Is your designer bag really a designer bag? IYK has raised almost $17 million to help you prove it
If you want to flaunt your $1,200 Gucci handbag to your friends, there may be a skeptical few who doubt whether it’s truly Gucci.
But IYK is here to help you secure those much-deserved bragging rights, announcing on Thursday that it’s raised $16.8 million in the past year to help customers verify the authenticity of their apparel and merchandise.
The crypto arm of Andreessen Horowitz, a16z crypto, led the funding. Other participants include Collab Currency, Lattice Capital, 1kx, Synergis Capital, Palm Tree Crew, Coop Records, and the prominent non-fungible token collector gmoney. Ryan Ouyang and Christopher Lee, the cofounders of IYK, declined to provide their startup’s most recent valuation.
“By combining web3 and NFC [near field communication] chip technology, the IYK Platform enables every brand on the planet to deliver novel consumer experiences,” Arianna Simpson, a general partner at a16z crypto, said in a statement.
IYK’s fundraise is comparatively large for an early-stage startup, especially in a parched funding landscape where venture capitalists like a16z have become more tight-fisted, and NFT-based projects, like IYK, have progressively called it quits.
Digital T-shirts
Ouyang, 22, and Lee, 34, are an unlikely duo. They first met when they started messaging each other anonymously in 2021 on Discord, a messaging service popular among crypto enthusiasts. Lee was then a software developer for Major League Baseball, and Ouyang was taking time off from college. “When I met Chris, I thought he was my age,” Ouyang told Fortune, laughing.
The two struck up a friendship and eventually settled on an idea for a startup: implant NFC chips—most smartphones sold today are equipped with the tech—into merchandise, which allows customers to simply tap their phones to a patch on, say, T-shirts to verify their authenticity. In return, customers receive NFTs and potential exclusives from brands. Businesses, too, can see data on who owns their merchandise and remain in contact with customers.
Chipping T-shirts isn’t a new idea, and there are other startups trying to progressively turn our clothing robotic, but Ouyang and Lee believe they have an edge. “One part that’s kind of unique about our strategy is this flexibility and accessibility part,” Ouyang added.
They offer brands a suite of options, and companies can customize how customers claim, for example, ownership of a product through the number of times and duration they have to tap their smartphones on a chip.
Ouyang and Lee pitched their idea around and eventually landed a spot this year in a16z’s Crypto Startup School, essentially a Y Combinator for aspiring crypto companies, and recently partnered with Adidas. They raised their most recent influx of capital for IYK, which stands for “if you know,” as the program ended.
“Part of the idea is you need to know that there’s a chip hiding behind that patch,” Ouyang said, “and that it’s like a portal to this whole digital universe.”
