Reflections on "Community"

Social tokens are not "community as a service", they are a "service" for a community ... that is, if you have a "community" to service.

R.N.G. (Random Number Generator) launched exactly one month ago, on October 10.

It's hard to believe it's already been a month, and even harder to believe it's only been a month. High on the thrilling engagement of that first week, I had managed to convince myself within days that social tokens were like magic fairy dust: sprinkle some on any crowd, and boost engagement and retention 10x.

Five days in, I consulted Raph Koster for his thoughts on our social experiment. He responded with a degree of measured repose that at the time I brushed off as "generational disconnect", but which over further reflection, I have come to agree with wholeheartedly.

For all the buzz surrounding R.N.G.'s ethos of coalescing diverse groups into a shared pool of common interests, all Raph saw in those early days was a money game:

Raph: "Tally the number of channel titles that mention or reference currency acquisition and wealth levels. It's clearly an extrinsic motivation architecture, at least in its messaging. Oh, I don't mean there is no organic element. But even the onramp is literally 'here's how to claim your play money.' It's framed around that."

"Community" is a fascinating rabbithole. Overused, misunderstood, and in constant evolution. One of those things you think you understand, and might even be crazy enough to try and build yourself, it's all jolly and well until you realize one day it might actually might mean something. Because you've tied your social capital to the endeavor, you know the game must go on. Yet, that next stage of evolution cannot happen until you come to terms with one key fact: "You're marrying your playerbase." (Thanks Raph, for leaving the most important conclusion for the last sentence of your blogpost.)

Raph: "An amazing first date ends with planning the wedding in your head, wondering about what your future kids will look like, where you will live, and doodling your names in hearts in the margins of your notebooks. Same with a player: you want them to be plotting what they will do when they return. you want them to have daydreams about future goals. You want them to be curious about the cliffhanger. You want them to be doodling fan art in the margins."

Any reasonably clever monkey can create a short term game, especially ones that promise rewards to early adopters. How many waitlists have you signed up for without knowing whether you even want the product? A week ago I was bombarded with images of the Backbone being hawked by gaming influencers on Twitter, and I felt an uncontrollable sensation to join the waitlist. Today, I was told I had 24 hours to purchase the device, and very nearly did, until I thought, wait a minute, do I really need a $100 controller for iPhone games...? (OK I bought it anyway, but I'm not proud of myself!)

It's much harder to plan a wedding. In a world fueled by attention, desire and the fear of missing out, I certainly side with Naval in thinking the ultimate antidote is to "play long term games with long term people". Eric Jorgenson's Navalmanack neatly illustrates the point:

Yet, it's one think to talk about long term games, it's another thing entirely to actually develop one. I started R.N.G. as my own antidote to the zero-sum thinking I had been inculculated in over a decade of working in investment banks and biglaw. I desperately wanted to prove that one could in fact create something out of nothing, by mixing disparate interest groups under the common cause of a shared social token. One month in, the R.N.G. experiment has gone reasonably well, with over 1,400 people in the Discord, D7 retention hovering between 20-40%, and a ton of quality engagement from quality people.

Yet I find myself asking one thing over and over again: is it really possible to build a long-term community modelled on the "Ownership Economy", without crushing the entire effort before it even begins under the weight of the "money game"?

In those formative first few days, my answer was yes: I argued that the wonder of the social token model was precisely the fact that it could unite disparate interests under the unifying banner of shared currency. As usual, Raph offered a more measured perspective:

Raph: "Community exists because of what they share first: values and interests. Money is a way to reduce friction and improve trust between people who don't share values, interests, and the like. Money exists so you can engage in exchanges with people you do not know or trust or like. Communities exist for the exact opposite reason. You do not build a community around a currency. You build a currency around connecting communities."

For all the talk about how crypto is changing the world, the vast majority of token-based projects are short term games that structurally devolve into glorified pyramid schemes. Inflated expectations lead to the classic boom-bust cycle where speculative intent runs ahead of reality, and eventually, it all falls down.

Naval: "Play stupid games, win stupid prizes."

