#239 – A New Golden Age for Creatives and Founders with Li Jin of Variant
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What's up, everybody? This is courtlandt from india hacker's dot com, and you're listening to the ni hacker's podcast. More people than ever are building cool stuff online and making a lot of money in the process.

And on this show, I sit down with these and hackers to discuss the ideas, the opportunities and strategies. They're taking advantage so the rest of us can do the same. I'm here with lee. jen. Uh, lee, let's go.

good. It's nice to speaker again.

Thanks for having me. Yes, nice to have you. I think you're last on the showing feber over this year about ten months ago. And I think I introduced you as the patron saint of the passion economy back then.

So the passion economy, very simple to the creator economy, is a sort of explosion of individuals moving onto the internet and making a living online by creating things. So there is youtube videos or tweet or blog posts or courses. But he said, you ve had a lot of that going on. You've raised a lot of money and investing more money than ever, even at the new york times, you're really cool, sort of huge profile on you and they college the invested guru for online creator and maybe that's your new title. What was that experience?

He also called me the ignorant and vector, which which we will have really loved .

onto hilas ly girl intercapital.

It's a lot IT fell nervous and exciting. It's one of those moments that I think you never even allow yourself in vision can happen because it's just so far, vest feels like, you know, how many people have really get the privilege of being profiled, ed, in such a international forum like that. But I was an awesome experience.

I did a remotely I was calling in from greece, offends at the time. Taylor, the reds, wrote IT up. SHE is an amazing reporter who I ve learned so much from over the past few years. I think she's really on the cutting edge of writing a lot about the topics that I care about, but from a news angle. And so I was just really, really such an honor and a privilege to be written about by her.

What is that process like of being profile? But like a huge newspaper, is that like, is that like an argus thing? There is a like, super quick, efficient, like a podcast recording.

Well, IT is pretty extensive behind machines. A lot of IT I did not even see, because essentially what happened was I had a Normal conversation kind of like this with her. But then after that, he contacted and talked to a lot of people who had interacted with me or worked with me over many years.

I was it's kind of like getting a new job and then um your employers like, by the way, i'm just going to call up some people that we know and you're like, okay, but this is like on the next level, it's like literally everyone and IT was so funny because I was like, August, who is he talking to? What do I think? I hope.

I hope they say good things.

I hope they say good things. I hope they don't remember that time that I like left my dishes in the same and hate me for that. No, but Taylor, actually, I think he knows, like, have them all of my friends now, because you talk to every learn and SHE was, like everyone just said, the nice things about you. Yeah.

that was a pretty glowing article. IT was definitely a guy read through IT. IT was like a one hundred percent positive as well as like a tale. But then it's the earth time.

So you get some like comments and I was looking at some of the reader comments and it's like various degrees of pessimism and especially against tech in general when you get to like sort of like the piano gallery commenting. And one of the comments stood out to me, this person, the name is anders. I think hard for me to apply anything that perpetuates this texture and consumerism cycle. We currently seem to be spy rilling into, I hope for humanity sake, we all wake up from our youtube and instagram hip noses soon. You see that comment .

I didn't because I usually try not to um look is everywhere, like on twitter, on comments, like responses to my sub stack news letter, like the text. Ash is very real and I don't go through all of them in detail because a lot of them are kind of not subtle. And so I I try to just focus my energy on more constructive uses.

But I do acknowledges out there. I mean, if we look back in history for every single wave of technology, there is that people who have been vietnam ally against IT, like there's a podcast that I really love called pessimist archive, which chronical the tecla h throughout history. IT didn't you? sweet? Tecla h with the social media platforms you speak.

Tecla h against lake telegrams. There was a text, ash, against telegrams, because he was like, well, why? Why is the thing being invented? now? I need to be plugged in and like response to my customers over the weekend, or like they can contact me whenever they want.

Um there was tecla h against bicycles being invented. IT was unnatural from meant to go that fast or against the subway. Because why would you want to go underground if you're still alive? Like it's unnatural for people to be underneath the ground.

And like, why would we invent a motive transport that had you to gain up the oil? So like with every wave of technology throughout history, there's when people pushing back because I think the root of IT is like change is really uncomfortable, and technology requires us to change the way that we live and move throughout our lives, and that can feel threatening and different and force us to adapt our ways. But I think it's a perenna al thing. And if history has taught us any al lesson at that, there will always be resistance against change. But overall, like technology, I think it's inarguable that technology has praised the quality of life for all of humanity since we started making tools as a species.

I can feel the exact same way that you do like we have played this game before. It's sort of on repeat. You know, if you're student of history, it's kind of like played out to resist whatever new technology comes about that scary and threatened because and another generation that will just be monday and sort of how things have always been and of humanity, you can do anything.

It's adapt to new environments and and what not, but I don't know. Now everybody shares his opinion and I wonder, like, what do you think that is about you that makes you more optimistic about these kinds of things? And you know why arent you like part of the text?

