Deciphering the hype.
Hey folks 👋
In this first newsletter of 2022 I’m jumping into one of the most energetic themes of last year: the metaverse.
It affects all of us *profoundly*.
The way we work, play, socialise, and live.
No matter how you define it.
This means the way companies are built and scaled. And, the types of products that will thrive in this new virtual macrocosm.
It’s fair to say media hype around the metaverse has been nothing short of colossal lately. Across both mainstream and industry-specific outlets.
So much so it gives the impression we are on the cusp of a sudden gigantic leap forward in our digital lives. On a level reminiscent of the smartphone.
If this has got you thinking things like…
“WTF is the metaverse?”
“When will the metaverse be here and what will it look like?”
“Do I need a metaverse strategy?”
“When can I plug a lead into the back of my head and learn jujitsu in ten hours straight?”
… then you’re in the right place.
My objective with today’s newsletter is to actionably frame the metaverse news cycle that’s currently unfolding around us.
The situation is fluid, as is my take on it, so I intend to return to the topic when appropriate.
Where to start?
By now we all know engineers are engineering it. Developers are developing it. Designers and designing it. Influencers are influencing it. Investors are investing in it.
But, *what* exactly is ‘it’?
I’ll dive into that below. First, the prudent question is *why*?
Why did the term ‘metaverse’ get so much attention in 2021?
Understanding this is key to internalising where we are and where we are going.
More specifically, the companies and stakeholders pushing their own individual agenda of a future metaverse vs. hypothesising a realistic outcome trajectory. Then, mapping out where these two narratives overlap.
Let’s dive into that next. 👇
Why has the term ‘metaverse’ been blowing up recently?
The pandemic fast-forwarded adoption of software and technologies that push how people live (work and socialise) further online. Probably, by at least a decade.
Attitudes, behaviors, and habits have completely changed. Permanently.
As a society, we work and socialise much more digitally now than we used to. Because we were forced to.
As it turns out, the tools and infrastructure of web1 and web2 were generally good enough to see us through. Examples are email, video chat applications, co-working applications, online gaming, broadband speed connections, streaming content, etc.
Digital workers were able to operate remotely at scale. Friends and family hung out a lot more via smartphone applications.
People were entertained via bountiful digital entertainment (Netflix and Fortnite for the win!) and had their groceries and fast-food life essentials delivered via online ordering.
In the (attributed) words of Roman poet Juvenal, the Internet was able to deliver ‘bread and circus’ to appease and distract the masses during extensive lockdowns.
It basically worked. And, just in time.
If COVID had hit just a decade or two earlier things would have looked a lot different.
Google Sheets and Docs launched into beta 2006. Netflix streaming launched 2007. Skype was founded 2003, Zoom 2011. Notion and Figma, 2012. Ready-to-eat food delivery companies such as Deliveroo, Uber Eats, and Postmates were all founded after 2010.
Around the turn of the century, the ‘cloud’ was something that produced precipitation and generally ruined bank holidays in the UK. Many workplaces were just not set up to offer remote working at all.
Even really foundational infrastructure like affordable access to broadband speed connections has only become widespread relatively recently—a prime example being India.
You get the idea.
But, COVID unvieled a problem.
The apparatus of web1 and web2 served us well, but it was *missing something*.
For a sustained period of time, millions of people lived mostly virtual lives for work, social interactions, and entertainment.
It was a grand unplanned experiment that somewhat paradoxically both:
Implanted the idea that remote/virtual living is entirely feasible (granting more freedom for one’s living choices) and;
Exposed problems demonstrating that it simply isn’t entirely feasible (the quality of interactions and meetings detoriated).
The way I see it, the apparatus of web1 and web2 (particularly applications that host interactions and relationships between people) are fantastic at augmenting and supplementing physical world interactions and relationships.
Zoom, Skype, and Google Hangouts augments in-person relationships. As does email and messaging services like Facebook Messenger, Telegram, Slack and WhatsApp. Plus, the many mechanisms of communication within applications and broader services like Google Doc and Figma to Xbox Party Chat and Discord. A far from exhaustive list.
