Learning, earning, and web3 - why I'm jumping in
Written by: Jomayra Herrera
Like many of you who are probably reading this, I have been trying to wrap my head around the web3 craze over the past few months. Admittedly, I have been reluctant to jump into crypto, largely believing that much of the activity was speculative and lacked a valuable use case.
But I was wrong.
Before you keep reading, I want to be clear this article is for those who are early in their web3 journey - the ones who don’t understand why we’re paying for gas on the road AND the internet now, are still scratching their head as to why someone would pay $5M for a jpeg, and are trying to understand how any of these seemingly magic coins have any real value.
I have spent the vast majority of my career focused on increasing access to education and economic mobility and I think we are finally at a moment where culture and technology, largely encapsulated by the web3 movement, are conspiring to create a much more equitable future. As a matter of principle, I generally avoid fads that others are hyping up. But when I noticed that young people, people of color, and some of the brightest minds I know are starting to dive into web3, I realized that this wasn’t a fad - it was a movement.
Some of the underlying tenets of web3 are transparency and verification, organic and inclusive community, and ownership, all values we’ve cared deeply about within the education and economic mobility space. I’m going to use this piece to talk briefly about how these can translate to real use cases and in subsequent articles plan to go much deeper. At Reach, we’ve just hired an awesome research associate dedicated to web3 to help us dive in so stay tuned for much more from us!
Transparency & Verification
For years, the education community has been touting the importance of hiring for “what you know” instead of “who you know” or “where you went to school”. As a result, there has been an explosion of digital credential platforms like Credly, skill-based bootcamps, and online assessments that help with hiring. In a Web2 world, we focus on trying to wrap up what happens in the offline world into a digital-based credential that is given meaning.
Web3 starts to get much closer to what we wish we had - a ledger of everything we have actually done. As opposed to relying on a summative or one-time assessment of our skills, web3 presents the ability to capture all tasks you are able to complete on-chain. Rabbithole is an early example of this as you’re currently rewarded for completing crypto/web3 tasks like supplying tokens on Compound or swapping tokens on Uniswap. While there is a heavy focus on learning related to web3 tools today, you can imagine a world in which this starts to expand to a much broader array of skills.
There is also Questbook, which similarly allows devs to earn while they learn. The long-game of questbook though is that after devs go through Questbook tutorials they are then able to fulfill projects for web3 companies in order to prove their abilities. They are then rewarded and have the potential opportunity to get hired.
To be clear, this doesn’t create a perfect replacement for a traditional interview, because social skills are not well captured (at least for now or maybe ever) on the blockchain (per this back-and-forth on twitter) but it does capture a lot more of what someone can do than a one-time summative assessment.
Organic and inclusive community
At Reach, we have always believed that relationships are at the heart of education. While we invest in technology to help supercharge educators, parents, and students, we know that we can never replace the importance of having a human connection.
Similarly, web3 projects live and die by the strength of their community. There are now over 1.4M DAO members that collectively manage over $15B in AUM. These are people across the globe who are working together on projects that range from HerStory, which helps to fund black women and non-binary artists to FWB, which is an exclusive social club.
The community is responsible for maintaining and adding value to the DAO and, what is novel, is that they are actually incentivized to do so because their tokens increase in value the more that the value of the DAO increases. There are people who are quitting their 9-5 job, because they are able to generate enough income from participating in DAOs full-time.
And the energy in these DAO communities is electric. People are excited to participate in making the community better, meet new people, take on different projects - all while knowing that the more they participate the more they are increasing the underlying value of the community they have ownership in. In a world of rising loneliness and increasing burnout from work, this presents a really exciting alternative for the world of work and communities for learning.
We know the best way to build generational wealth is to actually own an asset that appreciates over time - historically this has come largely through homeownership and stocks.
The problem with this is that there has been systematic inequality in terms of who has access to these assets. Whichever way you cut the numbers, the inequality is pretty staggering - the typical Black family has less than $13 in wealth for every $100 held by the typical white family. White, non-Hispanic households are far more likely to own stocks meaning that those who have not participated (largely black, brown, and low-income people) have lost out on more than 260% returns for the S&P 500 funds over the last decade.
And, beyond inequality across racial lines, the US middle class as a whole now owns less wealth than the top 1%, a switch that has only happened in the last decade.
There are dozens of more startling statistics that detail the huge degree of income inequality we have in this country and across the globe. But the point is that inequality related to ownership is largely at the core. What I love about web3 is that it starts to change who has access to appreciating assets by lowering the barrier to entry and aligning who creates value and benefits from the value they create.
Who owns crypto?
The demographics of who is investing in crypto relative to stock are interestingly different. Women, people of color, low-income people are more likely to own crypto than stocks as shown below.
And, while the numbers are still small, more than half of people who have been able to quit their jobs because of gains they have made through crypto make less than $50K a year. The idea that all of the people who are excited about crypto are privileged tech bros just seems to not be the case.
