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ICO Insight featuring Robot Cache

plus interview with CEO Brian Fargo 

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Robot Cache Transcript


 

Adam Chapnick:

Robot Cache is in this week's ICO Spotlight. They want to revolutionize the distribution of digital PC games by launching a decentralized video game marketplace. Their presale for accredited investors is currently underway, and for more on that, we're excited to welcome Robot Cache's CEO to the show, Brian Fargo. Thanks so much for being here.

Brian Fargo:

Thank you. Thank you.

Adam Chapnick:

So, first, tell us about Robot Cache. How would you describe what you're trying to solve?

Brian Fargo:

Yeah. Well, Robot Cache is a big idea, and I think more than trying to solve a problem, we're creating a new paradigm more than anything, and typically in the past, you've never been able to resell a game once you've got it before. Once you buy a digital game, you're stuck with it for the rest of your life, and you never had that ability to resell it, and because of the approach that we're taking in terms of margins and decentralization, we're able to get publishers to allow us to have those rights to be able to resell their game, and you think GameStop, for example. They do two billion dollars a year in used game sales. That's only for physical games, and the developers and the publishers don't get a dime of those used sales revenues. In fact, it represents 50% of GameStop's profits, so we want to take that model and apply it to digital, and I think an even bigger idea is that Robot Cache is gonna be opensource, so we expect a lot to be built on top of it.

Adam Chapnick:

Mm-hmm (affirmative). Amazing.

Amy Wan:

So, why did you decide to go ahead and launch an ICO?

Brian Fargo:

Well, you know what? When the internet first launched, sort of in the mid '90s, it was decentralized, and slowly over time, the bigger companies have come in and they've centralized things at many different levels, and I saw the blockchain as sort of an internet 3.0, and it is giving the ability for companies to throw the cards up in the air and to take on the big guys in sectors all across not just video games, but all the different sectors of business, and so I wanted to be part of that revolution.

Adam Chapnick:

So, what about the specifics of the ICO? You're open right now for accredited investors. That's right?

Brian Fargo:

That's right.

Adam Chapnick:

So, what's the minimum amount? Why did you decide to go just the accredited route?

Brian Fargo:

Yeah. We wanted to take a conservative route as it relates to doing an ICO, and technically speaking, we're doing a token generation event since we're not doing an ICO to the public, and so we did just open it up for accredited investors with an institutional minimum of $500,000, and that makes up about 90% of the money we've raised, is through institutional, and with a smaller portion coming from single individual accredited investors at $50,000 with a 25% discount, but we're gonna airdrop tokens into the economy once we launch, and those are a great customer acquisition tool for us, because ultimately, we want everybody on our system and using those tokens and buying and selling games.

Adam Chapnick:

Yeah, it's all about the network. So, how much are you trying to raise, and then what do you think you're gonna do with the money that you do raise?

Brian Fargo:

Yeah. So, we'll raise somewhere between 15 and 30 million dollars. We're very close to the soft cap right now. We're just collecting the moneys and hoping to making that announcement. Primarily, the money is going to be raised, of course, to build out the site. It's actually functioning. The hard parts are functioning, which is the downloading and uploading of games and the wrapping and that dashboards and that sort of functionality, so from here on out, it's gonna be getting great content. We want to have hundreds if not thousands of games at launch, and what's good is that we are signing up the biggest publishers in the world.

We have a very compelling argument, both for the premium publisher who gets 95% of the proceeds. On the digital stores today, they get 70%, and that kind of started with Steve Jobs back in the day, he with iTunes, and then Steam followed suit, Google followed suit, Vudu followed suit. That become the de facto standard. We don't think, and we know that it doesn't take that much to run that business, so we're offering 95% of the revenues to the publishers and smaller developers, which, by the way, can be make it or break it. For a small developer, that extra 25 points might mean he could make his house payments that year, so it's very significant.

Also, it's compelling for free-to-play companies, because we're gonna have this ecosystem with people who have got our iron token. They've either sold a game and got it, or they've airdropped it to them, or they mined it on our site, any number of the different ways they got a token, and for the free-to-play customers we're just another currency for them to take, another that they could say, "Hey, you've got this great base. Don't you want our people to use our token on your free-to-play games?" Also very compelling for them, also.

Amy Wan:

So, let's talk about your tokens for a second. What kind of tokens are you issuing? What do they represent? What are people actually getting when they buy or mine a token, and when are you putting the tokens out into the world?