All of these have also proven powerful at fostering new Internet-only relationships in many scenarios—e.g. work and gaming.
But, they do not replace the complete value of in-person interactions and relationships.
To use a metaverse-style analogy, they are kind of like the life-sustaining porridge that Neo and the crew of the Nebuchadnezzar eat in The Matrix.👇
Sure, they have “everything the body needs” to *survive*.
But, not *thrive* in terms of reaching a state of fulfillment, intrinsic happiness, and self-actualisation with other human beings.
This is especially true of web2 social media applications like Facebook, Instagram, Twitter, and TikTok—which (in addition to the self-actualising benefits they offer) generally surface superficiality, are calibrated to foster addictive behaviors, and engender feelings of loneliness and inadequacy.
But, what if people could live mostly virtual lives *and* have many of the benefits of physical events and interactions?
Plus, experiences that are even better.
Enough to empower them to reach their full potential proffesionally and socially on a mostly virtual basis.
Tackling this is a BIG opportunity.
How? Reducing the delta of *experience value* between a physical event and a virtual event.
This gap between where we are *today* and where we *need to be* is the gigantic leap forward in our virtual lives that I mentioned previously. The demand for it has been established, now startups and big tech are figuring out how to get us there.
I call this difference the virtual experience delta.
To reduce this delta:
Sometimes, it means better reproducing the conditions of the physical world virtually. One of the big themes here is the perception of ‘presence’—the sensation of sharing a space with somebody else.
Sometimes, it means producing a new type of experience that can’t be facilitated in the physical world easily or at all. One of the big themes here is real-time 3D gaming (or alternate life) worlds.
Over time, these two themes will increasingly combine and overlap. What is a game vs. life will blur. In some instances it’ll be obvious, in others not so much. Gaming technologies and design principles will provide the connective tissue for each end of the spectrum.
This ecosystem will be much better than web1 or web2 at connecting disparate people around the world with specific skillsets and niche interests. Encounters and interactions will feel a lot more natural to the way we are programmed pshycologically. It’ll be like the social and professional equivalent of 100 True Fans—100 True Friends.
For the foreseeable future, the virtual experience delta does not need to be eradicated completely. Just reduced significantly, will suffice. To hit what you might call a Minimum Viable Virtual Life.
This is a tipping point, which—repurposing Shaan Puri’s proposed definition of the ‘metaverse’—could be “the moment in time where our digital life is worth more to us than our phsyical life.”
It’s the point an individual can thrive, not just survive, in both their social and professional lives.
Here’s a totally unscientific and back of the envelope graph to visualise that:
This reaching of a Minimum Viable Virtual Life is individual to each person.
A minority of people already have— such as those whose primary social lives involve hanging out in online gaming or crypto communities and making a living selling services over the Internet.
The masses have not.
More is needed to accomplish that. Such as virtual interactions with other human beings that are nearly as fulfilling and productive as physical interactions.
In relative and practical terms, nearly all progress is ahead of us.
On a personal level, I met a lot of people for the first time over Zoom and Google Hangouts during lockdown periods. When I later met some of them in real life for a coffee or a beer, the quality of that interaction was at least 5X better. Reducing that to 2X would be a gigantic leap forward.
Many companies and creators have their own take on reducing the virtual experience delta. Collectively—and even-though largely uncoordinated—these initiatives are a push to achieve a Minimum Viable Virtual Life for the masses.
So, why the term ‘metaverse’?
The notion that humanity is going to live ever more of their life digitally is hardly a novel insight. We’ve been on that trajectory for decades.
In order to convey the Minimum Viable Virtual Life vision to investors and customers, a term was needed to embody the strategy and hammer home the point that what’s coming is not incremental innovation (like we’ve been accustomed too since the introduction of the iPhone) it’s a gigantic leap forward.
Preferably, a term with precedent bias the general public could visualise intuitively.
