Union Square Ventures is a heavyweight team of venture capitalists and an early investor behind Twitter, SoundCloud, Tumblr and Coinbase. Here's why its managing partner, Dr. Albert Wenger, sees similarities between the Web3 segment and the early internet.
"Worse at everything except for one dimension"
In his inspiring manifesto, Dr. Wenger invites his readers to discuss the most crucial aspects of what is known as "disruptive innovation." He refers to Prof. Clayton Christensen, who described disruptive innovation as a technology that is worse at almost everything than whatever is used by people in this or that period.
At the same time, disruptive innovation should have one "dimension" that allows it to be more advanced than competitors' products. And this dimension should really "matter a lot":
...being worse at everything except for one dimension, but where that dimension really winds up mattering a lot (and then over time everything else gets better also as the innovation is widely adopted).
To provide context, Dr. Wenger recalled the first PCs. During the first phases of their adoption, they worked far slower than large-scale machines, had weaker resources and so on.
At the same time, they were orders of magnitude cheaper, which was of paramount importance for a generation of people who had no computers.
From permissionless publishing to permissionless data
The adoption of PCs was the first example of "decentralization" as corporations were unable to concentrate the monopoly on computational power anymore.
The introduction of the HTTP protocol created the same for the ability to publish something on the internet. And blockchain does the same for databases: users regain control over their data.
Before the invention of Bitcoin, people had never been able to leverage such database themselves - without the necessity to work with federated databases like Visa and ACH.
This uniqueness is what the disruptive essence of Web3 is all about. And, while we're still in the very early stages, Dr. Wenger adds, "Web3 will be a platform for innovation that would never come from Facebook, Amazon, Google."