we can empower artists to use NFTs to establish provenance, to empower them to value their work and to help them create a new potential revenue stream.”
Her colleague, managing partner Omar Tom, echoes the sentiment that NFTs and Cheeze can boost the earnings of photographers and other creatives by “changing the narrative around how they value their work”.
“We believe it has the potential to revolutionise the way creative output is valued in the market,” he says.
While blockchain offers greater transparency and security against fraud and forgeries, smart contracts determine how promising talent benefits when their work is used or further transacted, such as sell-on clauses ensuring a percentage of resales or royalties as a piece gains in value, while confirming buyers have an original.
As it stands, physical art sold conventionally usually gives originators one payday. With an NFT, resales are blockchain-recorded and payments contractually protected
“The beauty of NFTs is that you don’t, as an artist and creator, just make money from the initial sale, you can put into the smart contract that you generate revenue from secondary, third, fourth, fifth sales.
“Having that royalty [element] in a smart contract that cannot be forged, cannot be changed, is a wonderful thing for artists.”
Mr Hudson describes NFTs as a “new extension of a technology evolution” that began with JPEGs – files invented 25 years ago that compress an image from a physical picture into a digital photograph, or the mp3 music equivalent.
“With NFTs, it is really just a matter of the compression of the transfer of ownership process,” Mr Hudson says, highlighting wider applications for everything from Gucci handbag validations and concert tickets to car purchases and villa deeds.
“Because you can track and see the history of things, that becomes a value; without going through the huge process of finding the documents, you can just look on the blockchain and see all the details behind it.”
NFTs are part of an emerging ecosystem with cryptocurrencies at its heart, not least as new millionaires look to spend their vast digital wealth.
“With a crypto millionaire, they are used to being in a digital world. So, rather than paintings on the wall, they will have digital screens where they display their art; for them it is an actual statement in their world,” Mr Hudson says.
“NFTs came to the mainstream really with art and this is a great entry point into the world within NFT, and when people realise how powerful it is … the counterfeit market is a billion-dollar industry, this can essentially wipe that out.”
But it is also expected to create a “whole new industry” of support networks.
Beyond technical teams, there is demand for specialist accountants, and lawyers to come up with specific terms and conditions, privacy policies and smart contracts.
Mr Hudson predicts considerable change in how people work and deal with day-to-day business, alongside fresh opportunities.
“You have got this new ecosystem of people that can essentially make money.”
For all the implied disruption NFTs could also bring to property brokers and car dealers, Cheeze is focusing on supplying creatives, including script and audio book authors, with a potent platform yielding smarter distribution and improved rewards.
Mr Hudson cites one of his missions as giving credit to artists who “need a new way to generate better revenue”.
“We have a dedicated team that helps photographers, new and experienced, to tell the story behind the image [and] explain the best ways to bring it to market.
“We have plans to have academies training artists, and then we can get them on to the app and, hopefully, get them income.”
Beeple has been creating art for the past 20 years and already had a sizeable following.
But because he has “made such a dent in the NFT space” Mr Hudson says people are now thinking, ‘Maybe things I'm doing on Photoshop and Adobe Lightroom, I can turn them into an NFT and make some cash.”
“There is just going to be this whole new world when people understand the technology," he says.
“The same as when mobile app developers understood what they could do, those ‘aha’ moments … before you know it there’s a ‘new Uber for this’ or ‘Tinder for that’, you get copies in a new vertical.
“When people realise that transfer of ownership is as easy as sending somebody an NFT or they mint items and make some money, then I believe it's going to be an adoption similar to what we saw with the internet in the mid-90s.”
Dukkan Media partner Mohamad Akkaoui agrees.
“The word is certainly starting to spread in key creative circles. Cheeze is an elegant and seamless solution for any creative person who wants to enter the NFT universe.
“We anticipate it will take off in the region … we are looking forward to the future.”
Cheeze Inc is a timely development for our times – and Mr Hudson’s entrepreneurial journey.
The founder of Dubai-based Brndstr, which helped brands integrate social chat technology into their internal systems, he has been credited with helping the early Dubai start-up ecosystem evolve, including aiding the UAE launch of discount platform Groupon.
Cheeze Inc was set up around 20 months ago, raising angel funding alongside the founder’s significant cash commitment. It recently opened a seed round for further funding.
The Cheeze app follows the success of the company’s community chat management app, Privy Chat, which witnessed a sharp rise in the number of users sharing and managing photos during the pandemic.
Cheeze Inc has its headquarters in New York and a presence in Los Angeles, San Francisco, London, as well as in Dubai.
Mr Hudson’s team of advisers and investors include Apple Fellow, author and podcaster Guy Kawasaki, Netflix co-founder Marc Randolph, brand guru and marketer James Vincent, Startup Grind and Bevy co-founder Derek Andersen, international businessman Paul Kemsley and celebrity photographer Pierre Auroux.
Mr Hudson cites his now five-year-old daughter Laila Grace for inspiring his own photographic aspirations.
“I always tried to be at the forefront of a technology,” he says.