It’s also a convenient opportunity to:
Rebrand and tie together a bunch of frontier consumer technologies and ideas that failed to gain mainstream adoption pre-COVID. Examples are AR/VR and cryptocurrencies.
Offer mass appeal use cases for newer technologies and ideas—e.g. smart contracts & NFTs.
Characterise the growth of real-time 3D worlds and multiplayer gaming.
Enter the ‘metaverse’… which accomplishes this on all fronts. It emanated from pop culture—specifically science-fiction—evoking thoughts that we’re leaping into a far out futuristic tomorrow, soon (more on that below).
The most visible company who’ve adopted this strategy is Facebook Meta. Zuckerberg really put the term into the spotlight with his bold ‘go big or go home’ Q4 rebrand.
Just look at that Google Trends spike for ‘metaverse’ during the last week of October, 2021. 👇
Meta’s metaverse plans are both as a builder of hardware and software—AR/VR gear and killer social applications to run on them. Plus, continuing it’s position as a platform layer for creators, merchants, and whatnot. Other big tech companies such as Mircrosoft are exploring similar offerings.
The initial ‘metaverse’ Google search spike back in April was around the time the NFT scene was really blowing up. Breakout profile-picture-projects like CryptoPunks and Bored Ape Yacht Club helped kick-start a broader conversation around virtual identity ownership. This is a key theme of the perceived future metaverse.
Ownership over ones’s virtual identity and virtual life assets ties into many other visible startups and projects who are often cited as metaverse-first startups. Examples are The Sandbox and Decentraland (even though they may disagree with the label). These are virtual worlds to socialise, play, work, and build businesses.
There’s a ton of similar projects popping up in various forms and guises. Many celebrities and consumer companies are getting involved to sell digital assets that can be utilised within them. Music and fashion are big themes.
These projects utilise blockchain technology to enable user ownership over in-world assets and currencies. This (theoretically) means interoperability between virtual worlds and services. Plus (again, theoretically) no third-party risk that a company will disappear or run off with one’s digital assets. Which, is a big deal in the context of a Minimum Viable Virtual Life.
Additionally, there are an array of existing non-blockchain companies and products such as Roblox and Fortnite who are often referenced as kind of ‘missing-link’ type stepping-stones to the forthcoming metaverse.
As you can tell… this is a warp-speed fly-by summary of the companies and products influencing the metaverse narrative (a full rundown is outside the scope of this newsletter). For a deeper summary, I recommend checking out Megan Loyt’s The Metaverse: 101.
Regardless, none of these things are individually a prerequisite for the metaverse.
Which, I’ll go into next. 👇
Defining the metaverse
So, what is the ‘metaverse’?
Well, there is no real consensus.
The metaverse is not a specific technology, system, or protocol like the World Wide Web or Bitcoin. It’s more of an idea with multiple interpretations and moving goal posts, like AI.
Author Neal Stephenson coined the term in Snow Crash. It’s a 1992 sci-fi novel about a pizza-delivering protagonist who jumps back and forth between dystopian LA and a virtual world called the Metaverse, where he lives a completely alternate life as a warrior prince.
Ernest Cline’s 2011 novel Ready, Player One further built upon this concept with a metaverse called OASIS and its namesake (Steven Spielberg directed) movie has become popular ‘go to’ reference material for what the metaverse is.
These combined stories really helped lay the groundwork for the premise of a persistent and shared alternative virtual network of networks that billions of people around the world could connect to synchronously.
If this sounds a lot like the Internet, that’s because it does. A key difference being it’s more like the Internet of the future. Everything is leveled up big time.
Tony Parisi (a VR pioneer) characterised it as follows:
Both novels present very specific examples of metaverses that are very different to the Internet today in that each is a vast closed ecosystem controlled by one all-powerful operator.
This is equivilant to the Internet (and all services within it) being entirely owned, operated, accessed, and controlled by Meta. What’s known as a ‘closed’ metaverse that people like Epic Games CEO Tim Sweeney have been vocal against.
