Today, Zach Burks is the 28-year-old founder of Mintable, an NFT, or nonfungible token, marketplace that’s backed by billionaire Mark Cuban.
But in 2012, Burks was a recent high school graduate heading off to serve in the U.S. Army. Before he left, he bought something called bitcoin at $5.50, and it defined the trajectory of his future.
“I actually have the email confirming my first bitcoin buy. I printed it out and it’s framed, I bought bitcoin so early,” Burks tells CNBC Make It.
After losing “a ton of money” trading bitcoin, but enamored by crypto, Burks found Ethereum and its currency ether in 2015.
“Bitcoin is a store of value that’s just going to be around, but Ethereum is like the internet,” he says, as it can power things including decentralized applications (aka, dapps), like games or financial tools, and NFTs.
NFTs are digital assets, like jpegs and video clips, that can be bought and sold. And since they are built on the blockchain, the ownership and validity of each can be tracked.
“I realized the power of what an NFT can do and how versatile they were,” Burks says.
So in 2018, Burks founded Mintable, a platform where users can mint (or blockchain verify), buy and sell NFTs. Amid a new wave of interest in NFTs – with the recent sale of NFT art selling for over $69 million at Christie’s – and within the crypto space overall, his business is booming, Burks says.
In March, Mintable announced it landed an investment from Cuban, who has used the platform to sell NFTs himself. Blockchain accelerators LongHash Ventures and ZILHive have also invested in Mintable, according to PitchBook.
Here, Burks shares more about Mintable, talks NFTs and Ethereum, landing an investment from Cuban and more.
CNBC Make It: What led you to start Mintable?
Zach Burks: I was one of the first to make money with CryptoKitties, which was the big intro to NFTs for people into crypto at the time. After CryptoKitties, I realized the power of what an NFT can do and how versatile they were. I fell in love with NFTs.
So in 2017, I was already full-time in crypto and I said, “I like NFTs a lot and I’m not going to do anything else.”
I made Mintable in 2018, the very first version of it. NFTs were still new. There was no support anywhere to mint NFTs. I realized that if we’re among the first on the internet to do something, that could be a really good business opportunity.
My team and I launched our alpha, our beta, and then 2019 to 2020, we were building the marketplace, which is what we have now and what you see now when you go to Mintable.
For those just learning about this, can you explain what Mintable is?
We’re like the eBay or Amazon for digital items that live on the blockchain. So, if you have a digital painting, or a trading card, or some music, you can sell it on Mintable.
You don’t have to have any crypto to make an account, so it’s a great way for someone to get exposed to crypto.
Even though NFTs have been around for a while, they had never really taken off because of the upfront cost or fee of minting an asset [which are known as “gas fees”]. The fees are charged [by the blockchain’s miners] to be able to transact on the blockchain.
For example, if you want to make one piece of art as an NFT, you have to pay like $50 to $150 just to do that. And that is prohibitive – you have people that don’t have that money or they just don’t know NFTs enough, like, “I don’t know if I want to put the upfront cost. If I use Etsy or eBay, I don’t have to pay $150 to list an item for sale that may not sell.”
So, we launched gasless minting in January, which means there are no gas fees. [The transaction on the blockchain does not happen until the NFT is transferred or purchased, at which point the buyer pays the fee. Traditionally, the NFT would be recorded on the blockchain immediately.]
This was a huge game changer and we’ve skyrocketed. We have about 50,000 accounts right now. Most of them don’t have any background or experience in crypto. It’s the very first time they’re buying NFTs.
In the last 28 days, we had around 650,000 users, and over 100,000 NFTs made.
You landed an investment from Mark Cuban. How did that happen?
Sometime in December, I sent him a cold email.
I tried to think about the fact that he’s a busy guy. He’s a billionaire. He doesn’t want to read a long email or pitch. So, I just tried to be very concise and thoughtful.
I was shocked when he replied the next day. I got little flutters in my chest.
We started talking, and I think we’ve talked every day since then – sometimes like 10 emails a day. It’s crazy.
I love him. He’s extremely smart. He’s got some amazing ideas. He’s so involved with helping us out. So, it’s been just a great pleasure to be working with him.
[Burks declined to disclose how much Cuban invested in Mintable and Cuban did not immediately respond to CNBC Make It’s request for comment.]There has been a lot of buzz surrounding NFT art, especially after the Christie’s auction of an NFT that sold for over $69 million (whose buyer was subsequently revealed as the founder of the Metapurse NFT project). Do you see any trends forming?
