Rising Above the Noise

How to build a category leader through experiments

Written by Abishek Dharshan (Zerion) and Qin En Looi (Saison Capital)

The world of web3 is replete with stories of unorthodox ideas that persevered against skepticism to ride on market trends that went unnoticed by others. As these upstarts emerge as category leaders, the early dismissals become shorthand phrases like "It's the UniSwap for X" or "The MetaMask for Y." Over time, their origin stories become refined, and their accomplishments make it seem as if the right-to-win was always theirs. 

This could not be further from the truth - often, the beginnings of category leaders look contrarian, and the path to success unclear. This holds an important lesson for founders and growth leaders: non-obvious ideas that lead to hypergrowth and in turn, category leadership, are hard to spot in the moment. These ideas are most likely to be found through experimentation. The trick lies in continuously iterating these experiments, and scaling those that work into key drivers for growth - something Abishek is familiar with.

Whilst still in college back in 2018, Abishek decided to raise $500K, move to Tokyo and launch the first peer-to-peer NFT marketplace, dBay. The year-long experiment took him on a roller coaster journey, as they grew to 2,000+ monthly active users in 3 months and achieved third place on Product Hunt. While the monthly active users on NFT marketplaces are sizably larger today, what is important to note is how early this was - there was only CryptoKitties and a tiny handful of NFT projects that existed. The Bored Ape Yacht Clubs and Azukis of the world had not been built. Later on, across roles in media and product management, Abishek continued to run experiments, before joining Zerion - a smart web3 wallet and investing tool.

Drawing on his experiences in running experiments at Zerion, along with those of his team members, Abishek shares his learnings to help potential founders and growth leaders uncover the non-obvious ideas that others are overlooking through experiments. In this article, he walks through experiments Zerion has conducted, and gets down to granular tactics.

Experiment #1: Launching Dynamic NFTs

From ‘DeFi-only’ to capturing mainstream attention

Depending on which circles you are closer to, when you hear “Zerion”, one of two thoughts emerge - “DeFi portfolio tracker” or “Zerion DNA NFT”. Whereas the former reflects the founding story of Zerion, the latter was one of the highest profile experiments the company has run to-date. 

Zerions’ DNA NFT was not the first NFT collection the wallet company had launched. In July 2021, Zerion expanded features beyond DeFi to launch new NFT features, and celebrated this milestone by introducing the Zerion Genesis Collection. Over a period of five days, Zerion Genesis NFTs were available to anyone, and it was a free mint. Beyond the art designed by an award-winning studio, owning the NFT meant exemption from Zerion’s 0.5% fees for swaps. The result? 50,000+ Zerion Genesis NFTs were minted and an on-chain mechanism to add attribution to Zerion's community was retroactively introduced.

Having experienced initial success with their first NFT collection, Abishek and team identified the opportunity for another experiment in early 2022 - the bull market was just past its peak, and there was a surge of Layer 1 and Layer 2 blockchains alongside keen interest in new protocols and NFT projects. The idea then emerged - “What if Zerion offers users a profile picture (PFP) NFT that represents their on-chain footprint?”

Without much deliberation or debate, Zerion’s design team drafted a set of designs and launched the Zerion DNA NFT collection. While generative art in today’s world of ChatGPT and Midjourney seems mainstream amidst the recent hype, it is important to note that the generative artificial intelligence (AI) wave had not arrived when Zerion launched their dynamic NFT collection. 

Within the first 4 months of launch, 80,000 Zerion DNA NFTs were minted. While this was a free mint that did not directly generate revenue for Zerion, the second successful NFT collection squarely placed Zerion in the sights of the web3 community, especially among NFT collectors. The wallet was no longer a “DeFi-only” tool, but one that attracted a diverse - and affluent - audience. Across the 80,000 DNA holders was more than $100M worth of crypto assets in their wallets, indicating to Zerion that the average user was a lot more valuable than those from competitor wallets. The organic traffic and attention resulting from an experiment around dynamic NFTs turned out to be invaluable.

More than just a holder of tokens

Experimentation at Zerion did not stop at the initial taste of success. A few months after the launch of Zerion’s DNA NFT, Zerion’s Marketing Lead Alexander Guy started to wonder - “Generative art is cool, but can we leverage our understanding of holders’ on-chain data, and use that to turbocharge BD and partnerships efforts?” The seedling of an idea turned into another experiment for Zerion to not just be a “holder” of users' tokens, but enable discovery and access to tokens - both fungible and non-fungible ones. 

Armed with a deep understanding of who DNA NFT holders are with their on-chain data, Zerion was able to collaborate with respectable brands including Lens Protocol and Unstoppable Domains. In October, Zerion was the first protocol to partner with Lens, and offered priority whitelist to Zerion DNA holders to mint their Lens handles. As a result, the community was the first to claim their desired handles - the DNA was no longer merely a cool PFP, but an “alpha” pass. 