That would be bad for a whole basket of really disturbing reasons. So, the general consensus is we should all be building towards an ‘open’ metaverse.
Due to the vast technical and behavioural challenges involved—that will play out over decades—it’s also necessity at this point.
But, it’s not inconceivable that as the metaverse starts to take shape, power will accrue with one of its facilitators disspropritanetly. Enough for it to absorb the others.
Kind of like when a solar system forms. Sometimes you end up with one gigantic planet that has absorbed all of the others through overwhelming gravity.
Another concern raised is the dystopian theme of Snow Crash and Ready Player One.
Vice broke this down last summer:
This dystopian vibe is kind of a buzzkill.
So, companies with metaverse-first strategies abstract away the negatives and appropriate the positives.
To the degree the term ‘metaverse’ has become it’s own thing, separate from those novels, but with core underlying commonalities.
Right now the term is being pulled in a hundred different directions by those claiming to be building it (or for it).
Back in January of 2020 prominent metaverse thought-leader and VC Matthew Ball proposed specific criteria:
Again, this sounds *a lot* like the Internet.
A fact that did not go unnoticed by Ben Thompson:
Matthew later proposed a fresh definition:
This became a little more specific in that it stipulates the “real-time rendered 3D virtual worlds” synonymous with the VR—accessed depictions of the metaverse in Ready, Player One.
Matthew provided context for this definition:
There are other notable takeaways from Matthew’s noble attempt to define the metaverse, which are:
The metaverse will not replace the internet, but instead build upon and iteratively transform it.
The metaverse is not a virtual world, virtual space, virtual reality, virtual economy, a game, or UGC platform. It can be all of these things, and more.
Technologically, the metaverse requires completely new infrastructure that the Internet in its current state cannot support (millions of concurrent users sharing the same persistent virtual space, synchronously). I.e. no tricks or workarounds like “sharding” (splitting) users onto separate servers.
And, he also provided this caveat:
Maybe that’s because Matthew’s attempt to define the metaverse is through the lens of technology, which is relatively straightforward to predict in terms of grand themes but super hard to map out with regards to timelines and the specifics:
To illustrate this, Matthew used ‘mobile internet’ to frame the length of time and the level and complexity of ecosystem development it takes to go from say an 80s ‘brick phone’ to the iPhone 3GS.
In that context, attempting to define ‘mobile internet’ back in the 80s for what we generally have today would surely have been way off—unless *very* broad.
This leads me to consider maybe we should not be attempting to define ‘metaverse’ through any kind of technical lens or infrastructure constraint.
Unlike the term ‘internet’—which in a more specific definition is “interconnected computer networks that use the Internet protocol suite (TCP/IP)” or a less specific definition a “network of networks”—the ‘metaverse’ has no technological premise except for its original appearance in Snow Crash when it was introduced as being something the protagonist accessed via a computer using VR-like gear.
If you break down the word’s meaning, meta in New Latin “describes a subject in a way that transcends its original limits, considering the subject itself as an object of reflection”.
This creates a very broad remit for interpretation. One that may be relevant to consider given society’s propensity to over-index the current crypto and Zuckerberg-fueled technology cycle in attempting to define it.
Doing that can lead to a prescriptive approach for building the next major phase of the Internet. As opposed to a more organic framework via building and solving consumer problems in line with their evolving behaviors and needs.
Whatever spectacular technological innovations and developments occur over the next decade or two, on a long enough timescale they will appear primitive. In this context they are almost impossible to map out.
To illustrate this, in a 1974 interview, Carl Sagan said:
The virtual lives we live today would have seemed metaverse-like as recently as 1992, when Snow Crash was published. To a citizen of 2122, the differences between virtual life now and 1992 will appear barely incremental.
Due to the laws of exponential technological development, the same dynamic might apply for a citizen of 2222 looking back at 2122. And so forth.
In the current technology cycle AR/VR (mixed reality) is a big theme for the metaverse. This, many argue, can foster fully immersive experiences in 3D worlds as our eyes and ears become nearly totally absorbed by stimuli streaming in from VR gear.
