🏀Krause House DAO plans to buy an NBA team
(published 2/18/22) — If I explained the above image to James Naismith I think his head would explode. Let’s start with some bullets (not the ones from Washington).
- DAO stands for “Decentralized Autonomous Organization”. TLDR; they are digital groups that collectively deploy digital capital. DAO’s began as a sort of absolute crypto-democracy. DAO members would make proposals for programmatic changes to a currency or protocol and members would vote on the blockchain.
- Now DAO’s are more like “send ethereum to this address and you’ll get back shares. We’ll vote on how to use the money and your shares represent your ownership slice of whatever we spend the money on”.
- Krause DAO refers to Jerry Krause. Jerry was the general manager of the Chicago Bulls in the 80s and 90s when Michael Jordan won his 6 rings. Recently, the Jordan-centric Netflix documentary “The Last Dance” made him out as sort of the foil to Michael Jordan.
So how does it work? It’s basically a SPAC. More than $4 million has been contributed to Krause DAO’s treasury. They’re using that money to put together a team that will somehow purchase a $1.3 billion NBA team.
Minority shareholders don’t really get full voting rights. They can sort of informally weigh in on issues in the community Discord (a popular chat app for crypto-heads). And they’re promised game tickets and free event entries.
Will they buy an NBA team? No. A few months ago a DAO raised $40 million to buy a copy of the U.S. Constitution and was promptly outbid by a billionaire. Anytime shares of an NBA team go up for sale, there’s a long line of sports legends and Private Equity looking to buy. And to be fair, those are probably more desirable co-owners than a 5000 NFT holders.
I’m hoping to see Krause DAO buy a small team overseas or get involved with the Big 3 or similar league. That’s probably the best route to gain experience and credibility while creating value for their shareholders.
