Creating Value Through Collaborations
Kristopher Shinn created $500,000 of value for holders of "By Way of Water" in one month. Already up 3X, price is yet to reflect future collaborations with top artists. Dive in for more details.
With almost no sales between April and December, the photography collection By Way of Water suddenly saw an influx of buyers who drove the floor price from 0.88 ETH ($1,100) to as high as 2.75 ETH ($3,500). Sixteen sales for a total of 25 ETH ($32,000) in one month.
Based on its most recent price of 2.30 ETH ($3,700) as of January 23, 2023, By Way of Water by Kristopher Shinn is valued at 230 ETH ($370,000). This puts it among the top-15 most valuable photography collections on the blockchain.
How did the 1-year old collection rise so much so fast at such a difficult time in the market when over 90% of collections have failed to hold value?
By Way of Water: volume & price dynamics
Top photography collections by market value
Standing out in a crowded space
Web3 is evolving fast. Artists are pushing the boundaries of their creativity every day, exploring, experimenting, trying new things, and launching innovative work.
The bar to stand out and succeed is significantly higher today than it was a year ago. In 2021, the rising tide was truly lifting all boats. August 2021 was the strongest month for photography. Nearly 150 photographers launched their collections, selling out and grossing over 3,000 ETH ($10 million).
Fast forward a year and it’s significantly harder for artists to capture attention, let alone sell their work. There are 100X more artists sharing their work. Meanwhile, the market has shrunk, with sales down 90%. (In October-December, photographers grossed, on average, 600 ETH ($750,000) per month.)
Even artists with established reputations, sold-out collections, and strong families of collectors find it difficult to thrive in the current market. On the most recent episode of 100 Proof podcast, investor and art collector Derek Edwards highlighted three factors that successful artists do to drive attention to their work:
They innovate and continue to make interesting work
They build in public, network, and constantly expand their community
They participate in conversations about the trends happening around their art
There are just a handful of photographers who have consistently remained in the spotlight. So when I saw By Way of Water by Kristopher Shinn having a resurgence in December I got curious and dove in to investigate.
By Way of Water
By Way of Water is a collection of 100 photographs by Kristopher Shinn that he shot riding the ferries in the greater Seattle area where his family lives.
Even without knowing the story behind the collection, viewers are instantly drawn to the diversity of stories unfolding on every photograph. They instill a sense of wonder and encourage viewers to dive deeper and learn more.
The first 30 photographs were released in August 2021. Collected by many of Kristopher’s fellow photographers, the collection slowly began to gain attention. Kristopher followed up with 20 more photographs in October and 50 more in January by which time he had strongly established himself as the “ferry guy.”
Rewarding early supporters
Selling artwork as an NFT is a big deal. Selling out a whole art collection is a colossal effort. Sustaining value, let alone growing value, is a very challenging.
The magnitude of what Kristopher Shinn was able to do – sell out 100 photographs at 0.25 ETH (~$1,000) a piece – cannot be overstated. Grateful for the enormous support from the community, Kristopher was determined to reward collectors that believed in him and bet on him early. The task was made even more difficult as the markets tumbled and sales volumes ground to a halt in the second half of 2022.
In December, Kristopher surprised his collectors with an artwork by one of the top trending artists Terrell Jones. Ferry Date was gifted to all 100 holders of By Way of Water and resold on secondary for as much as 1.35 ETH ($1,800). This is more than By Way of Water was worth before the surprise airdrop.
Kristopher followed up with three more collaborations – with Storm, Efdot, and Space Case. Artwork created by these highly regarded artists significantly expanded awareness about By Way of Water, attracting new collectors, creating value for existing holders, and exposing his audience to the four talented artists.
In one month, 16 new collectors joined the By Way of Water family, driving up the price to as high as 2.75 ETH ($3,500) and allowing select original collectors to lock in their gains. Moreover, the Ferry Date airdrop allowed By Way of Water collectors to partially take profits, as 20 collectors chose to sell the airdropped artwork.
With these high-profile collaborations, Kristopher Shinn built such strong momentum that if he launched a new collection today I have no doubt it would sell out instantly. This would not only allow Kristopher to expand his family of collectors, but also further extend the reach of his art brand, capture more attention, and therefore drive more value to his holders.
Kickstarting the value flywheel
There are various approaches to building multi-million dollar art brands. Some artists lean into scarcity. For example, DrifterShoots has built an $7 million art brand based solely on his Where My Vans Go collection. Only 125 pieces, with prices starting at $60,000.
In contrast, Guido Di Salle created $3 million of value by constantly onboarding new collectors. He maintains a balance of scarce and affordable work, constantly creating opportunities for his existing holders to obtain more exclusive art (some editions are limited to 30 pieces with prices starting at $2,000), while releasing new work in editions of 2,000+ for as little as $30 to onboard new collectors. As his network expands, every piece in his collection accrues value.
The strategy can be summarized in a simple flywheel:
Reward collectors.
Release new work.
Repeat.
Repeating this cycle prompts the flywheel to spin, driving value to holders, both early supporters and those who joined recently. Repeated enough times, the flywheel starts creating more value faster. In the long run, it is possible for the ecosystem to sustain itself and grow on its own. I’ll explore this in a separate article about CC0 (Creative Commons) and artists building their brands by relinquishing their IP rights.
Building a lasting brand
The value flywheel is an effective strategy. It implies the artist pushing the boundaries of their creativity, spreading awareness about their work, and proactively creating value for their holders.
In the early stages, the spin of the flywheel is sensitive to the nature of rewards and their consistency. Kristopher’s By Way of Water surged to 2.30 ETH in one month. However, would it continue to appreciate, let alone maintain its value, in the absence of future collaborations and airdrops? The price would probably settle above the original floor of 0.88 ETH, but I doubt it would sustain its current level.
Kristopher says there are more collaborations coming. As a big collector and supporter of other artists, Kristopher secured collaborations with artists whose work he’d collected himself, including Pop Wonder (ATH of 59.6 ETH), Juice Bruns (6.9 ETH), Natasha Chomko (3 ETH), DeltaSauce (2.3 ETH), SIGMA-X (1.3 ETH), and other high-profile creators. Besides sourcing these collaborations, Kristopher is actually investing his own capital into commissioning these artworks and splits future royalties 50/50.
Regardless of where the value goes from here, Kristopher’s collaborations are an exciting experiment to watch. I look forward to seeing collaborations he creates next and whether he starts rewarding holders of his other collections. And I have no doubt that if his experiment proves effective and sustainable, we’ll start seeing more artists collaborating with each other and expanding value for their communities. The massive wave of open editions is certainly calling for novel experiments.