A Deep Dive into the Mind of Web3’s Consumer Savant

Crypto investor Gaby Goldberg joins the podcast to outline the current state of web3’s consumer landscape and strategies for building product defensibility.
Crypto investor Gaby Goldberg joins the podcast to outline the current state of web3’s consumer landscape and strategies for building product defensibility.

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Mint Season 6 episode 23 welcomes Gaby Goldberg, the self-proclaimed shit poster and investor at TCG Crypto.

I hope you guys enjoy our conversation.

Time Stamps

  • 00:09 – Intro
  • 02:44 – Web2 Users vs. Web3 Users
  • 07:36 – Challenges Creating a Network Effect Using Tokens
  • 10:13 – Web3 Consumer
  • 17:56 – Curation in Web3
  • 24:19 – Digital Identity
  • 27:02 – Will Decentralized Identity Ever Be Centralized?
  • 47:39 – How to Build Product Defensibility When Data Is Open to All
  • 51:15 – Outro

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Gaby, welcome to mint, how are you doing? Thank you for being on.

Gaby Goldberg: Thank you so much for having me, very excited to be here. As we both know, it’s been a long time coming. 


It’s been a long time coming but we’re here now. And when I posted on Twitter and other platforms, people have a bunch of questions to ask you. So, we’ll have to get into that as well. But I think a good place to start first and foremost is, who are you, Gabby? What does the world need to know about you, we can start there, and then we’ll move forward.

Gaby Goldberg: Sure. So, my name is Gaby Goldberg. I’m an investor at TCG crypto. So maybe we can get into it in a little bit. But we are a crypto consumer fund, really focusing on figuring out what scale looks like in web three, and really focusing on investing in passion, whether that’s passion found in gaming, or in music, or in AR or in new markets that have yet to be really discovered and brought to market but really finding areas where people are spending a lot of time and a lot of their energy and oftentimes a lot of money in these really passionate areas and figuring out how crypto either unlocks or supercharges that behavior. And so, we’ve invested in companies like rabbit hole and Archive and Hume and a suite of others that we’re really excited to be partnered with. And I spend a lot of my time now thinking, both personally and obviously professionally as well about digital identity, internet culture, and kind of these pockets of the Internet where I think passion is emerging.

Are we happy with the current state of consumer in web three?

Gaby Goldberg: It’s a good question. You know, no one ever asks me how I feel about it. So, thank you for asking. Listen, I mean, we have a long way to go. And I think also just totally, candidly, the more time I spend in this space, the more I realized that there is so much I don’t know, and so much that we need to do, kind of as an ecosystem to create better consumer products and experiences to support these either new or emerging behaviors. There are definitely some certain areas that are early, but I’m really excited about. So, one of them is kind of online credentialing and how we figure out what a sense of identity and reputation looks like online, across both web two and web three. A big place where I’m interested in spending time and investing in is, sort of new interfaces for these consumer experiences. So hopefully, we’ll talk about wallets in a little bit. But I think kind of like wallets as an interface for interacting with web three, is largely kind of under explored and really excited about areas like that. So, I’m happy about it, because I’m happy to be here. And I learned so much every day, but we definitely have a long way to go.

Web2 Users vs. Web3 Users

What would you say are some of the unique behaviors that web three users have that differ from web two users, for example?

Gaby Goldberg: Interesting question. So I have sort of like a framework for consumer that actually, I think, in a lot of ways, stretches across web two, and web three. And it’s basically this four questions sequence. So why do people come? Why do people stay? Why do people share? And why do people pay? And I’ll kind of break them down and explain some of these unique kind of web three specific areas and answers to these questions. So why do people come? Is actually probably the most important one of what kind of you know creates this divide between web two and web three, a big reason why people come and try out web three products is because of a financial incentive to try them out. Maybe there’s a hope of an airdrop, or there’s another kind of like active token incentive, to go use a product and spend time there versus on a competing ecosystem or platform. And so, a good example, the blur Airdrop, even yesterday, the amount of activity you even are just seeing on ether scan, and other block explorers of dormant wallets, that now have become active because of this financial opportunity, in a lot of ways, is pure speculation. So, it brings a lot of these people to these platforms. So, it kind of leads us to the second question of why do people say? And I think this is actually really the important thing. And so, when I think about investing in web three consumer platforms, they can come for a token, maybe there’s you know, that financial speculation that kind of piques their interest, and they want to see what’s there. Obviously, it’s kind of just like human nature to want to have that incentive to go try out a product. But if they’re staying because of that financial incentive, or if they’re staying in the hopes that that token goes up and gives them some sort of financial return, it’s largely unsustainable. I think Stefan is a good example there, they did an amazing job of acquiring a lot of users. In a lot of ways, people who had never interacted with crypto before downloaded the Stefan app and set up a crypto wallet for the first time, to be able to earn this token. And that’s fine like as a means of, you know, clever acquisition hacks, I think it was super were smart. But in terms of sustainability of why are they staying there, if they’re only staying there because of the token, then at some point, like the music stops, right. And so, it’s kind of a helpful framework that I use to kind of think about these behaviors. And so, the financialization of all of these applications is not something to be overlooked, right? It’s one of like the most special parts about crypto, but I think sometimes you can kind of fall down that rabbit hole, and, you know, like, lose the forest for the trees.

So, why do people come? Why do people stay? There are two more sections, right?

