Prior to NFX, I was at Facebook where I was a co-creator of the Diem project, formerly known as Libra, which was Facebook's cryptocurrency effort. In a life before that I was Andreessen Horowitz where I looked at crypto deals around 2013/2014. I've been in and around this world that we now call Web3 for the better part of eight years. Now that I'm at NFX, I meet with Web3 founders and we talk about the power of network effects and how network effects were a nice to have in Web2, but a need to have in Web3.

In this section, we're going to go over several areas. One is we believe that Web3 founders and companies need to be built in an almost inverted way. As discussed outside the map, there's the social aspect and we believe that Web3 products start there. Like growing your Discord, growing your community and then bringing the product towards the inside the map. Then we'll talk about our three-stage framework for early Web3 founders. Then we'll go to my experience at Facebook - the strongest case study for network effects in Web2 and how those learning lessons relate to my job and early stage founders today. And lastly, how Ethereum also has some parallels to everything that we've talked about in this section.

Not to be too corny about it, but we see ourselves as being the river guides for Web2 founders trying to find their way into Web3 but also for Web3 founders trying to apply lessons from the Web2 network effects world to Web3.

Web3: Definition And Ethos

If you're new to Web3, welcome. I was first introduced to crypto, which is what it was called at the time in 2013, when I was at Andreessen Horowitz, and Balaji Srinivasan joined and he was preaching crypto left, right and center. I went on walks with him and listened to him, and I'm grateful for that learning experience. So if you're new, welcome. It's still really early.

One way to think about Web3 is relative to Web2 and Web1. Most of the world was introduced to Web1 around 1994. And it was read-only. You could consume the internet. Very few people actually contributed to what was read on the internet. Then around the 2000s, platforms emerged that were read and write. So you could consume content but you could also create content. You could write a blog, post on Facebook, send a tweet. Web3 is this concept of decentralized ownership of all of these platforms. That's the big unlock. Whereas Web2, you maybe would read on Twitter and write on Reddit, you didn't necessarily have ownership in those platforms. Maybe you own some Twitter shares, but that's different. In Web3, the creators are also the consumers but are also the owners of these products and platforms. And that changes the whole dynamic.

There are main definitions of Web3 and working at NFX, we created our own. Our definition of Web3 is any product that equalizes ownership and participation across the consumers and creators of products and platforms. Alongside our definition, there's also this ethos of Web3. And by the definition of distributing the sense of ownership and participation, the ethos is also this shared sense of ownership in that not only do you tactically own a piece of these protocols, but in virtue of doing so, you also feel like a real owner and contributor to the products and the protocols and the platforms that you interact with. So you engage differently, tell your friends to join differently, and you care differently. So that distributed sense of ownership and participation really is pervasive across how you feel interact and share that product as well.