Why the Metaverse matters to you

Jerry Eitel, the newly appointed chief Metaverse officer at Top 100 Firm Prager Metis, explains why his firm is pioneering this new digital space, and what it can offer accountants.

Dan Hood: (00:03)

Welcome to on the air with Accounting Today. I’m editor-in-chief Dan hood. Now you’ve probably heard of the metaverse, but if you’re like me — or like many other people— you might be completely confused as to what exactly it is and why exactly everyone’s talking about it. In that case, you are in luck because here to explain it all in small words that even I can understand is Jerry Eitel — he’s the chief metaverse officer at Top 100 Firm Prager Metis, which is the first CPA firm to have a headquarters in the metaverse Jerry, thanks for joining us.

Jerry Eitel: (00:28)

My pleasure. Hopefully I can shed some light — or darkness.

Dan Hood: (00:33)

Or at least make it a little less dark, maybe a little just, you know, sort of dusky. Why don’t we start with defining the metaverse — and I realize this is not an easy question,an easy definition to bring up, but give us your sense of what it is.

Jerry Eitel: (00:45)

Yeah, I mean, it definitely isn’t an easy answer because I mean, you can go into the internet and do a search and you’ll get, you know, the very obvious answer. But what I look at it as being kind of like an evolution of social media, kind of like an it’s an extension of the real world, but it’s almost like the real world meets, the internet meets Web 3.0 and meets 3D, the 3d virtual world. And basically it’s a place where people can meet, interact, do business, you know, go to concerts together. It’s almost like you’re all of a sudden you’re in this TV set and now you’re alive and you’re doing business.

Dan Hood: (01:32)

Right. And all in this digital environment.

Jerry Eitel: (01:35)

It’s all digital, it’s all digital. And, um, it extends the virtual headsets even, but that’s not where, you know, I specialize.

Dan Hood: (01:42)

Gotcha. Um, well, let’s talk about a little bit what, what the firm is doing there. I, I mentioned you forgot to your headquarters there. You’re in, uh, in, you have an office in, uh, headquarters in decent land, which is a metaverse platform. Uh, what does that mean? I, and, and what does the firm hope to get out of it? I mean, what’s the, what’s the goal behind head setting up those headquarters?

Jerry Eitel: (02:01)

Well, I, I think the goal, like, uh, like the metaverse, it’s evolving, like when we, when we, when we went into it, we were involved with some, uh, first of all, our clients were getting into this space, cuz we, this, the firm itself special has a, has a specialty in, um, in music and musicians. We have a business management division and, and um, and they, um, and their clients were getting involved in this space, um, you know, rappers and whatnot, you know, with virtual sneakers and, you know, so, and then we also, I’m just giving you the evolution of this. And then, then we also, some of the partners had a little and a little bit of an investment in this, um, me music platform and that music platform, basically, it was almost like an urban music scene where they had these, um, Tuesdays where they brought artists, uh, musicians into these loft spaces and whatnot.

Jerry Eitel: (02:56)

And they also had living where they, they brought musicians to live in certain, um, uh, houses together and then COVID comes. So then that company pivoted to, um, the virtual world and then they got into virtual wearables and virtual music. And then, then we realized how many different businesses there are that going? So that’s how it started that we see there’s a lot of businesses and a lot of activity in the space. So we wanted to ex extend, literally extend our company into a, it’s almost like moving into another state or even another world. So now all of a sudden we open an office in another world where there were businesses and whatnot. So that’s what led to it now. Um, you know, so we do have an office there. We haven’t got our opening yet, so I hope that’s kind of given you a little, um, sure. The, uh, foundation of the office.