Ash, you know, it's funny that you say that word because optimism because I just got A A reply to my latest newsletters that I just sent out two hours ago ah where readers said I wish I could be as optimistic as you, but you're wrong for all of these reasons.

I love .

internet. I think optimism is a traumatic experiences. And coming through them also, the fact that I grew up between cultures helps a lot, because a lot of the technologies that we commonly take for granted and that get vilified here, like social media platforms, I see the silver lining ings of them all the time, because my dad, my personal grandparents, they're from, like super rural china, like thirteen hour train ride, plus, like car ride, plus tractor, plus walking.

kind of, wow. Like the last part of IT.

there is no roads. If you have to walk through the rice parties, so they're from like that kind of rural environment. And when I was Younger, there was just no way to communicate with them.

Like you had to send a letter that probably took like a month to get there or three months from the U. S and then telephone polls got got installed there only when I was like, eleven or twelve years old. And I remember that moment clearly when I could finally pick up the phone and call my grandmother.

And then later on, they got sell service and now everyone has a smart phone. And the fact that, like, you can hold up your smart phone and talk to them face to bed now using the social platforms that are free for all of their users, like that's a magical moment that I feel like we don't acknowledge and recognize as often as we should. Like, I I remember them like telling my mother, like, it's crazy that we can still talk to you after all these years from this distance like, and I just thought, like, wow, there are a benefits to social media.

Yeah, IT made so many good points there. I think that we're sort recapping one of them as I think that a higher in the point that is easy to take these things for granted. And we have like, okay, people like live being empowered by technology at sea red and easy to hard to ignore those.

Look at all the bad, but like we appreciate like the simple things, like being able to communicate with your family, like that's very revolutionary and life changing. And it's easy to say technology is bad if we just ignore all of the good, but there's a lot of good that he does. And the other thing, I think is that on one optimisim can come from like unique personal experience, surviving difficult or even traumatic things and then seeing that life can be OK, I think is a good sort.

Proof on a personal level that like there's a reason for optimism, but also you can like logically make the case optimism if you're a student of history and you look back on things and you see like there's been so many different things that people over the decades have been afraid of that i've seen like existence al threats that actually, despite maybe being kind of dangerous, like we adapted and we worked through because generally speaking, people want things to be Better. And whenever some things that thing comes about, people go to work trying to fix the problems and make things Better. So I think there's a great logical case to you're sort of Violets ting for optimism.

Do you feel like the tech lash has been eagerly and like how do we ever mitigate that, especially in an era of social media and people? I think things for engagement.

I think that IT peaked in twenty twenty. I think that there is a lot more written about IT back then. But the fact of the matter like technology is sort of entrenched. It's sort of just here.

I think as much as people crave novelty, IT gets sort of played out to the like be like, you know fifty thousand, the newspaper article about why instagram is bad and how was doing us, you know and it's like, well, actually like we're still kind of okay and he mentally still sort of working well and people seem to be more or less surviving like we even adapted to like a global world wide pandemic and know it's not great. There's a negative that was, but like we seem to be able to adapt. And so I do think that like there are always we voice is out there that are sort of sounding the alarm are you know complaining for lack of a Better word.

But I don't think that it's necessarily a bad thing. I think it's fine and I don't think that it's like overwhelming and it's going to lead any major changes. I just think people will sound the alarm and sort of complaint and like. You know, that'll just be there. I'll be the persistent undercurrent until like humanity just used to this stuff and we will just complain about new things.

i'm already seeing the cycle happen again where there is now this like versioning nostalgia, the last wave of internet technology like with cyp to i'm seeing people now being like actually maybe facebook and google aren't that bad. Maybe it's not that bad that they have all of our data, like I trust them. And like if if you're gona trust anyone of our data, like it's probably google. So we have to go back to that.

Every so boring, but like every situation is nuance. There's always up and down. There is always a Cosmos of fit analysis. And so i'm not shock to see the opium. I spent a lot of time at hacker news where there's like it's always sort of the imaginary mythos c things were Better the way before. Yes, and there is a lot of that.

But I hate this. It's so funny how that has become the hacker news community.

It's weird, right? Supposed to be sort of a technologically like ford looking place. And yet, I think, no, I think every group is acceptable to sort of being commagena like that kind of maybe the condition. In a way.

I think we need to resist being promoted inly. That is like a lifelong g resolution for everybody.

Stay yang, stay hungry. I recently had like a sort of deep diving to like web three, because I was also, what is this stuff and sort of resisting seems like a flash in the pan. And then like earlier this year, and like, you know what, like I should, this is not the way to be.

This is not how I want to be like I should deeper dive and learn. And it's been super fascinating. And I ve earned a ton, at the very least, is very intellectually engaging and fun. And so agree with you, something like to start for.

yes, yes.

let's talk about some of this future stuff right down, like four, five topics we can talk about. We can talk about dos. We can talk about social tokens and web three. Maybe a good place to start is sort of a more broad topic, which is this concept, even tweet about a lot, which is creator or sort of taking back ownership from platforms.