Gaby Goldberg: Why do people share and why do people pay? So why do people share? especially for consumer products? You know, where’s your distribution coming from, right? I actually had like a little screenshot essay on Twitter a couple days ago about basically being good at social apps, kind of an extension of Eugene Waze status as a service. And I was talking about specifically web three applications that I think are really interesting from a creator perspective, when you see this flywheel getting created of take doing analytics, for example, people who call themselves dune wizards create these on chain dashboards of what’s going on in crypto. And it’s largely limited to just that platform, right? You go on to dune to see what’s going on. But the amount that those dashboards get shared cross platform, and people flex the fact that they’re doing wizard, it adds this brand equity across platform for dune and it makes dune better as a platform, when these creators can kind of rise and influence from dune. And so, you see that on other platforms as well. In this screenshot essay, I was also talking about block explorers, and how I think something similar could emerge there of you see, you know, the Nansen interns and Zach expertise of the world who are this quote, unquote, on chain sleuths. And they share these screencaps, either from Nansen, or from ether scan or some other block explorer about cool things they’re finding on chain, and it brings brand equity back to that platform. So why do people share is kind of where’s that distribution coming from? I think those are two good examples. And then the last one, obviously, is why do people pay? This is a super interesting one. In the case of web three native business models, and maybe we can get into it now or later. But the whole conversation around creator royalties, is a really, really good example of this question. Why do people pay? Not totally being answered and yeah, I think it’s a helpful framework, because the questions are actually quite simple. And if you don’t have simple answers to them, it’s like probably worth exploring.

Challenges Creating a Network Effect Using Tokens

The biggest challenge that I come with your first question, why do people come is, when you try to build a network effect based off tokens, then you misinterpret what product market fit sort of looks like because people, a whole sleuth, like you said, people sort of come in to grab the token wallets wake up from the dead. And they claim, maybe they don’t, maybe they hang out. But it’s hard to really figure out who the user is that really enjoys your product. And why they’re actually enjoying a product, right? I feel like it’s a common problem that a lot of web three projects fall for, right? When they issue a token, how do you come around that? How do you solve that problem?

Gaby Goldberg: Yeah, I actually, for consumer products, the only place where I’ve seen tokens, prop seemed to really work. And it’s hard, we’re still so early. And so, over a long enough time horizon, it’s hard to know how these things will change. But generally, for products that you can basically, you know, zero to one requires the token, but then from one to N, the switching costs are very high, and users are unlikely to turn, then a token might make sense. If obviously, there’s a real business model underlying it, and there’s kind of like a sink for the token itself. So, for example, a web three Uber that requires active work, zero to one as an acquisition hack with a token, but then one to N, you still need drivers who might turn to other platforms, that feels really tough to defend. So candidly, that’s where I’ve found kind of the most conviction in tokens in that kind of business model for acquisition. But I totally agree with what you’re saying, I think in a lot of ways, companies in crypto are essentially IPO and too soon by launching a token. And now you’re basically at the mercy of the public markets. And once sort of consumer perception of the product has changed, it’s really hard to go back. And it’s why I like seeing products that deliberately tried to stay small and focus on engaged users and don’t care about the numbers, forecaster is a good example, I know we’re both big fans. I saw even a post from Dan, was either today or last night, saying that Farcaster growing too fast. And they have to cap the waitlist to keep it smaller because you run the risk of having like an eternal September incident where too many new people come in too Farcaster and essentially overthrow kind of like the anchored culture or norms of the existing network and you risk ruining all the quality that you’ve built so far. And so, I think that’s a mature and smart way of approaching it.

Web3 Consumer

How’d you get your interest in web three consumer? I feel like everybody’s sort of investing in infra. And just a bunch of like infrastructure plays. And there are only a few people that sort of stand out across crypto Twitter and whatnot that enjoy consumer, I feel like I’m one of them. I really enjoy like the end user experience. And I guess maybe that may even tie back to your background like prior to crypto. Is there any sort of connection within that?

Gaby Goldberg: Yeah, I can definitely talk about background. And I also want to pull an you know, reverse card and incur the same for you. Yeah. But first, I think it’s an interesting sort of thought experiment to explore what is infrastructure and what is an application. This is completely taken from David Phelps, who have been really lucky to kind of work with and learn from over the past year or two. But I think it was either in a tweet or just in a conversation with him, I’ll try and find it after. But he basically was saying that everything is infrastructure for something else, it’s a little bit silly. So, kind of just like, humor me for a second. But take planes, for example, the invention of the airplane was infrastructure for the airport, which was infrastructure for travel agents, which was infrastructure for DTC luggage companies, which was infrastructure for so many people flying, that now you have DSA precheck, which is infrastructure for clear and like it goes and goes and goes. But basically, saying that, like apps beget infrastructure, which beget apps and like the cycle continues. And so, in a lot of ways, there’s also a great post that is shared very widely across web three called the myth of the infrastructure cycle from USB, and it’s a little bit similar. 

