Azuki founder’s first response to the disaster: Overestimated oneself, underestimated the community, won’t sell the company

Azuki founder's initial response to the disaster: Overconfident, underestimated the community, won't sell the company.

The solution may be to make some adjustments to the distinguishability and to give Azuki priority on equity such as points. The disaster sale problem for Azuki is still not resolved and the price fluctuations for all series remain severe. In a phone call on June 30th, Azuki’s major investor and NDV fund founder as well as ManesLAB co-founder Christian and Azuki founder Zaga talked for a long time. The investor, who had previously offered $40 million to buy Azuki, shared the contents of the conversation with BlockBeats. In summary, the Azuki team underestimated the sentiment of the community and overestimated their own abilities. They don’t want to do anything related to fundraising and won’t sell the company.

BlockBeats: Azuki’s founder talked a lot during the phone call. The two most important things to everyone are why such a disastrous mistake occurred and the solution. Let’s first look at why it happened. Did Zaga explain why the image is almost the same as the OG version and why the high price of 2 ETH was set?

Christian: Last night, in a phone call with Azuki founder Zaga, we talked about the cause of this incident and the current state of the team. The reasons for the consequences of this disaster can be divided into several parts. The first is that the initial offering price was too high. The Azuki team initially thought that this price was reasonable based on their understanding of the price, sentiment, and market performance of OG Azuki at that time. They didn’t realize that the 2 ETH price was difficult to afford in the current macro market.

Secondly, the 10-minute sale time given to the holders during the auction was too short, resulting in many holders not being able to mint. Zaga honestly admitted this mistake and said that there were some discussions and differences within the team at that time, but they ultimately decided to proceed with this interval time. He did not give specific reasons, but I guess they thought that Azuki holders would not mint all of them. Therefore, including the price, he said that it should enter the public sale as expected and the price would be lowered through Dutch auctions. However, they didn’t expect such a strong reaction and the sale was sold out instantly.

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In summary, I believe the main reason for this crisis is that Azuki underestimated the community’s expectations and overestimated the quality of their product. Personally, I think there are still some good aspects to the Elementals series in terms of production, and the quality of some of the images is good. But what is most criticized is that the images are too similar to the OG version, without any distinction, which harms the interests of the community. The team did not consider this before, and they admit that they will use a series of methods in the future to distinguish better and meet everyone’s expectations and positioning for different series.

BlockBeats: Do the teams currently have any ideas for feasible solutions in this meeting? I saw news that there may be a change in the image to make Elementals different from OG.

Christian: The current plan to change the image may be the team’s final decision. In yesterday’s communication, Zaga emphasized that the focus is to highlight OG Azuki, and he also mentioned that OG Azuki is definitely the most core series in the community and belongs to the top identity symbol.

He believes that the Azuki series represents very cool member attributes, and may also provide more rights to OG Azuki in the future. The team’s solution may make some adjustments in recognition, and give Azuki priority in benefits such as points to appease OG Holder’s emotions.

BlockBeats: You said on Twitter that the $40 million acquisition price is too cheap. Does Zaga have any opinion on this price, or do you think Azuki’s value is far higher than $40 million?

Christian: Yesterday I also clarified that the price of $40 million is definitely not available. After yesterday’s communication, Zaga has no intention of selling the brand, and this incident is not an intentional act of rug or fundraising. The reason is still as mentioned above, they overestimated their ability and the quality they delivered. When I said on Twitter that $40 million was too cheap, I didn’t mean that Zaga had raised a higher price, but that he had no intention of selling the company at all. Because there are many core contributors in the Red Bean Chinese community around me, everyone’s emotions are very low now, and many have begun to change their attitudes. I and Zaga proposed this situation, and he also apologized in the communication, acknowledging the contributions made by core builders such as County Princess to the brand, and also mentioned that he will pay more attention to the Asian and Chinese markets and communities in the future, and will continue to host offline activities in Asia this year. I hope this can give the community some confidence.

BlockBeats: What other key points do you think can be shared with everyone in this meeting?

Christian: We also talked about the development direction of Beanz. As the largest Beanz Holder, I am honest that I am a little disappointed with the progress of Beanz so far. Zaga said that in their conception, Beanz and Azuki are separate, and the two routes are relatively independent. This year, Beanz will focus on cooperation with Line, and some incubation of physical plush toys and peripherals similar to penguins are being carried out, which are already in production and operation, but details have not been disclosed too much before.

He also thinks highly of Beanz and even believes that in terms of IP, this character has greater potential than Azuki. He said that, compared to Azuki which focuses on being a unique and rare symbol of identity, the Beanz character is cute enough and easier to approach, making it suitable for mass promotion as a cartoon to reach groups such as children, which is their target and expectation. He also mentioned that Beanz will play a relatively important role in the worldview of Azuki in the future.

Finally, he also emphasized that Azuki’s future IP operations will not be limited to the Web2 model. He has different ideas on how to combine IP with the concepts and technologies of Web3, hoping to overturn the traditional IP operating model. The production of the animation is also underway.

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