Lab Summaries - Unraveling the Business of Magic Eden

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For many of you NFT enthusiasts, Magic Eden is probably not a foreign name.

For the unacquainted, Magic Eden is currently the 2nd largest NFT marketplace across chains, and the largest NFT marketplace in Solana with over 95% market share.

Today’s article goes deeper into the business of the NFT marketplace, sharing more about their company building process, their creator strategies, and more.

This article is also a summary of key insights from their interview at the Smart Venture podcast. Do check the podcast out and have a listen to the full episode if these insights intrigued you.

Now, some golden nuggets from the podcast:

Who is the Magic Eden team?

Members of the team came from large consumer marketplaces (e.g Ubereats) and crypto exchanges (e.g. Coinbase). These experiences helped them to focus on key features for Magic Eden, such as:

• Liquidity and exchangeability of the assets in Magic Eden

• Intuitive and sleek UX products for consumers

• Discoverability and creator-first features

Why an NFT marketplace?

The team sees NFTs as a core primitive for many things in the future (e.g. social communities, gaming experiences, etc.).

An NFT marketplace thus provides an opportunity to innovate and build things for these use cases.

Compared to incumbent NFT marketplaces, the Magic Eden team wanted to create a more immersive experience, with greater discoverability for creators and expanded creator bases.

What does it mean to build a company in Web3?

To Magic Eden, building in Web3 is not just about taking the Web2 playbook and copy-pasting it into Web3.

Web3 itself offers unknown innovations and opportunities not found in Web2, giving them a chance to make bolder, future focused strategies.

Another key feature of Web3 is decentralisation. Magic Eden embraces this by prioritising community over centralisation - focusing on a two-way dialogue and participative nature with users.

For example, the Magic Eden DAO gets to decide what gets featured on the first page of Magic Eden.

What makes a marketplace great?

Traditionally, we consider a marketplace as just a platform for users and sellers to meet, transact, and be on their way.

Magic Eden sees great marketplaces as being much more.

Great marketplaces give value to users before they even buy anything:

• For example, users can just go to Magic Eden, be inspired by NFT culture and experience value of NFTs, without making a purchase

Great marketplaces also often moving and experimenting fast, aiming to be first:

• Magic Eden is the first marketplace to have immersive games and content

• Experimented with many features - e.g. Whitelabelling Magic Eden in other brands, using NFTs as a sports bracket

How does Magic Eden attract and retain the best creators?

First, Magic Eden needs to make sure that they are in the conversation when creators are thinking of doing something with NFTs. This work largely lies within the Business Development and Marketing teams to reach the creators and spread the word of Magic Eden.

Next, when creators want to get started, Magic Eden needs to make it as easy as possible for creators. Creators also want to best find and match their NFTs to their ideal audiences, and Magic Eden needs to offer that match. These efforts will be helmed by the product team from Magic Eden.

It is truly a full team effort, from awareness to usage to retention of creators.

Enjoyed this interview?

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