Flipside’s GodMode Post-Mortem
What we learned about SaaS NFTs
On June 8th of this year, we launched an NFT series.
Today, we’re retiring it.
Let’s explore what happened, and what we can learn from it (with data, of course):
GodMode — the gig NFT
Flipside created GodMode to test the bounds of NFT utility.
Unique, chain-based digital ownership has potential energy far beyond the use cases currently taking hold of markets, and we wanted to explore how NFTs could benefit our community and culture.
One such area full of unrealized potential, we noticed, was SaaS — why aren’t NFTs being used as software licenses?
Software subscriptions are relics of Web2 business models that lie undisturbed, squeezing money from people monthly while granting them no say over the process.
As Web3’s decentralized, autonomous ethos was unifying products and platforms with community-building, software subscriptions seemed to us a logical next step in the disruption cycle.
Then, we wondered: Can we take it a step further than just a subscription?
People use the same software for a variety of functions to suit their unique goals, so why aren’t there better personalization options?
What is (was) GodMode?
The bounty program is a process through which partners like Flow, NEAR Team, Optimism, or other protocols bring goals and insight requests to Flipside, which we then present to our community of analysts in an opportunity to earn money.
Bounties are broken into difficulty tiers from easy to elite, typically corresponding to the amount of queries needed to fulfill the prompt. Bounty submissions are then graded to a maximum score of 12, needing an 8 or higher to pass and receive payment.
GodMode was the first test of our hypothesis that there was room for improvement in the Flipside app/SaaS vehicle — it was a limited-supply NFT series that granted Flipside analysts unlimited access to bounty questions in our bounty program.
For anyone wanting to earn money as a data analyst, GodMode was a ticket to unlimited gigs. If you knew you could “go pro”, but didn’t want or know how to find bounties, you could just “go GodMode” and get to work.
On its own, GodMode is a role NFT, a token which grants access rights to a community member within a specific function.
But when you combine multiple role NFT types under a software or platform umbrella, you create a powerful community in which each participant has a purpose that they chose. This was the disruption we aimed to explore with the GodMode experiment.
But did it work?
We’re not retiring GodMode because it didn’t work.
On the contrary, we’re retiring GodMode because it worked too well for current structures to keep pace.
By the end of this post-mortem, one thing you’ll hopefully take away is the power of role NFTs to create purpose in a community. If you have a product and your goal is to create as much value as possible for your audience, the opportunity can’t be understated.
Even if your goal is simply your own brand’s growth, your brand benefits from fulfilled users that find personal, custom-created value in your product or service by owning their participation.
GodMode has a total supply of 1,000 NFTs, the public mint portion of which minted out completely and generated 67.3 ETH.
After a successful mint, the newly-created private Discord channel for holders was alive and electric — drive, excitement, and ideation took hold. People were talking about doing analytics full time, showing off dashboards, trading insights, and making friends.
The original hypothesis was first validated by the initial reception, but proven by the follow-through.
In less than 90 days, nearly 13,000 bounties have been submitted by GodMode holders, a marked increase in participation:
But as is often the case when running tests, the process revealed several structural opportunities for improvement.
As of August 30th, 644 wallets owned all 1,000 NFTs, setting the average ownership at just over 1.5 GodMode NFTs per wallet:
Holding more than one GodMode NFT doesn’t offer any additional benefit other than potential resale value, so while this can benefit holders, it’s inefficient distribution for community scale. Because utility was the primary value proposition from the beginning, beneficially, distribution was not as concentrated as popular profile picture NFT projects, for example.
Concentration isn’t a critical issue, given that as the role expands and more potential holders join the platform, a 1,000-owner critical mass would likely be attained naturally. However, early distribution silos can affect adoption, program participation, and profit expectations, all of which should be closely attended to.
The GodMode role led to drastically increased participation rates, even when it meant increased competition for bounty payouts. At its height, GodMode holders submitted 3x more bounty responses than non-holders:
Despite comprising just 5% of Flipside users, as shown in the first chart below, GodMode holders claimed an average of 25% of all bounties, as evidenced by the second chart below:
In addition to doing more bounties, GodMode holders also did harder bounties, driving payout still higher:
Adjusting the core bounty program
The drop off in bounty submissions and decrease in easy bounty submissions in the previous charts was the result of a separate change to the bounty program.
The increase in submissions with GodMode provided more data on submissions and exacerbated trends that were detrimental to the bounty program as a whole.
For example, across the bounty program, lower-tier bounties and a lax grading scale gave no incentive to create top-tier and top-quality submissions (as an “8” grade and a “12” grade submission receive the same payment and difficulty didn’t always correlate to higher bounty payouts).
So, we refocused the bounty program to provide the highest value to the partners requesting them, and to better reward the analysts that do the best work. This meant realigning payouts to higher grades and higher difficulties.
What it cost
GodMode holders submitted nearly twice as many bounties on average, which, when added to their proclivity to take on harder bounties with higher payouts, led to an outsized increase in payouts:
The average cost to purchase a godmode nft including fees was $201 at minting and $467 on the secondary market.
