8 Oct

Visionrare’s “fantasy equity” NFT game shut down after just 24 hours

Phone and coins

Visionrare has temporarily shut down its “fantasy” NFT marketplace and is refunding users who purchased shares on the site. The app is expected to relaunch soon, but only as a free-to-play game.

What is Visionrare? Visionrare is the product of founders Jacob Claerhout and Boris Gordts attempting to take the gamification of investing to the extreme. Just as fans of fantasy sports can compete with friends by comparing the performance of their fictional teams, Visionrare users can compete to build the best-performing fake portfolios on the Visionrare app. The app aims to simplify the complexity of venture capital in an online format which is tied to the actual performance of the featured startups. 100 serialised “VisionShares” are auctioned off per funding round, one for each startup, with bids starting at $5. Users that have accumulated a threshold number of shares can then join a league and move up and down a leaderboard. Based on the performance of their portfolios, users are in with a chance of collecting a share of the collective value of the VisionShares.

 

Why was Visionrare shut down?

Even prior to launch, critics pointed out a number of flaws with the new app. Visionrare was encouraging users to spend real money on fake shares in real startups, most of whom never gave permission for their names and logos to be used in the game. Visionrare hoped to get around this by leveraging the game-like nature of the platform, as well as offering startups the opportunity to verify their profiles and receive a percentage of their NFT shares, but they had no formal go-ahead from the companies themselves, and were expected to accumulate plenty of cease and desist letters after launch. Indeed, in a note posted to the companies auction marketplace, the founders conceded that they had “underestimated the legal complexities” of selling novelty NFT shares in real businesses – suggesting they fell foul of objections from their featured startups. What’s more, Visionrare’s game mechanic is based on the performance of these private companies, most of whom have not consented to be included in the app, never mind sharing performance information. Startups are traditionally very careful about the information they release publicly, and so game users have nothing to go on but the game itself. Currently, Visionrare gets its startup performance data from Tracxn, which uses press mentions, social media and app downloads to track performance. This will lead to substantial disconnect with real-world performance at points, when intangibles can push valuations.

 

What’s next for Visionrare? The game’s founders, Jacob Claerhout and Boris Gordts, plan to relaunch the app without the financial element. Players will be given a fixed number of in-game credits with which they can build their starting portfolio, which they will use to compete in the virtual leagues. They hope to explore re-integrating the real world betting element at a later date, after resolving some of the more pressing “legal complexities” and structural flaws within the game. They hope that their market will one day serve as an opportunity for people interested in startups to show their flare for picking winners, and as a means to signal to VCs looking for new hires.