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Web3 protocols - Faster growth, less funding, and quicker exits that Web2 companies

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Venture-backed Web3 protocols scale faster than their Web2 counterparts An analysis of Web2 companies and Web3 protocols shows that the latter grew faster in terms of valuation and revenue per venture dollar raised. The results, as shown below, were clear; Web3 protocols grew faster and in some cases larger, despite being younger and armed with less financing. On top of this, the investments in Web3 protocols are already partly, if not entirely, liquid -- all in a matter of 3 years on average. This stands in stark contrast to the Web2 companies in the analysis who, despite being on average 8 years old, all remain private.  For this analysis we took the latest (2020 to-date) implied or stated revenue run rates for each of the Web2 companies based on their respective latest equity financings and compared it to the revenue run rates of Web3 protocols using on-chain annualized data from the past 30 days. We then took this revenue comparison and visualized it against the total amount of
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An answer to DeFi's cash flow problem? - Introducing Protocol Perpetual Rewards

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  Web3 DeFi protocols have become an extremely efficient cash flow engine. As these numbers have gotten larger, an important question has been advanced: What happens to a protocols’ transaction fees? Two of the most common answers to this question are: They accrue to the governance-controlled treasury of the protocol and are deployed via governance mandates (grants, audits, etc.) Depending on the protocol, they could be distributed to the protocols’ enablers. For example, the Uniswap smart contracts automatically distribute a portion of a transactions’ trading fees to the liquidity providers who help ensure a trades’ execution There are many more examples of these two common answers working in practice, but a third avenue for such cash flow distribution, which has raised questions about securities law implications, is distributing a portion of the collected fees directly back to token holders. Without an effective menu of ways that governance-controlled protocol treasuries can effectiv
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Go for a Web3 protocol: Forbes’ use of a simple revenue split for co-branded third-party newsletters could be missing a huge opportunity

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Go for a Web3 protocol: Forbes’ use of a simple revenue split for co-branded third-party newsletters could be missing a huge opportunity Today it was reported that Forbes magazine will be extending their brand to third-party writers or “content creators” who wish to publish through the Forbes brand and channels, but remain independent. Undoubtedly this announcement is a positive thing for many content creators who have a wide audience, produce fantastic content, but were previously unable to access the benefits of being directly employed by a major media brand with massive reach. This announcement is no doubt a great example of what good can come from the democratization of access to something previously reserved as exclusive. What else could have been done? Could Forbes have pushed the democratization envelop a little further? I believe that Forbes is currently overlooking a chance to create and monetize a decentralized media protocol that it co-owns along with their selected th
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Bootstrapping with aligned economic incentives between products & users

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Bootstrapping a start-up is a tremendous decision for any entrepreneur to make. VC’s are certainly known for turbo-charging a start-ups growth and fanning network-effects, but data supports that founder equity retainment levels are higher for those who choose to bootstrap for longer periods of time. A perfect blend of the two may make create better outcomes for everyone. Bootstrapping is domain agnostic and recently we’ve seen this in play within the blockchain sub-domain of decentralized finance or DeFi.  Over the last year, we’ve seen projects hit key metrics far quicker than what would normally be expected of them. Part of this success is what I believe to be part of the next evolution of bootstrapping; building aligned economic incentives between products and their users directly into the user experience.  Examples of this are already live. When Compound Finance launched their V2, the team announced an incentivization plan for users to be rewarded for borrowing a
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