- The two New York restaurant groups are raising money from NFT memberships, wherein the restaurant gets a percent of future transactions with every purchase of NFT.
- Unlike other memberships that provide only space access, it will also give the buyer a percentage of restaurant ownership.
There exists a new-fangled financial model for the still-struggling food and beverage industry: The world of crypto, NFTs, and blockchain.
Based in New York, two restaurant groups are raising money through individual “NFT” memberships, or the non-fungible tokens, usually associated with digital art pieces.
Come to think of it as a 21st-century version of a country club or the trendy Soho House. A one-time membership fee is all that’s required to access the club and it lets you meet like-minded people like you. The restaurants get a portion of each future transaction every time someone buys or sells NFT.
Brooklyn Chop House, which is set to open in Times Square next month, is planning to launch an NFT membership in its sub-cellar space in May.
The price range for a membership – purchased in the cryptocurrency Ethereum – will range from USD 8,000 to USD one million. Most memberships will give access to the space, just like a membership at a private club.
Stratis Morfogen, Director of the operation for Brooklyn Chop House, said that the million-dollar NFT will come with a quarter of percent ownership in the restaurant.
Then there is also a USD 20,000 gold membership that includes prime reservations for up to 20 guests per month plus guaranteed reservations. Platinum membership, pegged at USD 1,00,000, includes additional perks such as chauffeur pickup to and from airports to hotels and for delivery orders.
The news has come close on the heels of reports last month that Gary Vaynerchuk’s VCR Group will open Flyfish Club, which is the world’s first NFT private dining club. Although the venture hasn’t even signed a lease yet and will open only next year, it has already generated more than USD 14 million in NFT sales, said VCR’s CEO, veteran restaurateur David Rodolitz, a founding partner of Empellon Restaurant Group.
The USD 14 million in sales via Ethereum happened fast – a small pre-sale in December and the January 7 sale that sold out – 1,501 memberships, he said.
Since then, over USD 23 million has been generated in resales on a secondary market, Opensea, which is known as eBay of NFTs, Rodolitz said. The VCR Group gets 10 percent of every trade, leading to an additional sum of USD 2.3 million, he added.
The restaurant is not open yet, and Flyfish Club is already launching real-world experiences for the members, like upcoming pop-up champagne and caviar cruise. Both the restaurant groups are going to use the cryptocurrency Ethereum.
“The NFT market began with art and music. It wasn’t designed for restaurants. We’re changing that, creating a digital version of a private club — like a Soho House in the metaverse but in Times Square,” Morfogen said.
“Every NFT creator decides the percent and the market determines if they are right or wrong. We felt that as a first-of-its-kind in the hospitality industry, 10% was justified,” Rodolitz said.
“We’re finding a new way to do business,” Rodolitz added. “There’s an upfront sales component – selling membership – plus an ongoing royalty component, as memberships are bought and sold on the secondary market.
“I was pleasantly surprised by this sense of community that has rallied around a restaurant that doesn’t exist yet,” Capon said. “It’s actually touching to see how people are connecting … We are trying to do something innovative to help our industry and ourselves.”
“There is a huge community of crypto millionaires who only socialize with each other,” Morfogen said. “A lot of them are trading NFTs out of their bedrooms and buying things in the metaverse. We’re giving them a place to congregate, taking the best of both worlds.” Rodolitz added, “You will start to see a lot of real-life projects based on utility, not just digital files. I don’t think anyone has done a premier utility based NFT project before, across all industries, especially hospitality. We worked hard to be the first. It’s very exciting.”