NFT Creator Yuga Labs Confirms Layoffs
Yuga Labs CEO expresses concerns about company's direction, leading to layoffs and focus on core strengths.
Yuga Labs CEO, Daniel Alegre, in a team email that was also shared with the public, expressed his concerns about the company's direction. He felt that the startup had taken on too many projects internally, leading to a diffusion of focus. Alegre mentioned that some of these projects spread the team too thin or were beyond their core expertise. This realization came after his evaluation of the company post his joining from Activision earlier in the year.
"I realized very quickly that there were a number of projects that, while well-intentioned, either spread the team too thin or required execution expertise beyond our core competencies."
While the exact number of layoffs was not specified, it was clear that the restructuring would impact only the US-based employees for the time being. The company's evaluation of its international teams is still ongoing. Despite the layoffs, Yuga Labs co-founder Greg Solano mentioned in a tweet that the team still has over 120 employees.
“It's a challenging time, not only for our industry but also for the global economy. We must stay focused on our core strengths as we continue to create unique, engaging experiences for the broader Yuga audience.”
Yuga Labs has had its share of successes and challenges. Alegre highlighted successful projects like the Dookey Dash game, the TwelveFold generative art pieces via Bitcoin Ordinals, and partnerships with brands like BAPE and Gucci. However, he also acknowledged that some product launches did not meet expectations.
One of the significant challenges was in their gaming execution. Alegre mentioned that they realized they weren't optimized to manage and build everything in-house. The development of Otherside, their upcoming metaverse game, was one area where progress needed acceleration.
I’m sure many of you have seen the news that Yuga is undergoing a restructure today. Shit day obviously. Hurts to part ways with team members who have been in the trenches with us. But we needed to make some changes to the company in order to make sure we’re set up for longterm… https://t.co/RF0QGydqze — Garga.eth (Greg Solano) (@CryptoGarga) October 6, 2023
In response to these challenges, Yuga Labs has already initiated moves for Otherside. They announced various technical and creative partnerships for the game's development and recently revealed a strategic investment in Hadean, a spatial computing startup.
Alegre emphasized that Yuga Labs is fully committed to the Otherside strategy, with all ongoing digital content tying into this metaverse platform. Projects like the NFT avatar project Meebits and the 10KTF digital apparel project will be integrated into Otherside.
Founded in early 2021, Yuga Labs saw immediate success with the Bored Ape Yacht Club, an Ethereum NFT profile picture project. This collection quickly rose to prominence in the NFT space, with some Bored Ape NFTs fetching million-dollar prices and gaining celebrity attention.
In March 2022, the firm raised $450 million, reaching a valuation of $4 billion. This was shortly after they acquired the influential CryptoPunks NFT IP from Larva Labs, along with Meebits. The launch of the Bored Ape-themed ApeCoin crypto token and an NFT land sale for Otherside further solidified their position in the market.
NFT Sales Plummeting (Source: Dune)
However, the NFT market has seen a decline in demand for collectibles over the past year. Prices for renowned NFTs like Bored Apes and other NFTs have dropped significantly, as has the price of ApeCoin.