So, I try not to separate them so much. And I think a lot of ways, you know, consumer behaviors that are emerging can beget interesting, you know, I guess you could call them pieces of infrastructure. So, for example, people acting as on chain sleuths shows that there’s a real market opportunity for like better block explorers. And honestly, I’ve talked about that a lot over the last month, so I’ll shut up about it on this podcast. But that’s a good example. So that’s the first thing I’ll say of just like, what is infrastructure. But certainly, I spend a lot of my time thinking about real consumer experiences and looking at interesting consumer behaviors online. So, the story starts, when I was born, going way back, I actually grew up selectively mute, which is kind of crazy. But for a number of years, I grew up not saying anything. And it’s also you know, partly because of my age coincided with me spending a lot of time on the internet in the early days. And so, I grew up playing a ton of Minecraft and a ton of RuneScape. I had a viral Tumblr blog when I was a teenager, please, nobody go try and find it. But spent a lot of time basically crafting a sense of a digital identity, and particularly having a lot of online friends. 

And these networks were really, really important to me. And then as I grew up, and I went to school, I became really interested in how this was shifting, and especially seeing everybody else around me, either having had similar experiences as a kid or starting to have really similar experiences now. And I think now there’s a statistic where it’s like 60%, or 65% of Gen Z believe that their online identity is more important than their identity in real life. And you hear that at first, and you’re like, that’s crazy. But then you think about it and it’s like, okay, I got all of my jobs, from people that I met online. So many of my friends I met online, actually, I’m going on a weekend trip this weekend, with three amazing girls who are all met online, which is insane. And we’ve been friends for three years, things like that. And so basically this question of like, what is a digital identity? What is a real-life identity? When do they start to become the same thing? It’s very interesting for me. And then I guess the other thing around kind of like, digital identity, like the shift that I think is really interesting is basically this very high-level thesis of when the first wave of social apps really came around. So like Myspace or early days of Facebook, for example. They were all about how do we take our real-life friends or our real-life experiences and bring them online? 

So, for example, Facebook was taking your college friends and bringing them online, and even in the early days of Instagram, right, like how do we take photos that we take in real life and put them online and so obviously, no surprise for those used cases, those platforms worked really, really well. And we spent a ton of time online, so much so that we started to have these digital native experiences. And so, I guess you’ll kind of see where I’m going with this, it stretches across web two and web three. But as an example, we don’t just take pictures anymore, we take screenshots, and we put a ton of screenshots on Instagram are screenshots on Tik Tok. And now screenshots are kind of like the photos of our digital life. Or we don’t just buy physical art, we buy digital art, there’s a huge market for people who love to buy digital art and flex what they have in these online galleries. The sense of these, like internet, native domain names and senses of identity are really important to us. And so, I guess at a high level, across crypto, or not, just thinking about consumer products in our lives online, I’m really interested in the products that help us better share and understand what digital experiences look like.

So, I think you also asked me like, why do I care about consumer? Like, where does my interest come from? Simply because I don’t know how to code. And all my interactions come from being an end user, right? And using all these different products across web three, has really opened my eyes to kind of like tasting the sugar un web two and realizing what are we missing in web three from an end user experience, specifically so mint is all about the creator economy, right? Documenting the creator economy in web three, a lot of creators that try to transition from web two into web three, they try to bring their audiences with them, their followers across Tik Tok, Snapchat, YouTube, whatever, and try to bring them into web three. One of the things that I consistently see fail over and over and over again, is the funnel of bringing in a user from web two into web three, like how do you migrate an audience member a fan, to then get them to collect an NFT, right? And like, there’s so much in between that that’s involved that the process is completely broken. So, I faced this myself, right, trying to bring more of my listeners from Spotify into web three, or my subscribers from YouTube into web three, and the creators that I see, they also struggle with that, right? So, I think a lot of my interest comes from just merely being an end user, and being a super user in crypto and trying so many different things, realizing where the inconsistencies are, and yeah, I guess like falling, like having a knack for it, for my opinion. I feel like you approach it from like the investment perspective, but also from the end user’s perspective, I guess I approach it from like, okay, I create content, I try to build audiences, right? What tools can I use in web three to sort of allow me to empower that and scale that, scale that operation. That’s sort of how I think about it.

Gaby Goldberg: Well, I like that you called it a tool of like, it’s not you know, web three is like a means to something else, that’s more important, right? And it’s not even like, it’s this sort of like pot of gold at the end of the rainbow, where we need to onboard people so they combine NFT. It’s like, no, like you have this NFT, what can you do with it? What does it give you access to? Like, how does it make your communities more engaged, or more retentive? And I think the fact that you have to think about it as a tool is really important.

Curation in Web3

So, within your thesis of I guess web three social and your love for consumer, where do you think curation plays a role in all this?

Gaby Goldberg: Yeah, so I wrote about curation. Actually, before I was working full time in web three. And I basically said that there’s a ton of noise online, there’s so much new information being created every day, and that the real opportunities in the future are going to be and people who understand how to sort signal from noise and can basically have that trickle-down effect of curating, and then curators who will curate that. And then you keep curating all the way down. And you as a user, or as kind of like a yeah, as a user of the internet, you’re gonna want to put your trust in these curators, to tell you what’s worth spending your time and attention on. And actually, there were a bunch of people who are friends of mine now, but we’re in web three and read this and they were like, yeah, but you’re missing the point. This is crypto. And so, it’s been cool kind of seeing how that thesis has changed for me and how I’ve learned over time. I think actually, in my ideal world, I don’t know if this will ever happen. But my kind of like ideal end state for curation is, maybe every asset or every piece of content on the internet is traceable, and has provenance, like an NFT. And you can track the quote unquote, mileage of a piece of content on the web. 