And so I think the context is that like a lot of internet sort of web two, so to speak, has been these huge platforms like spotify, our twitter, creating sort of a place where creators can come in and produce content, but ultimately, the vast majority of like the capital, that's like a changing hands. So like, I guess, the reward for that content ends up been reaching and empowering the craters of the platform rather than the creator is creating that content. yes.

And this is not like idea. It's like it's a little bit topic away. What you thought this is like a fixie. It's a really interesting .

because in the last ten months, that has a lap since the last time that I was on the show, a lot has shift did on my side as well, professionally and personally. Just in terms of my focus area and where i'm investing both my time as well as dollars yeah to address like the future online work to .

the biggest opportunity of our time is to reconfigure the relationship between capital and labor.

yes. So i'll start with the founding thesis of my firm that i'd started last summer, italian adventures and trace IT to where I am now OK. So when I left a cincy IT was because i've became very passionate about the pieces of the passions economy.

How do we leverage online platforms and to give everyone the opportunity to start their own businesses on the internet, to earn income in whatever way they wanted, to offer up whatever product or service or knowledge or skill that they had, and connect with customers all over the world? That was the vision that I saw and the shift that I saw that was possible through internet enabled work. And I wanted to be really on the four front of that movement.

And so the founding pieces of italian adventures was, we should give everyone the ability to become a capital owner such that they can call the shots and be in control of their destiny. And do you work on their own terms, control their customer relationships, determine how they want to monetize their Price points, like empower them to be entrepreneurs, essentially? And that was very much reaction to what I had seen play out in the market place in platform world in the four years.

Power to that, that I was investing, which was that platforms mediated the relationship with and customers, platforms dictator of the Prices that they were paid out, they held all of the data. And sara, and so like, even though the promise was to be your own bus on a love is good platforms, that was inaccurate. The case, these workers were very much commodified.

And so my this is, was it's possible to build a new generation of tools and platforms that are much more friendly to online workers and actually enable them to own capital. And throughout the course of investing, what I realized was by investing in these centralized companies and businesses that were mostly on by investors like myself and by early employees at some point in time, in order to be worth anything and to generate to turn, these companies need to extract value from the users who are using them. And they could extract value at terms they thought we're fair, like through a take rate that they thought was low.

But there was still going to be pushed back from the participants on the platform over how that was determined. And was that really fair? And so that extractive element that a platform needed to converge on, which Christie s. Man has wrote about in his peace party, sentient zone, matters with the platform as curve, how, as they get more participants, they shift from CoOperation to extraction. I felt like that was this inevitability that presented attention in what I was trying to invest in and the impact that I wanted to see in the world.

So just to give relationship like an example of this, you're talking about something like facebook in the early days, and hey, craters can build on our platform and then later on, like locking down your followers and then you need to pay to reach these followers. Our twitter and A K developers can build on our API and then cutting off their A, P, I, killing a bunch of apps and just buying the ones that they care about, like eventually they start competing with the people that they sort of pretended to CoOperate with in the early days.

Exactly, exactly. That's right. That's that's precisely the dynamics.

And I thought how how do I resolve this tension? Like how do I actually fund the next generation of products and services that are going to be much more creative, friendly and not just eventually have to compete and extract from them? And I ended up going down the curve dabit hall.

And now I I went very investor because what I realized what I realized is that the tool kit that is offered by craftie in this innovation of a token actually allows you to transfer and distribute value to all of the participants in a network much more effectively than equity was ever able to do, and thereby enabling you to remove the distinction between a shareholder verses all of the stakeholders out there and make them one in the same. And so a cyp to network that can do can distribute tokens, their community, and that community can be users, that can be creators, that can be people who are helping you up on twitter or whatever. Like anyone who contributes value in anyway, can become a token holder. And the network can choose to drive value to those tokens and confirm rights, both economic rates and governance rights, such that everyone becomes a shareholder in that business, right? And so that was the strong form of the thesis of how do we make everyone a capital owner.

So an example of that might be a social network. I think I used to be called big cloud. It's not called d so but they had like a token that sort of represented their social network.

And the earliest sort of institutional investors weren't like signing you know special term shes where they ve got access to prefer shares or something there, just buying the tokens like any human being could do. Let me just buy this token. Any person who could do that. And essentially, you're not like at any elevated status as an early investor, you're doing the exactly things, everybody else.

and that's kind of revolutionary. Yeah yeah exactly. I I think there's A A little bit of a controversy with that particular example because the initial investors did get to access the token at a lower Price and like the retail investors. But the general idea is that is, is like eventually the company exits the community or maybe is community on from day one via the token yeah as an investor, you're investing in the same asset that is eventually going to be on by all of the users and creators on the platform as right.

