Decentralised.co
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Decentralised.co
Prasanna Sankar from 0xPPL
Today, we are joined by one of our portfolio founders, Prasanna Sankar. We have been huge fans and investors in what he has been building with 0xppl. The product helps users know what their friends are doing on-chain. Think of it as Facebook, but for user wallets.
Prior to founding 0xppl, Prasanna was involved with building Rippling - a company currently valued at $10 billion. He has been building consumer social products since the early 2010s and brings a wealth of knowledge around what it takes to go 0 to 1. We discuss why optimists win in markets, how philosophy helps persevere and the similarities between 2008 era Silicon Valley and Web3 today.
Tune in for insights from a seasoned operator.
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Twitter Handles
Decentralised.co: https://x.com/Decentralisedco
Joel John: https://x.com/joel_john95
Saurabh Deshpande: https://x.com/desh_saurabh
Prasanna Sankar: https://x.com/myprasanna
Hi, this is the Deco Podcast and I'm your host, saurav. Before we begin, views expressed here are personal opinions. None of this is any kind of advice, let alone financial or legal. It's a conversation about things we find interesting. My friend Joel joined me as a co-host.
Speaker 1:In this episode we talk to a brilliant and inspiring mind for our industry, prasanna Shankar. Like a lot of successful techies, prasanna's journey started in India. Winning a coding competition landed him a job at Microsoft in the US. This is where he'd go on to find his first company, likealit, which was an anonymous dating network. Prasanna has been a serial entrepreneur since His next startup, rippling, is now a decocon with a $13 billion valuation. Prasanna has been fascinated by crypto since a decade, but it took the summer of DeFi 2020 for him to cross the chasm between Web2 and crypto to start ZeroEdge people. Prasanna shares deep insights derived from his experience of growing a Web2 consumer social network, how they are applicable to crypto, why he's all in on crypto at this point and much more. Talking to people like Prasanna makes my conviction in crypto even stronger. I found the two-hour conversation inspiring. I hope you enjoy All right on to the episode.
Speaker 1:Now let's begin with Prasanna's journey from India to US, like many, many engineers do. But what happened after he moved to US is kind of unique, so let's just learn from him. Welcome, prasanna. Thank you so much for having me. Guys, why don't we start with your journey from India to US? What prompted those decisions and what happened with you later on?
Speaker 2:Sure, absolutely. So. I mean I'm lucky to sort of stand out in a country of like a billion people, right, you know, I didn't sort of focus at all on my academics. I did a lot of programming contests during my college days. I was ranked number one in India and, like you know, out of that I sort of was able to get a job in the US at Google and Microsoft out of my campus, which was my sort of first big delayed gratification win, you know, if I may so say. You know I took an offbeat bet. It worked out in my favor, which gave me a lot more confidence.
Speaker 2:Post that I worked at Microsoft for like a year, quickly realized this thing wasn't for me and Silicon Valley was happening, polygram was happening, y Combinator was happening and wanted to come to the Bay Area and live the American dream. So we moved to Silicon Valley in 2009 and applied to YC. It's been 14 years, 15 years, of just founding companies ever since and it's been a wonderful journey. What prompted you to start? So I'm an engineer by background, right, like you know, I really enjoy like solving hard problems and stuff. And you know, at Microsoft I kind of realized, you know, that's actually not the thing that I enjoy, because there were hard problems there but things were just moving really slowly and you were just like undifferentiated blob and startups were happening and I was sort of a fan of Paul Graham's essays where he talks about how you can totally differentiate yourself, how startups are.
Speaker 2:The R&D department for the world it's a distributed, decentralized R&D department for the world, and you know he asked this phrase millions, not billions. So you know, like this R&D it's like not pursued by many, many people. Therefore, the expected value was actually insanely high. You can sort of like become a millionaire, almost like guaranteed, not like, not quite. The YC millionaire rate was actually 50% back in those days, you know, after founders became millionaires, which is mind blowing and, like you know, here I was thinking what the fuck am I doing at Microsoft?
Speaker 3:Did that hook for you the millionaire bit, or was it okay?
Speaker 2:Absolutely. I mean, for me there were two reasons why that was a huge hook, you know. One is I didn't really enjoy my work at Microsoft. I had to do it for the salary or something which I didn't quite want to do. And Paul Graham's pitch was look, you know, participate in R&D for the world, invent something, make millions of dollars and never work again. Right, so that was. You know that was a pitch for the freedom aspect of it. That was also a pitch for you know. Hey, look, you have an unfair bet. You know, heads, you make a million dollars like tails. You get nothing. It's just a far superior bet to like making a hundred thousand a year at Microsoft. So for those two reasons it was a very attractive pitch.
Speaker 1:I think the EV is still 500 Ks. Yeah, you would go for it, I'd go for it.
Speaker 2:Yeah, and you know it turns out paul graham was wrong. You know it was not millions, I made a billion, you know. You know, actually, the ev turned out to be like much, much, much higher. You know, anyone who was with me at the time turned out to be fabulously wealthy, like gary tan, sam altman. You know all these, uh, friends of mine turned out to do extremely well.
Speaker 1:What were you doing at microsoft that made it kind of uninteresting for you?
Speaker 2:In my life. Yeah, you know, in fact, to be honest, like you know, I was working at one of the fastest growing teams at Microsoft. It was the Bing search engine and it was just getting started. So Bing search engine, during my year at Microsoft, went from 50 engineers when I joined to like 400 engineers. So it was going through a ton of chaos and there was a lot of opportunity to build these like massive distributed systems, which I actually greatly enjoyed, to be honest with you. But then the code took forever to get checked in. You know it took like months to get checked in and you know people weren't working as hard. People are chilling.
Speaker 2:And for me, I think you know, the big hit was like, just you know, I sort of had my sort of biggest fear, which is my peak was behind me. You know, I mean I was introducing myself to like a lot of people and I was telling them, hey, look, I was number one in India at Topcoder. I was never a single guy telling you know, I'm an engineer at Microsoft, you know. You know that's kind of like how my peak was sort of behind me and you know I was just like living sort of coasting my life, and you know that was pretty scary and you know wanted to go out on the adventure.
Speaker 1:Right, and then you apply to YC. You go there. What happens after that?
Speaker 2:Yeah, we actually. You know, the first week we went, we came to the valley, we came here on a tourist visa. We didn't have any sort of immigration credentials, so we came here on a tourist visa. First week we met with Paul Graham and, you know, applied to YC and he met with us and he rejected us. Actually, he looked at our credentials. He said you look smart on paper but your ideas are shit. And he rejected us. We kept applying. You know, we applied two more times to YC. We sort of didn't get in. The fourth time we applied. We actually, you know they made us an offer but we rejected.
Speaker 2:We had like one of the fastest growing social networks in the world in our hands. You know we had. You know, the company that we founded, you know, really sort of blew up and what was it? It was a social network called Likealittle. Okay, you know this was 2010. And you know we had applied to YC. We got in and we said no because we had like tons of investor interest at that time. But, pg, paul Graham convinced us. You know, ron Conway came to our house and he convinced us to get into YC and we got into YC?
Speaker 1:Were the deal terms different Because you rejected right?
Speaker 2:Unfortunately not. They were not. We didn't know that it could be different.
Speaker 1:I don't even know whether back in those days it was even a possibility. I don't think deal terms were different at all back in those days. Okay, so now you went to YC and what changed for you and your startup then?
Speaker 2:The way we thought about YC and investors and everything you know is most of this stuff is an insurance policy right. Like you know if things work really well and like you go from strength to strength, nothing matters you know, like no one matters.
Speaker 2:You know the quality of your team doesn't matter, like what you do doesn't matter, like yc doesn't matter. You know nothing matters right. Like you know, you can try hard to fuck up the company and you can't fuck it up like that's kind of like what facebook did. To be honest, like you know, they did everything that they could to fuck up the company and you know facebook is still facebook and peter theel's only advice was like just don't fuck it up. And he did. You know zuck sort of like you know, hired a bunch of outsourcing department, a huge outsourcing department, to build facebook and the outsourcing department built like a file sharing software or something you know, and he still couldn't fuck't fuck it up.
Speaker 2:So if for a company like you know, like YC or investors or things like that are just like an insurance policy that you're taking, you know YC for us was like quite useful in the sense that one of our biggest challenges that we faced was, after a while, our retention rates started dropping in the social network. So you know, like PG was like brainstorming with us, trying to work with us, you know, trying to get out of that situation. You know, ultimately we couldn't and the company failed but you know, it was nice to have someone we trusted to be in the battlefield with us.
Speaker 1:Okay, just before we move on, what did Like a Little do? Can you give us some context?
Speaker 2:Sure, sure. So, like a Little, is actually an anonymous flirting campus social network. So typically, you know, two-thirds of users were women. You know, typically it's a girl who's sort of like making a post. You know, you first selected your location Again, back in those days there was no GPS, so you had to manually select your location.
Speaker 2:You know, something like Stanford Greens Library and a girl would post hey, the guy in green jeans, I think I have a crush on you, right, the girl's name would be anonymous, you wouldn't know which guy she's talking about. Now the whole library is now, like you know, trying to guess who is she talking about, who's talking about whom, and like people are sort of posting gossip below it and sharing it to each other and it spread like wildfire. Within the first week we had like 20% of Stanford using us. Within the first six weeks we had 20 million page views all over the US. And within the first six months I think, we had, like you know, something like a 10 to 20% market share of all US college students. So it really sort of like spread like crazy.
