In this episode of "20vc," host Harry Stebbigs converses with Ian Lee, co-founder of Syndicate, a Web3 startup that has raised over $28 million. Lee shares his journey from being an artist and consultant to leading crypto investments at Citigroup and later venturing into Web3 and blockchain startups. He discusses the evolution of venture capital towards a decentralized model, the potential of DAOs to transform traditional VC structures, and the importance of building native capabilities to thrive in the Web3 space. Lee also touches on the narrative and inclusivity challenges within the industry, emphasizing the need for Web3 to be accessible and beneficial to a broader audience, not just the technologically adept. He predicts that NFT-powered commerce and media could see significant growth in the coming years, and stresses the importance of community and collaboration in building Internet infrastructure and protocols.
"Now. Last month we had Avegael Garg at Electric Capital on the show as a primer for all things crypto and Dow investing. And I asked Avegael who are the two best people for me to have on the show around the topic, he said. Ian Lee at Syndicate and Ruchi Sanghvi at South Park Commons."
This quote sets the stage for the episode, indicating the expertise of the guests and the focus on DAOs and crypto.
"Tigas is the only company in the world that aggregates qualitative information on private companies from seed stage to pre-IPO."
The quote explains the unique service offered by Tegus, demonstrating its value to the venture capital community.
"I always viewed myself as more of a builder... And when I got exposed to investing, for me it was very removed, I guess, from the process of building."
This quote highlights Ian's initial reluctance to enter investing, emphasizing his preference for hands-on creation.
"We identified an architecture of an Internet protocol that basically turned the core functions, capabilities and processes of what it means to invest into a software primitive that runs on the Internet that anyone can use."
The quote explains the fundamental idea behind Syndicate, which is to democratize the investment process using Internet protocols.
"Dows are a technology in web three that enable financial capital and human capital to coordinate natively on the Internet together very quickly, very cheaply, and very efficiently."
This quote defines DAOs and their function in the investment landscape, suggesting their potential to revolutionize venture capital.
"These things are being experimented and tested right now, and a lot of them are not going to work out, but some of them are."
The quote acknowledges the experimental nature of DAOs and the ongoing process of determining best practices.## DAOs with Explicit Strategies and Purposes
"A DAO that is specifically formed to invest in more female founders in the crypto and Web3 space over a long period of time, those ones have a lot of success because they have staying power and they have an explicit, I guess, strategy and purpose."
This quote emphasizes the importance of DAOs having a clear, long-term strategy and purpose, which contributes to their success and sustainability.
"We have like the biggest founders in the world all invested in our DAO, and then they delegate decision making to four admins."
The quote illustrates a DAO structure where decision-making is centralized among a few admins, despite the DAO having many investors, which is likened to traditional venture fund structures.
"Change happens sequentially. It happens incrementally in society."
This quote explains that societal change, including the adoption of new technologies like DAOs, is a gradual process.
"VC funds that don't build those capabilities, whether they are dedicated crypto funds or not, are going to not be able to maintain an edge and keep up with the pace of innovation."
The quote indicates that VC funds need to develop Web3-specific capabilities to stay competitive and support the startups they invest in effectively.
"Web three is just the next iteration of the Internet, it's not going to be a matter of five to ten years that web three is completely separate from web two."
The quote suggests that Web3 is not a separate entity but rather the evolution of the Internet, necessitating a combination of Web2 and Web3 skills and capabilities.
"Crypto is the future of the Internet."
This quote encapsulates the belief that cryptocurrency and Web3 technologies will fundamentally shape the future of the Internet and its underlying business models.## User-Owned Platforms
"Is there a way to create a user owned version of Uber, Airbnb, Instagram, Facebook, TikTok, et cetera? Could those platforms, and could those networks, if they were owned by the users, be more resilient, be more sustainable, and be better for society because it's more equitable?"
This quote highlights the idea that if major platforms were owned by the users, it could lead to a more equitable distribution of value and benefits, potentially transforming societal structures in a positive way.
"All technological innovation to this extent and level has led to greater income inequality, not income equality."
Ian Lee references Mark Carney's observation that past technological shifts have increased income inequality, implying that web three might have similar consequences.
"Yes, you and I may get it, and you obviously a lot more than me, but fuck, this is a small segment of society."
Ian Lee expresses concern that web three technologies are currently only accessible to a small, tech-savvy segment of society, highlighting the need for greater consumerization.
"It's both a narrative thing, being able to connect with these people, but also being able to match that with the infrastructure and products that deliver against that promise."
Avegael Garg emphasizes that both infrastructure and storytelling are crucial for the adoption of web three, and that they need to be developed in tandem to fulfill web three's potential.
"I think storytelling is one of those things that are undervalued today in web three."
Avegael Garg points out the need for better storytelling in web three to inspire and include a broader audience, which is critical for the technology's success.
"I believe that in time, those projects or those networks or those systems will be less resilient than the ones that are actually designed for society, that solve a really important need or problem."
Avegael Garg expresses optimism that, despite short-term challenges, web three projects focused on societal needs will prevail due to their inherent resilience and problem-solving capabilities.
"I really struggle with it, to be honest. I don't actively engage in a lot of those things."
Avegael Garg shares his discomfort with the influx of opportunistic 'tourists' in web three, preferring to focus on those with genuine, long-term interest in the space.## Cycles of Interest in Tech
"Ten to 15 of these cycles where it's been really hot. And then it went out of favor and all of those people left."
This quote highlights the cyclical nature of interest in the tech industry, where a significant number of people leave after a hype cycle ends, leaving behind a core group who are genuinely interested.
"I want to move into a quick fire round, so I say a short statement. Ian, you give me your immediate thoughts. Does that sound okay?"
This quote introduces the quick-fire round segment, setting the stage for a series of rapid responses from Ian Lee.
"Having a beginner's mindset is what web three needs and has needed for some time."
The quote emphasizes the importance of approaching web three with a fresh perspective to understand its fundamental principles and innovations.
"Incumbents fail to realize that a technological innovation often comes with a business model innovation behind it."
This quote summarizes the key takeaway from "The Innovator's Dilemma," highlighting the oversight that leads to the downfall of established companies when faced with disruptive technologies and business models.
"Andrese Nahorowitz has a crypto canon... Jesse Walden wrote this article about the ownership economy."
The quote provides specific resources for those looking to learn about web three, pointing to influential writings in the industry.
"I think that NFT powered commerce in web three, NFT powered digital media... are now possible in the next two to three years, even one to three years."
This quote reflects Ian Lee's revised opinion on the timeline for NFTs to influence various sectors, indicating a much faster adoption rate than he previously thought.
"The hardest part... is getting the help that you need and being able to ask for the help that you need."
Ian Lee describes the difficulties in building web three infrastructure, emphasizing the need for collective effort and the humility required to seek assistance.
"I think that there actually is one called Bitdao that has over a billion dollars in assets under management."
Ian Lee confirms the existence of a DAO with substantial assets, suggesting the potential for DAOs to deploy large capital amounts in the future.
"Web three needs people like you... who come in with an open but beginner's mind."
The quote invites newcomers to the web three space, highlighting the value of fresh perspectives in evolving the industry.
"I so appreciate you being so welcoming of me into the web three crypto community."
Harry Stebbings thanks Ian Lee for the warm introduction to the web three community, reflecting on the positive engagement during the podcast.