So, a good example is, actually have a fair number of friends who work in crypto, but kind of got into the space because they were running these really big Instagram accounts, like the at girl account, or you know, like just girly things or whatever. But like these sort of meme accounts that got really, really big. And essentially, a lot of these accounts don’t create any net new information. All they do is they take screenshots of you know, at the time Tumblr, or tweets, and they you know, or existing memes and they basically curate them onto these pages. They have these really engaged audiences. And then they make their money in the DMs by negotiating sponsorships. And it’s crazy that so much value is created from these pages that don’t actually create any unique content of their own. And they still exist today, I follow a ton of them. But how interesting would it be if all of those pieces of content were traceable back to the original place that they existed online, and perhaps there were streamed payments back to the original creators of that content. There’s actually an interesting curation protocol that I’ve been seeing emerge online, but I really don’t know too much about it. 

So, I guess this is my alpha on the podcast, but it’s the entropy Twitter account, it’s like entropy with three ns or something like that. And there’s a bunch of really interesting assets or like pieces of media or pieces of content being curated. And you can see individuals are curating them through this protocol. But what’s really interesting is this account entropy has been able to build up such a powerful and large following in a short amount of time, by being someone who can separate that signal from noise. And it’s a really, really high value part of the stack to exist in on the internet. So generally, like this idea of internet native brands, created by way of curation is very interesting. On Instagram, some of the ones that I think are interesting are hidden New York or New Bodega or furniture archive. And the people behind this account, like they don’t make money by having their own personality on the account, but it’s just the things that they’ve curated and their taste and it’s particularly interesting, I write about this in one of my pieces, but basically the impression to entertain like a Tik Toker who’s like dancing, no hate to that at all. It’s like also a very interesting conversation. But the impression to entertain like someone like that on Tik Tok, versus the ability to convert someone to making a purchase, are largely kind of misunderstood as being the same thing, and they’re very different. And the latter, you know, the ability to convert someone to make a purchase, you see happen a lot with these anonymous curatorial identities online. Specifically in web three, some of the interesting ones are collector Daos. 

So, for example, TCG crypto, we hold a seat and Flamingo Dao, which pulls capital together to basically curate NFTs across the web. Or we also invested recently in a company called archive, which aims to be the first decentralized physical museum curating this one of one physical asset and wrapping them in a smart contract. And essentially, with both of these examples, Flamingo archive, where you can think of pleaser, or fingerprints, or you know, all of these other kinds of collector Dao examples, you can think of it sort of as this analogy, you go to the Louvre to see the Mona Lisa. But you also go to see the Mona Lisa, because it’s in the Louvre. And by way of collecting valuable pieces of art and culture, the Louvre has created this sense of brand equity, that now the assets that continue to curate will appreciate in value by way of being underneath that umbrella and that brand, and you’re starting to see similar things happen with these internet native brands, like Flamingo, like archive, like hidden New York or New bodega, right, the screenshots that they take and put on these curatorial accounts, helped drive trends forward. And so that sense of curation is super interesting to me.

Never thought about it like that. That’s really interesting. New perspective taught me something new. Where do you think curation plays a role, sort of like in a cross platform setting? So, whether it be multi chain, for example.

Gaby Goldberg: yeah, multi chain I haven’t even thought about. Although there are interesting examples, like, I believe it’s called quixotic, which is helping to basically aggregate collections in like a multi chain perspective. Ideally, it’s something like this idea of having pieces of content minted as NFTs and you can track them cross platform, I was thinking more in the sense of tracking them, you know, from Tumblr, to Twitter, to Instagram and seeing the flow of media as it goes through the hands of different people. I’m not sure if I’ve seen a real example of it working yet. Although the entropy example is a good one.

Digital Identity

When you think about digital identity, what is like the picture-perfect scenario five years from now? Like, what does a digital identity really look and feel like? What are the actions end users are taking with their digital identity? What does that environment look and feel like?

Gaby Goldberg: Yeah, so I guess kind of starting, you know, totally from the beginning. When we think about the internet today, it really was created without a native identity layer for people and so you see, kind of like the coping mechanism for this digital identity was really relegated to websites and applications, right? I have an identity on Instagram and I have an identity on Facebook and I have an identity, you know, on SMTP with email, and this kind of siloed approach may have been appropriate for the early days of the internet, because obviously, how could we have imagined where we’ve ended up now. But now with billions of people online every single day, there’s real drawbacks to having this siloed approach to identity, that’s not owned by the user themselves. And so, you see, you know, we still use usernames and passwords for just about everything, even though they’re obviously an insecure model, right? If your Twitter gets hacked, you’ve basically lost a major sense of your identity. And even still, even if you don’t get hacked, you are renting your identity essentially, from companies and centralized entities. And so, my identity in a lot of ways kind of like belongs to Facebook, when I connect my Facebook, to all these different applications. And so, when we think about digital identity in the context of web three, it’s really this premise that each user on the internet will have a unique identifier, right? Gaby, doubt youth is a good example. And you can natively link it to any piece of software and it’s stored on a blockchain. So, it has that sense of provenance. Now, it becomes sort of like opt in, right? Instead of, you know, like, I can decide where I take my identity and where I plug it into. And kind of the experiences that I choose to have on the internet, and the identity is kind of shared across all of these platforms, if I choose.