Speaker 3:Prasanna, I was just wondering how did you come around this idea of like a little right, because it requires understanding cultural nuances in the US, even on to a university there? How did this whole thing come around?
Speaker 2:Actually we did not, you know. Okay, let me tell you this funny story we did not come up with like a little. Actually, what happened was we've been trying different startups for like no-transcript in Cambridge. Now she's my wife, she called me and she was like hey, look, there is a social network called Fitfinder which is taking off in Cambridge and Cambridge is trying to shut it down and it had like a million pages within a month and the founder is a student here and he's graduating in a month. So he's going to shut it down for a month and like, start it after he graduates.
Speaker 2:So this was sort of the info that was given to me and she was like, why don't you just copy it and launch it in Stanford? And we were working on another idea at the time and I was like dude, come on, no, no, we still believe in the idea. Let's first test this idea before we change. But then we thought for a second no, no, the hit rate on this one is so much different. And we, you know, immediately we sort of pivoted and, like you know, started a new code base and started coding like little. So that's literally how this got started. There was ton of cultural nuances to, like you know, understand, I actually read about every press interview that founder gave about how he got his first users. You know what was his motivation to start this thing and, you know, tried my best to mimic it and thankfully we also had an American co-founder who actually went to Stanford. He was an MBA at Stanford, you know. Therefore, we sort of, you know, understood the cultural aspects a little bit.
Speaker 3:You basically had the playbook, but then you rewired it such that it fit for your market, and obviously the co-founder being from Stanford helped, right, I think. So string along on that. Was this a time when every social network was trying to launch off a university, because that's what Facebook did? Was that a thing?
Speaker 2:Absolutely, absolutely. Because the internet penetration was still highest in the universities. It was actually spreading beyond the universities, but universities was, you know, like super high density connected. The university playbook was still very, very active. So this was 2012,. Right, this was 2010. All right, all right. In fact, like you know, once we sort of like spread to 10, 20% and, like you know, our growth numbers were ridiculous. Zak was like he was a little bit worried, you know, with Facebook, he actually wanted to buy the company. Our biggest investor was like Mark Andreessen, who was also on the board of Facebook, and he was trying to buy the company. We had like a sort of soft offer at a $52 million, $100 million valuation range and we turned it down. Mark was like, why would you sell? This could actually be the next Facebook. We turned it down.
Speaker 3:Do you?
Speaker 2:regret that in hindsight. To be honest, I don't, for a couple of reasons. One is you know I don't regret anything ever in life. You know we live life forward right. Like you know, I just try to make my best decisions. You know it's a poker hand. I sort of make my best decisions with the hand available. Secondly, I also think it was statistically like it was ev positive. It was actually the right thing to do. You know, now that I've made the money, like it's sort of, I can see it very, very clearly and it was the ev positive thing to do at some point.
Speaker 2:Zuck was in my shoes, right, and he could have taken like 100 million or a billion and like he didn't. And internet is such a huge growth market that, like you know, the upside is practically unlimited. So, you know, if you're worried, you just need to take some secondary and keep going, which is the lesson from all the social networks from my era. Like my friends, you know who are YC founders. Reddit was one of the biggest social networks. Obviously they shouldn't have sold for $10 million. You know Twitter was one of the big social networks. You know they didn't sell for 500 million, which turned out to be the right decision. So internet was such a huge growth market that all you had to do is nothing, so I don't even think it was a wrong decision, given the cards on my hands.
Speaker 3:Understood. So you know, moving on right, like. So how did the story around Likealittle play out, or the years that followed?
Speaker 2:So Likealittle was a huge boom bust within a fairly short period of time. So, you know, within six months we were the hottest kid in town. We were rated the number one, the hottest company of our YC batch. You know, again, the hottest companies of the previous YC batches were like Stripe and Dropbox and, you know, airbnb and so on. Right, so you know, we had like pretty solid company and within six to nine months we kind of realized, okay, our earlier campuses, you know, are not sort of retaining users that well, you know, we had like an insane retention curve in the beginning, which is why we got extremely hard.
Speaker 2:To be honest, like you know, we had the statistic. You know, I remember how we raised money from andes and orwards. We went to the room and, uh, you know, nobody spoke. I opened googlecom, slash and altix and I showed a statistic which basically said that our user numbers are, of course, up and to the right and it was crazy. But also, like you know, one specific statistic which said that if a user visited our site three times, there is a 50 probability that he visits our site a hundred times. Right, so you know, that was obviously like insanely high retention that we were able to hold on to. But then those numbers started dropping. You know, six to nine months out, when people got bored of this thing, it turned out to be a fad. And you know, within a year we knew, okay, like our cohorts are dying. And you know, within 18 months it played out. So we tried to sell. We sort of panicked and tried to sell. Nobody was answering our emails. Zach wasn't responding, you know.
Speaker 3:So I think the takeaway here is almost always play into momentum, but you almost don't know when you're at the peak of your momentum. Right Like you try not to sell because you think there'll be more in momentum. But usually when founders try to sell it's because the tide is turning and it's usually almost late.
Speaker 2:That is true. You also don't know, I mean, when the tide is turning, maybe you can sneak sell, maybe you can sort of depend on your opponent. You know cheating your opponent or whatever, like I don't know, it's not clear. Look, if we notice the retention numbers and like no one else notices it turning, then maybe you can get lucky or something. But you know, I mean, obviously the offers exist when the momentum is really high. But that doesn't mean okay, the answer is okay, just sell when the momentum is high, because it's not at one point in time that it's high, right, like it's sort of you know you're rolling into momentum, so when do you know it's going to peak out. So I don't know if I have like a very smart answer to it, except my answer today is to just like never sell. Actually, you know, this is a growth market. Anyone who held on did really really well.
Speaker 3:All you have to do is nothing gorgeous you know how did the story end here right, and what was the next chapter like?
Speaker 2:so the company failed and I mean the idea failed. We tried to pivot. So it was also when iphone launched and we thought, okay, fuck, you know, a location-based social network makes total sense to have an iphone. And we built an app. We sort of pivoted into the iphone and like we sort of built something where you don't need to specify your location, we could detect it. And we tried to sort of, like, you know, build something similar on campuses. But we just could never sort of like make it work. We could not move our users from desktop to mobile. First of all, they didn't have a ton of iPhones. You know these were college kids and we were kind of like too early for that we just couldn't make it work.
Speaker 2:After a few more years of trying you know, by this time it's already like year three into my startups and, like you know, after like year four, like you know, I still sort of tried pivoting and stuff for the next year, couple of years. You know we sort of got really good at like growth marketing. So you know, we after that we sort of launched a new app called Circle. It hit like 10 million downloads and you know it was fairly inorganic. You know we had like good connections in Apple and Google. They featured us. You know we had some social media growth hacks about how to spread in Facebook and stuff. It was sort of fairly inorganic. It had like a very flash in the pan growth curve, you know. It had like 10 million downloads but, like you know, nothing retained. The cohorts didn't stick and you know it went to zero. We launched one other app like that which again went into the millions of downloads and again went to zero and after that I was like so tired man I said like fuck this. You know this.
Speaker 2:You know my sort of takeaway there, you know I had a couple of conclusions from from that experience, you know. One is I hated the consumer internet. You know mark andreessen, our biggest investor, thought consumer internet is kind of like catching lightning in a bottle. He coined that phrase at that time and uh, you know like basically he you know it goes on to show that his theory is like he would never invest in a, you know, pre-traction social network or a consumer internet company. You know, based on any thesis or whatever, these things work randomly so he would just like buy post-traction. So by that logic, you know we were trying to start something pre-traction and you know it had no sort of scope. So i-traction, and you know it had no sort of scope.
Speaker 2:So I was like pretty disillusioned about building a consumer internet company. And like, even post-traction, you know, we both, you know, like we went back to zero, right, like it turned out to be a fad and it sort of also happened to like a bunch of companies during my time. Foursquare was another hot company which went back to zero. There was another hot company called Highlight which went back to zero, you know, so there were lots of fads occurring in, you know, social networks. So I was like pretty disillusioned about consumer internet as a whole. I thought, you know it was like throwing darts in the dark, it's never going to hit it. So I was, like you know, pretty frustrated with it, you know, and I wasn't going to do that and, like you know, so that was like one big takeaway for me. The other big takeaway is, like you know, with consumer internet and like most internet businesses, it is all about retention. Like that is sort of the hard slap on my face is that it's actually totally, totally about retention. It was not about growth at all.
Speaker 2:You know a lot of the social networks in that era, a lot of people questioned whether some of these social networks will make it Like LinkedIn. It had like insanely slow growth rate. Linkedin sort of really tested the patience of like any investor, any founder during that era and like people really questioned whether it would make it. You know, the joke at the time was, like LinkedIn, you open LinkedIn once every two years. You know, and that was true for most people at the time. To be honest with you, you know, when they look for a job or something, they open LinkedIn. Right, and it still worked. It still worked.
