As AI continues to reshape industries, major players like Anthropic, OpenAI, and Stability AI have faced criticism for their methods of data collection and handling intellectual property (IP). In response, a startup called Story is stepping in with a bold vision: leveraging blockchain technology to give IP owners better control and visibility over their content. Today, Story announced an $80 million funding round to support this initiative.
A Sustainable IP Ecosystem
According to Story’s CEO and co-founder, S.Y. Lee, the goal is to create a more “sustainable” IP ecosystem suited for the digital age. Story’s platform uses blockchain to treat IP like Lego blocks - allowing creators to permit others to remix and use their IP while still benefiting from it. “Anyone can fork and remix your IP permissionlessly while you capture the upside,” Lee told TechCrunch. Interestingly, the Lego analogy is not without irony, considering the toy company’s long history of defending its own IP.
Backing and Vision for the Future
The Series B funding round is led by Andreessen Horowitz’s a16z crypto division, with participation from Polychain Capital, Stability AI’s SVP Scott Trowbridge, K11 founder Adrian Cheng, and digital art collector Cozomo de’ Medici. This latest round brings Story’s total funding to $143 million, alongside its parent company PIP Labs, and gives the startup a post-money valuation of $2.25 billion.
Building the IP Blockchain
Story is developing what it calls an “IP blockchain,” a platform where creators can assert ownership, set usage parameters, and license their content to others. While the details of how this will function are still in development, the company plans to use its new funds to further build out the product, with a commercial launch anticipated later this year. Currently, Story is running a free, closed beta with over 200 teams and more than 20 million IP assets registered, thanks to partnerships with companies like fashion design tool Ablo, Japanese comic platform Sekai, and art collaboration startup Magma.
The Changing Landscape of Content Monetization
Chris Dixon, who co-led the investment for a16z, sees Story’s platform as a necessary evolution in how content is monetized, especially in light of the disruptive potential of generative AI. In a blog post, Dixon highlighted how AI-powered tools are changing the landscape, from search engines that provide direct answers to social networks filled with AI-generated content. “These AI systems were likely trained on original, human-created content but often don’t credit or cite their sources. If there’s no attribution or compensation, what incentive will there be to publish original creations on the open internet?” Dixon questioned.
Competition and Strategic Focus
Story is not alone in this space. Just last week, another startup, Sahara AI, secured $43 million in funding to develop its own approach to IP tracking and monetization. However, Lee believes Story differentiates itself by focusing on the IP and data layer of AI solutions rather than the AI infrastructure itself. “While Sahara appears to target intellectual property concerns, these are mostly focused on data, which is very different from the legal regime of IP. Story sees potential for partnership as the IP layer of solutions like Sahara and Ritual,” Lee explained.
A Founder’s Journey
Lee’s journey to founding Story is rooted in his extensive experience with digital content. He started as a journalist in the U.K. and later founded Byline.com in 2014, followed by the crowdsourced fiction app Radish, which was sold to Kakao for $440 million. Story, co-founded with Jason Zhao as CPO, represents the next step in Lee’s evolution, driven by his desire to create a more equitable and sustainable model for content creators.
A New Model for Creators
Lee’s ambition is to break the current model where companies spend billions on content and even more on marketing. Reflecting on his time at Radish, he noted, “I was drawing a lot of my venture capital money out for marketing,” and expressed a desire to change this dynamic for future creators.
The Future of Content and IP
Whether Story’s vision will succeed remains to be seen, but investors are optimistic. “What Bitcoin did for money and finance, Story is doing for content and IP,” said Olaf Carlson-Wee, founder and CEO of Polychain Capital. He believes the advancements in AI are triggering a second phase in Web3, one that will revolutionize IP just as the first phase revolutionized money.