Dan Hood: (03:51)

Right. Well, and it’s interesting because, uh, uh, that makes a lot of sense. You mentioned rappers. I was just reading a thing to talk about there’s apparently, and there are a couple of D platforms, decent land is one of them, but there are others. And each one of them, for those who remember second life from 15 years ago, there’s a sense in which there’s, there’s real estate within these, uh, these platforms. And, and there’s a degree to which that you can actually, it’s a real estate bit of real estate speculation, famously Snoop dog owns a plot in one of these platforms. And people have been up the plots around him, the digital plots around him in the expectation that they will increase in value enormously. And some of them have, I mean, you know, gone from 30,000 to $500,000 or something like that. So there’s a degree to which there’s, uh, uh, in addition to following, as you said, following, uh, uh, the industries that you’re that and the clients that you’re interested in, the businesses that you’re interested in, there’s also a degree to which you can, can be, uh, a bit of an investment itself.

Jerry Eitel: (04:43)

Yeah, well, actually, it’s interesting. You said a St I think in sandbox and, and actually it extends to, um, it’s like any other real estate, so, uh, to, to go back to the office itself. So, um, because this is how, how I became this chief metaverse officer, which at my age is kind of absurd to begin with, but we could talk about that after . So, so we had to go buy the land. So to buy the land, you know, remember I’m a, I’m a novice. So I have to, I go to Coinbase, I transfer to a, you know, you have to, you have to buy the, the currency to buy the land. And then you have to hire an, a kind of a designer that’s design the building on the land, but the land itself does have value. You know, it does increase in value and there are neighborhoods, you could literally build a neighborhood, so you could buy a lot of land and you could develop some of that land. And then somebody moves next to you. And all of a sudden your value of your land can go up. So it’s, it is, there is a, quite a, there is an investment opportunity in this land and there are funds buying, buying land up. Many funds are buying land in many different metaverses because there’s more than one metaverse, which we could talk about too.

Dan Hood: (05:55)

Right. Well, we’ve talked about you, uh, you’re in, into central end. You mentioned sandbox. That’s where Snoop dog. I, I couldn’t remember the name of it. There you go. Uh, maybe we talk a little bit about that. Like, uh, these separate the platforms themselves are separate, but you can go into either one they’re at their own little universes, right?

Jerry Eitel: (06:09)

Yeah. Um, there’s also NFT worlds. That is another one. There’s a thousand worlds. But the interesting thing is, um, there aren’t, you know, cuz um, now that I’ve, um, I’ve gotten to talk to some funds that actually invest in these in land. I I’m getting some statistics from some of these funds and they’re even shocking me like the amount of, uh, wallets. Like when you, when you have crypto, you transfer the crypto to a wallet and then you buy land, what’s the wallet for set. So I think I saw a statistic statistic that there’s only 73,000 wallets, that own land. Well, there’s a lot more than 73,000 people in the world. Yeah, yeah. You know? Yeah. And there are only like, you know, several major worlds, so the land and, and there’s so few businesses that have really gotten into the space yet. So I mean, I, I, I know the money’s going there. The money is going there and you know, accountants kind of follow the money to some extent. So, um, right.

Dan Hood: (07:11)

Well, and, and it, it is, and it’s worth revenue, right? These, the, the, the money and the wallets and the, these are all crypto assets, which have the own weird tax implications that a lot of people don’t necessarily understand, uh, where accounting firms are definitely like, wait the IRS, looking at these in a certain way. You need to be sure, but for when you do transactions in crypto, that’s not money. That’s an, an asset and you’re selling the asset and buying a new asset, et cetera, et cetera. And so there’s all kinds of tax complications. So it makes sense for accountants to be there. But, uh, you mentioned money is going there. There is tremendous amount of money. And a lot of it’s sort of speculative where it seems that way as if it’s, it’s a little bit of a real estate land, boom, no one knows exactly what we’re gonna do in these places.

Dan Hood: (07:48)

I mean, there’s all kinds of possibilities. There’s all kinds of, uh, you mentioned, uh, live music, uh, stream digitally from a, from a, uh, a metaverse platform, but other people are looking at, you know, is it, is it like a storefront, like a website kind of thing where you can go in and interact with an advisor, an accounting firm might have someone come in and say, Hey, what kind of services do you offer potentially? Uh, you could showcase all kinds of things, uh, if you’re in different industries. So, but, uh, I, it feels like at the moment, it’s really about real estate and less about what you can actually do there, cuz people are still trying to figure it out.