There are a lot of theories about why crypto seems to be more appealing to demographic groups who historically have been less open to traditional stocks. Part is that crypto has opened up the ability to purchase a fractional share, which means someone can start to participate with as small as $10 and then grow over time.
Another theory is everyone is getting up to speed about crypto at the same time - while folks who are higher income and may have more privilege were able to benefit from generational knowledge transfer about stocks and home ownership, but in this cause they are learning about this new asset class at the very same time as the rest of the population.
Whatever it might be, the reality is that the face of who is accessing crypto today has the potential to be different from those who had access to appreciating assets in the past, creating a much more optimistic future about how generational wealth might be built.
Lowering the barrier to entry for high-valued assets
If you’ve been on top of the crypto news in the past few days, you’ve probably heard of ConstitutionDAO, which is a DAO that teamed up to collectively purchase a rare print of the U.S. constitution. One of the architects of the project said, “In the ethos and spirit of Web3, we intend to purchase The Constitution and find a home for it among the world’s finest artifacts to be preserved and enjoyed by all. We the people plan to preserve the document for the people. The ownership, of course, will reside within the DAO. We'll fractionalize, NFT-ify, and mem-ify in the way that we do.”
This is one of the most interesting social experiments in web3 I’ve seen so far, but it showcases how through collective power something as important and rare as a print of the US constitution can now be in the hands of potentially millions of people. And, while it will likely be something that appreciates in value over time there is also a sentimental component to it as Web Smith noted in a recent tweet (below)
There are DAOs and projects across the web3 universe to help lower the barrier to entry for many. For example, PartyBid helps to enable collective purchases that may be too large for one person to make. Axie Scholarships help people to start on Axie Infinity where they can play to learn. And MintFund helps BIPOC and LGBTQ+ artists min their first NFT.
Creators have long supported major platforms across the globe to reach massive valuations, including Youtube, Instagram, TikTok, and more. And yet, they have rarely been able to benefit from the value accretion of those underlying platforms. My favorite expert on this topic is Li Jin who has written extensively about how creators should benefit from the platforms they accrue value to.
Web3 has now enabled this in wonderful ways - whether it’s from NFTs of digital media that creators are responsible for (e.g. Disaster Girl sells a NFT of her meme for $500K ), social tokens that allow creators to tokenize themselves and allow their early believers to benefit from their growth in fame, and most importantly, actually getting tokens in the underlying platform that a creator is accruing value to so that when the platform grows, the creator’s wealth grows as well.
Creators are hungry to be properly compensated for the work they are doing to support the explosive growth of these platforms and are very aware of the platform risk they have - for example, Roblox is now facing criticism that it has been challenging for developers to earn on the platform and they lost out an estimated $25M in bookings from a 3-day outage.
With the early advent of platforms that will allow creators to be able to share in the growth of the underlying company and have less platform risk, it seems wishful thinking to believe that web2 companies will be able to effectively compete for the best talent in the next 5+ years without a true web3 strategy.
Projects to help remedy some of the inequality of the past
We know that web3 is not perfect and the majority of those who are benefitting from it are primarily white males. That said, unlike in the past with appreciating assets, there are now projects that are attempting to remedy this before becomes a bigger issue. For example, there are projects like Station and Layer which are focused on onboarding users into DAOs. And there are countless communities, like ones I had the privilege to participate in, to help encourage women, non-binary, BIPOC, and LGBTIA+ people to get into crypto (and, in make case, feel safe to ask the dumb questions!).
It ain’t perfect though
To be clear, there are still important drawbacks of web3 and areas for improvement. These range from crypto’s carbon footprint, high transaction costs, DeFi attacks totaling hundreds of millions of dollars lost, cross-chain interoperability, many largely speculative projects, inequality in who has been able to truly access crypto, and the lack of consumer-friendly user experience. These are challenges many are aware of and will have to be addressed in the coming years.
And there are many fundamental issues in our work and personal lives that won’t be solved by web3.
That said, I’m excited that some of the smartest and most empathetic people I know are dedicating their time to web3. Many of them, like myself, see some of the inevitable culture and technological shifts that are accelerating this movement and are excited to steer it in a direction that feels more equitable for everyone.
This is the first time in years that I’ve been incredibly excited about technological shifts that are happening to enable a whole new set of innovation. I believe culture helps to give meaning to technology and what is clear to me is that many people are conspiring for change - more control of their density, more ownership, more equality - and I believe they can, through will power and collaboration, accelerate the technological shifts that will enable that.
We’re already seeing it in a small microcosm of the population, one that is far more reflective of the great diversity across the globe relative to prior technological shifts, and expect that to explode over the coming years.
If you are building in the intersection of earning, learning, and web3, please reach out to me at firstname.lastname@example.org! I love to jam on new ideas and invest in ambitious founders :) And keep an eye out for future posts as we continue to learn!