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Hey you, welcome back to part two of my three-piece (I think) series on how web3 is bringing us into a new era of culture and commerce (what I’m calling the Transformation Economy), and how it will facilitate more meaningful human connections and catalyze the transformations we seek.
In part one, we covered the evolution of today and tomorrow’s media landscape, how value is shifting from content to culture, and why I believe we’re entering a new era: the Transformation Economy.
It’s worth reading or watching it again ⬇ before we get rolling.
This is part two, where we’ll delve deeper into the Transformation Economy. I’ll share why I believe this new era will bring us into a better world with more human values that will better help us catalyze the transformations we seek to improve our lives. We’ll explore how the tools of tomorrow (web3) will improve how organizations make their desired impact on the world.
In part three, we’ll explore specific web3 technology ushering in this new era. We’ll look at how it works in practice and use concrete examples of how these innovations enable us to coordinate people, missions, and value in new ways. We’ll examine how the Transformation Economy makes life better.
Let’s roll.
The company
In 1602, the Vereenigde Oost-Indische Compagnie (better known as the Dutch East India Company) signed into existence a new kind of organizational charter - one that separated shareholders and investors from the company itself, and limited their liability.
The limited liability joint-stock company - arguably the most important innovation of the millennium - was born.
The invention of this legal concept sparked a 400+ year movement that brought the world’s most powerful institution - the limited liability company - into being.
The limited liability company has been an invaluable driver of the world’s economic, cultural, and political evolution since its invention. It can more seamlessly pool capital (human and financial) to fund larger, riskier ventures, and limit the risk of those involved to protect against personal bankruptcy.
We humans invented the company, and the company invented our world.
Our tools shape us
We co-evolve with the tools and technologies we create. We work on them, bring them into creation, and in turn, they work on us, altering our course.
As fast as we remake our tools, we remake ourselves. We are coevolving with our technology, and so we have become deeply dependent on it.
We are now symbiotic with technology.
— Kevin Kelly, What Technology Wants
As needs arise, we create and invent to solve them. Our new way of life creates new problems, and we create and invent to solve those. And so it goes.
But each time, we start from a better world. We pick up where those before us left off, standing on their shoulders and using their progress as our launch pad. Each step builds on the last, using more advanced and effective tools.
This creates new possibilities.
The problem with yesterday’s tools
The company unleashed a surge of innovation that’s made our world unfathomably better.
But there’s a problem.
The traditional corporate model separates the people who matter most - the humans, creating and participating in the project - from the legal framework governing the company's operations.
Several layers exist between the people who engage with a product, service, or community and the company’s legal and operating structures that coordinate and govern its resources.
Limited by our tools, this gap has left us living and working with systems, not humans.
It’s the non-human, legal constructs of the company that orchestrate power and value, removed from the humans they’re built for.
Our systems only loosely coordinate people and value. A company isn’t exactly equal to its impact on the world.
The gap between humans and systems limits us. I believe the closer we tie our systems to what matters for our humanity, the better off we’ll be.
This is the best we’ve had - and we’re better for it.
Until now.
Enter web3: our tools of tomorrow.
Web3: from users and owners → users who own
My TL;DR of why I find web3 so compelling is that it moves the hub of coordination from companies to individuals. In web3, members/users/customers/etc. are also owners, unlike today’s companies.
Web3 shifts us from users and owners to users who own.
Yup. That’s right.
By engaging with a project, users become members, and earn ownership. By contributing to a project’s mission and goals, whether through usage or participation, payment, investment, or anything else deemed important, we share in its value.
Web3 pools independent action, energy, and resources for shared ownership and upside.
Web3 technology better aligns incentives to coordinate shared action of individuals towards a mission. This results in more efficient use of resources (human and financial) with less waste and negative externalities.
Culture and capital are now intertwined. Belonging, affiliation, and status are no longer so separate from financial value.
Alignment is positive-sum
I mentioned that web3 pools independent action, energy, and resources for shared ownership and upside.
The shared ownership and upside that web3 enables is the truly new aspect.
Tools for pooling action, energy, and resources on the internet have been around for a while. Social media platforms bring us together to share information, ideas, or pictures. Kickstarter and AngelList enable individuals to fund projects, rather than institutions.
However, in these examples, we once again see the problems of yesterday’s tools.
The problem is that we’re just users of these platforms. We don’t have any ongoing, vested interest in them, financial or otherwise.
Imagine benefiting financially from using Instagram as it grows. Imagine that the earlier and more you used it, the more you benefit.
With web3, we can build projects and communities with shared ownership and upside, creating truly positive-sum environments with aligned incentives.
As members, we benefit when the project succeeds.
When one wins, all win.
Let’s get what we came for
The conditions of the current system are suboptimal.
Web2 gave us companies working to bring better content and community. Limited by the current system’s design and incentives, they don’t quite deliver what we seek.
In fact, they’ve so often ended up doing other things entirely.
While the platform owners benefit financially from people using their sites, the users don’t share in any of it. In fact, they often end up harmed in the process.
Despite aiming to “build community and bring the world closer together” (Facebook), “capture and share the world’s moments” (Instagram), or “inspire creativity and bring joy” (TikTok), we got something worse.
Due to misaligned incentives, these web2 systems often become extractive, aiming instead to get as many users as possible, for as long as possible, so they can sell as much advertising as possible.
These platforms are free to use, but we’ve ended up becoming the product they sell to advertisers to make the owners money.
We wanted content and community, but got a thin layer of information and connection while these products extract value from us.
If we knew this upfront, we might not have shown up to the party.
We’re not getting what we came for.
We now have the tools - so let’s use them
Let’s connect this back to the Transformation Economy.
I think we’re entering a new era.
Yesterday, we exchanged value for content.
Today, we exchange value for community and connection.
Tomorrow, I believe we’ll exchange value for transformation and impact.
As we’ve expanded beyond physical geography to a digital world, our relationships have hollowed out.
We’ve sacrificed depth for width. Our anchors of community and connection seem to be suffering - and so are we.
Look - our need for community and connection isn’t going away.
But we live in dynamic relationship with our environment and the prevailing culture. We create new technology to improve our lives, but new problems arise.
Such is life.
But as we just said: we’re not getting what we came for.
Today, we still long for connection and community with those who believe what we believe, and seek what we seek.
Today, we long for wisdom.
I believe we long for the thing we’ve always been seeking and building for all along: transformation.
With web3, we get what we came for.
With web3, we get projects that deliver the change they seek to make, without detours or unintended consequences.
We get a system that’s positive-sum, and fully-aligned.
We get a system that unleashes collaboration, and better delivers a project’s purpose.
I’ll go even further.
With web3, we get a system that requires and rewards collaboration.
Web3 scales service.
By serving others, we serve ourselves.
And perhaps even more powerfully, the opposite is also true: by serving ourselves, we serve others.
It’s quite poetic.
Web3 celebrates collaboration and humanity.
It’s a vote for optimism.
For abundance over scarcity.
For creation over extraction.
For win/win over win/lose.
In web3, we go on a mission. Together.
We make progress. Together.
We make money. Together.
Life is lived in relation to other people.
Let’s make it better. Together.
More on that in part three below ⬇
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