Speaker 2:That was the weird part. Like you know, as long as you consistently opened it once in two years, you can still make it work. But if you didn't and you forgot about it, like there is no way to make it work, right. So I kind of like understood okay, retention is king, like that was sort of the result of that era was retention is king If you can make it work, even small growth rates. Like you know, when you're using LinkedIn, your friend might just like see you using it from the back. You can't explain how these virality is happening, but you know, if you don't retain users, you're already at like you know user retention rate of one and even small viral rates, you know can create rapid compounding on the internet and like, within a few years, you know who cares if it's five years, 10 years, 15 years you know you kind of like take over the internet.
Speaker 2:So that was the second takeaway is just like, retention is king, growth is not, growth is overrated. And like you know to just like focus heavily on that in fact, there was a third corollary that I learned during that time is actually growth kills all social networks. There is probably not a single social network which, if it didn't control its growth, would live to exist. Of rivals. You know we became friends after all, our companies crashed, right, and this is something that we sort of came up with and this is specifically the highlight founder, who went on to found Clubhouse after that, and you know the theory that we had was like you know, growth actually kills social networks.
Speaker 2:You know any social network that grows really fast like dies, and you know the reasoning is you know, when you're building a social network, what you're trying to do is to create a cool kids club, right, it's sort of like a nightclub that you're creating. And you know, if you let everyone in, you know it's not kind of cool anymore. There is no sort of net new behavior that's happening inside the club. There needs to be something that is uniquely happening inside the club that doesn't occur anywhere else, right? So you kind of like need to nurture that one sort of single behavior that occurs uniquely in your club and you need to sort of like slowly grow that user base so that the new guys who come in, look around and like sort of absorb that behavior and like start exhibiting that behavior naturally, right?
Speaker 2:So if you just like open the door and let everyone in, they're not going to behave uniquely, they're just going to behave like they're behaving in any other social network and you have nothing differentiated at that point and, like you know, you might as well die, and like you typically do die. Which is why, you know, whenever Google launches Google Plus to compete with Facebook or Facebook launches Facebook Poke to compete with Snapchat, it just like never works. You know these things are all flashes in the pan. So poke to compete with snapchat, it just like never works. You know, these things are all flashes in the pan.
Speaker 1:So these are sort of like three big takeaways from my time. That was brilliant person. I think there were ton of insight in there and I have multiple follow-ups. But the first question I want to ask is how do you see these parallels with farcaster, like the three learnings that you have? Can you sort of say where it is in the trajectory or anything you know according to your learnings?
Speaker 2:absolutely. I mean, I think it totally applies to Forkester. In fact, one of the reasons why I founded like a crypto social network company was just, you know, people weren't sort of like doing this. Well, you know, I really was, you know, looking forward to BitClout. You know it was the first thing that was like launching and you cloud was actually a, you know, a very interesting experiment. I I thought it was actually a very important experiment to try out for humanity. You know, it is possible that you can just like bribe your way to like clone twitter and move the world over. It is possible. I have, I have like nothing that I know of to say that it's actually impossible. You know what? If you could just like clone the same behavior don't change the behavior just like bribe people and move people over, is it? You know, I have no data to say that it won't work. So it was an important experiment for humanity and we tried the experiment and it turned out not to work. You know it was again a flash in the pan curve and you know bribes turned out not to be enough, like the behavior didn't quite put over perfectly. So that sort of made it like okay, there is only one option left now.
Speaker 2:The big bang doesn't seem to work. You know the forces of a social networks, commoditization, are too big to be overcome by monetization alone, money alone. Now we have to build it the slow way, which is you know how you grow a fire. You know this is sort of YC, sort of pioneered, this approach of growing a fire, which is light it around a small area and like, keep expanding, keep expanding. You know you can't expand the surface area too fast or the fire, the flame, will die out. So now the question becomes okay, how do you? You know, I mean, if the big bang doesn't work, the only other option is slow growing the fire. And you know there were a couple of people who sort of came in to slow grow the fire. Lens was one, farcaster was another. That was a natural next sort of tech, you know, to slow grow the fire.
Speaker 2:Now my issue with Lens and Farcaster was, you know, whenever you're slow growing it, I thought, you know, I still believe you need to create a net new behavior. That needs to be something. You can't be like a clone of Twitter. You know, they were too much of a clone of Twitter and the only USP was just ideology. You know people are controlling you. Now we don't control you. Like that was only USP and I thought that didn't quite stand a chance.
Speaker 2:And, you know, to Farcaster's credit, they've sort of like done a great job attracting a core group of people for whom the USP was, like you know, really powerful, like these sort of crypto fanatics like Vitalik and stuff who, just like you know, didn't care that their distribution was like 100x lower. They were still willing to engage in this thing called Farkaster just for ideological reasons. And Farkaster, for the most part, was like a niche audience till they were doing that right. Like you know, for the first couple of 1000 users they were totally a niche audience. They weren't growing and, you know, a few ideologists were in Farkaster, even with its feature set being entirely like a Twitter clone.
Speaker 2:Now, all credits to them. They've actually transformed their position. I mean, first of all, they slow grew the fire in that niche and built a great community, which is actually incredibly hard to do, but they've done it. They've put in the hard work and done it over the back market and that is obviously not scalable. A Twitter clone doesn't work at scale. We already know that we need to create some net new behavior and, to their credit, you know, they've sort of like now pivoted entirely into like an app distribution company with frames and stuff. That is what sort of has created the massive growth in Farkaster, which is very interesting and fascinating. But you know, obviously like that is a much bigger idea than a Twitter clone on chain.
Speaker 1:So you think that they are able to slow grow the fire instead of very high growth, which is sort of detrimental to your existence, as you said earlier. Absolutely Right. There were a couple of things that you mentioned earlier. One of the things was all you have to do is nothing, but you know, like as you said, like how do you ensure this in terms of user retention? How do you see this when you have to retain users and so on?
Speaker 2:Well, user retention is totally king. I think that is everything. And now I view company building entirely as you have this tiny circle and if you put people into that circle they're stuck in that circle, the molecules are captured, their entropy is nullified and you're sort of freezing the universe one at a time. And you know these circles can only grow, they can't shrink if you have like high retention. So they can only grow. And you know, often on the internet things are growing pretty fast by themselves anyway, like because the whole internet itself is growing. You're riding like very strong undercurrents. Molecules are moving pretty fast. They randomly sort of get trapped into the circle, so it entirely matters. You know how much of a strong black hole you've built. That is sort of fundamental to the health of any company that you create. So absolutely like that is 100% the game.
Speaker 1:Another thing that you mentioned was that it's very difficult to gauge which social network will do well in its early stages, right, you only know once it has happened. A decade later, do you think it is still valid, or have we developed some sort of understanding as to what those ingredients are that make a social network grow and sort of predictable that it will be around in a few years time?
Speaker 2:So the funny part is, you know this is something me and the Highlight founder agreed upon and laughed upon and, like we said, like fuck it, we can't start a consummated company. And you know, fast forward. You know highlight founder went out to produce Clubhouse and you know, at its peak it was worth a billion dollars and, to his credit, he took a lot of money out in secondary. He understood, of all people, like he can never know when the momentum will die and he took a ton of money out and, like you know, he also slow grew highlight, you know, for the longest time it was in private beta. You know it was ridiculously hard to get on it and he did create a net new behavior that just did not exist before. You know he still couldn't make it right. It was too easy to clone for Twitter, the graph was too close to Twitter and you know Clubhouse is no more right, you know.
Speaker 2:So that tells me a couple of things. It is true that you know you can have like extremely high retention numbers and lose them totally possible. Sometimes due to faddish reasons. You know that was a little bit of part contributed to Clubhouse. Sometimes also due to competitive reasons. You know it is actually on the competitive reason. Typically you don't lose because, like you know, someone kickstarts a new social network and now competes you. You mostly lose because your graph, your social graph, is too similar to someone else's and they've, sort of like, added your feature. So, you know it turns out like that was the death kneel for Clubhouse, you know, which was sad.
Speaker 2:But also the other thing was, if it was just pure randomness and like lightning in a bottle, what are the odds that you know he was able to start it after he laughed saying, like you know, it's totally not possible. You know, clearly he did something. You know it was like better than random, certainly, right, you know. So there is always this temptation that, yeah, I mean you sort of disqualify it as random, but you do see some unique opportunities, you know, for him, you know what he saw obviously was like COVID and isolation and, like you know, like lack of voice as an internet medium and like the rise of mobile phones.
Speaker 2:In retrospect, in hindsight, you know, in crypto, the thing that I am seeing is like, basically, you know, a whole new network of trust developing on chain that is transacting, you know, and like doing one of the most scary activities like ever. Uh, you know, there was a time when internet was scary. You know, crypto is sort of like 10x that right it is. It is super scary. There is like very little to no trust. It is a place full of scammers and, uh, you know, there is an and it is already a social game. So there is an opportunity to create like a network of trust here and, uh, you know, create a net, new, unique behavior, which is the bet that we are taking at 0xpeople.
Speaker 1:Yeah, so before 0xpeople, I want to talk a little bit in brief what your journey was after. Like Little Rippling, I think, zenefits before Rippling, if I'm not wrong, and then 0x.
Speaker 2:Sure, sure, yeah. I mean, after Like Little failed and like you know, after we tried several different pivots and like all of them crashed, I was quite burnt out. You know I said like fuck this. You know I I really believed in the lightning in a bottle idea of consumer internet and in fact, you know, even after catching like lightning in a bottle, you could still lose it. So I was like tired of like wasting four or five years of my life building nothing. And you know I said like fuck this, I'm not doing this shit anymore. You know took a break. You know left the silicon valley.