Brian Fargo:

Right. So, it's an ERC20 token. We'll be launching the tokens at the same time as the site, so roughly six months from now will be the event. I mean, the tokens, number one, is for tracing the titles on the blockchain for the buying and reselling. As you can imagine, when we first went to the publishers and said, "We want to allow people to resell a game that you've given us for," their initial response was of fear, because they don't want it to get out of control. The blockchain gave them the security that they knew that if a Bitcoin cannot be hacked or copied, because it would be over tomorrow if you could just start making copies of coins, right-

Adam Chapnick:

Of course.

Brian Fargo:

... that we would use that same technology for a game, to lock it up, to make sure it could not be copied, and that gave them the confidence to allow us to allow peers to resell it to each other, so that was a very big part of it. As far as the tokens themselves, like I said, there are different ways. We'll be airdropping them, mining. Most people don't own cryptocurrency, and most people don't mine, so we want to make a very opt-in-easy process, so if you want to leave your computer on at night, you just click a button and then it starts mining for a cryptocurrency, which are rewarded back to them in iron tokens form.

Adam Chapnick:

So, just to follow on that, is the mining process basically just my computer would do the verification of the distributed ledger of who has rights to each game and keeping that chain of titles, so to speak?

Brian Fargo:

Perhaps. I mean, to me, there'll be this computational power. If we have a hundred thousand people that have their computers on at night, there's any number of things we can do with it. Right? So, it might be solving our own, doing our own gas fees, so to speak, as you were hitting on, or it could be that we decide that we've got excess. We're gonna mine a coin, and we're gonna reward them back in iron, or we could be solving problems for NASA. I'm not sure.

Adam Chapnick:

Oh, got it.

Brian Fargo:

So, whatever we want to do with this computational power, we're gonna reward the users back with iron tokens.

Adam Chapnick:

Got it. Okay. So, you're definitely bought in, obviously, in a big way to the promise of blockchain in general, but how do you see blockchain beyond what you're doing in the world, let's say, in the future? Is blockchain just gonna be everywhere, or does it just got applications in the game space, or what do you think about that?

Brian Fargo:

No. I think, like I was saying earlier, I think it's thrown the cards up in the air, and it's making us re-look at where there are industry giants that control things. There's kind of an irony, I think, where you look at ... People, generally speaking, they don't trust the government. They don't trust the tech companies so much with their data anymore. Right? We're all worried about that. Well, the decentralization allows us to sort of take some of that control back. At the same time, we've learned to trust each other. Right? You look at Uber, you look at Airbnb, so there's this funny sort of twist of the two going on, and I think the smart contract allows us to take that trust level to another way.

One of the great things about what we're doing is we're opensource, and the beauty of that is you never know what people are gonna do with it. So, people ask me sometimes about my competition, and we don't have any competition in this space, but we certainly have it in the non-blockchain space, but I say, "Well, it's not how am I gonna compete with them, but how are they gonna compete with the crowd," because my audience is gonna be an open API system. They're gonna be building on top of it. They're gonna be doing things they never dreamed of, and to me that's where the excitement comes in.

When Steve Jobs and Wozniak launched the Apple II, they never dreamed of [ViziKoat 00:13:55]. They never dreamed of the [Bargetell 00:13:56] game. They didn't know what was gonna be built up on it. Just great things happened. So, if we're successful, we create this wonderful watering hole of people that are coming, they're buying games, they're selling games, it becomes a system, but on top of it, they're gonna start building things on it, and to me, that's where it really becomes exciting.

Adam Chapnick:

What about partners? Do you guys have some partners that you've lined up?

Brian Fargo:

So, it's a very compelling argument to give people 95% of the proceeds, so you can imagine that we're doing quite well in signing up some of the largest publishers and developers in the world. We're gonna be announcing those here in the next week or so. We're getting them all together at once and doing that, but expect some hardware partnerships. Expect some payment processor partnerships. We're in negotiations with one where if it's a game that already takes a payment provider and they're already taking our token, then there's no API functionality they have to build in, so it's completely friction-free for our token to work in their ecosystem, and that's our whole goal here, is to make this as friction-free as possible for all of our partners.

Adam Chapnick:

Amazing. So, what about the future? What's the future hold for Robot Cache?

Brian Fargo:

Well, again, for me, it's getting all the content ready, it's getting the partners in place, it's getting the site, making it wonderful and super elegant, and again, friction-free, and then it's the launch, and then just letting the people take it over from there and building something we never dreamed of.

Amy Wan:

Brian Fargo, CEO of Robot Cache, thank you so much for joining us today.

Brian Fargo:

No, thanks for having me.

Amy Wan:

For more information on Robot Cache, visit robotcash.com.

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