Jerry Eitel: (08:16)

Well, I think it’s a combination, but I do think, and who makes all the money? It’s always the people that are on the real estate. So I think it’s the same exact situation that the funds are not taking chances. And maybe they’re just buying the real estate to some extent. And the rest of us are trying to make money and different ways. You know, it’s always the people with the real estate and, and they say, okay, the people that sell the tools are making the money, right. And then the most people that are trying to do business, maybe one out of 10 survive or something like that. I still think it’s here to stay though, you know? Um, and there are a lot of brands going into, I mean, how did I get into this space because how did I get to this position? We’ll say, so I’m obviously a tax person.

Jerry Eitel: (08:58)

I was a tax barer, real estate tax bar. I do have some very bad, I’m a very bad auditor, but I wasn’t, I was an auditor at some point early in my career and just not for me, but, and then we got involved with this, um, kind of a fill that does branding. So I kind of have, I have a little bit of, um, the knowledge of the branding side of like, you know, how do you do something in the metaverse and maybe make some money, then I have some tax knowledge. So, um, you’re right. When you, if you’re a business and you, um, paying somebody in crypto, you may have made a capital gain or a capital loss when you actually pay somebody in crypto, then you probably have to give somebody a form, a 10 99 form, you know, and everybody says, it’s the wild west. So, uh, there were so many rules and then the SCC gets involved. So I guess I became this person because I kind of like, I can touch the branding aspect of it, the tax aspect, the audit aspect, you know, of the legal situations. I know when somebody’s kind of needs to, you know, doing the wrong thing. So, you know, it’s, um, it’s a very complicated environment and we try to help people do the right team.

Dan Hood: (10:07)

Well, I wanna dive, I wanna dive more into that. I wanna dive more into your role as just chief me versus officer and what the firm is. Uh, you know, I kind of services are offering what we’re gonna take a quick break and we’re back, we’re talking with Jerry, I tell of Preger medicine about, uh, the metaverse his role as, as chief metaverse officer. As I mentioned before the break, I, I wanna dive more deeply into that. Uh, you talked about sort of your qualifications and the reason why you’re there, you understand the branding, you understand the tax aspects of things. Uh, what do you think of, what is your role there? What are you, uh, how are you, are you promoting them at, are you, are you guys building services around it? Uh, and how are you working in that, uh, that sphere?

Jerry Eitel: (10:44)

Well, I guess at, first of all, my role’s probably gonna evolve and eventually it’s gonna go to somebody else because remember I’m a, I’m a partner emeritus and how did I end up in this space? You know, God knows, but I’m here, you know? And, um, and, but basically I’m I at the moment, I mean, ultimately I, I think the, the strategy would be this position would be kind of on a consulting level, but for now until I’m kind of quarterbacking. So, um, people would reach, reach out to me and I would bring the, uh, tax people into the situation or the audit people the fund comes to, to, to me, I know kind of what they’re looking for in terms of, do they need audit? Do they need tax? Do they need some branding or are they looking to, to do something to do business? Are they already doing business in there? Do they want to do business there? Are there, are they a brand? Do they know a brand that wants to get into the space? I per, I mean, remember I, as crazy as it sounds, I personally bought the land that absolute land is on. I personally went to my wallet. I purchased the land. So I mean, that’s how deep that’s how crazy this thing is.

Dan Hood: (11:58)

, you’re a pioneer, well,

Jerry Eitel: (11:59)

That, that a guy, my age would buy the land that absolute is on, in decentral land. Right.

