A16z Crypto leads $80 million Series B for Story Protocol, a Layer 1 IP blockchain

Programmable IP (PIP) Labs, the developer of the Layer 1 intellectual property blockchain called Story Protocol, has raised $80 million in a Series B funding round led by a16z crypto.

Other investors in the round included Polychain Capital, Stability AI's SVP and board member Scott Trowbridge, K11 founder and billionaire Adrian Cheng and digital art collector Cozomo de' Medici, PIP Labs said Wednesday.

The firm started raising money for the mega Series B round in early summer and closed it this month, Seung Yoon (S. Y.) Lee, co-founder and CEO of PIP Labs, told The Block. The round was structured as equity with token warrants, Ben Sternberg, chief financial officer at PIP Labs, added.

The Series B round brings PIP Labs' total funding to $140 million. Last year, the firm raised $54 million in a Series A funding round, also led by a16z crypto. "There were some smaller angel investments that came in between the Series A and Series B round," which takes the total to $140 million, Jason Zhao, co-founder and chief product officer at PIP Labs, told The Block — declining to comment on the valuation.

What is Story Protocol?

Story Protocol is a Layer 1 blockchain that seeks to tokenize intellectual property, making it programmable in the AI era. IP lets people own and control their original ideas and creations, like inventions or art. PIP Labs says AI makes it easier to create but also leads to IP theft, with big tech companies profiting without permission. This could stop people from creating new content, which might hurt AI in the future if there's no original work to learn from.

The Story blockchain aims to let creators register their IP to track its use and protect their rights, ensuring they get rewarded whenever their content is used or shared.

"Story will ensure a sustainable and flourishing path for the internet's creativity that benefits both creators and AI, without any intermediaries," said Lee. "Creators can programmatically declare their sovereign rights and licenses on their IP," and AI models "can now license the creators' data and compensate them easily without lawyers and legal documents, making Story a win-win for both IP and AI."

Story will turn static IP into programmable IP with a proof-of-creativity protocol, PIP Labs said. This will allow easy licensing and automatic royalty payments, opening up new ways for creators to earn money, it added.

PIP Labs said over 200 teams, covering more than 20 million IPs, are already building on Story in fields like AI and consumer markets. Ablo, an AI fashion design tool backed by Accel, Polychain and Pantera, uses Story to let people customize and remix fashion with AI. Meanwhile, Sekai, an AI storytelling platform, uses Story to help creators and fans co-create content with their IP, making stories more engaging.

"PIP Labs is building the necessary infrastructure for a new covenant in the AI age," Chris Dixon, founder and managing partner at a16z crypto, said in a statement. "Blockchains are perfectly suited for large-scale economic coordination, and Story's platform ensures creators are compensated for their IP feeding the AI systems."

Story Protocol mainnet launch

Story's mainnet launch is expected later this year. The Layer 1 blockchain is being developed via Cosmos SDK and will be fully compatible with the Ethereum Virtual Machine (EVM), Zhao told The Block.

"There are a significant number of improvements we've made to optimize for IP, such as cheap graph traversal and the proof of creativity protocol as well as the programmable IP license," Zhao added.

He declined to comment when asked if Story will launch its own token alongside the mainnet.

There are currently around 40 people working for San Francisco-based PIP Labs, Zhao said, adding that the firm is looking to hire around 20 more people across functions, including engineering, marketing, APAC regional functions, product and design.

"What Bitcoin did for money and finance, Story is doing for content and IP," Olaf Carlson-Wee, founder and CEO of Polychain Capital, said in a statement. "Big tech is geometrically increasing their monopoly power, and the world needs a decentralized intellectual property system that brings the ownership of data and IP back to the people in the same way Bitcoin brought sovereignty to money and finance after the global financial crisis." 

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