But, that is not the limit of human experience. We touch, taste, smell, breath and manage risk that can damage us either cripplingly or fatally. The metaverse experience presented to us in The Matrix is much more immersive than what we are talking about today.
There is always room for further development beyond that. Maybe in the far future people will upload their consciousness into the metaverse using technology that is no longer digital (based on binary digits). After that, who knows.
We are always living in the metaverse relative to the past and always building it relative to the future.
Therefore, it may be prudent to define the ‘metaverse’ in a more experiential context. One that transcends time and is inclusive of all technology. And, is short and simple.
Metaverse: artificial mechanisms for humans to notionally connect and live.
You’ll notice this is extremely broad. It includes the technologies being built by companies like Meta today, the Internet since its inception, and effectively all other artificial constructs that connect human beings.
This definition could be applied as far back as pre-historic peoples using cave paintings to educate, entertain, and cognitively synchronize their society. And, things like books.
That may sound absurd because these things are super low-tech. Even the internet today does not pass the bar for ‘metaverse’ in many circles.
But, experiencing a ‘virtual experience as if it were physical’ is completely subjective and relative.
Playing Counter-Strike on PC can feel like a physical world when you’re in ‘the zone’. VR-gear takes this to the next level. And, future technology even further (such as The Matrix).
Put another way, I’ll use a Morpheus quote: “What is real?”
Any kind of metaverse only really exists in our minds and consciousness, through “electrical signals interpreted by your brain.”
They all have to be accessed via hardware. A novel, through a book. World of Warcraft, through a personal computer. The Metaverse depicted in Snow Crash, through VR-like gear.
Despite their striking experiential differences, they all activate the imagination centre of the brain and synchonize people’s consciousness around it—on either an asynchronous or synchronous basis.
No matter how primitive the input data (which is always relative to the technological era you happen to live in), our imagination and consciousness fills in the blanks.
If you read a novel that describes an environment, it’s probably only actually describing 1% of what you have cognitively visualised. With a little more description, an immersive world manifests imaginatively.
When more than one person reads the same novel, this creates a kind of shared experience of the same world. Tribes and cultures can form around them, as is the case with a franchise like Harry Potter.
Zuckerberg touched on this latter point in his interview with Ben Thompson (edited for easier digestion):
This overlap on its own creates a much broader definition for what the metaverse is versus the current popular dialogue.
I probably experienced this for the first time when I was a teenager, when myself and a bunch of school friends got heavily into a sci-fi strategy MMO called Planetarion.
We were simultaneously both physical world friends and virtual world friends, connected by a physical world institution (the school) and a virtual one (the game). Life from both worlds blended into one another materially.
For example… Planetarion rounds operated 24/7, meaning the game was playing out virtually in the background whilst we were in class or on lunch breaks. It was also heavily political in terms of decision making.
This naturally drew the politics and action of the game into the physical-world through (sometimes heated!) dialogue—alliances were forged and broken, raids organised, and plans devised in the cafeteria. Therein lies a premise for experiencing a virtual world without actually having to be connected to it.
Convincing cognitive immersion is also true of text-based adventure games I used to play on my Commodore 64 as a kid. The visual and audio stimuli was laughably minimal. But, my imagination filled in the blanks.
In an article for Polygon, author and University of Georgia professor Shira Chess made a salient point that “we tend towards thinking about games in terms of speed, in terms of action, in terms of what’s happening on the screen… not the action of what’s happening internally with the player.”
On this basis the ‘metaverse’ is less a technical specification and more a state of experience.
In one C64 game it felt like I really was navigating up a treacherous mountain passway, deciding whether or not to attack the big hairy monster in my direction of travel or try to slip by unnoticed.
People get totally lost in their imagination. The brain creates the ‘virtual’ world and deamplifies physical world senses so that they are no longer consciously perceptible. Awareness of the physical world body diminishes. In extreme cases, this happens to the point where it’s neglected and dies. That’s how powerful it is.