Speaker 2:Thought silicon valley was a toxic place where there is a ton of peer pressure, where you need to act like you've made it. You know your company is doing well, like put up a fake face and you know shit like that. You know was like fed up with the valley. You know pretty angry. You know said I have to have starting a company again. Left the got married, spent a couple of years in Europe. I was a house husband, my wife was working in Shell Netherlands, you know, but then started getting the itch again Once I sort of stepped out, I realized how unique a place Silicon Valley is where the hierarchy is actually.
Speaker 2:You know, in most places, sort of like you know, paul Graham has a blog that every city has a voice. It whispers in your ears what the optimization function you need to be optimizing for. And you know you would think the people who are, like you know, resistant to social pressures would be sort of ignorant of the city's cues, but it turns out actually, like you know, they're also as susceptible to what the city is telling them to do, just that they have the ability to delay gratification a lot more. So that was really interesting. So you know, a concrete example is, like you know, in California the city is whispering you to like be ambitious, you know. So you're rated on a social hierarchy on like you know how ambitious a project that you're sort of like going after, right.
Speaker 2:And while Elon was in California, obviously he did, like you know, a bunch of amazing things. You know he went to LA and, like you know, in LA it was about like who do you know? You know, do you have a pretty girlfriend and stuff? And, like you know, he got divorced and, like you know, he got a like a pretty. He married a model wife. There is a lot to it. You know you just can delay gratification for like many, many years, till you get the price, you know you, till you get the price, you know you still sort of succumb to the optimization function of the city.
Speaker 2:So, anyway, stackpop, that's probably like an unnecessary detour, you know, for me I sort of appreciated what California was Like, you know, like anyone in Europe, it was fun to hang around with, but like no one was intense, no one was going after anything meaningful that I thought was of value and my value is still sort of you aligned to startups. And I was also like I also thought the best time of my life was actually like a little, when things were growing really fast and the market was pulling the product from me and I was able to work at like, give it my 100%. I slept two hours, three hours, four hours a day. For a while I didn't feel happy, I didn't feel elated, I didn't feel sad, I didn't feel tired, I just didn't feel anything. I just woke up and served god, you know, in the moment, as this, yeah, yeah, yeah, you know my meaning and purpose of my existence was phenomenally clear. There was no ambiguity and, like, this is what I had to do. This is what the world demands from me. And there was a very, very powerful place to be in and I, you know, I couldn't like not be there after I've been there, so you know. But then I also didn't want to start a consumer internet company again. You know, I was like pretty disillusioned by that. You know, it was almost like God sort of like taking my gift and like sort of stabbing me in the back after.
Speaker 2:So I went to the opposite side, which is the most boring side, which is enterprise software, and you know, I joined the fastest growing company in the world at that time called Zenefits. It went from zero to $50 million in ARR within a couple of years. It was an extreme outlier company. Again, you know, I sort of realized from my journey in startups that it is an exceptions business. If you build something like everyone else is doing, it's not worth anything. So you know, I learned to sort of appreciate the exceptions and like like little was about appreciating the exceptions no-transcript normal distribution and uh, you know, the thing that got me in was basically I did a few customer calls with customers of zenefits and I asked them how was the software?
Speaker 2:And they told me it is complete pile of crap and it is like complete bullshit. Know, they sold software that didn't like quite exist and they're so unhappy about Zenefits and I asked them why didn't you leave, why didn't you switch? And they told me switch to what. There is nothing else out there, I don't have any options, you know, and I was like, okay, this is what I want to hear.
Speaker 2:You know, like I was fed up of like people telling me how much they liked loud, like a little, and like you know, and they don't know why they stopped using it. You know, I like the other extreme, which is they hated the software and they had to stick on, you know, and their issues were with software which I can actually fix. You know I can underwrite that. I can underwrite the technical dead risk. You know I can go fix that stuff. So that was music to my ears and I joined them as a director of engineering, built much of the engineering team. You know, for me, as an entrepreneur, you get the best aspects of an entrepreneur, which is, like you know, market is pulling the product out of you, and you can avoid the worst aspects, which is you build something that nobody wants.
Speaker 1:Right Fantastic.
Speaker 2:Oh yeah, absolutely. So you know again, I have phenomenal luck. You know, zenefits was a huge growth story. It was a 10x in a year. It went from like some something like 500 million valuation to like 4 billion valuation within a year that I was there and it crashed and burned. It went to zero. So whatever I touch goes to zero by that point.
Speaker 3:But why? What was the reasoning behind it?
Speaker 2:I think the principle one was one of internal errors and internal mistakes. So what actually caught up to Zenefits was the technical debt risk that I underwrote. Actually, what happened was they sold to everyone who didn't hear about Zenefits' poor quality and it got to a scale and size where, you know, before a guy was buying Zenefits he spoke to a friend who said this is shit and they didn't buy it. So our conversion rates actually went down as we got bigger. You know, meanwhile, the business models did not show that. It thought our conversion rates are going to go up as we got bigger because we're building a lot more software to solve for, like you know, objections that people are sort of like, so therefore our conversion rate should go up. That has been true for most enterprise software. By the way. Like you know, conversion rates go up over time as you build a bigger and better brand.
Speaker 2:In our case, our brand was getting hit and getting worse and our conversion rates dropped and it was opposite to the model and it was, like you know, a very important variable into the model that the company was totally fucked. You know, it hired too many people, it hired a lot of ops people and it had to like. It was fundamentally. You know, the financial models were fundamentally broken. It was losing too much money too fast. And here was this. This was 2015.
Speaker 3:Okay, is it fair to assume that the broader startup ecosystem was in a micro-bayer market around then and there was also a lack of startups purchasing enterprise products around then? Is that a fair assumption?
Speaker 2:No, absolutely not, Absolutely not. I mean, look, three, four months before the CEO got fired, we raised around at 100x ARR and we were valued at 4 billion at a revenue figure of, like you know, pretty small. So something like you know 40 million ish, right 40 to 60 million. So it was pretty small. So you know we were pretty hot. It was not the lack of funding. I mean the market was pretty good. You know people were hiring, so it's definitely not the markets that killed us.
Speaker 3:Were you in a safe spot financially, like did you do secondaries, or you killed us. Were you in a safe spot financially, like did you do secondaries, or you know how was it.
Speaker 2:seeing this burnout, you know, as a not found, I was not. I've never done any secondaries, you know, I didn't do any secondaries at Zenefits and I was very bullish and it went to zero and the sort of saving grace was, you know, I only spent, you know, a year to 15 months there and I knew, the moment the founder was fired it was over and I, you know, I was ready to quit, you know. So I kind of like wonder why a lot of people did not quit. Actually, it took them a long time to recognize the bare, naked truth that I saw in front of my eyes, that, you know, this talk is not worth the paper it's written on.
Speaker 2:I also think you know Zenefits could have been fixed. It just had to unwind a lot, and startups are a momentum game. You build a bunch of momentum, you build a Ponzi scheme and if too many sort of levels collapse at once, often it takes a while to fix those levels and like build it up again, but it's not impossible. So I did think, you know, zenefits could have been saved. It is just that there wasn't like a good founder to save. It is my sort of honest opinion. They fired the founder.
Speaker 3:What next? You know how did the month after this thing going to zero happen?
Speaker 2:Yeah, I mean for me, it became clear that it was going to go to zero. For most other people it wasn't, and the CEO got fired. So I actually wrote to the CEO saying look, this Zenefits thing is not going to work, obviously, you know, I mean it's because these guys are going to fuck it up. You know they don't understand the business. You know I thought very highly of him. You know he was a very sophisticated, detailed thinker. He really understood the idea maze.
Speaker 2:He was a lion in his den around that market and you know I told him look, dude, like you know, obviously this market opportunity is proven. Market wants the product. Then, if it is going to this market, you know, or no one else, can structurally even go after this market because startups couldn't raise the kind of capital that's needed to build an all-in-one product. You know, it would take like tens of millions of dollars. Big companies are not going to do it because they have this verticalized DNA and they're not going to suddenly come and say I'm going to build 10 products in one. So there is only one way the market can have this product, which is, you know, let's go start this company. And he was like yeah, yeah, yeah, fuck. Silicon Valley, you know, fuck startup founding. I'm never going to start a company again. I'm going to Europe and he left to Europe, actually.
Speaker 1:What you did a few years ago.
Speaker 2:Absolutely, absolutely. And you know he went on a road trip in Europe and you know he was a MIA for a bit and then you know his name got dragged on the street in the media for a while and then you know he was severely depressed. It turns out, and you know I told him dude, you're going to come and start a company. You don't know how to do anything else. I want to, I want to do it with you. He didn't respond back, but after a month, he was like, yeah, let's do this.
Speaker 1:And we started Rippling.
Speaker 2:So basically any founder who is tired, who feels burned, they should go to Europe and start the next company, absolutely 100% recommend. I'm an angel investor and a lot of my portfolio companies. The most common call you get is from portfolio companies saying I'm sorry, I lost your money and they're severely burnt out and they're looking for a job or something. And I tell them dude, that's fucked up, you just need to go to Europe looking for a job or something. And I tell them dude, like you know, that's fucked up.
