The Bane of Silicon Valley: How Web3 Solves Geographic Silos of Innovation

Missed a session at MetaBeat 2022? Visit our on-demand library for all the sessions featured here.

Facebook, Google, and Apple are the tech giants of today. They’ve been successful by leveraging their geographic location in the heart of Silicon Valley. But what if there was a way to decentralize the web so that everyone, wherever they were, could contribute to its growth and development?

Silicon Valley has become the most dominant force in the tech industry. But this dominance came at a price. Silicon Valley has fallen victim to its own success. The high cost of living and the cost of doing business have preyed upon many entrepreneurs and innovators.

In this article, we’ll look at some notable Web 3.0 projects that have achieved Silicon Valley-style scale without adhering to Silicon Valley’s geographic restrictions. We also discuss how Web3 can help solve some of the problems that have resulted from the concentration of power in Silicon Valley.

What makes Silicon Valley work?

Since the dawn of the Internet, Silicon Valley has been a center of technological innovation. There are many factors for this. One is the concentration of wealth in the Valley. This has created a large pool of capital that can be invested in new and innovative ideas.

event

Low-code/no-code summit

Join today’s key executives at the Low-Code/No-Code Summit on November 9th. Register now for your free pass.

register here

Another is the presence of major research institutions such as Stanford University and the University of California, Berkeley. These schools produce some of the world’s most talented engineers and computer scientists.

But perhaps the most important factor is the culture of risk-taking that permeates Silicon Valley. This culture has produced some of the most iconic companies in history, from Apple to Google to Facebook.

But as Silicon Valley becomes more successful, it becomes less accessible to the outside world. It is becoming increasingly difficult for start-ups and technology companies to gain a foothold.

How Web3 sets a precedent that makes the Silicon Valley model obsolete

To better understand how Web 3.0 resolves geographic silos of innovation, it is necessary to consider all the factors that make the Web3 project work and why these factors are not efficient in Silicon Valley. I have.

Factor 1: Democratized funding pipeline

Web 3.0 startups are raising funds through crowdfunding vehicles such as Initial Coin Offerings (ICO), Initial Dex Offerings (IDO) and Security Token Offerings (STO). These are independent of traditional funding and can be funded from around the world. This gives them a distinct advantage over traditional startups that rely heavily on venture capital (VC) funding. In contrast, one of Silicon Valley’s hallmarks is its hub for VC funds, but to profit from these, companies often had a better chance of being based on the site. .

Another reason Web 3.0 startups don’t need to be located near other companies is because they can benefit from network effects. This is a phenomenon where the more people use a product or service, the more valuable it becomes.

Are these benefits available to traditional companies as well? Yes, but to a much lesser extent. This is because traditional companies are more likely to be funded by VCs. This means they are less likely to benefit from the global network of investors that ICOs (and companies) can offer.

It can be argued that the exchange’s success might not have been as great had Binance founder CZ (Changpeng Zhao) gone to the San Francisco Bay Area to raise funds. This was because he was competing with much more established companies for a limited amount of his VC funding.

Factor 2: Crypto-friendly regulatory environment

IFTX founder Sam Bankman-Fried is one of the most successful people in the cryptocurrency industry and a successful Silicon Valley startup founder. He is a highly intelligent Massachusetts Institute of Technology (MIT) graduate and former quant his trader at Jane Street Capital. , a successful New York City hedge fund.

But instead of going to The Valley and starting a company there, he chose to do business in Hong Kong. The reason is very simple. Hong Kong’s regulatory environment is much more crypto-friendly than the US. And this will become more and more as time goes on.

The United States has been very slow to adapt to the rise of cryptocurrency and blockchain technology. The U.S. Securities and Exchange Commission (SEC) is just beginning to move closer to the idea of ​​approving cryptocurrency-based exchange-traded products (ETFs), and has only recently given the go-ahead to a Bitcoin ETF.

Other countries such as Canada and Switzerland, on the other hand, are more welcoming of cryptocurrency innovation.

And it’s not just the SEC that has been slow to adapt to other US regulatory environments, it’s not particularly friendly to cryptocurrency businesses. Hong Kong, by contrast, has a much more business-friendly environment and its regulators are open to working with cryptocurrency companies.

This regulatory arbitrage is one of the main reasons why so many cryptocurrency businesses are choosing to set up shop in Hong Kong, and that trend will continue.

Factor 3: A Flatter Hierarchy

Web 3.0 startups tend to have flatter hierarchies than legacy companies. This is because they are often built around the idea of ​​decentralization. In other words, there is no need for a centralized authority.

In traditional companies, the CEO makes all decisions. However, in a decentralized organization, authority is distributed among all members. This creates a more horizontal structure, which often encourages innovation.

