Business strategy, design, and decision making in web3
🛠️ Deep dive: On new sources of competitive advantage & moats in web3
Scott Duke Kominers et al
A deep dive and tour through key business concepts from theory to practice, the latest episode of our podcast ‘web3 with a16z’ covers the tricky nuances of business strategy in a new world of open source. The discussion — which features a16z crypto research partner and Harvard Business School professor Scott Kominers in conversation with editor in chief Sonal Chokshi — covers foundational business frameworks yet also what changes in web3, as well as guidance for builders.
For decades, Michael Porter’s Five Forces model on the competitive forces that shape strategy helped companies understand the structure of their industry to “stake out a position that is more profitable and less vulnerable to attack” — but how do those assumptions change in web3? Where do so-called vampire attacks come in? And what even IS competition in web3, where so much is publicly available on blockchains?
The question throughout is basically how to compete when you're building in public… So we also go into the new moats of “community cohesion” and software “embeddedness” — and how network effects really work, beyond common misconceptions. Finally: since web3 changes the game altogether, what’s ahead for the evolution of business strategy overall?
listen to the discussion
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Vampire attacks: A theory (and thread) on 'blood sucking' platform competition by John William Hatfield and Scott Duke Kominers (2023) — on a16zcrypto.com
Can web3 bring back competition to digital platforms? by Christian Catalini and Scott Duke Kominers (2022) — in Competition Policy International
Why build in web3 by Jad Esber and Scott Duke Kominers (2022) — in Harvard Business Review
▶️ Builder resources: On protocol to product, design, security, & decision making
Taking an idea, and turning it into a real product for people to use, is nothing short of alchemy. So it’s not easy… but several expert speakers at this year’s Crypto Startup School (our accelerator that connects builders with the resources, expertise, and networks they need) distilled their hard-earned experience, and journey through the idea maze, into guidance and frameworks for founders.
We shared the first batch of talks in our last edition (be sure to subscribe to our channel for the next releases), but subsequent batches cover the themes of “from whitepaper to reality”; product and design; leading and decision-making — as well as infrastructure, smart contracts, and security. Below are a few recently released talks; check out the full playlist so far here:
On principles for growing a protocol + principles for building with Dan Romero, co-founder & CEO of Farcaster
On principles for web3 product design with Ben Scharfstein, co-founder & CEO of Stelo
On smart contract design patterns with Noah Citron, engineering partner at a16z crypto
On how not to get hacked, attack types, and lessons learned in the wild on crypto security with Riyaz Faizullabhoy & Nassim Eddequiouaq (former a16z crypto, Facebook, Anchorage)
On the journey from coder to manager, making product bets, and more with Brian Armstrong, co-founder & CEO of Coinbase (in conversation with general partner Sriram Krishnan)
🔋Op-ed: On a new mining tax for crypto
The White House recently proposed a new mining tax — a 30 percent tax to be imposed on mining cryptocurrencies (proof-of-work, in particular) — but the so-called DAME Tax seems unlikely to accomplish any of the goals that the administration has laid out to justify it. While the intention is to reduce any negative impact from cryptocurrency mining on local electricity prices and global pollution, it is far from obvious — from an economics perspective — that the other goals will follow. Or so argues Joshua Gans, professor and economist at the Rotman School of Management, and author of the forthcoming book on The Economics of Blockchain Consensus…
The economics of cryptocurrency mining with Aviv Zohar of Hebrew University — on a16zcrypto.com
Proof-of-Stake Blockchains: Designs, consensus, attacks with Valeria Nikolaenko, Tim Roughgarden, and Sonal Chokshi — on web3 with a16z
What The Merge means with Ali Yahya — on a16zcrypto.com
--Sonal Chokshi with Stephanie Zinn, Tim Sullivan, a16z crypto teams
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