Dropp acquires metaverse platform Phly for $25M
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Dropp Group has acquired metaverse platform Phly for $25 million to build “digital twins” of the major cities in the world.
Dropp said it is combining with Phly (which also spells its name Flyy), a social metaverse platform, to develop the a physical digital twin (‘phygital experience’) of every major city in the world to bridge digital and real-world locations for consumers, communities and brands who aspire to seamlessly onramp into Web3. The deal shows that the metaverse may be moving into an acquisition phase after seeing a burst of startup activity.
DroppLabs, the innovation arm of Dropp Group, will use the to deploy Flyy technology to create MetaReality — which it calls the commercial and multisensory evolution of the metaverse. Accessed through the DroppTV consumer facing platform, MetaReality will provide users unique, value driven Web3 experiences unavailable elsewhere, the company said.
“Our acquisition of Phly represents a major leap forward for our company and platform. By integrating our innovative technologies, we will deliver the most complete and compelling metaverse experience anywhere,” said Gurpreet “Gurps” Rai, Dropp’s CEO, in a statement. “Our mission is to enable communities to build the world that they want to live in.”
The platform will feature fully immersive digital renderings of cities around the world, starting with the most iconic locations and buildings. Each building will be minted as a unique NFT so owners have access to Dropp’s proprietary technology resources to build and engage communities.
Phly’s Founder & CEO, Adel Al Massarani, has joined dropp as Chief Metaverse Officer and will head up dropp’s new MetaReality division, “I am thrilled to bring Flyy into the dropp group portfolio. Collectively, we are now poised to revolutionize the metaverse and Web3 industries.”
The company said DroppTV harnesses DroppLabs’ proprietary technology to connect consumers, creators and brands through an interoperable ecosystem allowing for streamlined experiential commerce between the physical and digital worlds.
Dropp said it enables brands to achieve enhanced affinity, increased conversions and granular attribution for data. In addition, DroppTV offers unique comprehensive experiential NFT (non-fungible token) and social token capabilities, empowering partners and consumers to generate even greater value in Web3.
Dropp was founded in 2018, as was Phly. Dropp has 35 full-time employees while Phly has nine.
“We acquired Flyy because of their technology’s unique complement to our existing tech stack and deliverables for consumers and clients,” Rai said in an email to GamesBeat. “We know current metaverse offerings have substantial barriers to entry. For example, they require specialized knowledge of certain technologies such as crypto, and they lack true utility. Most are also not mobile friendly. That said, our overall objective as a company is to create an easily understood and accessible on-ramp for everyday consumers and companies to Web3 and the related experiences it offers and the assets acquired from Phly will allow us to do that.”
He added, “Acquiring Flyy has allowed us to accelerate our comprehensive Web3 roadmap versus creating a compelling metaverse offering from scratch. Now we are able to focus on evolving and adapting owned technologies, giving us critical speed to market in an intense market race. Flyy’s capabilities, when combined with our existing tech stack, will collectively drive this seamless experience from Web2 to Web3 quickly and efficiently in an enjoyable environment.”
As for the vision for the metaverse, Rai said, “Our vision for the Metaverse is to combine digital and physical experiences into one. As we bridge our consumers and clients from Web2 to Web3, the Metaverse is the last mile extension of this natural progression. This will allow IP owners, companies and consumers to generate maximum experiential and economic value. Consumers will now be able to live in both environments simultaneously from anywhere on their mobile device.”
He added, “Our plan for MetaReality is to also aggregate, enable and amplify communities – providing a platform for users and fans to independently grow and market with relevant ideas, experiences and commercial concepts. IP owners and companies will have the ability to integrate their fan and consumer experiences across the physical and digital worlds thereby making their offering much more accessible and powerful.”
I asked why the Phly assets were valuable. Raid said Phly’s technology allows Dropp to create a true physical, digital twin of locations that exist in real life – which the company has coined as “MetaReality.”
“The nature of the Flyy technology also enables us to roll out ‘metaverse as a service,’” he said. “We can rent out and parse out our platform to others that will be portable into other platforms and experiences. Essentially this allows owners in the metaverse to build out their own ecosystems using dropp’s technology including AR, MR and gamified capabilities.”
From a development efficiency perspective, the Dropp and Phly apps are both built in unity, which allows for seamless integration and quicker roll-out.
Dropp said it is harnessing the Phly assets and putting them on optimal Web3 rails which are being identified and will soon be activated. The result will be a comprehensive, easy-to-use offering integrated within the dropp app, complimentary dropp products and our enterprise client eco-systems, Dropp said.
“In the short term, we already have active dropp clients, such as Universal/Def Jam artist/actor Dave East, Elite Hospitality and Tajia diamonds, that have a real and present opportunity to expand into the metaverse which we can now quickly activate,” Rai said. “MetaReality will also be combined with our SuperFan experience, providing IP owners and their followers a dynamic ‘place’ for activations and experiences – something the marketplace currently does not offer.”
As for consolidation, Raid said it will not mean exactly what it did in the Web2 world. In Web2, businesses consolidated to reduce redundant personnel and processes, gain market share, and improve their bottom-line revenue, he said.
“While these goals can be essential for a company to survive and excel, consolation in the Web3 space will be more customer-centric. Web3 business consolidation will focus on offering consumers and end-users a more seamless, smooth engagement across platforms. Interoperability will be a guiding principle, and decentralized digital assets, like NFTs, will make this possible,” he said. “FAANG (the big tech platform companies) and other large centralized tech companies dominated in the Web2 world because they were closest to the server and the databases they owned. In Web3, the consumers and their digital goods are one-and-the-same; they are not beholden to by a particular server or database.”
He said people can move themselves and their digital assets throughout the internet as they please. As a Web3 company, Dropp Group is consolidating with Phlynot only because it makes business sense, but also because it will provide our customers a smooth and uninterrupted digital experience, he said.
“As a company, we are concentrating on speed to market and on-ramping while acquiring and adopting technology resources and maximizing interoperability between our portfolio offerings in anticipation of the continuation of the rapid consolidation that we are seeing around us,” Rai said. “We see the consolidation in the industry as a positive force, collaborative projects that are building long-term products, communities and economies will still be here as opposed to projects with short term gold rush philosophies.”
As for the economic downturn, Rai said, “We share humbly and proudly that we have strong access to capital with some of the deepest pockets in the world on our cap table. We see the market turn as an opportunity and are positioning ourselves to take advantage of the dry spell to entrench ourselves as a Web3 market leader. The downturn and our recent financing actually puts us in a stronger position relative to the market and potential competitors.”
He said the company is also putting together a venture fund to help promising companies survive and thrive. The company plans on activating its technology, communities and resources as an angel and enabler for select high potential companies.
“We are confident this growth strategy optimally positions us not only for the current environment but also for the next market bull-run,” Rai said.
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