A Future of Fluf, with Aaron McDonald of Non-Fungible Labs


A Future of Fluf, with Aaron McDonald of Non-Fungible Labs

The NFT space has been invaded by bunnies lately. Where did these bunnies come from? Check out Jamie Burke’s interview with Aaron McDonald on Fluf World, the home of these bunnies. Don’t miss it. There’s some alpha leak as well.

Posted by A Future of Fluf, with Aaron McDonald of Non-Fungible Labs - December 2021


A Future of Fluf, with Aaron McDonald of Non-Fungible Labs Outlier Ventures


  • Been in tech for more than 20 years
  • Started his career as an engineer
  • Moved up to the business and product side
  • Went to corporate venture and eventually moved into the start-up world
  • Started this venture business called Centrality in 2016 where they build a connected venture portfolio where each venture adds something that’s missing from the rest of the portfolio
  • Each portfolio company would experience a snowball effect and could scale faster
  • 60 portfolio companies in 3 funds
  • Started Non-Fungible Labs to accelerate ideas into the Metaverse space and bring exciting new content formats

Co-Founders For Non-Fungible Labs

  • Met Brooke Howard-Smith through investing in his company. Brooke’s company, WeAreTENZING, specializes in the management of content creators
  • Allows them to engage with audiences as they would have access to sports stars, influencers, and content creators
  • Had a chat with Brooke one day and decided to pool their resources to build something in the NFT space
  • They were joined by Alex and Jesse. The latter is a creative genius and is behind a lot of the art that comes out of Non-Fungible Labs

Fluf World

A Future of Fluf, with Aaron McDonald of Non-Fungible Labs Outlier Ventures

💡 10,000 Unique 3D Animated Rabbits

How The Project Started

  • Jesse had a side project he was working on. Made bunny theme art as he was inspired by the bunny he has at home
  • Concurrently, they were also working on a real world NFT street art treasure hunt. Connected with street artists around the world to create some unique street art and put QR codes on them
  • The team would release clues on the location and people would self-organize and go on these treasure hunts
  • The first person who found it could scan it and claim it as their own
  • Jesse revealed his work to the rest of the founders and they were blown away by it
  • Alex was a master of lore and created a whole world behind these characters
  • Combined them together. Did a lot of strategic thinking about how to do it as an avatar project but give it an infrastructure and creative background that could be sustained over the long term
  • Added music element to the avatars as well

We were connecting with really cool street artists around the world, getting them to create some unique street art, put a little QR code on that. And then we’d release clues as to the location of it. And people will then self-organize and go on these treasure hunts.

– Aaron McDonald


A Future of Fluf, with Aaron McDonald of Non-Fungible Labs Outlier Ventures

  • Fluf holders can download the media content — music files, images, backgrounds
  • Fluf holders have the full commercial creative license of the Fluf they own
  • Their community is creative. Within a few weeks, they had people create over 50 remixes of the tracks into new songs
  • Their 3D avatar will be fully rigged
  • Will be launching a new campaign early next week where they put up these fully rigged models. There will be a competition and $100,000 is up for grabs for the community to create a short film featuring these characters
  • Once the competition is over, they will release everyone’s full bodied avatar. Comes in multiple formats:
    • Cinema quality (like Pixar quality)
    • Voxels
  • This allows Flufs to exist in multiple worlds and interact with multiple content formats
  • There will be a breeding game coming up soon

Role Of Music In Fluf World

A Future of Fluf, with Aaron McDonald of Non-Fungible Labs Outlier Ventures

  • Inspired from Bored Ape Yacht Club. The creativity of the community propelled its growth and the branding around it
  • Took that into account when they were thinking about the architecture of Fluf
  • Created FLUF as a dynamic NFT. It is more of a storefront for users as a personality/brand rather than a piece of art
  • Has a feature for people to change the music/audio file and background behind the Fluf. Turns Fluf into a dynamic, responsive content platform

What that does is allows your Fluf to become this kind of dynamic, responsive content platform for everything from podcasts through to brand advertisements, through to album releases through to, you know, you name it in terms of what you want to do and show to the community that’s relevant at that point in time.

– Aaron McDonald

Breeding System

  • Game has already begun for breeding
  • It is not a mashup of profile pictures
  • Tradability and swappability of Fluf backgrounds is important for breeding as they need to be in the space place for breeding to occur

If you can imagine Flufs going on a journey to breed, just like we humans do. You kind of have to be in the same place in order for yourself to meet your breeding partner. And the same is true for Flufs.”

– Aaron McDonald

  • Breeding as a play-to-earn game. Fluflets are produced from breeding and they have utility because people will be buying them to play-to-earn with them
  • Fluflets will also have a game for themselves. It will be an interactive real-time game where people can play and earn from the Fluflets

Their Metaverse

  • When producing their game assets, the team is future-focused and looking at where the Metaverse is going
  • Still, they also made their Flufs compatible with existing metaverse spaces
  • Brought in heavyweight players to help create a metaverse world that can accept high quality assets. Their metaverse is known as the underground burrows
  • The underground burrows will evolve into a world space that can accommodate Flufs in their full glory as well as other metaverse characters and collections
  • Existing metaverses are dull and boring. They will be changing the game and making their metaverse more interactive
  • There will be intelligent NPCs that exist in these spaces that will make it rich and vibrant for users


A Future of Fluf, with Aaron McDonald of Non-Fungible Labs Outlier Ventures

  • Will be a VR-first experience
  • They will be launching on mobile first, followed by PC. Mobile was selected due to its large user base
  • Will be dialing up the quality for the PC version
  • Resolution will adapt to the device that users have
  • Flufs will be able to interact with different experiences, games, and content. There will be social connectivity between Flufs
  • Purchase of burrows will come with some land/public spaces in the metaverse
  • Burrows are private spaces that can be customized for more private engagements
  • Land/public spaces will be built by the team so that it will be rich and high quality

So have these two layers, this kind of above the ground, let’s call it public space as a metaphor. And then this kind of below the ground, which is your private space that you can build out and, and give people the rich experience up top and the customized experience underneath.

– Aaron McDonald

  • There will be installations that people can put things on a piece of land they own
  • Public spaces can be connected to private spaces/burrows, without needing a link through to another metaverse

Altered State Machine

A Future of Fluf, with Aaron McDonald of Non-Fungible Labs Outlier Ventures

💡 Altered State Machine: A decentralized protocol for creating ownership of an AI agent via an NFT. It can be used to create agents for games, financial applications, virtual assistants, online worlds, and many more. These AI agents can compete with each other, interact, and support human actors.

  • Altered State Machine gives them 2 new “Lego Bricks” to build with:
    • The ability to own artificial intelligence through NFTs
    • The ability to inject a personality into your NFTs
  • This creates a rich set of unique intelligences that can exist in these metaverse spaces
  • Team is working with 3 intelligence projects to kick things off
  • Some will use their intelligence as an asset to generate wealth for you
  • The next stage would be to put these characters into the metaverse space to create the richness those spaces are missing

Mycelium Token

  • The token will be the binding thread that links everything together (e.g. the world, the land, play-to-earn, multimedia social format)
  • Token will work not just within Fluf world, but across worlds that leverage the altered state machine

Alpha Leak On Art Associated To Burrows

  • Can be found on their YouTube channel here

A Future of Fluf, with Aaron McDonald of Non-Fungible Labs Outlier Ventures

This podcast summary was prepared by The Reading Ape in collaboration with Outlier Ventures. The Reading Ape is a humble servant of the written word.

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