And so that sort of alliance incentives as everybody sort of participating in the same way, was a question not like isn't access still like sort of powers of the proportionally favoured, just like the earliest people or the biggest investors? Like ultimately, if you own fifty percent of the tokens in any of these things, like you still sort of control things in the same way of you're on the board of, know a traditional startup. So what does the change come in that so .

revolutionary? yeah. So ultimately, I think these things aren't black or White.

When I outline the faces of giving users ownership these platforms, a lot of the reaction that all here from people is like, but where does that put you as A B, C? Like, what are you investing in men? How do you get to return? And the truth is that we we are investing in these networks as well, and we do, and we need to make a return.

And so the idea is that at a later point, like what we invest in will be worth more than what we invested in initially. Hopefully, idea, idea. That means the network grows and attracts more users.

And there is like the token Price. Appreciate its its setara, but if you look at the subsidy difference between the old style model of funding a startup through equity all the way through to IPO first is one of these decentralized networks. What looks really different is the percentage of ownership that goes to VS versus goes the community, like in a traditional company start up that is funded via equity selling equity.

They'll probably raise many, many rounds on venture financing to the point where probably by the time of ipos, it's mostly on by investors, by outside investors and the team on, I don't know, like a third of the company or something and then IT ipos. And that's when all of the retail investors can finally get access to this company. That is now probably worth already a lot.

And that at that point, like the venture industry exit and the retail sters kind of pay what they're exciting to versus in a decentralize network. Usually, if IT starts as a centralized company before doing a token distribution, there will probably raise like one or two rounds of capital maximum and then investors will earn fifteen percent of the business or so and then the team will own, let's say, ten to fifteen percent of the business as and the remainder of IT goes the community. And so much larger port of the token network goes to the community much earlier, enabling people to benefit from the Price appreciation of the toka they're after from a much earlier prestige. And then there's the added part, which is that a lot of people don't even need to buy the token in with their own capital. They can earn IT through doing various actions that the network dict ates are.

So get to or even if you really have any money by like working or posting or waiting or whatever the product sort of intimate, yes.

that's right.

Is this so fascinating essentially is a VC like what you're kind of basically saying is like, hey, this new future world, it's like technically not as good as the past world was for vcs, and we're not going to take home lion share of the equity, but this is where the world is going anyway. And so it's either sort of a after die adjust to this new reality or try to hold on to this past reality.

And they kind of see that patent, lots of things like in the one thousand nineties of usual media organization. And you hear about the web you like anybody can publish to the web. Like I enjoy my privileged position on T, V stations and having, you know, privilege distribution and newspaper stands.

Like why do I want to go on the web? If you had that mindset, you would have just died. You, you can have to adapt and say, okay, in the future i'm gonna more competition. I'm going to have less power. But that's where the world is going to have to go that way. So maybe as an investor sort of getting on the cyp to sort of web three desensitized trained as the same sort of thought process, we're like accepting that this is just how things you're going to be.

Yeah, I I would say a corporation to that is, yes, I I definitely feel like this is the direction the world is headed. But B, I actually think this alternative way of building a platform through community ownership is potentially even more powerful. And the end result is a network that grows to be much more valuable for everyone such that the pie expense. And so even if we end up with a smaller share of the pie, IT could be worth right, just as much or more as I did in the old equity world because you're turning over ownership to users who are thereby much more incentive to stick with the the community to take actions that are valuable to see IT grow more. And so the thesis, part of thesis, like ownership, is going to enable networks that grow bigger, faster than what was possible before.

right? okay. And so if we come full circle to this idea of like reconfiguring, the relationship between capital and labor, the future that we're headed toward potentially is basically the labor like the workforce like a just owning a much bigger share of these companies.

And what does that like ultimately like accomplish? Does that mean that we have Better, healthier companies? Does that mean that like there's like a more sort of income and inequality and well distribution, like what is that, that makes us a noble goal. I guess I think .

different people see different things in this. But what I personally see in this is the potential to solve income inequality, which is one of the most pressing issues of our time, I believe. So if you look at the reasons driving in a income inequality and widening the wealth gap, it's because too few people are owners of assets that are appreciating and value.

They're living paycheck to paycheck. They have no see things. They don't own assets like stocks or equity. They're not accredited investors, and so they are not privy to the same opportunities to invest as like the other verified tier of investors.

And so people are falling behind and then other people are able to a mass ownership and get Better access to, like more attractive investment opportunities. And the wealth gap continues to de. And so I think of crypto and the ownership economy idea as like this really powerful force pushing back against that, which ultimately creates a healthiest society.

Yeah, this is this term of kind of idea of the rich kit, Richard. And I think technologies like played into this so much pressure with the web or it's like, you know, on one hand, you have this very empowering, like exciting story of just a small group of people can create so much value and wealth, you know, using code that can reach so many people and it's like really inspiring.