Speaker 1:You just need to like go to Europe, okay. So what happens at Rippling?
Speaker 2:So Rippling, you know again, is an exceptional company. I've never, sort of before then, been at a startup where the five year vision was very clear. We had market data from, you know, from years and years of Zenefits' experience, we knew exactly what to build over the next five years. You know, we raise a shit ton of money, tens of millions of dollars. We burn a shit ton of money before showing a product to a single customer. It's the weirdest startup ever. I wouldn't even recommend it.
Speaker 2:But like we knew that going in it had one of the highest talent densities, you know, we hired XYC founders who come in and like, start building, almost becoming mini CEOs of parts of the all-in-one product. You know, so for every product there was a mini CEO who was an ex-founder. So we had a payroll team, we had a HR team and so on and so forth. It was a huge build-out and it took us a while to launch it. It took us 18 to 24 months to launch it and get the first dollar of revenue. But then after that it was an iPhone and it just sold. It was a high quality product that just kept selling.
Speaker 3:I think personally you're being a little humble about the volume, right Like volume and valuation. Do you want to be a little more explicit about it?
Speaker 2:Yeah, I mean, you know Rippling has been a phenomenal trajectory. It has worked out as we planned and you know, I think you know it has crossed, I think you know something around $300 million in ARR at this point in the last sort of seven, eight years since founding. It has grown extremely fast. It is now worth something around $13 billion and my personal stake in the company makes me like a billionaire on paper. So it has been a phenomenal, phenomenal experience and it has been absolutely surreal.
Speaker 3:You know, with that experience, I think you're like the literal story of taking a decade to be an overnight success, because I feel just in this conversation we spoke about four startups which went zero to a hundred and then collapsed right. What's been the biggest crystallized wisdom that you've had in that decade of just waiting it out?
Speaker 2:I think you know I was just. I think there are a few different things, you know. One is I was always optimistic, I always was willing to believe. I just like never took secondaries. You know, I was always like you know, I mean still even at rippling, you know I'm probably worth, you know, like a lot of money on paper but my sort of secondaries would be like less than five percent of my worth right. So I've been like always very, very sort of bullish very long term and uh, you know, and that has worked out pretty well for most people like Sam Altman or Gary or like you know, all these people, we just like we're believers and you know, and this internet thing turned out to be a huge thing. So you know we were at the right place at the right time.
Speaker 2:I think you know, again, it goes out to show, like you know, the importance of like catching extreme outlier events, like Six Sigma events. You know, know we sort of rode one of the biggest waves of human history. You know we were at the center of that wave. You know this internet thing turned out to be a huge thing. And you know, when we connected, so you know, when we invented language, suddenly technology started exponentiating, you know, humans could communicate with each other. That's what sort of marked the rise of human beings. And then now, when we've connected our brains with fiber optic cables at speeds of light, where we can just compound ideas over this thing called the internet, and the whole economy is now shifting into this thing called the internet. You know, it turned out to be a huge thing and we rode, like you know, multiple secular waves.
Speaker 2:In my opinion, like you know, basically the smartest people were going to the center of the world, which was Wall Street at the time, and the center of the world actually moved to Silicon Valley. So we were early to that trend. And within Silicon Valley, the center of the world moved from hardware to software and internet, and we were early to that trend. And within the internet, the center of innovation moved from expensive companies to very asset-light, capital-light companies founded by a bunch of nerds. We were early to that movement.
Speaker 2:And Y Combinator was at the center of that movement. And we were early to that movement and Y Combinator was at the center of that movement. And we were early to Y Combinator. So this sort of like multi-accelerated center of the universe. You know, we were at that place and anyone who was with me at that time you know, made like fabulous amounts of wealth and learning and impact and so on and so forth. So, again, one of the biggest takeaways is, just, like you know, I like totally enjoy and like appreciating the butterfly flaps that uh turn out to be, like you know, causing a storm or a tornado, which just like keep amplifying and amplifying and amplifying first of all, sorry to cut you off, but I think one of the things that you said a while back is I was doing god's work and you had a sense of purpose and meaning right.
Speaker 3:Just trying to get that in the context of silicon valley culture and even within crypto right, where this constant culture of comparison and competition like. Do you want to like just go deeper into your philosophy context of Silicon Valley culture and even within crypto right, where there's a constant culture of comparison and competition? Do you want to just go deeper into your philosophy around all of that?
Speaker 2:Absolutely. I think one of the things I mean. I think Silicon Valley has a lot of good things going for it and it has a bunch of really bad things going for it. The good thing is they're willing to think different. They're willing to sort of bet on very big changes in the universe. The bad things that are going for it is like you know, even with that. So now the society is sorted by your willingness to think different, willingness to bet big and like make sort of big changes to the universe, and if that's your life's purpose, you're like appreciated and respected. And you know, if you're a doer versus a thinker, like doers get like a lot of credit, all the credit almost in Silicon Valley, right, so it has disproportionately produced all the innovation in the world. You know people are believers by nature, so it has like some amazing things going for it in the world.
Speaker 2:Now it does have, you know, even with all of this stuff, the weird thing is like there is significant amount of groupthink. You know there is. You know it is kind of crazy when you need to think different and change the world, but then that still produces huge pockets of groupthink. Entrepreneurs are not immune from it. But the thing that I've learned from YC is actually it didn't have a ton of correlation with the companies that are working and in fact, the sectors where there was a lot of group thing were actually like tragic sectors to be in. So there are some, you know, significant sort of like downsides to being in Silicon Valley is that you know you could lose potentially your ability to sort of like stand out and like think different. And, like you know, it also has an extreme sort of like short term culture on momentum, no-transcript, any change in the world uses to enforce and like even further accelerate that change and like silicon valley is actually the best place to do it. So, you know it sort of invites the best and the brightest from all over the world to come in and compress their life, you know, into a short span of years and like create changes in the world. So in that sense, it's actually, like you know, one of the best places.
Speaker 2:Now, the flip side to that is it, you know it also creates a short term culture, right, it basically sort of creates, like you know, two year funding rounds where you need to sort of prove yourself within a couple of years. You know, you sort of like go straight at the goal and there is often not a ton of like redundancy when you know if and when momentum turns. If a sector gets hot and like not hot, you know it just produces massive waves of debt and like that's what happened to Zenefits, right, you know it sort of over accelerated momentum and it had to turn. And you know people who you know are like pure mercenaries, like myself, did not want to ride out many layers of the Ponzi unwinding and my stock price going deep and black. It sort of lost momentum. It'll take significant amount of time to gather its grounding and bring back to where it was right. So Silicon Valley has this issue of momentum chasing, because if you don't your next round of funding would not come and you're kind of like fuck, right, so you know that's sort of the flip side of the Valley.
Speaker 2:Now, you know again, some of the best iconic companies that did come out of the Valley was actually also very closely associated with YC, where people sort of like you know again, yc was this sort of tiny area where one of the first things they teach you is this momentum graph. You know they sort of explicitly first day of YC they teach you a graph where, look, you know, there is this thing momentum peaks and then it falls, then everyone is depressed and then finally adoption happens. They sort of impart this in your head that you know, like some of the founders were able to create extremely iconic companies like OpenAI. You know, obviously Elon is like king at this. Like you know, like SpaceX would not occur. You know, like space travel probably would not have occurred if not for Elon and like you know, tesla would not have occurred if not for Elon. Like these were not.
Speaker 2:You know, it is hard to argue that these were like sectoral tailwinds that he rode on right Again. It's hard to do that in the Valley when you're competing with all this sort of top talent. You know, in fact, openai early on did not have a lot of top talent. You know it had like fairly basic engineers when OpenAI was founded. You know, but it was Sama's life's work and you know he kept going. You know, and I think there is a lot to it, and you know, from my perspective, because it's a game of extreme exceptions that you can create, that would probably not even happen if you didn't do it. So that is kind of when you really believe that you know it's your responsibility, or your duty almost, to go and make it happen and to sort of like devote your life to it. And you know those are again exceptional companies. But you know they can have outlier impact to the trajectory of humanity this would be the time I want to ask you why crypto?
Speaker 1:why zero xd?
Speaker 2:so when I was doing like a little, I was actually introduced to crypto by this dude who's famous by the pseudonym called metakovan. You know, his actual name is vignesh sundareshan. He was another yc founder, he was also from chennai, he was also a tamar, and we met in the bay area and he sort of told me Is this the dude who bought Beepin?
Speaker 3:Yes, this is Arakon. Yeah, $70 million RFD purchase Right.
Speaker 2:Same guy, same guy. So he sent me this weird white paper which is open in the internet, called Bitcoin. And you know I read that white paper and I was just like really mind blown. And and you know, I read that white paper and I was just like really mind blown and he also told me he was all in on bitcoin. He has like no us dollars at all and all his money is put into bitcoin. And I was like I thought that was like fascinating. That was the craziest thing that I've ever seen anyone do on this on this weird internet money. And I read the white paper and I was just totally mind blown.
