Two longtime Seattle-area tech leaders are teaming up on a new startup that sells NFT-based customer engagement tech to consumer-facing companies.
Former Starbucks exec Adam Brotman and startup investor Andy Sack just raised $10 million for Forum3.
The fresh funding comes after co-CEOs Brotman and Sack recently advised Starbucks on the launch of Starbucks Odyssey, a new NFT initiative from the coffee giant that lets Starbucks Rewards members earn and purchase collectable digital stamps, then buy and sell them in a marketplace with other members of the loyalty program.
Through its tech platform, Forum3 plans to work with brands to remove the normal frictions that come with blockchain tech, such as having a crypto wallet or owning cryptocurrency. Users will be able to engage with a company’s customer loyalty platform with their credit cards and phones. The goal is to sell a white-labeled version of Odyssey to other consumer-facing brands, Sack told Startup.
Sack said brands offering something like Odyssey will be the “predominant consumer use case of blockchain.”
Forum3 plans to target other midsize-to-large companies in industries ranging from consumer packaged goods, hospitality and travel. It will make money through licensing, royalties and other servicing fees. Sack said Forum3 will be “chain-agnostic,” meaning it will eventually work with all types of blockchain platforms.
The startup’s first project was a three-stage NFT “drop” with author and screenwriter Ben Mezrich, and it also helped on a collaboration with the Boston Globe. After that, in April, Starbucks leaders reached out and Forum3 became strategic advisers for Odyssey.
There are a number of players in the Web3 loyalty space advising brands and individuals on NFT-based loyalty tech. Hang recently raised $16 million and works with brands like Budweiser and Bleacher Report. Sack said that Forum3 will be able to compete because of his and Brotman’s experience and connections.
Sack co-founded Seattle-based seed-stage investment fund Founders’ Co-op, then led Techstars Seattle for five years, with one cohort producing three unicorns. After that, he worked alongside Microsoft CEO Satya Nadella as an innovation and digital transformation consultant. Most recently, he was an investor at blockchain native venture fund Keen.capital.
Brotman is the former chief digital officer at Starbucks, where he helped build the Starbucks mobile app, which now handles more than a quarter of the company’s orders. He is also the former CEO and current chairman of Brightloom, a startup that helps companies turn their customer data into personalized marketing campaigns.
“We have an understanding of how to work with big brands,” Sack said. “There will be aspects of our platform that will be very different than the standard players in the space.”
Blockchain startups have struggled to secure funding this year, part of broader market downturn and flurry of negative headlines looming over the crypto space. Venture capitalists deployed just $4.44 billion in crypto-related companies in the third quarter of the year, Bloomberg reported, down 37% from the same period last year.
The swift collapse of the giant digital-asset exchange FTX last month also sent a contagion through the crypto industry.
Sack said that some people have been “building Ponzi schemes and scams all around crypto and these tokens, and they have no utility in the world.”
“All that is somewhere over in left field,” he said. “We are far away in a totally different space. We have a real business case.”
The funding round was led by Decasonic, with participation from Bloccelerate, Liberty City Ventures and Arca. Other investors include Polygon Ventures and Valor Siren Ventures.