But then it's also like, what doesn't that just mean? Like a lot of worth is going to be concentrated in very few hands in the future. You know when you don't need you know ten thousand mom and pop stores, but you can actually just have like one e commerce business that serves everything. And so it's like the idea of the mac u effect or you know essentially .

advantages .

accumulate and like it's almost as a cypher do is like sort an antidote. Oh, we can have this technology that reaches everybody and yet we can have another layer of technology that make sure that like all of the wealth doesn't accumulate .

into just a few hands yeah, I remember reading this analysis around the facebook IPO years ago, which was studying like the revenue generated per employee a facebook compared to I africa IT was like some very traditional offline business. The revenue generated with some offline manufacturing that says and you could clearly see the distinction where like every facebook employee had so much more leverage and generate and so much more revenue.

But then you think about that more and it's like, well, yeah, because they're leveraging the creation of this worldwide network of users who are contributing the content in making the network entertaining and attractive in the first place. So this whole generation of like multi sided platforms and user generated platforms, they have gotten to be really valuable with very few employees because there's this widespread network outside of the confines of the company that are also doing work for the company, contributing to its value. If you think of the term user generated content and all of these user generated platforms, there are something insidious about that terminally.

It's like this class of users who are generating the value. And yes, they're not owning anything. Yeah so it's true back because .

i'm trying to do this with any hackers like I want the end of kers formed to be awesome and then I like go away and like look at all these people making all these posts. I don't have to do anything. They're making the website great.

I don't have to do anything. But I got one the other like maybe this is a little exploitive, but any actions least, I don't generate any revenues like there isn't anything that i'm capturing in particular. Bit like I do think that there is a legion and argument to that. These companies have found a way to leverage the work of so many people but aren't necessarily, I guess, needing to compensate them for the worth they're doing .

due to network affects. Yeah exactly. And even if they wanted to compensate them through giving them stock in facebook or over whatever, like the existing regulations just wouldn't facilitate that.

Like there is no way to distribute value in mass to three billion users all around the world. You really need a digital way to distribute value. I ecri pto, right?

And so the other question this brings up is, like OK, will you've got cyp? Do you presumably like these future absent platforms take over the the web? We're going to be based on tokens and anybody can buy token.

Where is in the present day, like it's very hard to like invest in the company. You need access, you need to be sort of an Angel investor. You need to be sort of connected.

You need wealth. There's literally laws about being an accredited investors. You've got to have like a million dollars in the earth to be even like trusted and allowed by the government to be an investor, which is kind of crappy.

But there's an not argument to be made that like, well, when you open up tokens and this is huge digital casino, people are just going to like, lose money in mass. People are like, you know, buying what was that? The squid game coin that came out was like a huge game, like people are not necessarily sartin ted. People are not necessarily know what worth investing in, what's not worth investing in.

And so like perhaps we're just creating a world where sort of the advantages just get taken advantage of even more and you know miss out and the people who already have the advantage and the connection still when because they're just making sort of, I don't want to say unfair decisions, but like Better decisions through Better access and through Better connections at at a what I think is a real downside. So like the question in my mind is this is downside, you know, is IT worth the good? You know, are we really fighting against the sort of inequality? Or we just sort of exacerbated ving the people who already have the advantages, even more ways to win.

I I just don't agree with the patch nizing nature of investor protection laws.

You don't know what to do with your money.

exactly like the fact that only your credit investors could invest in our find or in a start up that just not that there are some dollar cut off beyond what you're sophisticate enough to know what you're doing. And below, like you're dumb. Like go invest in the stock market like going out of a beautiful fun which gives you two percent return year.

I I think that's just so unfair and it's this pretense that being used to lock people out of financial gains, it's really protectionist for the upper class of individuals who want the best investment opportunities for themselves. That's what is is plain and simple. And so this whole like people who are leveraging the charge that like crypto o is going to cause so many retail investors to lose their money because, I mean, the undertone of that is that there's not spring enough to do their own research. It's usually coming from people who are really wealthy and probably have an incentive to protect those opportunities for themselves.

Yeah again, like this is a sort of an alleged like media companies of the nineties know people are saying, oh, the internet. Anybody can write and publish anything that we can can trust people to go find real information there. And this is being said by people who own like these huge media corporations and have an incentive to people only read their stuff rather than allowing you to be democratized and allowing sort of everybody to play. So I agree, strong incentive to keep people.

I mean, I will grant there are definitely scams and stuff going on like with any decent technology. It's been used by all sorts of actors for all sorts of different purposes, but it's no different from the early uses of the internet or for email for bad purposes like we've gotten those emails from people pretending to be in nigerian princess or whatever we have to send them money and no one ever talks about regulating .

email email yeah.

or maybe they did. And I missed that. The technology will be used. How use, like our job is to try and paint the picture for how could be used for good. And I don't think we should be overly overbearing on people's lives.