One of the best examples of decentralized organizations is the Ethereum Foundation. The nonprofit is responsible for supporting Ethereum, but there is no central leadership team. Instead, it is run by a group of core developers who are responsible for making decisions about the direction of the project.

The advantage of this decentralized model is that it enables a much more agile decision-making process. This is because there is no need to wait for a centralized person to make a decision. Organization members can simply reach consensus and move forward.

So what does this have to do with not being in Silicon Valley? The answer is that if you’re not in Silicon Valley, you’re not competing with traditional power structures. This means that you are much more likely to succeed as you are not facing the same level of competition.

Take Austin, Texas, for example. The city is not known for being a center of technological innovation. However, it has been able to attract many Web 3.0 startups because it provides a far more favorable environment for innovation.

Unlocking the Internet’s location-independent nature

The Internet has made it possible for people to work from anywhere in the world. And this is a trend that will only accelerate. As more and more people are able to work remotely, the traditional mindset of 9 to 5 is becoming increasingly obsolete. This is especially true for Web 3.0 startups that often don’t even have a physical office.

At its core, the Internet is decentralized and location-independent, but the Silicon Valley model has prevented that from happening. Power structures were too centralized and funds were limited.

Fortunately, Web 3.0 is finally starting to unlock the Internet’s true potential. By decentralizing power structures and opening up funding channels, we are creating a leveler playing field for innovation. And this benefits us all in the long run.

Next article in this series: How important is Know Your Client (KYC) for Web 3.0 startups? Isn’t it violating basic tenets of privacy and data sovereignty?

Daniel Saito is the CEO and co-founder of StrongNode.

data decision maker

Welcome to the VentureBeat Community!

DataDecisionMakers is a place for data professionals, including technologists, to share data-related insights and innovations.

Join DataDecisionMakers for cutting-edge ideas, updates, best practices, and the future of data and data technology.

You might consider contributing your own article!

Read more about DataDecisionMakers

What Are The Main Benefits Of Comparing Car Insurance Quotes Online

LOS ANGELES, CA / ACCESSWIRE / June 24, 2020, / Compare-autoinsurance.Org has launched a new blog post that presents the main benefits of comparing multiple car insurance quotes. For more info and free online quotes, please visit https://compare-autoinsurance.Org/the-advantages-of-comparing-prices-with-car-insurance-quotes-online/ The modern society has numerous technological advantages. One important advantage is the speed at which information is sent and received. With the help of the internet, the shopping habits of many persons have drastically changed. The car insurance industry hasn't remained untouched by these changes. On the internet, drivers can compare insurance prices and find out which sellers have the best offers. View photos The advantages of comparing online car insurance quotes are the following: Online quotes can be obtained from anywhere and at any time. Unlike physical insurance agencies, websites don't have a specific schedule and they are available at any time. Drivers that have busy working schedules, can compare quotes from anywhere and at any time, even at midnight. Multiple choices. Almost all insurance providers, no matter if they are well-known brands or just local insurers, have an online presence. Online quotes will allow policyholders the chance to discover multiple insurance companies and check their prices. Drivers are no longer required to get quotes from just a few known insurance companies. Also, local and regional insurers can provide lower insurance rates for the same services. Accurate insurance estimates. Online quotes can only be accurate if the customers provide accurate and real info about their car models and driving history. Lying about past driving incidents can make the price estimates to be lower, but when dealing with an insurance company lying to them is useless. Usually, insurance companies will do research about a potential customer before granting him coverage. Online quotes can be sorted easily. Although drivers are recommended to not choose a policy just based on its price, drivers can easily sort quotes by insurance price. Using brokerage websites will allow drivers to get quotes from multiple insurers, thus making the comparison faster and easier. For additional info, money-saving tips, and free car insurance quotes, visit https://compare-autoinsurance.Org/ Compare-autoinsurance.Org is an online provider of life, home, health, and auto insurance quotes. This website is unique because it does not simply stick to one kind of insurance provider, but brings the clients the best deals from many different online insurance carriers. In this way, clients have access to offers from multiple carriers all in one place: this website. On this site, customers have access to quotes for insurance plans from various agencies, such as local or nationwide agencies, brand names insurance companies, etc. "Online quotes can easily help drivers obtain better car insurance deals. All they have to do is to complete an online form with accurate and real info, then compare prices", said Russell Rabichev, Marketing Director of Internet Marketing Company. CONTACT: Company Name: Internet Marketing CompanyPerson for contact Name: Gurgu CPhone Number: (818) 359-3898Email: [email protected]: https://compare-autoinsurance.Org/ SOURCE: Compare-autoinsurance.Org View source version on accesswire.Com:https://www.Accesswire.Com/595055/What-Are-The-Main-Benefits-Of-Comparing-Car-Insurance-Quotes-Online View photos