Dan Hood: (12:04)

But that’s well, that’s, what’s, what’s neat about it is right. I mean, anybody can be a pioneer at this point. It’s, it’s so new that, uh, it doesn’t really matter what age youre, it’s more a question of, of, uh, of whether you’re willing to give it a shot and whether you’re willing to try it. I, I wonder do you, do you foresee a point where, where you are guiding clients into the op somebody comes to you and says, Hey, what’s this metaverse thing about, do I need to be there? Should I be there? And how do I go in? Is that an area that, that the firm is exploring, like to try to be that Sherpa, to bring people into the metaverse experience?

Jerry Eitel: (12:30)

Um, AB absolutely. That is where we want to head. We want to teach people, we want to onboard onboard people, help people get into the space, maybe give tours. We know, we know we’ve learned a lot about, we we’ve made a lot of contacts in these different metaverses first of all, and we, we can kind of help people get into the space. Um, we know where to go. So the answer is yes. Now is, does everybody need to, does everybody need to get into the metaverse? No, but enough do. And, you know, we have a business management division at our firm that specializes in the music and you, you know, it’s, um, and fashion, we have fashion. So certainly there’s there’s businesses that will be going in that don’t even know. There are businesses that have going to be going in that don’t even know they’re gonna be going in. I mean, I can give you an example. I mean, you take a, a building like the empire state building or something like that. I mean, they could literally, you know, put a building in the metaverse and rent space. I’m in the empire state. I’m not saying it’s gonna happen. but even the real estate business, maybe in the virtual real estate business. Right. You know,

Dan Hood: (13:43)

Well, it’s interesting. Does

Jerry Eitel: (13:44)

That make sense to you?

Dan Hood: (13:44)

Yeah, absolutely. Well, I mean, in one ways, when you talk about industries that sort of would have a natural fit. I mean, there’s a lot of, of, uh, metaphorical parallels between the real estate business and the digital a estate business. That makes sense for them to wanna be in there to be able to say, yeah, not only can you rent a floor in the, the, the empire state building in the real world, but you also wanna make sure you have the same floor in the empire state building in, in a, in a virtual world. But it’s interesting, you, you talk about some of the, you talked about, uh, fashion and, and music, uh, that does seem to be a certain degree, and it’s not entirely this way, but a lot of the interest in this is seems to be driven by creative. Uh, the creative industries, uh, is music, people who are making NFT art, you know, the sort of non fungible, uh, token art sort of stuff are going in there in a big way. It seems there’s a lot of that angle to it. Do you see it expanding much beyond that and becoming a much more sort of general business? Or do you think it’ll always keep that sort of like said it’s not, it’s not entirely artistic or artsy, uh, but there seems to be a, a, a major inflection that way.

Jerry Eitel: (14:41)

I think, um, ultimately it’s gonna be many, many industries. And the reason I say this is, um, once again, I point to the funds and they start, and I see the statistics and they start mentioning all these healthcare. I mean, I just, I’m not even sure how these are gonna get into it, but they mention everything. They mention retail, they mentioned healthcare. They, they mentioned so many different types of industries that, and, and statistics, and it just, I’m not sure how they’re go, how all these businesses are going to, to evolve into the, uh, space, but I am sure it’s going to happen eventually. And which leads me to think that maybe, you know, I mean, we are the first, maybe we’re the first accounting firm, or maybe I dunno, a hundred we’re in the we’re in the metaverse, but there are some other accounting firms doing. Uh, obviously we’re not the only one advising clients, but I would imagine that most accounting firms will have to start advising clients this because there’s so much business to go around. Right.

Dan Hood: (15:48)

I definitely wanna dive into the, the accountant firms of potential role. And it sounds like you you’re, you’re, you’re getting ahead of me and answering your question. I’m about to ask, but that, which is great. And I wanna dive into it a little more, but before we do, I want a quick question. How did you choose decentral land as your platform? I don’t,

Jerry Eitel: (16:03)

Um, we chose that because, um, actually the, uh, the guys that we were involved with in that, um, music area, that’s, that’s kind of where they were, they were in that space and it seems to make, it seemed to make sense for us because, um, I think sandbox is a little gamey, you know, and this is more like you can have events there and we knew, and they knew the designers that can do the building for us.