So let's talk about dos D A O, decentralized autonomists organza. I have sort of been doing A A bit of crypto research. This is an area I haven't looked into quite as much as other things like nf and social tokens. What what exactly is a doll? And how do you see this sort of a new type of org ization playing into um what we're talking about sort of the businesses of the future, of the organza of the future and like sort of I guess, decreasing inequality, helping sort of owners and laborious can emerge in one class.

There are so many different types of downs. The term has almost become kind of meaningless because everything is depending down to the end. I just wait about every week just because .

IT calls itself the doubt out. Yeah it's in the name and you hackers .

is dw all like chat groves are downs the okay, starting with basic definition. So a decentralized, autonomous organization, essentially, I think of them as internet communities that share resources and are lie towards a common goal or mission. And importantly, all of the members of the community are bonded through ownership in the community via tokens.

There's a dw native token s that every member of the community holds that points them in the right direction. And like allies, everyone's insanity of kind of like a digital co Operative, just like in a offline co Operative. Everyone was a member owner, if they were a worker at the cop.

Similarly an dough. All of the members are owners of the dough again, which represents their owners of stake. And right now there's like hundreds of, not thousands of doubts popping up, eat with their own missions and goals that they're trying to do.

We saw a constitution down which pull together capital to try and buy this coffee at the constitution. There's other doubts that are pulling together capital to invest in other types of assets like nf, almost kind of like many VC fans. But going after crib donated assets, there's doubts that are joining together and deciding to like build products and ships off together.

An example of this is like party doll, which built party bed, which is this tool that used to buy n of ties with your friends. Others are just like social networks, where people are buying and hanging out and meeting friends. But the commonality between all of them is this layer of ownership through the doubt token, where all of the members in that group are owners in the community and get exposure to the upside that's generated.

And so tying IT back to our conversation about work, the model that has been pioneer by silicon valley over the last few decades is that you can use incentives to create a more successful company than would have been otherwise possible by giving your employee ownership in the company itself through stock option plans. Um and so this has now become prevalent in silicon valley. Like every start up gives our equity grants to their employees.

It's unheard of not to do that. And the idea, which I think is true, is that by giving them equity, your employees are that much more instances vize to see you succeed, to see the company that they wearing for succeed because that represents upside to them. And a dough is very much similar to that, except that everyone who is contributing value in different ways can be an apart owner of the dough. And then there's this other added element, which is that outsiders can also speculate on the doubts token and buy IT, even if they're not really active members. So if I think, if I think like F W B, A, which is the social .

friends of benefits, friends with benefits, the most famous style, probably probably yeah.

one of the og downs out there. Like if I am just a passive investor, and I think, oh, I think F W B is going to be the future of social networking, then I can buy their token as a way to sort of invest in their future without even joining the group. Were talking to anyone or doing anything. And so what that means is like these communities have a way of bootstrapping themselves through speculation that wasn't really possible before for a CoOperative yeah.

it's super cool. I think like the speculation part of like the cyp to a sort of craze gets a criticize a lot, but it's actually a really good way to bootstrap stuff after beginning. You have a lot of people who are like, I don't know, I think I can make money from this thing and suddenly they put my money into IT. And now this, like a nicer organization, has way more power to get going really quickly than IT would have. As we're saying, if we were like a traditional silicon on public company and that kind of the competitive advantage to starting a double, if you can sort of, I guess, market yourself well and generate a lot of excitement, get raise crazy amounts of money, like what how much money did, like the constitution doors, like forty or fifty million dollars and like this, it's like unheard of for like a group of people to just get together and do.

And I think speculation gets a bad rap. I'm actually a fan of speculation. I think it's a necessary component to technology development.

I mean, my whole job is speculation, like the entire venture capital industry is speculating, like we expect to lose our money in a lot of cases for some of the companies to be successful in the generate of return. I think people are speculating with their careers by joining and start up as well. Like this notion of like betting on a future outcome is a critical element to attracting capital to certain causes.

right? So I think the other part of a dow is like a lot of the dow that I looked, delhi, the kind of like a shared bank acco. Okay, this is how like might not even be like a traditional bank.

And in many cases, it's not we don't form l and have bank like we are this like almost magical entity on the internet that is not registered with any government entities. And our bank account is actually just like a crypto wallet. We're all like we have like maybe hundreds of millions of dollars with crypto, and I guess we use like smart contracts or technology.

You'd like vote on things as a collective that we're going to do with this money. Which is just like crazy. It's like this like future internet business that government not even how to regulate or just it's just like anything goes.

And like part of me wonder like, well, like okay, the competitive or advantage here is that you can raise this money really quickly from speculators. You are excited about what are doing. I put money into days, for example.

And I like, I don't really keep taps and what are doing. I just think like a timely about the staying. Let me put some my money and here and I can delegate my other people, who I think will do a Better job voting and you actually care. The downside is, like, okay, doesn't this amount of running a business like almost by consensus, like can a business that needs to vote on all these major decisions really compete with an organization that's got, you know clearly defined CEO and aboard and people making sort of top down decisions very quickly and very accountability?