“Your mind makes it real” — to quote Morpheus, again.
Nowadays the mind is still filling in blanks when playing games like Call of Duty: Vanguard, it’s just doing less work. The less imagination is used, the less ambiguity there is between people.
This is an exponentially consistent trend of the digital era. It’s like humanity is on a quest to develop ever-better technologies that synchronise cognition.
Maybe the metaverse is what manifests in the absence of telepathic ability. We have to code our notional worlds to share and experience them with one another.
Perhaps in the future humans will be able to augment their consciousness with technology that enables all of the metaverse qualifiers described by Matthew Ball without the need for sensory hardware like VR gear or smartphones.
Anyway, this has all got a bit philosophical and reductionist. Let’s loop back to reality. Whatever that is.
“Do you think that's air you're breathing now?” 😆
My point being: the term ‘metaverse’ is more and end unto itself than anything specific that you can pinpoint. But, there are tangible “critical category forming” technologies and themes emerging—that are often cited as precursors to the ‘metaverse’—from which we can draw actionability.
To do this, we first need to address nomenclature.
For the most part web1, web2, and web3 satisfies the requirement pretty well. The distinctive iterations of the Internet have so far tracked that of our online metaverse experience closely.
But—since ‘web’ is a reference to World Wide Web—meta1, meta2, and meta3 may be more appropriate because it is technology and protocol agnostic and still fits regardless of infrastructure and ecosystem changes over time.
On that basis ‘meta3’ (and beyond) is generally what people are referring to when they say ‘metaverse’ today.
If you’re feeling a bit lost and are wondering how to approach the coming metaverse technology cycle—meta3 (web3)—commercially, a succinct way to think about it can be drawn from meta1 (web1).
Specifically, from Jeff Bezos.
Let’s jump into that next.👇
Meta1 as a framework
It was such a badass retort, you can literally get the t-shirt. 👇
Taken out of context, this may seem kind of flippantly dismissive coming from the founder of Amazon.
But, it’s actually a fantastic example of extremely clear thinking when it comes to defining and articulating business fundamentals and strategy.
Let’s set the scene.
The interview was held on 13th July, 1999.
Tim-Berners Lee co-invented the World Wide Web just ten years earlier.
In between those two points in time, the Internet transitioned from a niche technology with limited practical value into a de facto utility utilised by millions.
Companies such as Yahoo!, Netscape, AOL, Amazon, and Hotmail demonstrated the Internet could offer valuable and sticky services to the masses.
This non-exhaustive cohort of Web1 startups were the foundational consumer applications of the Internet. They legitimized the World Wide Web as a gargantuan commercial opportunity.
But, it was still very much a shiny new, novel, and divisive technology. One that many could see had vast but untold potential—a disruptor of everything.
Very few had *any idea* what sort of timeframe this disruption would play out in, which markets and industries would get disrupted first and in what order, and what entirely new markets and industries would be created as a result.
Despite this confusion, the scale of the opportunity was obvious to many. And, so were the potential returns on investing in the right companies. FOMO was rampant—sound familiar?
This set of ingredients escalated into a market mentality that became disconnected from the fundamentals at play. Seemingly any startup positioning itself as the ‘Internet for X’ became inundated with investor interest and capital.
As more ‘Internet-first’ companies entered the ecosystem awareness, interest, and valuations boomed. This became a positive feedback loop of ever degrading investment decision quality.
Short-term expectations of what the Internet could facilitate often exceeded what was intrinsically achievable. These views were detached from multiple key developmental phases such as adoption, infrastructure, and consumer behavior.
Capital ploughed into companies with no customers, no product, and increasingly vague go-to-market strategies. Investment decisions seemed to be based on little more than a checkbox exercise of ‘the first company to pursue the Internet for X’.
It’s like the Internet had magical properties that eviscerated the need for an *actual business* underpinning the company.
You can observe this investment fervor most perceptibly through the rise and fall of the NASDAQ around the turn of the century. 👇
This graphic frames the context of the 1999 interview.
