Why “Automation” is needed for the Nascent Decentralized Web
Part 1 of 2: Why early products in this grand revolution need to be leaner to survive (✍️ by Michael Coon & by Mitchell Opatowsky)
Idealists are the fuel to innovation for the Decentralized Web (DWeb). As opposed to builders for speculators in DeFi, builders of the DWeb are probably value-driven idealists building highly refined projects on top of Ethereum who face the uphill struggle of building their community and showing “traction” to scale the project. Driven by the shared values and missions within this ecosystem, these idealists find themselves attempting to adopt a cooperative strategy where all projects, protocols, and potential partners are on the same team—using the common “centralized versus decentralized” narrative around ownership of data, immutability and provenance of records, self-sovereign asset ownership, and the like. However, despite idealists trying to play on the same team, many are forced to compete and defect to one another in what, by all means is an ultra-saturated market, where the many battle it out over the few customers they think “get it”. The team behind BUIDLHub believes better playing to the narrative comes from adopting leaner technology so innovators can expend more resources in cooperative network growth games versus disruptive technology competitive games.
2020 is making it painfully obvious that the core idealistic mission is stronger than ever: our institutions are broken.
Despite this alignment of mission and value proposition, many DWeb developers are struggling to let the interests of Actual Users exceed those of Speculators. This intensifies competitive attention games for the few instead of growing the total pie.
In this article, we’ll share some thoughts on specifically building for the Decentralized Web and what some of our takeaways developing on DeFi have been. And we’ll allude to what the team behind BUIDLHub is working on to address these problems and opportunities.
First, there’s tremendous difficulty to demonstrate a compelling enough value proposition for someone to essentially change their usage habits with software. A project’s mission might be to enable privacy and sovereignty, but the immediate value of what’s being built towards that mission is not clear or easy enough for people concerned about privacy, asset ownership, immutability, or censorship to adopt.
So let’s fix this—let’s try to be cooperative to introduce more value into the ecosystem.
Let’s imagine this is your store.
Once, maybe twice a day, you get some customers coming your way. Every time you get a new customer, you work with them to examine their color options for some new luxury handbag and to choose the right accessories. To run this store, you have to manage:
- Various cost-basis/expense reports for goods sold and inventory ✔️
- Sales tax ✔️
- Packaging and delivery to the customer ✔️
- Customer appreciation including referral coupon points for future discounts ✔️
- Capture customer contact info for future engagements/promotions ✔️
- Track supplies. Oh yes, only 364 more days before you need to restock ✔️
It’s really easy to be manual when you’re a small company. According to the Decentralized Web Developer Report 2020, somewhere upwards of 75% of all DWeb projects have less than 100 users or simply just an insignificant amount.
Being manual with each user, community member, tracking all that for taxes and expense reports — it’s not too hard. It is a full-time job nonetheless.
You don’t need to be reminded: this tech is in its earliest stage and we haven’t even hit the early adopter phase.
Then one day…
If your business had the volume equivalent to a shopping mall, you might suddenly say, “Woah, what’s going on — oh, it’s the early adopters! Wait, there’s a lot more people here, and I have no one to do my job for me. My hands are full and I’m missing new customers right and left!”
Small, self-funded teams don’t have the resources to focus on creating great innovative products without user adoption. They have to prove they have “traction” for that—which is often a painful hand-wavy explanation to a highly dismissive investor. This “traction” has to come from building the community. However, building community is so much harder when you’re a techie who’s competing for attention with highly speculative projects.
For instance, everyone has a great idea for a DAO these days, but until we turn the A from “Autonomous” to “Automagical”, our earliest codified beasts like Aragon, DAOStack, Colony, and Moloch will still require manual decision making and authority granting. They’ll ultimately run atop the adoption and success of early communities forming around shared ideas and objectives. Several DAOs have thus turned to speculative themes to encourage action, for example, see Jorge’s appeal to the Yearn.finance online forum community from September 14th.
The bar to compete for idealists is very high. Moreover, the activities required for excelling across different verticals are mutually exclusive from a time perspective. One could see the activities to excel at building community (graphics & design, UI, marketing, and promotions) as exclusive to developing open source, which would consume you’re time and distract you from your revenue-generating business model or even hinder your internal proprietary development. All of these fundamentals to your project are massively time-consuming, demand your attention, and are hard. The bar we’ve set to be worthy of the community’s attention expects all of this from idealists. At the same time, speculative hype, hackathon and blockchain education narratives, and evangelists haphazardly market the idea that it’s “easier than ever” to launch an app atop your Ethereum-competitor’s protocol network.
As a hypothetical scenario illustrating these nascent fallacies, a Tencent mobile Pokemon Go knock-off game dominating the Chinese market accepting the Digital Yen CBDC in its Huawei Store as payment is of course going to be far easier to adopt than the app that seeks to guarantee its users access to censorship-resistant distribution against state actors on Arweave, Filecoin, among others. One is a very clear use for crypto, and the other is changing your relationship with technology.
To reiterate, the competition developers struggle with exists only as a symptom from the ecosystem’s inability create a cooperative network growth game—thereby making that task of sharing value easier by collectively splitting the mission of adopting the early adopters. Because essentially, the Total Addressable Market for DWeb and DeFi is everyone in the world who has the luxury of freedom online and attention.
Automations will create cooperative DWeb games
What are “automations” and how do they apply to the decentralized web? How do they reconcile this competition in DWeb and DeFi?
First, let’s define what automations are. Looking at the traditional web reveals many instances where automation is critical to its growth and functions.
Using automation to filter, organize, and move data according to our preferences just makes practical sense. The most common examples are digital marketing, e-commerce, scheduling, to-do lists, spreadsheet data, time-trackers, content sharing, access controls, and API updates:
- Send data from any API to Google Sheets
- Automated keyword generation for Ad Campaigns
- Automatic notifications for incomplete Shopify data
- Send an email whenever a Trello cards is moved to another column
Traditional web “General Automation” is a very saturated market. Amazon and Microsoft have recently entered the space to compete in some sense with the existing participants — Tray, Zapier, IFTTT, Integromat to name just a few.
“General Automation” is an evolution in how we use technology and data; DWeb and DeFi are evolutions in our relationship with our data and the rules & incentives for human interaction.
The DWeb Market
The DWeb market is young. One look and you’d assume automation, in the traditional sense, is not yet necessary or might be too early. You’d think it’s like the designer handbag shop in the middle of the desert. But we have to prepare ourselves for the next phase, a phase where early adopters start believing in the DWeb principles enough to take action. We have to give them a UX that is at least as good as the traditional web and think about the little things we take for granted. For example:
- If you have a bank account, all your transactions and tracked and you’re provided with a monthly statement for required reporting.
- If you invest in traditional markets, you can put stop/limit orders on trade executions.
- If you set budgets and limits to online spending accounts, you can protect yourself from fraud or identity theft.
The automations we take for granted must be replicated in Web3.0 if we expect people to migrate away from the traditional Web2.0 world. For the DWeb to survive and its idealists to flourish, we must lay the foundations for transferring data and value of both human attention and monetary assets between them all in epic volume.
Read Part 2 for how.