It's it's a really great point. I think first of all, what also is that the playback for running a decentralized organza is still being written.

I think no one has really figured out how to take a huge community that maybe hundreds of thousands of people and to make everyone clear on whether suppose we doing and what the valuable activities are like that it's kind of like community management, like no one really knows for sure what the playbook is in every community is different and and dance are similar to that, where you're managing a huge base of people who could be contributors, I E like, could be doing work on behalf of the doll. Some of them more speculators, and they don't want to do anything. And you have like a lot of diversity in that number base.

So I think it's like so still being figured out, but be on the running company micon sensus point. So right now, what's usually happening is that daw's resemble, I think, the future of dow governance is gonna converge on what we see in the CoOperative world. So if you look at the ops worker on CoOperatives, which are kind of like companies, but every employee is also an owner of the company.

In the real words, the most successful cocos in the world have management structures that are similar to centralize corporations. So the most successful cop in the world is the spanish cop called manger. Gone has lot, a lot of different lines of businesses, but essentially they have different business lines that each of their own manager that reports up to, essentially C, E O, who reports up to a board of directors.

And so it's not that different from the data Operations of a Normal company. What is different is that those leaders get elected by the workers. And so there is this kind of democratic accountability of the leadership to the people who are working at the company.

I think dough governance is gna look like that where it's not literally every single business is sajan goes up for a vote and every single person votes on IT IT. IT looks like a stata. But there is this accountability element.

IT makes a lot of sense. It's fun talking about the stuff like just like thinking, okay, these like crazy possibilities and like what the future might look like. It's like a very unexpected, I don't want to say rena's ons, but just like sort of technological transformation of how things are working that like two years ago, I know obviously cripp or was still a big thing, but like I had heard of a dw or an nf t our social tokens.

You know I didn't see the real applications and like how these things could supplant kind of the current organizations and means of investing in seta. But like now, it's pretty, pretty clear how this all works out. The world could change and we could be in for very different things. I mean, there are some concrete sort of implications of that too.

For example, the last I became on the show, we are talking with this article you about like the missing crater medal class with just kind of like we stop these like crazy power ladd distributions where youtube or spotify or any sort of network, you know, there are creators making money, but it's like the top one percent. They're crushing IT. They're taking home all the games and the vast majority of everybody else on these platforms, he is trying to make a living.

They just broke you. They're not making a middle last wage. And i've heard a lot of optimism in the cypher community that like basically web three is going to fix this. We're going to have platforms that this should be owners.

And that will mean that like the average artist can make a living or the average musician can make a living or the average right can make a living, instead of IT all going to the top one, two percent. And I haven't yet seeing a convincing reason why this is true. I'm not sure i'm not convinced, but i'm also not like that skeptical. I was curious, like, do you think this is true? Do you think that, like crypto is sort of a path toward at being much more likely that a creator can make a living on the internet?

I actually just publish a subset new letter this morning outlining, you know, how cyp du can be used to a create or middle class is called the web three renaissance IT was the article that someone responded to me saying, like, i'm too optimistic. I ish I wear optimistic as I am, but IT does be this optimistic vision of what is possible with crp deal.

And I talk about how crypto can introduce all these new dynamics to make IT possible for craters to be more successful than they were before. And I talk about how N F T introduce the scarcity dimension, which fans really value. If they really care about you and love you, they care about the product that you create that's rare.

And they want to own that rare, rare thing, just an element of human nature. We like to collect rare things. And so people are earning more through nfs now than they would have through getting tens of millions of streams on their spotify ones.

There's also this added element of supporting a create no longer just becomes an active ultra ism. IT becomes an active investment and people are much more willing to spend on things that benefit themselves than what benefits others. And so you're tapping into this new spending behavior that didn't really exist in the web two world.

There was no such thing as investing in a creator in web two. But now like all of these and of teas and social, hogan's represent investment vehicles in addition to to just showing your support. Then there was I outline the idea of like programmable economic models, where everyone in the chain of creation who contributed to a colorado work could potentially see the upside from that final content being successful.

So today there is the issue on social media, which is that a lot of the attribution is missing. And so the creator who ends up being successful economically is usually the one who is successful going viral with something not necessarily the create a bit. This has been a huge you on tiktok, where the initial person who invented a dance is usually not the person who did the dance and got all the views and gets all the brand sponsor chefs, but in visionary world in which all those pieces of media are toggled, zed and transparent, and you could build upon them. And that end product just speaks in all the royalty payments to everyone that came before.

right? So you can do this with nfs, and you can sort of like use the block chain of any n to be like who's the originator and they can be programmed. And to that thing, basically any money made of this N F T can have some percentage goes to the gino creator, exactly. yeah. yeah.

