How Dirt Closes the Loop Between Commerce and Subscriptions

The digital media company Dirt, a blockchain-based publisher covering entertainment, has generated roughly $90,000 in one year by selling non-fungible tokens that will soon double as subscriptions. The effort offers a new framework for publishers looking to capitalize on reader support and diversify revenue streams. At Dirt, its NFT releases provide revenue but they also double as speculative assets, which buyers can hold onto or sell on the secondary market. (Dirt would receive a revenue split, generally between 10% to 20%, from all such transactions.) The structure blurs the line between subscriber and investor, letting passionate fans buy more deeply into the brand, said Daisy Alioto, the cofounder of Dirt. “How do you take a publication like Dirt that covers digital culture and NFTs and make that profitable?” Alioto said. “You take the editorial brands that have seen ecommerce success in Web2 as examples, but you replace ecommerce with commerce that happens on the blockchain. That way you keep what works from Web2, but you build blockchain into the DNA of the company.” Crypto Publisher Decrypt Launches Token Cryptocurrency for NFTs The system resembles a more complex, blockchain-based version of a strategy used by start-up media companies like Puck and Defector Media. Using paywalls, these nascent publishers have been able to translate the support of their loyal early followers into immediate revenue, letting them grow from scratch more sustainably. By covering entertainment and baking the blockchain into its revenue model, Dirt occupies a relatively unsaturated space in cryptomedia, cushioning it from instability as interest in NFTs wanes. How the Dirt flywheel works Dirt currently runs on newsletter service Substack, where it has more than 8,150 free subscribers that receive a daily email containing an original piece of writing. These readers represent the top of its funnel. Dirt entices these readers to become consumers by releasing NFTs in drops, mimicking the sensibility of streetwear culture, which relies on artificial scarcity to imbue items with a higher potential value. So far, the publisher has orchestrated seven total drops, all but two of which––a collaboration and a t-shirt NFT––grant their holders a Dirt token. As a result, Dirt has sold roughly 200 NFTs and created a pool of 195 token-holders, which brings the average revenue per subscriber to around $500, according to Alioto. The publisher then uses this money to pay its roster of freelance writers. In January, Dirt unveiled a third, more premium membership tier when it launched a decentralized autonomous organization, called DirtDAO. We look at Web3, DAOs and NFTs and we try to back them into our existing models of creating, distributing and consuming content.Jarrod Dicker, a partner at The Chernin Group As a reward for their early support, all 195 current token-holders were invited to join the DAO, who chat in a private Discord server. There, members exercise their perks, such as the ability to vote on which freelance pitches get written, giving them an active role in the editorial direction of the company. Later this year, Dirt will professionalize this process, transforming it from a blockchain-based crowdfunding tactic to a more accessible, consumer-facing product. Readers will have the option to subscribe to Dirt by purchasing an NFT––giving them exclusive access to paywalled content, events and products, as well as the ability to resell the NFT––or purchase a token, making them a member of DirtDAO and an investor in the company. Dirt announced Monday that it had raised $1.2 million in seed funding from a group of six investors, which it plans to use to expand its reach and build out DirtDAO. Turning digital media into a lifestyle brand In traditional media companies, commerce generally consists of affiliate links or merchandise sales––think New Yorker tote bags and NPR car decals––but fans have few ways to more deeply align themselves with the brand. At Dirt, fans can buy into the company itself. By selling limited-run NFTs and inclusion in its DAO, Dirt lets these dedicated subscribers spend even more money in exchange for deeper involvement in its operations. And, like investors, they stand to benefit financially if the publisher flourishes. Unlike legacy publishers like The New York Times and Playboy, which have sought to tack on cryptomedia elements to their businesses, Dirt is endemic to the blockchain space and built to operate within it. And unlike other media companies in the cryptomedia ecosystem, including Decrypt and The Block, Dirt is a lifestyle publisher, covering streaming, literature and digital art rather than cryptocurrencies and their markets. This positioning, aided by its founders’ backgrounds in media, enables it to bridge two worlds––blockchain technology and lifestyle publishing––that have yet to fully connect, said Jarrod Dicker, a partner at The Chernin Group specializing in cryptomedia. “We look at Web3, DAOs and NFTs and we try to back them into our existing models of creating, distributing and consuming content—and it does unlock some value that way,” Dicker said. “But I think it’s really interesting to look at what Dirt’s doing as an entirely new genre, where not only is the content going to be unique, but the type of customer is very different.” Publishers Continue to Experiment With NFTs, Signaling Their Potential Staying Power

Platforms

How Dirt Uses NFTs to Close the Loop Between Commerce and Subscriptions

The blockchain-based publisher turns readers into subscribers and subscribers into investors

Mark Stenberg

About

Subscriptions

Events

Publications

WORK SMARTER - LEARN, GROW AND BE INSPIRED.

Subscribe today!

Mark Stenberg