The turbocharged incentive structure that makes crypto so potent in the long-run is exactly what makes it so problematic in the short-run. If all you've built is a money game, then all you're going to attract are infinitely elastic yield farmers. And in so doing, you're going to alienate the core of the community you hoped to build in the first place. This is the crux of the problem that many token-based communities face: whether they acknowledge it or not, they are so focused on token price that they lose sight of why they were created to begin with--the shared values and interests, the intrinsic motivators, the glue that is left when all other bindings are stripped away:

Raph: "Game design can be thought of as the structuring of incentives.... Money (virtual or not) is a very blunt instrument, because it incents strongly but mostly as an extrinsic reward. Ideally, you find a way for the monetary rewards to tie into intrinsic motivators."

Even in the context of communities that have already gelled around a core interest segment, Raph offered cautionary thoughts on the impact of introducing token structures:

Raph: "Carefully consider whether it would help or hurt an existing community. You're essentially introducing a whole new incentive structure. If it's compatible with the existing community, great. If it's not, it could be very bad. If you already had a community where you did things like regular contests, then stuff like airdrops might be fine. If it was entirely a mutual support community, something like airdrops might run contrary to the spirit of \the place.... Not all communities are made better by money or "money" or incentives at all. Even just reputation systems can be damaging if they don't fit the culture. Especially ones with downvotes. In short: every time you introduce a metric, you are encouraging people to perceive the space as being based on that metric."

These nuggets of wisdom were profound not so much in isolation, but in the context of the analysis they forced me to walk through. We often overestimate what we can accomplish in the short-run, and understimate what we can accomplish in the long-run. So if I were trying to build a 20 year social game, how would I design it, and what should I be incentivizing today in order to take concrete steps in furtherance of that vision? Lucky for me, five days in, Raph already laid out the roadmap for me:

Raph: “I notice way less activity today -- not every channel is lit up with a 500 mesage backlog! -- and also see discussions here and there on bringing in more people, etc. It makes me think of the classic stages of customer lifecycle, which I define slightly differently than most. I think it's worth [thinking about these stages in terms of what is getting built here]("

1. Targeting

2. Messaging

3. Barriers

4. Sampling

5. Conversion

6. Retention

7. Content

8. Community

9. Re-engagement”

I mentally bookmarked this suggestion, and promised myself to assess the community that was forming against these standards after one month had passed. In Marketing, Raph summed up the playbook for getting "married" in the following steps. Now seems like the ripe time to reflect on where we actually stand:

Make them a promise. (Targeting/Messaging)

Early on, I described what we were building as follows: "R.N.G. is a curated, members-only social club for the gaming/interactive community (founders, investors and enthusiasts). Early members get in for free and own substantialy all (80%) of the upside of the endeavor. A crypto ERC-20 token called $RNG serves as the binding layer underpinning community access, coordination and incentive models. R.N.G. is intended to serve as a social experiment at web3 scale, as we organically bootstrap a community of innovators and tinkerers from diverse backgrounds in seeking to drive the creation of, well, something ... from nothing." For the crypto-saavy types actively participating in R.N.G. today, this definition makes perfect sense. For the other 99.99% of the target audience, I lost you after the first sentence.

If “brands are iconified shortcuts intended to trigger emotional reactions,” as Raph says, the only thing R.N.G. seemed to engender was “confusion”. So now, I describe R.N.G. in simpler terms: it’s the "Virtual Soho House for the Curious".

Specifically, we are targeting three personas: "Intellectual", "Creative" and "Gamer".

For the Intellectual: We have created a virtual space for founders, investors, media and gaming/art enthusiasts to come together and share "The Knowledge", participate in book clubs and seminars, and experience virtual entertainment that blurs the boundaries between the physical and the digital.

For the Creative: We have established a "creative haven" for artists and developers to meet other interesting folks across the digital art and blockchain gaming landscape. We have also hosted "creative competitions" that illustrate our own twist on how marketplaces for digital collectibles should operate, bundling three disparate functions into one: creation, curation, and capital.

As an early example, in our first Artist Challenge…

We asked the community to submit pieces on "RNG Impressions". It was amazing to see the 20 submissions that came back from members all over the world, especially the ones who don't normally think of themselves as "artists". These pieces have been minted into 3-edition sets of blockchain-based digital art in The RNG Vault. One piece will remain in The RNG Vault, one will be auctioned to the RNG community in $RNG (100% to the artist), and the final one will be kept until a later date (possibly for listing on an internal marketplace, with 80% going to the artist and 20% to the Treasury). If early indications from our first digital art auction (31 pieces from RTFKT's creator community) are any indication, we are in for a wild ride at the next $RNG art auction.

