Christine Kim I The New Computing Paradigm: Innovation and Opportunities in Web3 | Summary and Q&A

TL;DR

Web3 is the next iteration of the internet that aims to decentralize control from dominant corporations and give users ownership over their data and identities.

Key Insights

• 👤 Web3 is a philosophical movement that aims to decentralize control and give users ownership over their data and identities.
• 🖐️ The gaming industry can serve as a major on-ramp to crypto adoption, with concepts like NFTs and play-to-earn.
• 👶 DAOs introduce a new model for organizations and have applications in areas like grassroots movements and collective action.

Transcript

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Questions & Answers

Q: What is Web3 and how does it differ from Web2?

Web3 is the next major iteration of the internet that aims to decentralize control from centralized corporations and give users ownership over their data and identities. In contrast, Web2 is the current era dominated by platforms like Facebook and Google that aggregate data for monetization.

Q: How do DAOs (Decentralized Autonomous Organizations) work and what are their applications?

DAOs are collective organizations that financially align communities through tokens. They allow communities to have a say in the decisions and direction of a project. DAOs have applications in areas like grassroots movements, collective action, and even as a new model for corporations.

Q: How does Web3 impact the gaming industry?

Web3 has the potential to revolutionize the gaming industry by enabling ownership of in-game assets through NFTs (non-fungible tokens). It also introduces concepts like play-to-earn, where players can earn real income and transfer their skills and assets across different games.

Q: How does Greylock fit into the emerging Web3 industry?

Greylock brings its expertise and experience from the web2 era to the Web3 industry. It offers support to founders in areas like customer acquisition, growth strategy, and scalability. Greylock also recognizes the importance of having diverse perspectives and encourages collaboration with crypto-native investors and funds.

Summary

In this podcast episode, Christin Kim, an investor at Greylock, discusses the concept of Web3 and its intersection with crypto and consumer technology. She explains that Web3 is the next iteration of the internet, which aims to decentralize control from centralized corporations like Facebook and Google. Christin also talks about the history of the internet, from Web1 to Web2, and how Web3 introduces a new characteristic of collective collaboration and distributed computing. She shares her experience as an investor in the Web3 space and highlights the growth and potential of crypto and web3 in various sectors.

Questions & Answers

Q: What is Web3?

Web3 refers to the next major iteration of the internet, which promises to decentralize control from centralized corporations that dominate the web, such as Facebook and Google. It aims to give users more control and ownership of their data and identities. Web3 is characterized by principles of decentralization, individual ownership, and distributed collective collaboration. It also introduces a new level of computation by involving many participants in a decentralized network.

Q: How does Web3 differ from Web2?

Web3 is a reaction to Web2, the current period dominated by centralized platforms like Facebook and Google. While Web2 allowed users to consume and create content, it was primarily controlled by centralized corporations. In contrast, Web3 emphasizes decentralization, individual ownership, and collective collaboration. It introduces the concept of executing the web on a decentralized network, where many participants contribute to the computational power required for scalability. Web3 also challenges the monetization of data by centralized platforms.

Q: What was the history of the internet leading up to Web3?

Web1 was the early period of the internet from the 80s to the early 2000s, characterized by platforms like AOL and Netscape. It was a read-only version of the web, where users consumed content published by a few players. Web2 followed in the mid-2000s to the present and allowed users to both consume and create content. It introduced platforms like Facebook, where users could generate their own content. Web3 builds upon Web2 and adds the ability to execute the web on a decentralized network, involving collective contribution to computation.

Q: How has your experience at Uber influenced your focus on transformative tech and Web3?

Working at Uber, particularly on the Uber Eats product, gave me a deep understanding of marketplaces and consumer technology. This experience shaped my perspective on transformative tech, including the intersection of crypto and consumer tech in the Web3 space. At Greylock, I bring my consumer-focused approach to investing and look for companies that touch the lives of consumers. Web3, with its potential to transform various industries, has become a crucial focus for me and the team.

Q: Why is now the right time for the growth of Web3?