That makes sense. So, who will end up owning sort of the, I want to say like the web of all these identity pieces from your off-chain identity, to your on-chain identity. Is that like, is that an infrastructure play? Is that a single company play? Is that a decentralized play? It obviously, hopefully, we’ll all live on chain, right? In a very decentralized manner, right? But what does that look like from an application level?

Gaby Goldberg: Yeah, yeah. So, I’ll need to pause, think about how I really want to answer this.

Will Decentralized Identity Ever Be Centralized?

And I think we’re already seeing like pieces of this thesis sort of unfold, you brought up Ens is a great example. That’s one single piece. And then you have other companies and projects, building out other pieces of the puzzle, right? And we as users, we find out what we latch on to, and we sort of piece them together, by default, by opt in, right? Like we connect our Ens username to our Twitter handle, because that appropriate doesn’t exist fit in with culture, right? We find friends like that, right? Do you think it’s going to play out like that big picture or is there going to be some type of like centralized entity that’s able to sort of like, take control this entire, I guess, thesis around decentralized identity? What do you think?

Gaby Goldberg: Yeah, so I guess the first thing I’ll say is, when I say all of this, I don’t think that companies like Facebook or Twitter or our existing senses of kind of like siloed, centralized identity are going to go away. And perhaps I shouldn’t say this on the podcast, but I’m not a decentralization maximalist, I think there are a lot of products that will continue to exist. But when we think about a decentralized identity, I like to think about it from beginning with the wallet, right? So, my view is that in five years, the wallet really is going to be one of the most important pieces of consumer data for individuals, but also for businesses, right? If I’m a business, and I can have the users who or the consumers who are super engaged in whatever I do, whether it’s a community or a brand, or something else, connect their wallet, now I get to know who they are, I get to know their spending habits, I get to know what other communities and brands they’re aligned with and figure out what cross promotion might be highly effective. And also, if they have that sense of identity, they’re right within Ens, ideally, then I can talk to them, right? And tell them, you know, with you know, by connecting your wallet, here are the experiences and access points that you have that previously were unavailable to you. And here are the interesting collaborations that we can create to make experiences for you as a user of our product better. And so, starting from the wallet, I think makes sense in that sense. And then ideally, also connecting your off-chain information there as well. So, you know, open sea, you connect your wallet, but they also for a lot of us, they have our email as well. And that’s the way that right now open sea can talk to us. And so perhaps in the future, like a real native web three communication layer, will bring more things on chain. But for now, I think a hybrid makes a lot of sense. 

I think ultimately, the way I see it is that, it’s going to be a bunch of independent products in companies, that try to piece all that data together. And the way they do it is going to be through various problems that the user needs solving. So, for example, right? There’s this company, or this product called link three, okay. They are a community and they’re able to sort of link wallet addresses now to discord handles, to Twitter handles, to all these sorts of like really important data points that creators and communities need, but they do it through an opt-in way, right when it when a member wants to join a Twitter space, they can RSVP via link three, and they self-opt in and fill out all that data themselves, right? And then link three provides that data to the community hosts, right? So, when I sort of think about, like what the interconnected data layer looks like, I really think it’s from a product perspective of different products being built, that sort of intertwine that information together, right? It’s like, for example, something that I do on the podcast is that I give out free NFTs to my listeners, I’ve been able to build a substantial database of wallet addresses linked to Ethereum addresses, right? Wallet addresses linked to email addresses, right? In a way that’s very organic and opt in because I create content via my newsletter. And then I reward people for reading and listening and clicking and sharing my content with an NFT down the line, right. And it’s all sort of an opt in, I think the interesting perspective is, trying to make sense of all that data for whoever’s capturing it, number one, right? Whether it be the creator who’s building an audience on chain, where now they have interoperable fans, right, that they can take cross platform with them, and sort of what that data means for them. Because I think there’s also a level of responsibility, and a level of, I guess, like, I guess, responsibility is the right word, of understanding what that data really means, right? And how you can use it to your benefit, to create better experiences. Activations, monetize better as an individual, as a creator, as a brand, as an enterprise, whatever it may be. Are you thinking about it the same way or what are your thoughts?

Gaby Goldberg: Yes, and I love what you said about giving the free NFTs to your listeners, NFTs is a business model, I think largely is continuing to be developed, I think the smartest approach that I have seen, is not using NFTs as like the primary way of accruing revenue to a business. But instead of figuring out how to strengthen the relationship between basically the business or the individual, or the brand, or the community, and your audience, and so even we have a portfolio company, medallion, which is doing this with musicians and essentially creating super fan clubs on chain. But the idea is, the NFT is not the end goal, right? The NFT is not the driver of revenue for the musician, but instead they want to figure out who their biggest fans are. What if you minted a free NFT that acted as an access pass into this community. And then once you’re there, what are the things that you can do with these wallets, and it becomes really, really interesting, the level of engagement that you start to see with these communities and with these fan clubs, in gaming, I also think it’s a really interesting and underexplored model, we’re investors in a company called branch, which launched a game called castaways, which is one of a couple games really pioneering this, quote, unquote free to own model, where you can have these free NFTs that are, you know, in game playable assets. But now when you have ownership of these assets, and you create these digital worlds and these micro economies within them. Now the sense of building something of value, and building something that is meaningful within the game becomes so much more real, because you add real world liquidity to the game. And so, you’re seeing people go into castaways, and they have these islands that were minted for free. And they go to the islands and they build these incredible little worlds on them, right? And maybe they’re catching all of the fish, and now they have a monopoly on fish. Or maybe they’ve got the biggest house on that island and now other people want to be a part of that tribe. And so now you’re seeing the secondary market for these islands become amazing, where it’s not a typical land sale where you want to buy the most expensive Island. Maybe you buy the worst one, right, and you build it up into something of meaning. Now that economy becomes something really, really interesting and valuable. But it all starts with that free NFT right, it shouldn’t be paid to play.