For the Gamer: Inspired by D.I.C.E., we have established 2x per week Poker tournaments (on Thursdays at 3pm EST and Sundays at 9am EST) and a weekly MTG Arena Swiss bracket tournament on Saturdays (together with a quarterly league-wide ranking). We are setting up more gaming tournaments soon. I'm excited about the potential for R.N.G. partnerships with esports teams and streamers to grow R.N.G.mindshare. We've already inked our first branding partnership with the TST Gods Unchained team, all in the native $RNG token.

What Gives $RNG Value? Naturally, all this begs the question, what gives $RNG value? My answer is simple: its utility as a virtual currency. Today, $RNG serves as the access gate and status symbol for various roles in the R.N.G. Discord. You can also use it to buy digital art auctioned in $RNG (like the RTFKT Creator Community collection), or use it as the currency for certain blockchain games. Over the long run, $RNG will boil down to a call option on mindshare expansion: the ability of the R.N.G. community to continue capturing the hearts and minds of its users, and the willingness of a wide range of buyers/sellers to adopt $RNG for digitally native transactions across the ecosystem (i.e., the GMV of the R.N.G. ecosystem). To use an analogy, imagine if Fortnite v-bucks were tokenized and there were only ever 10m v-bucks issued, with skins were priced in a variable amount of v-bucks such that the USD price of skins was held constant. The upside to early v-bucks token holders in this scenario is straightforward to understand, as v-bucks become in progressively shorter supply.

So what's the price of $RNG then, and how do you buy it? Today, it has no price, and you can't buy it, you can only earn it (with zero cost basis). If bringing short-term liquidity to $RNG were a priority, we could use liquidity mining incentives (rewarding liquidity providers into automated market makers with $RNG for that liquidity) to generate deep liquidity overnight. But I fear that doing so would attract all the wrong types to the community, in addition to being a significant drain on community resources. Why not reframe expectations instead? If what we're building here is a 20y+ project, and we are in the seed stages of the venture, why should anyone expect liquidity in the first few months, let alone the first year?

Show them the reality, and make sure it matches. (Barriers)

Raph: "You’ve caught their attention by shouting something that briefly popped out of the ongoing noise. They have turned their head. Now how much effort do they have to expend to get close enough to see if they actually like what you have on offer? The answer had better be 'as little effort as possible. Every time the user must make a decision, they weigh whether it makes sense to continue with the process. Your message lit the match, and depending on their affinity for the message, they have varying amount of fuel. How far they go once launched is dependent on how many times they have to recommit."

R.N.G. is based in Discord. "Discord is like a country with 100 million inhabitants, living in different states and towns." Outside of its core gaming audience, this "country" is not regularly visited by most people I know. For a first time user, Discord certainly does not give you that warm, fuzzy, inviting feeling.

Layer on top of that the onboarding frictions for social money once you're in Discord, and you have the perfect recipe for good ol' country churn. Crypto communities have developed a real affinity for using tokens as access gates (i.e., the channels you can see are a function of how many tokens you hold). This approach presumes a high degree of audience awareness around the rules of the game, and the audience's willingness to play it. Unfortunately, most just give up at a certain point after deciding that bad/clunky UX is not worth the initial curiosity that led them in....

My own thinking on this topic has flip-flopped quite a bit. Initially, we opened up all channels to everyone, even to those who didn't complete the registration steps for token-based access. Then, thinking that the issue was that new users were overwhelmed by the number of channels, we closed off access entirely except to those who registered. That approach did not work well given the buggy state of web3 infra. So we've now settled on a middle ground: you can attend events, join art and game dev discussions, and participate in gameclub events, all without touching $RNG. But to access the other channels around opportunities to earn $RNG, sports, tv, film, music, etc., you need to register. A certain amount of friction is inevitable, but with this middle ground, I hope it's finally manageable.