Definitely. I think the easiest and the most common is art, so that’s where you get most of the content.
But there is a trend that’s appearing, which is musicians, who drop NFTs with their music and unique digital collectibles for their fans. Each time an NFT is bought and sold, the original creator can earn a certain percent of its sale and get paid, like a royalty.
And that’s what Mark [Cuban] likes the most: The royalty aspect. Musicians are looking to this and they’re seeing that this is a unique way to distribute content, to connect with fans.
[For example, in his recent NFT listing on Mintable, Cuban is charging a 15% royalty on secondary sales, which ensures that he will continue to get paid if his NFT is resold. Any seller could do the same, including musicians and artists.]We have famous musicians from different categories making their music NFTs. This is where there will be a lot of disruption in terms of traditional record labels and stuff like that in that artists can be directly rewarded as the NFT is bought and sold.
What would you say to those who think the NFT market is a bubble?
Each type of NFT is a different asset class, so if one asset class within the market is a bubble, that does not mean every asset within the market is as well.
I like to use this analogy: Maybe Pokemon cards are really hot and have a lot of hype around them as an investment, and so they can be “a bubble.” So, if that bubble pops, do you think the price of baseball cards are going to collapse as well? If one type of assets within the card market is a bubble, that does not mean all assets are.
Beeple, the guy who did the auction of Christie’s for $69 million, all of his assets are in their own category. Beeple may be in a bubble, but that’s not going to affect the everyday person that’s selling on Mintable.
These are all different asset classes – artists or musicians or content creators. Each one of those is unique in and of itself.
[Mike Winkelmann, aka Beeple, told CNBC Make It that “[l]ong term I am very, very bullish on NFTs and see them as a massive opportunity … especially for the younger demographic. People just need to be careful with the things they are buying to make sure they will have long-term value.”]What do you think the future of NFTs will look like?
I’m a big believer in NFTs. Eventually they’re going to be a very common, everyday household term that we say and interact with.
If you have kids, they’re going to be interacting with NFTs in a multitude of different ways.
As an adult, you may be interacting with NFTs as an investment, or as a way to collect, or as a way to diversify, or maybe just as a way to support content creators or creators overall.
You’re going to see multimillion-dollar companies utilizing NFTs for a variety of different use cases, whether it’s documents and documentation, [like deeds, invoices on payments or insurance policies, which would be then stored on the blockchain where ownership could be tracked]; or ticketing, [where buying an NFT could may unlock a collectible or special feature and potentially protect against counterfeits]; or with collectible items – NFTs can really apply to so many things.
So, they’re not going to go away. They’re just going to grow.
Do you think that your personality or maybe past experiences have made you more open about topics that are new and not super mainstream?
My friends always remind me that, I’m always two years early, like with NFTs. I always think I’m wrong, but I just have to wait.
I’ve always been a nerd, but I’ve also always been the guy that if I see something interesting that no one else is doing, I’m not just going to dismiss it. I’m going to look at it. And maybe it’s worthless, but maybe there’s some value in it in some way, shape or form.
In high school, I was always experimenting with different things. And then I went to the military, which really shaped me. When I got out, I knew I was going to be an entrepreneur. I wanted to build multiple businesses. I already had the introduction to crypto, so I was kind of just going back and revisiting.
It’s my personality where I think outside the box and I’m open.
Is Mintable profitable, and how does it make money?
We are profitable. In the first three months of 2021 alone, we have generated roughly $300,000 in sales.
We make profit by taking a percentage on NFT sales called a transaction fee. So, for example, if we do a million dollars in volume, we get a 2.5% to 5% fee on that.
But that’s just one way we make money. We have a lot of different revenue streams, which makes us profitable, that I don’t want to share due to competitors potentially catching on.
Some are concerned that if a user buys an NFT from a website, and that site fails, then their NFT files – which may live on that site – may disappear too. What do you think of this and how does Mintable prevent this, if at all?
This is a valid point and we offer solutions.
You can choose where you want your data hosted – you can host your data yourself, on your servers where you control it, or you can choose to host it on IPFS [InterPlanetary File System] or we can host the data for you on our servers. We offer a 10-year guarantee that the data will exist even if we shut our doors to address this concern.
Interviews have been edited together and for length and clarity. This story has been updated to add comment from Beeple.
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