Hi RENTnauts, we are excited to update you on the latest developments in the RentFun project. Our team has recently entered the marketplace testnet development stage, and in order to design an effective marketplace, we have conducted thorough market and user research.
This process, known as "Know Your Business" (KYB), has helped us gain a clear understanding of the real demand from the four core parties - Arbitrum games, players, guilds, and NFT owners - as well as the unique qualities of game NFTs and RentFun's development strategy.
The KYB research is crucial to the design of the RentFun marketplace, and will inform all of our decisions moving forward in the development process. Since the official launch of RentFun on February 9, 2023, we have spent the past month delving into the needs and preferences of the four core parties.
We are eager to share our insights on the KYB of RentFun with the community, as we believe that this will give you a better understanding of our plans, product designs, and decision-making processes before we move towards launching the governance token and entering into DAO governance.
1.Key Scenario of NFT Rentals
While we have identified over seven different user scenarios for NFT rentals, including game items, metaverse land, music NFTs, avatars, membership passes, tickets, and NFT domains, games currently represent the largest user scenario for NFT rentals.
With the rise of crypto games, such as Play to Earn or Pass Card, there is a growing demand for users who cannot afford game NFTs but still want to play the games.
Crypto games provide solid utility for NFTs, making them an attractive option for users. Even PFP collections like BAYC are now exploring the gaming space.
Therefore, RentFun will initially focus on serving the gaming market, rather than other categories like domains or avatars. While we may expand to other categories in the future, our early focus will be on games.
2.Rentals Are Hugely Different with Trading
As we delved into NFT rentals, we realized that they are fundamentally different from secondary trading marketplaces like OpenSea.
Why?
1) Rental has the time duration of its services.
Firstly, rentals involve the concept of a service period, which means that renters and NFT owners continue to utilize the services provided by RentFun throughout the leasing period, which can last anywhere from one hour to one year.
In contrast, NFT trading in the secondary market like Opensea involves one-time transactions where the buyer and seller complete their exchange within a single transaction.
Therefore, RentFun's rental services have a time duration aspect that applies to both NFT owners and renters. Renting is only considered complete after the leasing period has ended, which sets it apart from the one-time nature of secondary market transactions.
2) Users rent an NFT for the real utility.
Another major difference between NFT rentals and secondary marketplaces like OpenSea is that renters have a very clear demand when using RentFun: to rent the NFTs they want for temporary use.
This means that we must pay close attention to the utility that is listed on RentFun to ensure that renters can easily and efficiently make their rental decisions. In contrast, this is not a primary concern for the secondary trading marketplace.
3) Focus more on Users than Assets.
Furthermore, the rental market primarily deals with the utility of NFTs, rather than the transfer of NFT asset ownership.
Therefore, RentFun must focus on the growth of its user base, rather than just the growth of its listed assets. This is a fundamental shift from the asset-centric approach of secondary trading marketplaces, which primarily focus on asset growth.
3. Dive in, Dive in and Dive in
As highlighted in Point 2, RentFun's focus on utility requires the team to deeply understand the demands of its four primary participants: games (which must integrate RentFun first), renters (who represent a weaker party but have a large potential quantity and labor), owners (who hold assets and represent a small number but a high proportion of assets), and guilds (which are an important force in the game and own both assets and users).
By gaining a comprehensive understanding of these four primary participants, RentFun can effectively prioritize the utility of its NFT rentals and make informed decisions that benefit all stakeholders.
To build an effective rental marketplace, RentFun needs to prioritize catering to the specific and clear demands of the four core parties involved in the rental scenario.
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Renters, who need to be identified by the games as NFT users so that they can play like owners in the game. Additionally, some renters may want to rent an address with multiple NFTs needed to play a particular game.
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NFT owners, who prioritize the security of their NFTs and want efficient lending procedures, access to renters' records, and no degradation of NFTs after renters' play.
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Games, which require rental integrations that don't pose any security risk to their game while also attracting more players, generating more sales for game NFTs, and providing a sustainable income stream.
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Guilds, which want an easy and efficient way to recruit scholars, manage assets and scholars, view income statistics, and use their guild tokens to pay scholars.
You could see the demands for the four core parties are very specific and clear when they are in the rental scenario. This means if RentFun wants to build an effective rental marketplace, the team has to cater to these demands above.
Indeed, meeting the demands of all four parties may be a challenge, but it is necessary for RentFun to provide real value to its users. It is understandable that not all demands can be met immediately, and a balance must be struck between meeting demands and achieving product-market fit.
However, the team can work towards meeting these demands step by step to provide a better user experience and build a strong reputation in the market. Consistently improving and innovating based on user feedback will be key to RentFun's success.
4. Renters are our God
Renters are the lifeblood of RentFun's rental marketplace. As the ultimate payers for rental services, their demands must be at the forefront of our priorities. At RentFun, we believe that Renters are our most important stakeholders and should be treated with the utmost respect and care.
We must stay closely connected with them to understand their needs and deliver the best possible experience. By putting Renters first, we can create a thriving community and build a successful platform for everyone involved.
However, it is also important to ensure that the platform is sustainable for all parties involved and that the needs of all stakeholders are met. The team will strike a balance between catering to the demands of renters and addressing the concerns of NFT owners, games, and guilds.
5. Building Strong Cases First
For RentFun's solution to work, games must first integrate the RentFun SDK to verify renters as NFT users when they log in and play the games.
This means RentFun must prioritize building strong use cases to demonstrate the real benefits for games and their communities. Only after establishing these use cases can the team focus on promotion and business development efforts.
6. Test
After conducting research on RentFun’s business, we can use the insights gained to establish the right North Star for our product design and development strategy. The next step is to test the market and user response to RentFun’s product.
To validate our business and product strategy, we need to conduct the following tests on the marketplace testnet:
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Determine if renters are interested in renting original and low-cost NFT rentals on RentFun.
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Confirm if owners are willing to list rentals on RentFun.
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Verify if games have a real demand for integrating RentFun.
In The End
In conclusion, it's crucial to recognize that great products aren't just created by chance. Instead, they're the result of careful planning, research, and the right insights. The team’s right insights are the key to build RentFun in the right way. So the team takes a lot of time to do the user and market research, gather feedback, and listen to our users continuously.
By gaining a deep understanding of RentFun’s target users’ pain points, preferences, and aspirations, we can create a real market-product fit NFT rental marketplace that truly resonates with them.
This is a long road for the team to keep diving into the RentFun’s business and upgrade the team’s insights with time. Also the team welcomes the community to keep sharing suggestions, feedback, and even criticism to help build an awesome NFT rental marketplace.
WAGMI!
About RentFun
RentFun is an NFT renting marketplace that allows users to rent original NFTs through Access Delegation Protocol on Arbitrum. RentFun’s Access Delegation Protocol allows the NFT owners easily and safely delegate the access rights of the NFTs to renters without losing their ownership. Beyond renting, RentFun will become the game players' hub on Arbitrum.