A matter of months later, the dot-com bubble peaked. Excitement was on an upward trajectory to fever pitch.
Sentiment was building that ‘everything’ could be done over the Internet, soon.
Beyond servers and offices, physical infrastructure were symbols of outdated business models.
This atmosphere is easy to get caught up in.
Leaning into such exuberant excitement, particularly as a highly-visible company like Amazon, can generate large short-term stock-price gains.
Plus, pressure from the market to follow a certain narrative (like being a “pure Internet company”) can become intense.
At the time Amazon had a fast-growing physical presence to serve its customers.
This incurred big costs for necessities like stock, distribution centres, and the thousands of employees needed to operate them and service customers for things like returns.
The CNBC interviewer was referencing this when he suggested Amazon may not be a “pure Internet company”… insinuating investor misalignment.
Instead of trying to explain why Amazon was a “pure Internet company”, Bezos cut right through the noise and simply dismissed it. 👇
This made it pretty clear Amazon is not an Internet-first business. It’s a customer-first business.
Packy McCormick framed this superbly in Crypto Bezos:
So, yes, the Internet is a powerful mechanism to help Amazon deliver the best customer service, but it’s not *the only* mechanism.
As of 1999 there was also owned and operated stock, multiple distribution centers, and a workforce of thousands. This enabled customers to order, receive, and return items in a “timely manner“.
Today, there’s a whole lot more.
Delivery networks. Hardware. Even physical stores! The list is endless.
Amazon utilized whatever it needed to deliver the best customer experience. And, dropped or ignored what did not.
It’s the ability to:
Wade through new technology cycle noise to grasp and deploy only what is useful.
Not over-index new technology cycle hype by utilising older technologies and methodologies if they make more sense.
Hold that thought.
In Packy’s ‘what would Bezos do?’ lens to web3 he explored what a 30-year-old Jeff Bezos might build if starting out today… weilding the “Internet, Schminternet!” framework.
This is useful when thinking about emerging and evolving metaverse technologies and themes, like:
Avatars / Digital Identities
But, not through the eyes of Bezos, the eyes of each individual startup or web3 project. To what you might call a ‘Metaverse, Schmetaverse’ framework.
Here’s the Bezos framework from Packy, repurposed and edited for the metaverse:
When you find a nascent but fast-growing space, dive in. Either go ‘all in’, test the water, or stay up to date (so you know when the time comes).
Don’t be a purist. Most customers don’t care whether your product has VR, AR, or on the blockchain. Those are tools, not value propositions.
Build something that literally can’t be built within the previous paradigm. It has to feel ‘wow!’… not ‘meh’. If it’s not going to blow people away, it’s probably not worth the investment.
Don’t be try to be too smart. “If you can do things using a more traditional method, you probably should do things using a more traditional method.”
Build something that captures attention. “[Do] something new and innovative for the first time that actually has real value for the customer.”
Focus obsessively on customer experience. New technologies can create tunnel vision… intellectual debates, musings about the future, and “hey, isn’t this cool?” type cultures. Core fundamentals, like customer experience can get neglected. Always put this *first*.
Viable, long-term strategy. Bezos used books as a wedge into selling online. Amazon didn’t start out trying to sell everything. Build small and impactfully, then expand.
Parralleling these points, navigating the noise is also key.
As was the case with dot-com companies around the turn of the century and many web3 and metaverse iniatives now, there’s a lot of yet-to-be substantiated hype.
‘Critical category forming’ periods attract what ex-VC Ben Holmes calls “tourists”.
These are individuals, startups, and projects that primarily dive into an exciting new technology or ecosystem because its hot, not because they are truly passionate about it. There are more tourists in the world than missionaries. This turns the volume up to 11.
Sometimes it feels like things are moving faster than they are. That you’ll get left behind. Developing clear thinking on that is critical so that you don’t feel FOMO or peer-pressured into making a move.
Jump in when it makes sense.
— That’s it for today. Until next time. 👋
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