The last 12 months will go down in history as the year NFTs broke out. Non-fungible tokens have been around since 2014, but their cultural relevance solidified in 2021, infiltrating almost every industry from art and music to charity and even floats in the Macy’s Thanksgiving Day Parade. Yet the multi-billion dollar market rapidly scaled this year without a critical piece to sustain this growth — proper infrastructure. San Francisco-based Mnemonic looks to change that.
“We realized in order to unlock the opportunity and value in this space, there was this key information missing, this data layer of everything that has ever happened in the NFT space,” Andrii Yasinetsky, cofounder and CEO of Mnemonic, tells Forbes. While this data was technically public before, Mnemonic looks to make it easier for companies to navigate and track the NFT market and build their own applications using its API. The startup has been operating in stealth since April 2021, but has already amassed partnerships with recognizable players in the space, including Dapper Labs, Yat and Mintable. The startup recently landed seed funding and is ready to launch to the general public early next year.
Mnemonic raised a $4 million round led by Kenetic with participation from Monochrome Capital — where Mnemonic cofounder Ben Metcalfe is a founder and managing partner — Sound Ventures and Tribe Capital, in addition to angel investors, as originally reported in Midas Touch newsletter. Tribe Capital knew it wanted to put money behind the NFT space and wasn’t sure where to start, firm partner Jared Madfes tells Forbes. Kenetic founder Jehan Chu — who led the funding — introduced Tribe Capital to Mnemonic. The firm really liked its potential scale and could already see how its tech could benefit some of the firm’s existing portfolio companies. “Pretty much every company is an Internet company, and included in that will be NFTs for a wide variety of them,” Madfes says. “You need to have a system like Mnemonic to reference and track this. This is a core building block for many company’s Web3 strategies.”
The potential use cases for Mnemonic expand far past tracking and compiling NFT data, the founders say. Luxury goods authentication is one potential future use case, Metcalfe tells Forbes. Brands like Louis Vuitton could make its authentication certificates into NFTs and use the tech to track whether its goods pass hands on the resale market. “When everyone has access to the data and can build off of it, it has a lot of merit to show transparency and enable people to do things with public data which is super exciting,” Metcalfe says. The startup has already received interest from multiple Fortune 500 companies. Elena Ikonomovka, Mnemonic’s third cofounder, says in the more immediate future there are uses in gaming and the metaverse in addition to fan engagement and creator tools.
The first NFT was created in 2014 by artist Kevin McCoy three years before the term NFT was coined. The medium really took off in late 2020 when Dapper Labs launched NBA Top Shot, a marketplace where consumers can buy and sell NFTs of notable NBA plays and moments. The market further gained clout earlier this year when digital artist Mike Winkelmann (Beeple) sold an NFT for more than $69 million at Christie’s. Last quarter, more than $10.7 billion was spent on the digital momentos, according to data from analytics platform DappRadar. Mnemonic joins a small but growing handful of recently formed companies looking to tackle the B2B side of the market like Islands which looks to help creators get involved in the NFT space.
“There is so much demand and interest,” Yasinetsky says. “We believe to provide and build more data visibility, actionability and accessibility to this data, as the rate that this data is producing is increasing every single day, is crucial.”