Speaker 2:Now, you know that was the point in time where I founded like many companies. None of them work. So I really understand how special it is for something to work and like little was the only thing that has worked for me and that was the right bet at that time. And I was, like you know, patting myself on the back for identifying like a six sigma event and betting on it. Now, this Bitcoin thing, there is no way I could classify it as like less than a nine sigma event. Like you know, whichever way I put it, you know, on a thousand year history. It just stood out so much. I was sort of went in with the idea that this guy was an idiot. And then I just like couldn't come up with any reason why I should not put half my net worth into this thing. And, uh, you know, with over the next couple of days, I put half my liquid net worth, which was only five thousand dollars at the time. I had ten thousand.
Speaker 2:I was a startup founder, you know, living in a single bedroom house and, you know, near Stanford at the time, with four roommates, and I put half my net worth, which is $5,000 at the time, into Bitcoin. So I was like really mind blown. I thought this is the new money. Actually, you know, my experience is the more outlier something is, you know, know, it kind of like becomes true by itself. It becomes like a self-fulfilling prophecy. And I thought this is new internet money and this was the hand of god. You know this can't occur in nature. There was just like too many coincidences that, like you know, some sort of hand of god kind of structure exists here and it's going to happen. And I put half my net worth into it. When was this? This is doing like little 2010, 2010 and like why?
Speaker 1:are you aware of previous attempts of bitcoin s currencies and their failures.
Speaker 2:I was not. Actually I was not. This was I read the white paper. I knew this was not like a mere mortal writing this thing. You know, this was just like so packed, so information dense, and it had like aspects of convincing based on mathematics. It had aspects of convincing based on economics. It had aspects of convincing based on politics, like who prints the first? You know which math nerd you know prints the first page of New York Times. You know which is the Federal Reserve rescues the banks for the fourth time into the first block of his blockchain. Like you know. Know, there was just politics in it. There was economics in it, there was math in it. You know, all of these had breakthroughs that were fields metal worthy. You know, I could tell by the information density in that and I thought, like you know, it's not, like you know, a normal man couldn't have done it. You know that what sold me?
Speaker 1:yeah, like nine pages. One of the highest signal to noise ratio material that I ever watched. Absolutely Okay. So you were convinced that Bitcoin is going to be the next thing.
Speaker 2:I thought it was going to be the new money. Actually, I turned out to be wrong. It is not the new money. You know, 15 years in, I was wrong about that, but it's okay. It seemed to be okay, you know. It was actually right enough that it was, like you know, from $50 a Bitcoin to like $50,000 a Bitcoin. It was fine. It's a reasonable bet.
Speaker 1:I kind of missed a bunch of. Did you sell the first BTC that the half-year net was at that time? Did you sell ever?
Speaker 2:I did not, but it was not because I was a genius, it was because I was an idiot. I put my Bitcoin into Mtbox and it got hacked and it got locked and it turned out to be like a blessing in disguise. Like you know what if it didn't get locked? And what if I sold? You know I'm still getting 20 cents on the dollar on the mount box bankruptcy. You know, is it worth it to get a 5x cut off to guarantee that you were destined to hodl?
Speaker 1:hard to answer yeah, difficult okay, so convinced that bitcoin is going to be next money, maybe that work. That, yeah, work, like the tour is still out yeah, yeah, I mean I think it has worked.
Speaker 2:It hasn't worked as the next money, but it has sort of worked directionally. Well, you know, it has become important enough that that story has played out. Now I missed the rest of crypto actually after that. You know, in a weird way I was like early to crypto but I missed much of the rest of. So Metacorn also sent me this white paper on this thing called Ethereum and it was valid at a $40 million valuation when they were launching their ICO and I thought that's bullshit. You know I have the number one social network in the US. You know I just raised money at a $40 million valuation. This thing is like nonsense and you know, and Bitcoin is so special it's a nine sigma event. This doesn't even stand a chance. There is no way there's going to be the new internet money. And I passed on it. You know Metacone put half his Bitcoins, which is half his network, into Ethereum on the ICO. I passed on it.
Speaker 2:I was a skeptic of Ethereum for a while, you know, until 2000. What made you a skeptic? I just thought. You know, money has severe network effects. It is a winner-take-all and internet money is going to produce one of the massive consolidation of money that humans have ever seen. You know it's like gold on steroids and you know any other forms of money don't stand a chance just because you know God has blessed it. You know it is just the information density ratio of like Ethereum to Bitcoin is, like you know, infinity. Like a mere mortal is creating Ethereum. So I just thought, like you know, because it has severe network effects, there is no chance for anything else. And I was wrong about that, you know, and I changed my mind during the DeFi summer. Actually, I was like totally out of anything else other than Bitcoin. I did buy a bit of like privacy tokens like Monero and Zcash early on, but you know nothing of size of Bitcoin and I totally missed Ethereum.
Speaker 2:The time I changed my mind was like DeFi summer, when I actually saw, you know, a new way of building consensus in the world, which is, you know, I saw that Uniswap bootstrapped from zero to like $10 billion within the first 18 months and I saw Compoundap bootstrapped from zero to like $10 billion within the first 18 months and I saw Compound Finance bootstrapped from again. This is something this dude called Meta Cohen. I met him again and he showed me. Look, I'm using this thing called Compound Finance. I'm getting free money and I was like holy fuck, what the heck is this? What is going on here? And I saw these things where bootstrapping zero to 10 billion in TVL in the first couple of years, and that is.
Speaker 2:I've been building companies on the internet for a decade at that point and I've never seen that happen, ever in my life. I'm all about momentum. I've been around the fastest growing companies on the internet by that point because I was at the center of the world and I saw the fastest growing. The fastest growing company at that time was Uber and it consolidated, created consensus for, like you know, about $10 billion of investor money over seven years eight years is what I think. So it took them eight years. You know. They fundamentally changed the world. They grew extremely fast. It was unheard of and within eight years, they sort of created consensus on $10 billion of human capital that this is a new way the world is going to operate right Now. That was happening in two years, you know, on this new platform called crypto, on Ethereum, and that sort of was an extreme outlier, like you know. That made me notice Fuck, this is actually. You know, I quickly realized, you know, I went into a rabbit hole again. Lots of days of reflection, and it was fairly clear to me that you know the days of reflection. And it was fairly clear to me that you know the days of building companies are over. Actually, company was the best mechanism available to humans to create consensus in the world, where money could sort of aggregate and signal like this is the way we are going to operate. And you know there was a new paradigm called protocols. So it was fairly clear to me that, like fuck, we shouldn't be building companies anymore, we should be building protocols and this is the new way by which it's going to operate.
Speaker 2:I'm also, like you know, a student of momentum, you know. I know that, like Silicon Valley, within a 30 mile radius, created some of the most transformative changes to humanity and like transformative amounts of wealth for the early believers, because it had an ecosystem of early believers. You know it had everyone in the ecosystem. You know, for Uber, they needed divers riders, media employees, investors all of them to believe at the same time, and because they were packed, highly dense and they were all willing to believe, you could run these momentum loops insanely quickly and, like you know, you started with the most optimistic place and you sort of, like you know, rolled out further and further. I saw that with Rippling. You know who's going to trust a HR software right, nobody. You know who's going to trust a payroll software Nobody. But you know, when we got started, a bunch of my YC batchmates, who are my friends, trusted us. Then YC people trusted us, then Silicon Valley people trusted us, then US trusted us and then finally now India trusts us right.
Speaker 2:Like you know, you sort of like roll out any movement of change in the world in decreasing order of optimism and for the first time I saw this sort of optimistic corner of the world aggregated all together on this thing called the internet, on crypto. They all got rich. They've been Pavlovian dogs who've been trained in this feedback loop of willing to believe early and that's how they made their wealth, and they're now continuing to believe early. And that's how they made their wealth and they're now continuing to believe early. So now you've aggregated all of the early humans who were able to produce high signal on what is going to be the future change in the world, and they're all willing to believe early. And obviously I thought the center of innovation is going to change from Silicon Valley into this thing called crypto, and there was fundamentally a new way of building companies. You don't build companies anymore. That's deprecated, you know.
Speaker 3:Prasanna. What this reminds me of is how we started this conversation right About how Paul Graham was setting this idea of everybody being a millionaire. Crypto kind of repeated that promise for a lot of founders, or it just became this new avenue for wealth generation and in turn, that attracted a ton of talent, is my understanding, and that it's just a repeat story across time? Absolutely Right. I was just thinking of this right when you started, you know, mentioning Paul Graham and his story, right, I feel like for any new sector to capture a critical momentum of talent, you do need to sell optimism. You cannot sell pessimism and attract talent has been one of my takeaways from that?
Speaker 2:I think it's the other way around. It is actually, like, you know, you sort of attract a group of optimistic people early on and you know, in crypto they actually got rewarded by getting rich and now they sort of like, you know, this is now a self-selected group of people who have been rewarded for being optimistic and they're like doing more and more and more of it, you know. So, actually, optimism comes first. You know, even when you start a company right, like you know you're trying to like most people won't join your company You're already self selecting for optimism. The success comes later. Optimism comes first. You see what I'm saying. You know, the optimistic talent comes first, the sector works out later. So it's sort of like optimism is actually causal, not an end result.
Speaker 1:If the writing is already on the wall, then you are just being pragmatic, right. I mean, because it is big, so it will work. But it's truly optimism only when there's nothing, absolutely, absolutely.