Dan Hood: (16:29)

So there are differences between the platforms, right? So, or, or feelings that a out platforms, they have different focuses at the moment, at least. Uh, so it’s worth, if you’re looking at it for a platform they’re not all equal, you wanna pick and choose one that, that, that feels right for whatever the purposes you have in it.

Jerry Eitel: (16:45)

They’re definitely different. They have to be different because, you know, that’s what differentiates one platform from the other. But, um, for instance, um, what, what is it NFT worlds is based on Fortnite. So, you know, that’s, that seems to be where some people are gravitating to these days.

Dan Hood: (17:02)

All right. Well, let’s go back. As you said, let’s go back to, to the accountant firms, uh, role there. And it sounds like, uh, you know, you feel that accountant are gonna have to get involved in this if only because their clients are, are gonna need to know about it.

Jerry Eitel: (17:15)

I don’t think there’s any doubt, um, because they’re going, they’re gonna have to go somewhere, you know, and there’s so many, but there’s, um, there’s some pitfalls too. The accounting is, is a nightmare. Also the actual accounting is a nightmare. You know, they said the blockchain would, would make it easier, but it’s makes it much more calm, but there’s no doubt that, you know, um, they’d be turning away business. We’re giving it to some firm that does it. So it, it just, you know, I don’t think people should be turning away business if they don’t have to.

Dan Hood: (17:49)

So what should they be bearing in mind? What do you think, uh, just from your experiences and from your sense of it as an accounting firm approaches it, what should they be? You know, do they need a presence in it themselves, or is it just enough to know about it and know the tax or implications know the, how to the ins and outs of the accountant accounting, uh, and being able to advise clients that wanna go into it or do they need to be there in person themselves? Well,

Jerry Eitel: (18:08)

All I could just speak from personal experience, um, since I actually been involved in buying the land and doing stuff and literally, you know, and, and just getting involved in the nitty gritty, I’m in the weeds. So the way it works is the, the way we’ve been, you know, generating some business, really, I, I get on a call with potential clients or funds, and I’m talking funds with a lot of money, right. And I’m in the weeds talking about all the problems that you run into. And then I bring in, um, one of our partners, you know, audit partners that specialize in funds, and you got people talking on a high level and you get talking on the weeds level and, you know, something, you can’t be, you can’t be having that general, no matter how much somebody knows on this upper levels, when somebody can talk about the, you know, the nitty gritty, it’s, it’s, um, not a genius, but it’s kind of, for some reason, it’s, it helps with, um, um, the marketing and it’s just general knowledge. And, you know, so I think, you know, at least they should, if they’re not gonna open an office or something, you do need to get involved in it on some kind of a transactional level where you have some experience, some not just buying and investing crypto, but maybe NFTs stuff like that, you know? Right.

Dan Hood: (19:33)

Well, it’s just, it’s such a weird new place that, uh, I mean, that certainly makes sense that it, you can’t really advise people if you’re not at least some degree involved in it yourself.

Jerry Eitel: (19:42)

Exactly. And that’s what, that’s what we found out. Um, like why did we build this office? I mean, you know, it was just one of these extension of the brand into, but we got so much traction as a result. I think we’re just surprised, you know, I mean, I’m surprised I’m on this call, frankly, you know, , let me think about that. I mean, I should be often the, uh, wherever I’m supposed to be, you know, but

Dan Hood: (20:07)

Yet on a beach somewhere, but, uh,

Jerry Eitel: (20:09)

Well, you, you, uh, I mean, you can’t die out of this business even I’ll be an avatar

Dan Hood: (20:16)

Well, this is the, well, this is the, you know, this is, uh, could be the solution to, uh, succession planning around the profession, right? If it’s all, all virtual successors in a virtual, uh, virtual office, somewhere in decentral land or sandbox or wherever makes sense, uh, firms could just go on forever and never, never have to hire or anybody new, just keep going with the, uh,

Jerry Eitel: (20:34)

I mean, we can keep going with this, but like, all I know is I’m still doing this, you know, I’m not a, not a tax partner. I’m the chief metaverse officer.