Today, Zerion partners with Daylight to offer a comprehensive suite of perks and whitelists to members in their community. There is a healthy pipeline of inbound interest from social platforms and dapps that want to be featured on Zerion, and users spend more time in-app to browse for opportunities. Ultimately, the non-obvious idea this follow-up experiment revealed was this - users are self-custodial humans who are brave and seek alpha. They need cutting-edge tools and updated information to perform as seamlessly as possible. Zerion can help users find alpha and opportunities that are rarely found elsewhere.

Experiment #2: Creating Content on Mirror.xyz

Another experiment Zerion conducted is around content creation on Mirror.xyz - the web3 native publishing platform that turns content into NFTs. Whereas Zerion was one of the first who experimented with dynamic NFTs, the opposite holds true for content creation. In Abhishek’s words, “Zerion was a little late to the on-chain content space”, having joined the platform a year after launch. 

However, this did not deter Zerion from experimenting with content creation. The second article posted on Zerion’s Mirror page was a fundraising campaign for earthquake victims in Turkey and Syria. As Abishek and his team saw the crypto world rallying together to financially contribute, they decided to offer the Mirror post for 0.005 ETH and made 10,000 editions available. Within a month, the fundraising objective was reached, and 10 ETH was recently transferred to Anka Relief. 

This underscores an important lesson in experimentation - it is never too late to start. Over 70k Zers have minted subscriber NFTs on Mirror – one of the few projects to achieve such impressive traction, alongside Coinbase and Optimism.

Experiment #3: Monetizing POAPs

Experiments around proof-of-attendance NFTs (POAPs) have also led to a non-obvious idea - adding friction is not always a bad thing. In fact, it can increase engagement.

As the Zerion community continued to grow, Abishek and team were curious about the gamification of Zerion Connects - the weekly community calls held in Zerion’s Discover server with 70,000+ users. Zerion’s Discord users, affectionately known as “Zers”, could claim a POAP upon attendance of a Zerion Connect. What if Zerion could charge users a nominal fee to claim the POAPs?

This is counterintuitive - most projects optimize for attendance and participation from their community. Charging users for POAPs was adding friction towards participation in these virtual town halls. Would Zers pay? Or would they FUD it and slam the project for being “cash grabbers”?

As it turns out, Abishek and team had these considerations in mind when launching the experiment. The notion is simple - pay $2 to participate in the weekly Zerion Connect, but if you participate in an engaging quiz trivia (via Dispatch) or meet certain on-chain conditions, you would get their $2 fully refunded (on-chain). 

This turned out to be a hit among members in the community. Previously, Zerion Connect had bots or bad actors crashing the party to shill their projects, but the friction acted as a deterrent. Furthermore, the gradual accumulation of dollars from less engaged members meant that in a span of months, Zerion had garnered more than $40,000 from the community. These funds are held in a community treasury, separate from Zerion’s internal multi-sigs - funds which are used for campaigns including cashbacks and sweepstakes, or community initiatives. 

Even today, Zerion’s experimentation has not ceased - the price per POAP has increased from $2 to $3, as Abishek describes it as a “real life sensitivity analysis to see what level of friction leads to optimal outcomes”.

Laying the groundwork for experimentation

The culture behind Zerion’s experiments is summarized by Abishek - “We are learning at every stage, and cannot stagnate. We refuse to limit ourselves by our initial ideas - we constantly evolve and iterate as an outcome of exploring data on-chain and engaging with our community.”

To enable this culture of experimentation, he shares two tactics - structuring the team to move fast on experiments, and proactive communication over reactive communication.

Set up cross-functional squads with ambitious OKRs

Abishek notes how teams are often structured by function (e.g. an engineering team, a community team). This creates silos, which slows down the pace for experimentation. Taking a leaf from Spotify’s squad setup, Zerion sets up goal-specific Squads that involve 4 to 6 members across each domain, gathered together to solve a specific problem.

This, combined with the setting of ambitious but realistic objectives & key results (OKRs) around the ‘Visibility’ Squad, has led to some of the experiments we discussed above. Take for example an OKR around community partnerships. With the objective set on the education of more users about community initiatives, the team set key results to launch 1 marketing campaign on social media per month. Across the quarter, the team launched in rapid succession campaigns featuring Lens, Unstoppable Domains and CyberConnect.

Communicate first, execute second

Also, Abishek stresses the importance of proactive communication. For Zerion, this means actively driving the narrative by taking to the blog or crypto media to explain thinking behind the experiments - before it begins. For example, the team invested the time to introduce the charging of $2 for a POAP even before the experiment started, so the community could appreciate the quest for active engagement over vanity metrics powered by bots. The lengths Zerion goes to be transparent can be seen in their public product roadmap, as the team strives to be one of the most personable teams building in the competitive wallet market.

Ultimately, knowing what experiments to run is more of a hunch and gut instinct, and requires guts and gumption - as seen in the case of Zerion. Since it is almost impossible to know what will work without trying, founders and growth leaders can take a leaf out of Zerion’s playbook - roll up their sleeves, take hold of a shovel, and begin digging for the non-obvious. When you sense that you have struck gold, run an experiment as fast as possible to see where the idea takes off - because if you do not, someone else will, and bring it to fruition without you.