Speaker 2:And the thing was, like you know, around that time when I saw DeFi somewhere happen, then I realized, okay, yeah, actually this is not about money. Money has already been disrupted. That disruption has played out. Now it's about disrupting internet. That is when I really understood my business was at risk. You know, like the thing that I've sort of created my wealth on, I've cornered massive portions of the internet. You know, with Rippling, where if you start an internet company, you better pay Rippling a tax. You know we will give you a distribution to sell your SaaS software and we'll take a cut and we will sort of like you know, if you're starting an internet business, you know you better use Rippling to pay your employees, right? So we were a tax collector on the internet. I got fabulously rich doing that.
Speaker 2:Now I understood, okay, fuck, internet is going through a structural rewrite. You know money is done. Now crypto is coming for the internet and maybe the third leg is it'll come for the governments. You know, now we're in the second leg, which is the internet. And you know I thought like, okay, now there is actually place to build. I thought the only way to participate in this thing called money, because it's a winner. Take all thing is to just like speculate and like invest. Now I'm a builder and internet is going through a rewrite and I could participate. So that's kind of like what pulled me into this. And you know there was an opportunity.
Speaker 2:I was not alive when the US constitution was written and that is the system where we still run our societies. That constitution got forged a hundred times, you know, with an Indian constitution, which is a small. You know changes in variables of the US constitution, right. So that piece of legislation or like piece of smart contract you know I was not around, I was not able to contribute when that got written, but now we are sort of creating a global smart contract while they, you know, with the blockchains and the internet going through this rewrite and you know I have the skills to participate and you know this is the most important change that's happening in front of me. So that's what got me excited.
Speaker 1:Yes, so like was this the time when the idea of zero-waste people came into mind. So what was it? When did you start? And what happened to Rippling? Start and what happened to Rippling Like are you still active there?
Speaker 2:No, I actually left Rippling during the COVID time so I took a step back from Rippling and you know I was reflecting on what to do next. I was actually on a break from Rippling. I thought I'll come back and start Rippling International. You know my co-founder wanted me to sort of like work on something which expands Rippling across countries and stuff. I thought it was extremely important for Rippling and that would 10x Rippling's TAM. That's what I was going to work on.
Speaker 2:I took a little bit of a break and you know I was pretty tired. I wanted to take some time before I did it again. And three months became six months and you know that's when this whole DeFi summer thing was happening. And you know I was just fascinated by how it was playing out and you know I thought, fuck, like this is actually the most important change that's happening. And you know I got, like you know, deep into the technology of it. Proof of stake had worked.
Speaker 2:I thought proof of stake was never going to work. I wrote it off this like idiot. 19 year old kid called Vitalik is trying to, you know, solve, find a second solution for a 75 year old unsolved computer science problem called by sentence general. You know, only God could do it and only Satoshi could do it. You know, it didn't get solved for 75 years and now, you know, within a few years there is a second proof of stake solution Either that's. There is no way. You know, ultimately all these things started working.
Speaker 2:You know, I was fascinated by the tech and I also thought, look, you know, what is my life's work going to be? You know, rippling is my co-founder's life's work and I'm extremely jealous of him for finding that and, like, I was sort of like super satisfied working alongside with him on that stuff. But you know, I felt extremely drawn to crypto. You know, I thought it is the new YC, y Combinator, just a hundred times bigger, and you know, and it also like politically and philosophically, you know, align much better with me. You know, I'm like a digital nomad. You know I came to the US in search of opportunity and you know this idea that there's a meta government where there is massive opportunity across the world extremely appealing to me from a political perspective. So you know, I just thought this was a place to build.
Speaker 1:So yeah, what was the idea and where is the product or the business exactly at this stage?
Speaker 2:So you know, at the time it was clear to me that internet was going to go through a rewrite and every internet app was going to be on blockchain. Then the question was like when will these things happen? You know what is the right timing for these things to happen? Right, I thought that you know the framework or the lesson from the growth of the internet was almost everything that the internet changed the world for happened, like you know, in the last bull run of the internet. You know Airbnb and you know all of this stuff. You know grocery delivery, and all of this stuff happened post 2008, which is when, you know, I was sort of out there building companies and you know, I fundamentally thought the reason for that is, like you know, you need like a high degree of penetration for the last, you know, for the real world to get touched right. You know before that you had to build for the existing audience on the internet. You have to build something that has no real world parallel or equivalent, real world parallel or equivalent. So you know, basically, you know. So, for example, airbnb you know you could technically build an Airbnb in 98, but it wouldn't work because you know if our owner put his house on this thing called the internet. You know only 0.5% of potential renters are penetrated on this platform. They probably wouldn't see the house and it wouldn't get rented. You know, when the penetration rate goes like 30%, 40%, you know Airbnb starts working right, and that is true for, like a lot of companies, like you know Instacart and you know many of these companies. So you know when will the crypto Twitter happen? You know it's probably like really late. You know your mom and my mom is not going to come on this platform called crypto. You know it'll take a while.
Speaker 2:The things that are touching the real world sort of happens to get, you know, hit the last for these reasons. So I was looking at, okay, what are the biggest problems in this space and you know how do we solve it. It was clear that I need to build up an important product for the existing audience. You know be a monopoly in this very small but fast growing market and become extremely important that you just sort of like start riding the wave as the sort of market expands, right. So that was my framework going in. I did think, you know, social networks were fundamentally going to change Over the next decade or so. Social networks are going to happen on chain. You know, fundamentally the centralization was, like you know was, unsustainable equilibrium.
Speaker 1:Why is that, though? Does the end user care? So one thing was.
Speaker 2:You know, like the time when Firecaster was founded, 0xpeople was founded, lens was founded, you know, bitload was founded, what was actually happening in the world was, you know, donald Trump, the president of the United States, got banned from basically the entire internet, right I mean. So that is sort of the outcome of centralization, right? There is a foundational question whether you know a bunch of people living in San Francisco, you know, less than a thousand people can sort of decide on the fate, you know, decide on de-platforming the President of the United States. So the centralization got too extreme that you know these sort of extreme effects were starting to happen.
Speaker 1:Because you brought up that example. There was social outcry and social like. Trump is back on Twitter. I mean, I don't think he uses as much because of course, the Twitter management, so on, but if there is enough social pressure, such acts are reversed, right. So how do you think?
Speaker 3:I think part of the this is softly cut both of you guys off, but I think sort of the answer to that is not everybody gets social pressure right.
Speaker 1:If you and I get de-platformed, I don't think we're getting back on twitter right, but unless that, unless that happens, then people did not leave Twitter because Trump was banned, right? So how do you change that? User behavior, or behavior is what I'm getting at.
Speaker 2:No, yeah. So first of all, twitter is still Twitter, right, like I don't think it did anything to Twitter, like whether Trump is de-platformed or not, it is just that Twitter got banned in China and, like most people don't trust Twitter and like most countries have like a policy for what Twitter needs to follow or get back. So basically you have these like extreme power centers that are starting to politically compete with each other. You know, basically Twitter is the new. You know British East India Company. You know, is British East India Company a part of Britain? Is it a separate sort of? You know a nation? You could argue. It's just like a huge power on the sort of on the big boys league who control and, like you know, they influence how the world operates. So the power consolidation got so big that it was an unsustainable equilibrium. You had to go to battle with the big boys. Now, in the short term, these guys were so powerful that network effects of the internet is still so powerful that Twitter is still Twitter. Nothing has happened to Twitter. Like you know, they can do whatever they want. They can ban Trump, they can ban Biden and they would get away with it. You know the network effects are so strong that users don't have a ton of power end state like. I'm sure.
Speaker 2:Like you know, most of the internet like is going to be rewritten, you know, in a decentralized manner. You know it's going to happen to like every website in a to a point where in a decade or so, we'd be asking why is it not decentralized? Why do you need it to be centralized? You know we're now asking the question why does something need to be decentralized? But users are just going to ask the question why does something need to be centralized? You know I think it's going to flip over the next decade. You know culture has always followed technology. Like the technology is that the culture is going to follow. Now, obviously, as an entrepreneur, we need to like time it, we need to figure out the catalyst for it and like play it right. So for me, I think the way I think about you know, playing these sort of like.
Speaker 2:You know there is a long term directional vector. You don't know when it's going to materialize, right. But Jeff Bezos doesn't know when grocery delivery is going to actually happen. But he needs to start with selling books. He needs to start with finding a 10x use case for the existing audience, like a bookstore. You can create a 10x better bookstore because you can have all the books in the world right. So you need to find use case that is directionally pointed towards the long term. You know where. You know, know the world is going, but 10x improves the life of the existing audience who are within the ecosystem, you know.
Speaker 2:So that's how I come into this. You know, come into this world, which is basically okay. How do we? You know social networks are going to eventually get decentralized.
Speaker 2:If I build it today, it won't work, you know. So today, what I can build is something that improves the lives of the users who are already in crypto. So forget about onboarding your mom and dad into crypto and into a crypto social network. They can still use Twitter. They can still use Facebook and Instagram. I'm not building something for them.
Speaker 2:But if you take the sort of subset of users who are very active on crypto or doing a bunch of stuff on chain for them, can we build a like a 10x better product which is fundamentally better than twitter or any other thing out there and, like you know, fundamentally creates a new behavior or a new sort of social network of trust for the existing audience.