And then ultimately, I think the creator middle class is going to come about through the idea of platforms, accident to their community and turning over otherness to their unity. Because a lot of the value before had been locked up in these platforms. And I went to the shareholders, not to the actual people are using the products. And so when that shifts, I think there becomes a lot more economic resources and assets that are controlled by creators and users.

right? Yeah, that makes a lot of sense. Do you think that means that we can have a world where, you know, I don't know how many artists are successful? Let's say there's a thousand artists. You know, random number is obviously ghe in that who are very successful today.

You know, basically the sort of accumulation of everything you talking about me, we can never rode a million because I I wonder that, okay, yeah, that is IT is possible like to make sure the originators of these things get, you know, paid royalties. And IT is possible to you to like leverage scarcity to make sure that like artists can make more money than, like you having to beg spotify for pennies on their streams. But also, like, doesn't the power loss still exist? You know what? Most people are invest in like the top one percent of the most famous artist or creator.

Yeah, IT is interesting because one of my portfolio companies, mission statements, is actually to let a million music garners live off their work called sound. It's the music of tea platform. So that is the express go.

So I think a million is possible, we can get there. But I think another element of this is perhaps not just letting nature tickets course, but users and craters deciding collectively that actually we do wanna do more to spread the wealth around. We don't want that to be that we're on this platform and five people get all of the earnings.

We wanted to be that there is universal creative and count that everyone who is producing work get some guaranteed minimum monthly income. Like hypothetically, in that worlds, you can more easily create the infrastructure to distribute that value on to create a universal creative income then what exists today. So I think part of IT is like these new monetization models and new economic models that do you may get more possible for people with fewer followers to be successful economically. But part of IT is also going to come down to our choices that we make as users and as participants in society, as to what that the end distribution of wealth we want to see and live in is going to be like. And if we make choices such that we want a million musicians to be successful and to be able to live off of making music than we can more easily do that now than before using this new technology.

I think one of the things that's like very consistent about you said you're not sort of just like you blindly opportunistic. You're not like i'm putting money into whatever works. You're much more like mission driven.

Like here's what I want to see happen in the world. But I like you, like the passion and economy because you want creators. To benefit from and enjoy and flourish in their work. And even when that comes like web through in crypto, you like what's making the most money and more like how do we reduce income and equality. And that's where your shoulder putting your money.

And I think that this is something that a lot of founders can learn from because when you start a business like your business is not just a means of making money, you can actually have some impact. You know, if you're doing something, you're creating a product, people, you're using IT, they're changing money from that is changing the world in some way even if it's only a small way. And I think that people underestimate the degree to which like they can pick something that's like beneficial.

They can like literally say like H I went the world to be literally Better in this way and sort of business that does that. And I I guess, in my opinion, people are afraid to do that because I think that constrains them. They're like, well, it's already hard not to be successful like how I have this other constraint as well and like make the world a Better place. Like i'm just struggling to make something that succeed. So I guess I find a question for you is like, you know, i'm an entrepreneur n to this podcast and i'm like, you know, I really would like to make the world a Better place, but I really primarily just want to be able to pay my own rent and income and i'd have to have a job like is there way for them to accomplish both without making making the journey much harder?

There's a really funny quote from this business analyst or professional. I forgot who had the score, only need to look at afterwards. But he said, like investment analysts think that companies make money.

Companies don't make money. They make socks, something like that. I'm probably watching that.

But I was like, yeah people who work in like, well, state or investing firms, they think companies exist to make money. They don't. They're trying to make the product that they are making. So in terms of words of advice for founders, I think is more impossible now than ever before in human history to do what you love and to go after the mission that you want to see in the world. And for the outcome of that to be financial again for yourself.

Like I think that's almost guaranteed now because chances are if there's going to be someone out there or a group of someones who see what you're doing and really value IT and are willing to support IT in different ways and give IT a viable business model like that, the whole this is of the passions economy is you can you can do what you love. You can just like put your skills and knowledge out there. And there will be customers around the world, like at least probably one hundred people or ten people, hopefully out of many billions, who value that thing and are willing to pay for IT.

And that's all you need because you don't need that many people to buy your product or service in order to make a living. And so I think yeah, I think founders should just allow themselves to be LED from their hearts and to pursue the visions that they want and trust that the business model and economics will flow from. That first is being too N B A ish in their own analysis of opportunities later.

the heart. And there is reason to be optimistic that that can work lejean, thanks a ton for coming back on the show. Can you let listeners know where they can go to find out more about your investments and your ideas? Because you do, you're absolutely prolific. You everywhere wheating blog ing is a lot of stuff.

yeah. Thank you so much for having me. People can follow along on twitter.

I'm l gen. Eighteen on twitter. My sub stack is the sub stack dot com. And then to find out more about the fine or to smith, your pitch, we're at very ant dot funds.

Hi, thanks.

Thanks so much.