2021 saw broad mainstream adoption of crypto and web3, with a proliferation of use cases that felt varied and broad. Unlike previous boom and bust cycles dominated by one or two themes, 2021 witnessed many themes gaining traction, including gaming, NFTs, DeFi, DAOs, and social tokens. This broad adoption and varied use cases indicate that web3 is capturing the attention of the mainstream audience and bridging the gap between insiders and new users. The potential to reach a billion users under crypto is a promising sign for the future growth of web3.

Q: How do you stay optimistic about Web3 in the face of recent market crashes?

It's important not to overly fixate on token price volatility when evaluating the quality and potential of a project in the web3 space. While token prices serve as leading indicators and reflect market sentiments, they don't necessarily correlate with the adoption, revenue, or value of a project. Many successful projects in web3 were started and launched during crypto winters or periods of market downturns. Long-term investors like us focus on the fundamentals of projects, such as revenue, user adoption, and real-world impact. Market crashes can be productive times for projects to focus on building and achieving milestones.

Q: Could you provide examples of web3 investments made by Greylock?

Greylock has been investing in web3 even before my time here. We are investors in Coinbase, which is a prominent crypto exchange. Additionally, we have invested in companies like Chia, which offers hard disk storage-based blockchain, and Handshake, a decentralized DNS naming protocol. Since my arrival, we have ramped up our pace of investing in web3. We invested in Pinata, a decentralized storage service for NFTs, and Zed Run, a blockchain-based horse racing game. Our most recent investment is in Portals, a metaverse where users can own and decorate virtual rooms. There are other investments that we have not announced yet, but we're actively exploring opportunities in the web3 space.

Q: How does Greylock's approach to investing in web3 differ from traditional investments?

While Greylock's core principles remain the same in terms of looking for great markets, ideas, and founders, the web3 space brings in new ideologies and operational structures that differentiate it from web2 companies. Web3 companies often embrace principles of collective ownership and community governance through the creation of tokens and DAOs. Greylock recognizes the importance of understanding and participating in these new operational structures, governance models, and funding mechanisms. However, the evaluation process still relies on frameworks developed over years of investing in a diverse range of industries.

Q: What makes gaming an interesting focus area within web3?

Gaming is a massive industry, bigger than movies and music combined. It has the potential to be one of the biggest on-ramps to crypto and web3 due to its large user base of nearly three billion gamers worldwide. Gaming has close ties to web3 concepts, such as metaverses, where users can own their online identities and spaces. Additionally, the concept of play to earn is gaining popularity, allowing players to earn rewards or income by playing games. Gaming also has a strong connection with NFTs, as gaming assets can be tokenized and traded. The intersection of gaming and web3 presents unique opportunities for mainstream adoption and innovation.

Q: How do NFTs contribute to the web3 ecosystem, and what are some potential use cases?

NFTs, or non-fungible tokens, enable digital ownership and scarcity. They allow individuals to provably own unique digital assets, such as art, collectibles, and gaming assets. NFTs have a broad range of applications, including art, collectibles, commerce enablement, authentication, contracts, and IP rights. They can be used to track and authenticate unique entities, events, or concepts on the blockchain. NFTs offer a new level of digital ownership and value creation. Infrastructure that supports NFTs, like storage, marketplaces, and tools for creators, is essential for the growth of the NFT ecosystem.

Q: What are DAOs, and why are they significant in the web3 space?

DAOs, or decentralized autonomous organizations, are a new model for corporations and governance. DAOs operate on the principles of decentralization and community ownership. They are often established through the creation of tokens, allowing the community to have a say in the future direction of a project. DAOs can be seen as committees or networks of contributors who work together on an open-source project. DAOs have implications for various industries, including gaming, where the community can collectively contribute to the development and governance of games. The concept of DAOs introduces new operational structures and governance models beyond traditional web2 companies.

Summary & Key Takeaways

• Web3 is a reaction to Web2, in which centralized corporations like Facebook and Google dominate the internet and monetize user data.

• The philosophy behind Web3 includes principles like decentralization, individual ownership, and distributed collaboration.

• Web2 allowed users to consume and create content, while Web3 introduces the concept of executing the web through distributed computation on a decentralized network.