Over the 12 weeks of the program, a holder only needed to do 10 bounties on average to cover the cost of a secondary market purchase.
With the weekly average of submissions roughly doubled, the average GodMode user earned $1,271 during the program, more than enough to cover the cost of purchasing the NFT in any context.
The total paid to GodMode users was $485k in just 12 weeks, while the NFT sales generated $123k ($104k in mints and $19k in secondary sales).
While the program was designed to pay out more than it generated in NFT sales, the speed with which the total paid climbed was months ahead of our projections. With low resale value to keep pace with a drastically increased submission volume, the sustainability time frame of the program shortened considerably.
The end of GodMode
The results of GodMode weren’t only applicable to its holders. The 12-week process was a kind of stress test on the Flipside bounty program as a whole, bringing to light multiple opportunities for improvement.
We organized a core task team aimed at adapting GodMode to optimize it for the long-term health of the bounty program. For weeks we performed extensive modeling, cost estimations, incentive structure simulations, and more to determine the most efficient and rewarding structure in light of GodMode usage.
All data lead the team to the conclusion, however, that the best path forward for improving the integrity and sustainability of the program did not include GodMode.
As a result, we’ve decided to retire the GodMode program and use what we’ve learned to find better ways to engage and reward our community.
But it’s not the fault of GodMode holders that the program can’t continue, nor should they bear the downsides of its conclusion.
To that end, we’ve refunded each current GodMode holder for the amount they paid for the NFT, plus transaction costs, so that the experiment ultimately came at no cost to those who participated, and anything they earned answering bounties is unaffected.
What we learned
Let’s talk about failure.
We strongly felt that Godmode would benefit the client and the community. In the end, it was ineffective at supporting both — as well as flipside as an organization.
This failure we own, and this failure is something we are willing to do our best to solve.
Failure is one of the few possible outcomes of the scientific method — it always points in the direction of another outcome, of other choices.
If executed on, then failure becomes an achievement. It’s the learning that benefits the entire ecosystem.
In the case of Godmode, there were a few key takeaways we’d like to share, as we aim to build the next great version of the flipside ecosystem:
1. People find the simplest route to outcomes
GodMode drove explosive submission growth because it simplified participation. By framing participation around a single goal (earn money with bounties) and removing limits, it was everything an analyst needed to achieve that goal, with nothing else to distract from it.
The bounty program relies on a more complex relationship between multiple parties, so GodMode was too simple a route to benefit all participants fairly and efficiently. Yet, the strength of simplicity remains a key point that will inform decisions going forward.
2. SaaS is ripe for NFT disruption
GodMode wasn’t the right implementation for our present setup, but software subscriptions as NFTs is a paradigm worth exploring.
The power of NFTs to create personal identification with a platform can serve SaaS models well, if done well. GodMode holders correctly assumed a sense of ownership and stake in the bounty program, following updates and debating the future of the program. This alignment contributed to the increase in bounty participation and collaboration between the greater community.
3. Role NFTs let your community choose how they participate
Redefining the user experience with “user participation” is a paradigm full of value.
By loosely defining a role within your community and providing a tangible “badge” in the form of an NFT, you can simultaneously create concrete boundaries for effective participation while giving your community the autonomy to decide how they participate within those bounds.
By differentiating roles within a community, you further empower each person to personalize their experience.
4. You can choose how you adapt
When the data came back that GodMode was becoming unsustainable, we had to decide how to resolve the program in a way that was most respectful to both the holders that embraced the program, our broader community, and the sustainability of the platform around which we gather.
Refunding holders was the first step.
Continuing to experiment in pursuit of progress is the next.
5. Put learnings to use
GodMode directly inspired a different iteration of SaaS NFTs at Flipside, in the form of ShroomDK.
ShroomDK is a free NFT for builders who need comprehensive data. It grants access to our SDK, and it’s popping up everywhere, powering web3 projects across the industry.
Ultimately, everything we’ve learned with GodMode has found its way into practical implementations. As always with good data, the application is the opportunity to create progress.
At Flipside, experimentation is a central tenet. What else is data for, and where else is it found?
We’ve got more than just NFTs under the microscope:
- We recently welcomed a new GM of DAOs to investigate the potential of decentralized organizations.
- We’re in pre-production for a content series teaching everyone from beginners to former GodModers how to level up their analysis and best market their skills and insights across platforms.
- We’re upgrading our platform from all angles; adding features, increasing usability and shareability, creating new ways to query and display data, and more.
- We’re exploring new roles and benefits for our current community and building ways to help analysts that do good work share their work with others.
- We’re experimenting with events like sports bounty tournaments, blockchain scavenger hunts, build-a-thons, etc.
Free data for all
Whether you’re a founder, builder, or “user” (a human with individual goals that aren’t able to be summarized here), information is a powerful tool to have on your side.
Some people think they can charge money for that kind of thing, but I think we’re all better off when more people make informed decisions.
This qualitative exploration of our experiment can help you avoid some of the pitfalls in NFTs, but for more quantitative data, head to flipsidecrypto.xyz.