Another great example is a G money’s a bit one, is all free to mint thousand editions and it did hundreds of thousands of dollars of secondary sales, and was able to sort of sustain the project until where it is right now, another good example is this creator or music artists name sound of fractures, he literally just had a drop yesterday on sound dot XYZ was able to sort of like mint out, for free of course, but mint out 500 editions of his new song, using NFTs as a tool for distribution, right? So, the more people that sort of got their hands on the song, the more people listened to it, right? So, it’s not about like the 25 sort of collectors that you typically see from music artists. But what’s really cool is that, now he has hundreds of addresses that he can now sort of like tap into and build like a top like leverage this top-level funnel of free collectors and find ways to monetize them down the line, right? And I love that approach so much because it’s so much easier to give first than to take and by giving, you’re now able to give with purpose and get all this information on chain, on an aggregate level and be able to create really cool experiences based off what’s in their wallet, for example, right and based off what they like, I tried to do this with the podcast too. I noticed that a lot of my collectors across the season 2, 3, 4, 5 and season 6, they collect on different platforms. They like buying different NFTs. And I’ve been starting to create content around the things that they’re collecting because I’ve noticed that that’s what they like. So, I might as well sort of like create content around that. And it’s helped me a lot as a creator to, I’ve seen like upticks in episode downloads, I’ve been able to find new sponsorship opportunities through that. So, I don’t know, I love this whole concept of like, wallet information, wallet data. I think still, it’s incredibly under explored. But I think in the next bull market, it’s gonna be one of those big narratives that people are going to be latching onto, excuse me, and using to their benefit.

Gaby Goldberg: 100%. There are so many places I want to take this; I think this kind of like free to mint opportunity as a collector acquisition hack is so important. The whole thing is just an acquisition game, right? How do you get the wallets? And then once you have them, that’s not the end goal but what do you do with them? Okay, there are a few points that you brought up that I think are so interesting. So, I’m trying to decide which order I want to talk about on. I think the first one I want to touch on is, the whole creative royalties’ debate, and it’s very topical. But the fact that, you know, a lot of like, the most exciting projects right now are minting initially as spree mint is, I think, an interesting place to start. So generally, on the creator royalty’s argument, obviously, to bring folks up to speed, a bunch of the major marketplaces, magic Eden probably being the most notable one, kind of moved towards optional creator royalties. So, royalties that stream out to the original creator of an NFT, are not actually enforceable on chain, it’s at a marketplace level. And so now when you see the rise of other marketplaces, like pseudo swap, for example, that don’t enforce those royalties at all, people have been a little bit surprised that nobody actually wants to support these graders. And instead, they’re going so that they can have a cheaper transaction on a marketplace, like pseudo swap. 

And so, it’s very hard to enforce these things now, what’s the moat of a marketplace like magic Eden, when you have this extra transaction fee, and so that’s why they’ve added the optional, you know, the option to have royalties or not, for buyers and sellers. So, for me, I think the problem is twofold. The first one is, companies believing that they could use secondary sales and the royalties from those secondary sales, as a primary means of generating revenue, right, obviously, can be one line on the balance sheet. But as a primary means of generating revenue, I think it’s a problem. Because when you have a lot of liquidity, and you have a lot of secondary sales, and you’re calling yourself a community, what you actually have is churn, you have people leaving the community every time a sale is made. And particularly by taking a royalty on that you’re implicitly kind of agreeing, and you’re okay with the fact that your community is churning. So, I think that to begin as an issue. And number two, these companies call themselves communities, and they are lying to themselves by believing that communities can be sustainable and successful by making their primary means of revenue on liquidity and a constant churn of members. 

And so, I don’t believe it was the right way to launch a real community to begin with. And if you’re a company, you have to be okay with having a ton of churn in your business and your user base, to be able to make money. And so eventually, like, who becomes the buyer when the last buyer sells, right? So, I think that is the main issue, I think my view on what will end up happening, and I’m curious to hear your thoughts. But generally, my prediction is that this major kind of aggregated marketplaces, who are similar to like the Craigslist, or eBay of NFT, marketplaces, so like magic Eden, and open sea, etc., will not be able to enforce royalties on chain, because people will just move to other marketplaces. However, I think generally, as a trend, you’re seeing brands and companies and communities in web two, and sorry, in web three, but also in web two, want to own more of their relationship with their audience. So, for example, you’re seeing the rise of all of this kind of verticalized secondary marketplaces powered by companies like reservoir or hyperspace, or first may or all of these interesting companies that allow brands to launch their own secondary marketplace embedded on their site. I think we’re going to see that continue to happen, where brands and companies want to own the relationship with their audience. 

