How did we start Lootex? The in-game item NFT marketplace.

This is David, COO and Co-founder of Lootex.

I decided to write this blog because Lootex was invited by Google Cloud, to share our insight on the future of Web 3.0, along with experts from Polygon, Binance.com, and Temasek Holdings. The event has a total number of 1000+ online and 100+ onsite participants. This article will sum up the talk I shared at the Google event. I hope this can help the founders who are stepping into web3.

Let me take a minute to talk about my background. I was a developer who was highly interested in building applications with cutting-edge technologies. Product planning was and still is one of my favorite parts of the process. I co-founded three startups: a mobile app studio, a UX SaaS company, and then Lootex. In total, I have 8 years of startup experience and I have done a few successful fundraisings.

Why Lootex?

I am a gamer since I have a memory. I spent countless hours playing MMORPG games with my friends. The goal was simple, win and get to the next levels. On the way to every level, I will collect different weapons, characters, and badges. After collecting them, they can help defeat a lot of other players. However, here is the problem: the game stopped operating at one point. Suddenly I lost all my characters, badges, and all the things that I worked hard for. I wasted thousands of hours and got nothing in return. Those virtual assets were one of my best memories but I have no way of collecting them.

We simply have one mission, which is:

Give digital asset ownership back to the players.

How did we start Lootex?

How did we start Lootex?

As I found the problem, I met Justine, my co-founder. Justine has more than 8 years of experience in the game industry. Fortunately, she shared the same perspective on game asset ownership. We learned a lot from each other since we have completely different backgrounds. We spent hours researching NFT projects and got more excited about the NFT space. It got us very excited that we wanted to share this amazing technology and the new concept of holding digital assets to the people.

Before Lootex started, the CryptoKitties were trendy. We bought 30 CryptoKitties and started to have giveaways and wrote blogs about NFT. Later on, we became the pioneer and evangelists in the NFT space. We soon figure out that people will need a marketplace for NFT. It needs to be as easy as people trade on eBay.

That’s when we founded the company, Lootex.

After two years of hard work and not well-known to the public, the NFT hype began at the end of 2021. Many of you guys might ask, why do we focus on games, but not digital arts or profile pictures? We discovered the valuable game assets in games were traded over 10M a month. Also, there was a play-to-earn game that had over 350k active users monthly, with a steady growth rate every month. The market has proven its feasibility, and it has a lot of potential in the long run.

The NFT Hype

During the hype, suddenly we had a lot of users and also, competitors. However, the previous two years of hard work will not be in vain. Having years of knowledge, we are still one of the best marketplaces. The difference between Lootex and the other marketplaces is that we specialize in game-related assets. We have a dedicated interface for different game asset types: characters, equipment, card games, monsters, and eggs. Lootex is able to provide different browsing experiences for users.

Our active users are still growing by many folds every month. We continue to improve our user experiences for in-game items. In order to attract different target users in this competitive space, Lootex is one of the first to be introduced as the multi-chain NFT marketplace. This enables our users to see all of their in-game items in one place.

This is one of the coolest 3D browsing features. In preview mode, you can view your NFT in action.

Problems

As the users grew rapidly, there were 3 significant problems that came up. These are 3 happy problems for founders.

The first one was the increase in NFT scam projects. Lootex’s priority is to protect our users from being scammed. Our solution was to have a very strict and efficient screening process. We successfully overcame this problem.

The second problem is the traffic surge before the NFT minting event, we cannot handle it very well using our old tech stack. Hence we devote ourselves to the updates of our website, and find reliable third-party services to optimize.

Third, there were cyber attack attempts more often. You can easily see the common problems even with other blue-chip projects out there. We relied on multi-layer cloud settings to shield our website.

Solutions

Being secure and staying scalable is super important while growing. One of my advice to all the web3 founders is: yes, a solid web2 infrastructure is what you need in building a web3 platform.

It’s an excellent choice to choose a cloud platform at a very early stage because you will need a lot of architects and experienced developers to solve the issues you might face while scaling your business. Lootex only took a few iterations to migrate our service, the configuration is super easy nowadays. By doing that, now we don’t have to worry about the site crashing before the events.

Almost every web3 project still needs web2 infrastructure while scaling.

We think we want to be web3 all the way, but the reality is just not like that. If you want your users to see the website, you still need HTML/CSS. If you want to store some data, you still need servers. For data pipelines or analytics, you still need a complex design. And when it comes to scaling, you still need a better algorithm and cloud to help you with all that.

Key Takeaways

I am here to give you some general advice that I learned from my journey.

Really understand what the new technologies can do

It’s better to do something that we can’t do before. But first, you have to really understand it well. This allows your project to be more competitive and more attractive compared to the web2 companies, because of your knowledge of the new technologies. What’s more, the infrastructures like APIs and node services are getting more mature day by day. You can definitely build a dapp faster than those who were building web3 without the additional support.

Talk to real users

Don’t hide behind the screen. To begin, you have to imagine the user scenarios, like how or why they will use your service. Imagine it a lot and prove it by talking to real users. By talking to them, you can prove your point or know you’re wrong sooner. In this space, early adopters have a lot of user insights, and they are usually pretty easy to find on Twitter or Discord, start with them. The next step is to identify what’s the value in the long run. The reason for thinking long-term is that timing is super crucial in this fast-changing world.

Build trust with your community

Last advice and most importantly, you have to build trust with your community. Web3 has a native culture to be transparent to the users. Most of the data is open and on-chain. Build your own community and let them participate in some decisions making. Even the best, find a way to grow together. On the fun side, using memes to explain something really complex is a great approach. It’s easier to get people’s attention by using memes, like what Elon Musk does.

Conclusion

If you haven’t started the company and felt that you are not ready, join a web3 startup is a great way to meet talented people and you will learn really fast. Lootex is hiring, FYI!

All of the above is my take on web3 as a founder. Again, Lootex is an NFT marketplace for gamers. Please visit lootex.io.

Thank you!