A New Model For Startups.
The image of a technology startup usually involves a small team producing a new and disruptive product and then rapidly scaling with the help of an institutional venture capitalist. The hope is that by having a first-mover advantage they can capture and dominate the market before competitors can get off the ground.
While this model was popular for many products and platforms that emerged in the Web2 area, and even parodied extensively, trends in decentralization are pushing for developers to change how they work, collaborate, and integrate emerging technology.
What Makes Blockchain Different?
The nature of Blockchain startups is informed by the technology itself. It is liberating, decentralized, and links into an ecosystem of platforms that have been built by other technology enthusiasts. That's why I helped found yard [hub] in 2021, which has been working to implement Blockchain-based solutions in a more accessible way through our venture studio model.
Having worked in traditional IT projects throughout my career, the transition to emerging technologies has allowed me to consider the strategies and solutions that are needed to help this new model of startup thrive. The decentralized ever-evolving nature requires an agile and adaptable team, while also making informed leadership decisions based on hard data.
Our team at yard [hub] has developed Blockchain solutions for a wide range of applications, from digital currencies to car rental, to video games and educational platforms, demonstrating the wide range of projects these teams can adapt themselves to.
A Different Approach.
Startups working with Blockchain, and other Web3 technologies, differ in their approaches and structures from traditional startups in several ways. Sometimes informed by culture and sometimes by the technology they use. This has led to the emergence of the Venture Studio, a cross between a tech incubator and a development studio that allows for smaller projects to be conceived, developed, and brought to market in a shorter time frame. Producing multiple projects in succession also allows the development and leadership team to hone their skills across various areas. By pushing the boundaries of technology, these studios can attract some of the most passionate and talented developers in the industry.
Additionally, the interdependence of many systems, such as the Ethereum Blockchain acting as the spinal cord of many technologies, encourages a full ecosystem of technologies being developed in parallel. While collaboration has existed in the technology industry since its inception, with entire operating systems being open source, Blockchain's foundation of decentralization, encryption, and automation allows for different technologies to interface with each other as developers build up the overall ecosystem.
Decentralized tools have already been brought into use to replace traditional systems, such as distributed encrypted cloud storage that operates across an entire Blockchain, creating multiple layers of redundancy. The security built into Blockchain technologies, primarily encryption, also allows developers to deploy systems like software licenses through a Blockchain, rather than having to use a centralized legacy system.
Investment, But Not As We Know It.
In terms of relationships with investors, the traditional model of startup investment usually involves rounds of funding and support from VCs or other institutional investors seeking to make a significant profit over decade long timeline. While other investment routes are available, they often involve the developers partnering with a large institution in exchange for influence within their organization, trading control over their vision in exchange for support.
Blockchain and Web3 allow for different approaches to this model, letting startups spread their investors over a larger pool by making transactions faster and more convenient through the use of crypto-currency, or by combining this with tools like Smart Contracts and Governance Tokens. This can allow much smaller investors, down to the individual level, to support a project while also experiencing the potential of the technology being developed through mechanisms like Smart Contracts.
Hard Choices and Agile Teams.
As the direction of the tech industry moves away from the centralized models of the past, with large corporations holding onto large central platforms, and towards a more distributed network of technologies, the working practices of successful developers and leadership will inevitably adapt with it. What allows these new structures of tech organizations to thrive comes from both their developers' enthusiasm for pushing boundaries forward and from leaders making difficult, open-minded, and data-driven decisions.
The culture of collaboration and experimentation is also what drives startups and their technology forward. By building new infrastructure for Web3, developers can feel their contributions to the emerging world of Web3 and Blockchain, giving these startups a motivational edge over their more closed-off competition.
Bio:
Sergei Lagutenko is an accomplished tech leader in IT, mobile gaming, and venture incubation with his expertise in leveraging data-driven and agile methodologies.
As co-founder of venture studio yard [hub], he has spearheaded projects from award-winning games to innovative educational platforms and has contributed to the development of numerous successful products that exemplify the potential of decentralized technologies.
