When I meet Daniella Loftus at an Instagram-friendly coffee shop in New York City’s SoHo neighborhood during the middle of the massive NFT.NYC conference, she lets me know first that she’s not drinking this week. “I’m not here to party,” she says.
Instead, the digital fashion influencer, and founder/CEO of a Web3 digital fashion startup is in New York to network and grow her business, which sits at the intersection of fashion and crypto. It’s a niche world, and Loftus – who’s wearing an oversize leopard print jacket when we meet – knows this. That’s why she got in at ground level.
This article is part of CoinDesk’s Future of Work Week.
Speak with Loftus and you’ll find out that digital fashion can be broken down into three categories: IRL, ORL and URL. IRL comprises “everything from when a designer like Burberry uses a digital backend to produce physical goods, to [designers] who will say we’re producing a physical good with an NFT [non-fungible token] attached,” she explains. ORL, or “On Real Life,” is what Loftus does via her brand/Instagram account, called This Outfit Does Not Exist, where she uses augmented reality (AR) filters to show off digital garments as she poses in physical spaces.
The last, “Un Real Life,” refers to the “direct avatar economy,” aka skins in video games or outfits avatars wear in metaverse programs like Decentraland. In games like Fortnite, Loftus says, “they don’t call it fashion, these gamers, but it’s a $40 billion market.”
Among all three of those categories, she adds, “blockchain-based digital fashion is a miniscule ecosystem.”
Loftus’s goal is to grow this ecosystem to the point where digital fashion is no longer an emerging trend or a buzzword but a mainstream part of how people express themselves, both online and off. To do this, she models digital wares on social media and is fundraising for her company, Draup, which she aims to grow into a marketplace where digitally native fashion designers can sell their work.
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“The dream is to be the CEO of a fashion marketplace, which will have, let’s say, 100 digitally native brands on it [and] collectors who are fully monetizing their garments … aimed at transitioning fashion from a consumer good, which is aimed at a female audience, to an investment,” she says. “You start by buying an item because you like the way it looks, then you realize you can generate revenue and it becomes an on-ramp for women learning about financing in crypto.”
Loftus talks about “stumbling into” blockchain, but her journey appears rather deliberate. Born in London, she graduated from New York University in 2018 while working at an impact fund in the city. One of the fund’s advisers was starting a company that lent money to “financially underserved populations in emerging markets using blockchain,” she says. Though she knew nothing about blockchain, she wanted in, thinking to herself, “I love a challenge … and I remember sitting on the train and just reading these blockchain books.”
Meanwhile, her love of fashion – something she’d held onto since growing up in London – never faded, but she couldn’t quite see herself working in the industry. “I didn’t see it as ethos-driven in the way that I’d like it to be,” she explains, citing sustainability and exclusivity issues. She had many friends in the industry, but she was “always the weird one who was in business.”
Then, during the coronavirus pandemic, she spent time reading anything fashion-related she could get her hands on, from Vogue Business to TechCrunch. When she came across an article about the chief marketing officer of Gucci saying the brand would start designing clothes to be worn digitally, she figured that was her way to not just enter the fashion industry but to shape an important aspect of it firsthand. “I was, like, obviously this is the future,” she says.
Loftus took to Instagram to see what digital fashion brands and influencers were already strutting their stuff. “I thought I was going to see 100 accounts of people wearing digital fashion,” she says. “There was nothing.”
It was the middle of the pandemic and Loftus was spending a lot of time alone, so she figured she’d fill in the digital fashion void herself. She started her This Outfit Does Not Exist Instagram account from scratch and posted articles on digital design. She found the few digital fashion brands and marketplaces that existed and reached out to them to collaborate. Though she had a miniscule following at that point, it didn’t matter – they still wanted to work with her. “I made the bet that, because they’re starting out and they need somebody, maybe they’ll work with me, and it worked out,” she says. “And I was on Clubhouse all the time.”
Then came a pivotal moment for blockchain-based goods – the recent NFT boom. The timing was perfect for This Outfit Does Not Exist to gain traction. But Loftus still held onto her day job. “I had 10 months where I was keeping my old job as a consultant and waking up at four o’clock in the morning and doing This Outfit Does Not Exist,” she says.
Meanwhile, she forged her way deeper into the ecosystem, joining Red DAO, a decentralized autonomous organization aimed at “supporting the growing digital fashion ecosystem.” Together, the group purchased a physical, bejeweled Dolce & Gabbana crown topped with a human-faced sun (the symbol of Venice), along with the corresponding NFT, for 423.5 ETH, or $1.27 million back in September. (Last NFT.NYC, some of the DAO’s members even got to wear the crown, which is normally held in Milan, but Loftus wasn’t there for the occasion.)
Fashion is just how you want to express yourself. That’s it
By October, Loftus realized her digital fashion work was “maybe a real job.” Because she could perform her Web3 activities pretty much anywhere, she up and moved to Mexico City, a place where she’d always wanted to live. At that point “I basically had this epiphany about what I needed to build in the space,” she says.
That platform is Draup, named after the Norse god Odin’s magical ring, Draupnir, which would multiply for its owner every ninth night (detailed in Draup’s white paper). It’s also a nod to “drop culture,” where a brand like Nike (NKE) suddenly drops a new sneaker that fans wait for in lines that wind around SoHo blocks – a model adopted by NFT artists releasing new collections.
Becoming the founder and CEO of her own company, brought on some growing pains for Loftus. “You dictate your own schedule,” she says, diminishing the stress she felt when reporting to someone else and working on their deadlines, but exponentially multiplying her workload. “I was taking 15 meetings a day, especially during the fundraise. But because I enjoy this and this is genuinely my life’s work, I didn’t realize I was burning myself out.” Her whole persona had become wrapped up in her work, especially as she continued to act as a digital fashion influencer with This Outfit Does Not Exist.
“There’s a synergy where this is everything I am,” she adds. “Literally every element of me as a person kind of feels like it’s encapsulated in digital fashion.”
Making time to keep up This Outfit Does Not Exist around her demanding schedule hasn’t been easy, and Loftus admits she’s been slacking on that front. She “should do a post every two weeks,” she says, but when you’re running a business, it’s not exactly top of mind to “put on makeup and go pose on the street.”
Still, she manages to post when she can. The digital fashion she wears on her Instagram account and website comes from emerging virtual designers like Tribute Brand, Xtended Identity and Replicant, and it appears on her body in one of two ways. Either she sends a photo of her posing to the brand, who uses something along the lines of Photoshop to put the outfit on her in the photo, or an AR filter dresses her in the “clothes” while she poses in real time, via products by Snap and Zero10.
Both the Substack and Draup work towards Loftus’s ultimate goal, which is to make fashion less gatekept by both price and physical appearance. “It’s so snobby,” she says, “like if you’re not this size … we shouldn’t engage.”
Digital fashion has the potential to break down both of those boundaries. Many of her fellow Red DAO members, for instance, “don’t know anything about fashion” and never bought into it in the physical realm, she says, but they’re all about its digital counterpart. “I really love that because that’s what digital fashion is about,” she adds. “It’s about tapping an entirely new type of consumer.”
Over the next several months, Loftus will travel all over the world to accomplish that goal, spreading the word by speaking in London, attending the Dolce & Gabbana show in Sicily and a “digital fashion dinner” in Milan, then heading to ETH CC in Paris, all while trying to find a chief technology officer to help realize Draup’s vision for the future of fashion.
“Fashion is just how you want to express yourself. That’s it,” Loftus says. “And that’s what’s so fun about the digital world, because those [choices] can be so much more boundless.”
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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.