And perhaps then, if you know, you’re selling things directly on your site, and you hope that kind of like secondary sales continue to take place on your site, then you can say okay, you have to buy them on our site, and if you do, and we see that it was minted or sold or you know, when on secondary from our site, then then you have access to all of these perks and, you know, benefits that you have from being a part of the company or the community, for the NFT as kind have a tool. And sure, you can sell it anywhere else and not pay royalties, but you won’t have that same level of access. So actually, DigAdz, before they went fully zero royalties did something similar and I thought that that was clever. And so of course, it’s not enforceable on chain. But brands and communities and companies are still going to have that level of control over, you know, what you actually get, depending on how the transaction went through. But I’m curious, your thoughts.

I think creators are gonna end up flocking to the network or the platform that’s able to enforce royalties, if you remember, or something that I paid attention to really early on, during like the nifty gateway era of NFT, right? That initial heat wave of artists, corporate artists, Instagram artists flocking from web two into web three, using NFTs as a tool to tokenize their art make living, right. All this really cool things that NFT sort of became known and loved for from creators, is now being taken away from them, right? It’s like it’s a weird sort of, it’s a weird thing for those who came in during that era. For those who come in after this debate, right? I think it’s just going to be one of those things that they’re just going to have to expect and go with, right. But there hasn’t been another industry or another sort of like technology or another sector that’s been able to implement this level of transparency and this level of automation, that same way smart contracts have been able to, and that has really much so favored the creator. And I think creators really like that. I mean, who wouldn’t like that as a creator, right? I’m in favor of creator royalties, I think they’re great. I think they’re really, really great by design. And I think it’s needed, I think it’s really cool to be able to figure out and use the tool in different ways to sort of create monetization, whether it be through the primary sale, or the secondary sale and I don’t think it should be stripped away. So again, I alluded to earlier, I’m not technical, I don’t know how to code. So, I don’t really understand how the technicality sort of looks and feels like, if there is a way to make it enforceable, I’m not sure. But I think if there’s a platform that gets created in the future that prioritizes royalties, maybe to some extent, I think the creators will sort of flock to that, in my opinion. I don’t know. 

Gaby Goldberg: Yeah. I actually had a tweet last week, I just put it in the chat, it’s sort of similar. I basically said, or I’ll just read it aloud. I see a world where a new artist focused NFT marketplace is spun up featuring top artists and up and coming projects, and only buyers allowed on the site, are those who have opted into paying royalties on competing marketplaces. Oh, I love the share screen. Yeah, so you can see it here. Who knows? I mean, I think it’s an interesting idea. I think particularly it would work with one of one artist. I don’t know if like 10k projects. First of all, I’m just curious to see the longevity of 10k projects, in general. But I don’t know if creator royalties are as enforceable for projects like that. But I think particularly for one of one artist or NFT photographers, or things like that, where there’s really that intimate relationship with the creator and the buyer, I do think they’re going to be enforceable in that kind of sense.

I also think it’s kind of messed up to not enforce them, because we’re still playing and building in a world with constraints, right. And if we want to tap into mass adoption, we need to rely on mobile, as being one of those driving factors. And if we’re building around Apple’s guidelines of their 30% take rate, right? It’s really hard to issue NFTs on primaries at that level. And that’s why you have really creative people thinking of like free, as a perfect model for building an MVC, right? A minimum viable community, right? And sort of like bootstrapping liquidity from secondary sales. So, I’m not sure I’m and that’s why I’m like, also excited for technologies like the Solana phone, right, because while it may not end up being like the end all be all type of phone, I think it stands a chance, depending on how well it’s executed, to sort of like enable a new sort of adoption curve. And when we’re talking about web three social, web three consumer, excuse me, it’s like building all these new sorts of products and platforms and protocols, that tailor the needs and wants and desires of the web three native user, right? And that web three native needs, wants and desires are completely different than those of the web two users, right? So, it actually makes sense to spin up all these sorts of like new products to cater towards them. So, whether or not Apple ends up acquiring a product like Solana, if ends up doing well, I don’t even know if that’s going to be possible, an acquisition may be even possible, but it will definitely be putting more pressure on these corporations, then maybe that it may introduce a new conversation for secondary royalties. I’m not sure, like you brought up this concept of like free to own right, like that’s only applicable and really well executed. I think at scale when it comes to the mobile side of things, right. We can even talk about like web three mobile and web three social and whatnot, but I don’t know, do you think I’m losing you or do you think my head is in the right place? What do you think?

Gaby Goldberg: I think it makes a lot of sense. I think Solana phone is really interesting. I also love that Ethos S project Ethereum phone basically doing something very similar. I also think, outside of just this kind of mobile native OSs, we’re gonna see also a more open approach from the consumer side, but also even like from Apple towards web apps, versus actual apps on the App Store. Because it’s going to be, unless Apple does away with a 30% tax, which I don’t think is going to happen, it’s going to be the best way to actually have mobile native experiences for web three. So, I think my other kind of like prediction over the next maybe five years is like, we’ll see the rise of more just kind of like web apps for mobile. Generally, I think web three, mobile is a super interesting space, though. I mean, even as we saw the shift towards mobile, a decade ago, it really shepherded in kind of the quote, unquote, casual consumer. And I think there are a lot of, you know, we talked about interfaces at the beginning, there are a lot of experiences that are really not possible and will be uniquely unlocked by a mobile native interface. And so, stepping again, you know, we talked about it, but one of the big reasons it did so well in terms of user acquisition is it was on mobile, and you know, everybody has a phone even. This is a web to kind of tangent, but I think Replete launching, basically, like the code editor on mobile is so interesting, right? Not everybody has a laptop and being able to do that on mobile is so powerful. But other kinds of experiences that I think will be uniquely unlocked, because of mobile will be things like geo located NFTs, almost like a web three Pokémon Go. So, there are companies that are doing interesting things in that space, Mirage is my favorite one in this space, and then drop versus another super interesting one. I imagine we’ll also see a bunch more VR, AR type experiences in the future. I haven’t totally figured out my opinion on that at a high level. But Jadu is an interesting web three AR game and all these things are mobile native. And then, obviously, also, I think, web three wallets on mobile are going to continue to be massive. And so, rainbow is one that is already widely used on mobile, the glow wallet on Solana is interesting. We are investors in kind of like an explorer called Genesis, that’s mobile first, and really a beautiful consumer experience. So, I’m really excited about kind of all of these interfaces. But I imagine we’ve got a little bit of a ways to go, until we’re really mobile first for web three, just because of kind of the infrastructure that we have today.

