Interview with Benchmark partner: Web 3 is a revolution to Web 2, not just the evolution of Crypto

Benchmark has invested in projects such as Ebay, Instagram, Dropbox, etc. Sarah Tavel is one of the partners of the venture capital institution Benchmark. She began to pay attention to the Crypto track relatively early, but her investment strategy is more prudent. In recent years, she has invested in Benchmark's Crypto. Mainly there is only one Chainalysis, who was recently interviewed by Techcrunch to offer her views on the current range of issues surrounding Web3.

core point

When people talk about Web3, they almost use the word Web3 as a synonym for cryptocurrency, but I don't think so. Users own cryptocurrencies, which also involves various decentralized infrastructure and financial incentives - Tokens, and also requires Token-related economics to coordinate all decentralized entities and all users behind them.

Decentralization is not an end in itself. My point is that decentralization is like a new palette that allows participants to build new experiences, and now the decentralized infrastructure is just a means to an end. Creating real value for users does not mean that it needs to be as decentralized as possible to achieve the purpose of creating value. Take a look at the famous projects mentioned around - Sorare, Axie Infinity, OpenSea - these are actually centralized companies built on decentralized infrastructure, using this decentralized infrastructure as a way to create more means of value.

It's a lot like when the iPhone came out, the iPhone was a new infrastructure, this new hardware device itself was built by people with very specialized skills, the professionals built the chip and system architecture and all the components that made the iPhone a pioneering era of equipment. Then there are builders from different disciplines, entrepreneurs like the Kevin Systroms (founder of Instagram) and Zuckerberg, who use different skill sets to build new consumer user experiences on infrastructure platforms like the iPhone .

Investing in C-side products and founders requires a certain degree of professionalism. It makes sense to understand the underlying infrastructure, what models are incentivized by people across the network, and the strengths and weaknesses of the various options that consumer builders must work to address. But I think companies that have established a lasting C-side investment strategy have their own experience and are also very professional disciplines, which will be very meaningful in the Web3 era. That's why while I'm focused on web3, I admit that I haven't focused on cryptography at the protocol level yet.



foreword

In recent years, the only company officially announced by Benchmark about the Web3 track is Sorare, a Paris-based NFT+ game-type company that raised a total of $730 million in two rounds of financing last year.

Sarah Tavel has long been very interested in the idea of blockchain-based smart contracts, and once led a "white paper reading session".

Although Benchmark seems to be relatively slow in Crypto compared with its peer venture capital institutions, including some of the big funds that have launched funds dedicated to investing in Crypto tracks, Sarah Tavel believes that Benchmark’s strategy is still relatively prudent (prefers its age-old practice of making concentrated bets in all areas, with each general partner leading just one to two new deals each year) each GP leads just two new deals each year. Sarah Tavel believes that Benchmark's prudent strategy has given the investment team more time to think about the changing situation. This is an interview with Sarah Tavel about Web3, Crypto and DAO.



@Sarah Tavel

Reporter: There is a lot of debate about Web3 now. Do we really need a new Internet era? Need to have more decentralized organizations? Or is it just the same people from the past frying rice? Brand hype? What do you think about this issue?



Sarah Tavel: Let’s start with the origin of BTC. In the 2008 financial crisis, the essence of Bitcoin was to support decentralization (Lehman Brothers went bankrupt, the so-called financial system failed). Now, we hear a lot on social media. , people are unhappy with a centralized overlord like Facebook. The idea of decentralization, intertwined with the idea of creating value for users, has led to today's crypto ecosystem with a wide variety of protocols built on top of BTC, Ethereum, and Solana (Layer 1) Tier 1 solutions, they have breadth and variety. And the whole feature of this crypto infrastructure is decentralization, because it brings many benefits.

But these are different from Web3 as I know it. When people talk about Web3, they almost make the word Web3 synonymous with cryptocurrency, but I don't think so. Users own cryptocurrencies, which also involves various decentralized infrastructure and financial incentives - Tokens, and also requires Token-related economics to coordinate all decentralized entities and all users behind them.

However, decentralization is not an end in itself. My point is that decentralization is like a new palette that allows participants to build new experiences, and now the decentralized infrastructure is just a means to an end. Creating real value for users does not mean that it needs to be as decentralized as possible to achieve the purpose of creating value. Take a look at the famous projects mentioned around - Sorare, Axie Infinity, OpenSea - these are actually centralized companies built on decentralized infrastructure, using this decentralized infrastructure as a way to create more means of value.