Dan Hood: (20:42)

It’s an well, this, and, and I actually, this is a good question cuz not only you, uh, the firm to have the first, uh, uh, headquarters in, in there, you must be the, for the first firm to have a chief metaverse officer.

Jerry Eitel: (20:53)

I mean,

Dan Hood: (20:54)

I, I, I certainly haven’t heard of any, but uh,

Jerry Eitel: (20:56)

I know, I mean, I haven’t heard of anybody either. It’s kind of, uh, it’s, it’s pretty weird. I have to say. I mean, I actually don’t even know how, um, I don’t even know what the, the image of being the chief metaverse officer is. Frankly, if people sitting there saying, oh, he’s the chief metaverse officer, what a joke or is he, are they saying, well, that’s cool. I don’t know. You know, it’s,

Dan Hood: (21:16)

It’s whatever you make it, you’re the George Washington of, of chief metaverse officers in the sense of you get to decide what the role will be for millions of chief metaverse officers to come. It’s exciting stuff. I have to say. It’s, it’s really neat. And, and I think it’s neat that as partner emeritus, you’re getting involved in it and uh, uh, follow up and we’ll have to, you know, have you back every six months to tell us, uh, where things are going. Cause it just changed very quickly, I think, or I suspect that it will, uh, you know, we expect to see things like we could go through all the different things where may change, you know, will platforms merge, will certain platforms emerge as the, the leading place to be in the metaphor, metaphor, that kind of thing. But those are all questions, I think maybe for, for another day. But I dunno if you have any long term thoughts about where it might go, uh, you know, obviously, uh, no we’re gonna hold anybody accountable for predicting this kind of thing. Cause it is so fluid, but do you have, uh, expectations for it in the long term where you kind of see, it might go,

Jerry Eitel: (22:04)

I go back to the money. I think the real estate, I think the real estate’s gonna get very, very valuable at some point. And I think people are gonna be renting this cause it’s already happening. You know, NFT worlds is, I mean, it’s kind, it’s kind of an, I’m not an expert in staking and things like that, but it seems like you’re gonna be making passive income on some of this real estate. And that’s where I think it’s gonna go. I think the real estate guys are gonna make the money

Dan Hood: (22:34)

As that. Well, you say, you said real estate guys and the guys who sell the tools, the ones, the ones who make the money, it’s the subjects who come along to pan the gold afterwards. Yeah. Uh, it doesn’t pay for them, but, uh, uh, but,

Jerry Eitel: (22:44)

And a lot of branding, a lot of branding and stuff like that, which is good for the brands. And it’s also good for startup businesses that went. And the one thing I don’t, I do wanna say is, uh, communities. We, I, I really shouldn’t have left that out, but that’s the main thing about the metaverse is you can build communities around your self, around your, your music around products, your new business, your old business, and it’s about building community. So it’s a it’s, um, community of communities.

Dan Hood: (23:14)

Excellent. All right. Well, I think that might be a good, uh, a good note to, to wrap up on that. Uh, it is not just a, it’s not just a land boom. Uh, there is this potential potential, uh, enormous potential for, as you say, building communities, uh, of people who wouldn’t normally, you know, physically would never be able to be in the same spot, but now they can, they can join these digital platforms and, and suddenly find themselves living next to Snoop dog or, uh, building, as you say, building communities, uh, within these communities, Jerry I teller Prager medicine. Thank you so much for, for coming on and, and telling, uh, helping us get a sense of what the metaverse is all about.

Jerry Eitel: (23:44)

Thank you for having me

Dan Hood: (23:45)

And thank you all for listening. This episode of on the air was produced by accounting today with audio production, by Kelly Malone, ready to review us on your favorite podcast platform and see the rest of our content on accounting today.com. Thanks again to our guest. Thank you all for listening.

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