Woo them with an amazing first date. (Sampling)

Raph: "The player has not yet made an emotional commitment; they are on a first date. And that means you don’t have them yet. You are still selling them. You don’t actually have them until they decide to go steady. All this leads to the actual sampling. You still haven’t really sold the user on the game. Now, however, the user is yours to lose. They hurdled every barrier you put in their way because you told them “there is pizza and ice cream inside.” Now here they are. You had better show them pizza and ice cream.”

“So you had better make sure that what they encounter is both familiar and startling; saves the awesomesauce for later but is also amazing off the bat. I think it was Alan Pavlish who taught me to call this the James Bond moment. Think of the first part of any James Bond movie: an amazing action set piece, Bond pulling off something impossible, and enough of the flavor of the entire movie to serve as a teaser. Even when the film series changed tonally, as it did when Daniel Craig took over the role, the opening sequence still served as a mini-movie that summed up what was to come; the parkour sequence in Casino Royale and the opening sequences in the earlier films accomplish the same purpose, even though the vibe is very different.”

As much as I would like to believe we've created pizza and ice cream that is "familiar and startling", what we've actually created is stone soup that is "unfamiliar and overwhelming". I feel the solution for all of this is quite clear: targeted onboarding funnels with no access gates, to funnel users to their first date as quickly as possible.

  • If you've come for one of our "tip culture" seminars with live audience chat --> go to RNG Chat.

  • If you've come for the wonky intellectual discussions --> go to RNG Wonky.

  • If you've come for discussions on digital art or blockchain game dev, or to participate in the creative competititons --> go to RNG Creators.

  • If you've come to play a Poker or MTG Arena tournament --> go to RNG Gameclub.

And then, only if you like what you see, register for the tokens so you can participate in the meta layer of the social currency.

Learn to read their emotional desires. Keep the relationship fresh and varied. Give them moments of glory. Protect them from humiliation. Help them learn about themselves and be creative. Talk regularly and honestly. (Conversion, Retention, Content, Community, Re-Engagement)

Raph: "The moment when they decide to return after the first date is what we call conversion. What makes them stay? An emotionally satisfying experience. It has to be fun, meet their particular entertainment needs, surprise them, leave them curious as to what comes next, clearly have hidden depths to it that they are eager to master even though they don’t quite know what they are…"

What makes for an emotionally satisfying experience? The feeling that you're playing a fun game, and playing a part in something bigger. That game has to be predictable yet emergent, challenging yet achievable. Take what Raph calls Schubert's Law of Player Expectations:

“A new player’s expectations of a virtual world are driven by his expectations of single-player games. In particular, he expects a narrow, predictable plotline with well-defined quests and a carefully sculpted for himself as the hero. He also expects no interference or disruption from other players. These are difficult, and sometimes impossible, expectations for a virtual world to actually meet.”

Now mix that with Raph's point about how to keep the relationship "fresh and varied":

“The single greatest system ever developed for creating emergent content is other players. So multiplayer games where other users insert unpredictable factors into the mix, including their own personalities, retain better.”

None of this is straightforward, and I've largely given up on trying to find the "right" answer for anything at this point. Instead, I'm taking my queues on what feels like the right balance between planned events where we all come together, and bottoms-up contributions from the organic community that's developed.

“Make sure players can form a strong self-identity within the game. Otherwise, they will feel like an insignificant cog in a large machine. And yet, reinforce the sense that “we’re all in this together” via large-scale shared events. The holiday events, charity drives, and story arcs done as a common practice in live game management are great examples of this. Allow users to participate in groups with formal identity, in order to foster a greater sense of community commitment. In fact, provide membership in multiple groups at once (something few games permit!). Multiple group membership ensures that when one group fades, there’s another there to still web the player into the social graph.”

That basically sums R.N.G. up in a nutshell. And so to conclude another meandering musing, I leave you with a quote from Yurame's "Random Life", and the Three Rules of R.N.G.

"Life is like a video game.

Nothing happens as you plan.

Mistake after mistake, to get to the next level.

But in this video game everything is possible.

Everything is random."

To conclude, I leave you with the three rules of R.N.G.

  • The first rule of R.N.G. is: You do not talk about $RNG.

  • The second rule of R.N.G. is: You do not talk about $RNG.

  • The third rule of R.N.G. is: You do not talk about $RNG.