How to Build Product Defensibility When Data Is Open to All

So, if we keep on building front ends, for a world where data is a commodity in blockchain, how do you build stickiness? How do you build defensibility? What does that look like from your perspective?

Gaby Goldberg: This is like the big question, right? I think it depends on what you’re trying to do. So, I think a big one actually is in brand and in brand equity. Perhaps there are token gated experiences, for a specific type of experience that you want to have. And that’s kind of the moat of, you know, I want to have a certain experience for a certain type of action I’m completing and web three. Specifically, I think wallets are a very interesting space. I put out a prediction, I can’t believe it was almost a year ago. That’s crazy. But it was my 2022 prediction in Mario Gabriel is kind of like what to watch in 2022 for crypto. And I basically said we’re going to see this shift from crypto wallets to web three wallets. And kind of how I would explain that shift, is generally to date all wallets have been built and designed around transactions, right? How do I buy and sell and custody tokens, and the wallets that are able to capture specific consumer behaviors at certain points in time will be really successful for that cycle. So, for example, in defi summer, all you needed to be able to do was to interact with defi, you want to be able to buy and sell and custody those tokens. And Meta mask was around for defi summer. And they skyrocketed to, I think half a million to 10 million users in the span of a year, because they were there to capture that consumer demand. Similarly, I think rainbow was a good example. After defi summer came NFT summer, and everybody wanted a highly visual way to show and display and explore NFTs as assets in their wallet. Meta mask couldn’t really do that. But rainbow could and rainbow skyrocketed and users.

So, the story like really doesn’t end there. The question now becomes, what are going to be you know, the really big waves of consumer appetite and which wallets are going to be there to capture that demand? And so generally, I think we’re just going to see more wallet front ends. So even a couple months after I wrote that Mario Gabriel’s piece, I put out an article, stop calling it a wallet, basically saying and I’ll probably say I don’t have a better word yet. So don’t come at me. But I think the word wallet is a little bit limiting, because it insinuates that the things in your wallet are static and that they’re capital assets. And that already is very limiting to how we interact with web three and the things that we hold in there. So maybe, perhaps, again, don’t quote me on this, I guess you have to quote me, but, yeah, maybe there’s a passport, perhaps if it’s a wallet all around digital fashion, there’s a better interface for actually trying on digital fashion. And you can browse through the clothes hanging on a rack, instead of like a really shitty 2d image, like you see on open sea. And maybe that wallet is called a wardrobe. Or maybe there’s a specific front end for music NFTs. And it plugs into NF T’s that were purchased on specific marketplaces that focus on music. And maybe if you bought a glass music video NFT you can watch the video within the wallet or maybe you can play the songs on a playlist. And so maybe that wallet is called a discography or something. And so, again, I haven’t really flushed out a better word, because obviously, the word needs to be able to kind of take the thing seriously, and it’s not something to be taken lightly, obviously, that it’s like a high value and, you know, important thing.

The way I see it as like different front ends for different experiences. That’s how I sort of see right? 

Gaby Goldberg: Absolutely.


Like you said with music NFTs with the rise of people collecting music NFTs with the rise of tokenized audio, there is going to be a media player, right? Whether it be spin amp or future tape, right that people are tapping into, they just act as aggregation layers, maybe soon have marketplaces on a mobile front, right? That they sort of like monetize accordingly, based off the attention that people use and listen the application for right, I think there’s going to be many different instances around that. And I think, now we’re tying back curation, playing an even more important role, in sort of like showcasing the right assets, and the right experiences on that front end, in a world where data is so vast and so expansive, right, and when you have indexers popping up left and right, for all different types of used cases, it’s up to you, the creator, the entrepreneur, to figure out what type of experience, what type of front end you’re going to create for what type of data. I think this is a great place to end off Gaby. Before I let you go, where can we find you? Where can we learn more about your work? Show it away.

Gaby Goldberg: Yeah, so I’m on Twitter, Gabby underscore Goldberg, send me a DM, say hi, I’ll try and respond to most of them. And then I write on mirror, Gaby.mirror.XYZ. And first time I’ve said this, but I’m on Farcaster @Gaby. So maybe you should DM me there.

Sounds good. 

Gaby Goldberg: But thanks so much for having me. This was so much fun.

Thank you so much. We’ll have to do this again soon. Till next time.

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