Speaker 2:So that's how, you know, I've sort of come into this space. I think that's the general theme that I invest in, which is build something great for the existing audience and like ride the coattails of the platform itself growing and, you know, for 0x people it is. You know, you can be simple if we sort of are the google slash facebook of the space, so we basically index all the blockchains out there and make it human readable. You know, instead of stack traces and like, instead of things being built for developers, we build something for like you know humans, which is much more easier to understand, and we also sort of like make it social. We have the biggest directory of real users on chain, so you can go search for your friend and you know we are most likely to find them. If you can find them anywhere at all, you will most likely find them on 0xpeople so I'm just going to ask some specific questions here, right?
Speaker 3:what do you mean when you say you have the biggest directory of users on chain today, and how did that directory come around? If you can, you know, shed light on that?
Speaker 2:absolutely, absolutely so. Again, we're the, we're the google of the space. So we go out and index all the blockchains and all the apps and we make sense of it. So one of the biggest indexes that we've built over time is all the social apps which actually connect a user's social presences. So, for example, the first killer social app on chain that occurred was ENS. So you know, obviously we've indexed the ENS and we've mapped ENS names to Twitter names. You know, obviously, we've indexed the ens and we've mapped ens names to Twitter names. You know, whenever people name their Twitters to eth or whenever ens have backward pointers to your Twitter, we have that index. So that sort of creates you know a part of the directory.
Speaker 2:And then over time, more and more and more social apps have appeared on the scene and, like all of these have links between wallet addresses and Twitter and, like you know, your other social presences which we index and like create one of the biggest directories in crypto today. So some of the apps that we index are, you know, things like Frentech, things like you know again, all of these apps map your wallet with your Twitter or, like you know your other social presence. You know, frentech, fantasy Top we sort of also index these bridges and we're able to put multiple sort of if you've used ethereum and if you solana, we're able to put them together and say, okay, this is actually the same person with a high likelihood. You know, we're able to index all these social apps like firecaster and lens and, you know, merge this sort of mega directory of mappings between you know, users, wallets and their actual, real persona and their real profile so in in raw numbers, are you able to share how many wallets you've broadly mapped out or how many apps you've broadly mapped out?
Speaker 2:so I think you know our directory which has, you know, uh, overall we think we have like about a hundred thousand good people. You know, by good people I mean like with like reasonable wallets you know they have a twitter with a bio. And, like you know, by good people I mean like with like reasonable wallets, you know they have a twitter with a bio and like you know a bunch of followers. We've been able to put them together. So that's sort of like roughly the scale of it.
Speaker 3:Obviously, you know, as more and more people use these social apps, like that directory will keep growing, understood so it's like google indexing, you know, pages in the late 1999, for instance, right like the, the known universe of wallets is relatively small. Is when, when compared to the total number of active wallets, is that a fair?
Speaker 2:or no. That's totally fair. That's totally fair. One sort of specific catch here is also, like you know, this crowdsourcing of wallets, so anyone could join 0x people. Today, you can put in a wallet address and you can click on follow this wallet and you could name and tag the wallet. You know you can tag it with a twitter or you can tag it with a name, and that is a wikipedia collection of wallets as well. So, you know, as more users use zero x people, it also organically grows one of the biggest sort of collection of wallets in the space listen.
Speaker 1:I think this is where it gets interesting, and I think you mentioned earlier that you were drawn to privacy and you bought monero and zcash and so on, but the product is doing something that is like 180 degrees to what you said earlier. So how do you resolve the contradiction here?
Speaker 2:so I think so. I was there when the internet got de-anonymized. So so Like Little was actually an anonymous social network, and when we pitched Mark Anderson, mark Anderson was like internet is all about identity. Internet is going through a fundamental transformation and people are going to put their identity on this thing called the internet. And I was like no fucking way, dude, like Little, we're going to stick to anonymity. And that was when internet actually got identity and was when internet actually got identity and like facebook actually happened. It was weird to say that, okay, you know who's going to put their profile pic and like their bio on this thing called the internet, why it just like you lose all your privacy, right. But then it did happen and we have facebook and now internet has de-anonymized, right.
Speaker 2:I think crypto is fundamentally going through that right now. I don't think people will share all their wallets ever. People would still want privacy it is their bank account, after all but i't think people will share all their wallets ever. People would still want privacy it is their bank account, after all but I do think people will have. People want to be listed on this directory where, you know anyone could send them money, they could receive money. They could share some of the transactions that they want to share. They could show off certain things. You know they could point them at domains and know that, like they own it. So identity has like a lot of very strong use cases and some of them have already sort of taken off. You know, the first killer app was actually ENS. You know, obviously you know people want ENS right. The second killer app was NFTs. You know you don't buy an expensive NFT to hide it. You want to show it off. It's a Rolex watch.
Speaker 1:It's not necessary that everyone who is buying an extensive NFT is for that. And just as to respond to what you said, I mean I think people do want to be famous, but do all famous people want to open up their bank accounts? Like I thought that's what I equated 0x people to Like. It's almost like opening partially opening your bank account to everybody.
Speaker 2:I think you probably wouldn't want to open up your entire bank account with everybody, but I think we already live our lives in a way that we are opening up parts of our bank account to everybody. Like you know, why do people buy a Rolex watch? Why do people buy a Porsche? That is exhibiting bank account opening behaviors in real life.
Speaker 1:It's different from. I mean saying that I have this kind of wealth is different from saying I bought X token or I sold X token at this time and making that open for everybody.
Speaker 2:I'm not saying that'll be the norm. I'm not saying that, like you know, everyone is going to, like you know, want to share with everyone what tokens they're buying and selling. All I'm claiming and I really believe this is that you will have an on-chain identity where you'd want to show off what kind of person you are. Right, it would be the way by which you would, by default, people will send you money. You won't be like pinging people asking, hey, what's your wallet address? You know, like, did you get this? You know it would just be like. You know people will look you up and like just the way they send you your email, they'll send you money, right, I think you know there'll be more and more and more of these social apps, that sort of take off in this bull run. Actually.
Speaker 1:What more and more of these social apps that sort of take off in this bull run?
Speaker 2:actually, what do you think are the unintended second order effects of this? Obviously one of the things people think that crypto is private. People think there is anonymity in crypto Pseudonymity.
Speaker 2:And yeah, yeah, people think that you know obviously I mean obviously you're not anonymous or pseudonymous to governments right now and like Chainalysis sells tens of millions of dollars of sophisticated, expensive software to like lots of governments, including India. You know where they dox you to the governments. So it starts with like government software which is super expensive, massive enterprise sale, and then that got commoditized by tools like Nansen which you know for a buck, for like tens of thousands of dollars, hedge funds can sort of figure out who the other traders are. And then now you know obviously that tool will sort of like penetrate downwards and like now everyone can figure out, put these one and two together and get the same set of tools that sophisticated people are getting. And you know these things will naturally democratize. And you know people will understand hey, look, you know, when I transfer money between wallets, a link is being established and people can trace through these links.
Speaker 2:It used to be really hard. You know 0x people is one of the tools which simplify. You know understanding what's happening on blockchains, that you know a common man gets the same powers as the government of the United States. You know that is going to reveal a certain level of shock to people about, like, how much the blockchain is actually pretty transparent. You could see through it. They just didn't have the glasses to see through it. You know, now people would realize, look, you know, this is how these things work. It is actually fairly simple to put one and two together and, you know, I think what is going to happen is like, you know, people will sort of realize, okay, which ones do we want to keep private and there is a way to clean up your wallet so that it's totally private and which ones do I want to actually keep it public as a part of my identity, as a part of showcasing who am I?
Speaker 2:It is one thing to showcase an expensive Rolex watch which is an NFT. It is also another thing to showcase that you bought ETH at ICO. You know that is a status symbol too. You know, especially in this society called crypto, where you know you're ranked based on you know, how much of an optimist you are, how much of an early believer you are, how much of a signal you are to how the world is going to change. So you know that is arguably as much of a brand as like buying an expensive Rolex watch. So you know some of it people would want to showcase some of it.
Speaker 3:People might not. I think one of the things that you guys are missing in this conversation is how people would willingly give up their identity if they know they have access to certain perks or benefits. So what I mean by that is, if you look at most dating apps, they require you to you, you to link your Instagram or your Spotify account so that you look more legitimate, and I think in the next few years, you'll have the same thing happening with wallets, where you would be required to use wallets with history so that you have access to a new product. That's really interesting and you really want access to it, right? It's exactly a repeat of what happened with the internet, where it went from a phase of anonymous internet to one that is identified, and the same thing is going to happen on.
Speaker 3:Check is one way to think of yeah, but the problem is we did not like showcase the value that we were transferring with the web to internet so I think where you have a gap there is because, because a lot of people saw crypto as money for the last decade almost all of our perception about digital assets comes from you know the dollar value attached to these assets. But it is possible that in the next few years, you're able to signal how healthy you are. That is, you know, step in. Or you are able to signal how early you are to an artist using something like audius, or how active you are on an on-chain network, you know, using something like farcaster. Right, those elements of identity have not come on chain yet.
Speaker 3:It's just that the lens that you and I are talking about are within the gaps of, like, the last five years, where liquid assets being traded is the number one sign of reputation. But it is possible that you create a parallel crypto ecosystem and this has already already happened. Right Like YGG gives you these stamps that show you how active you are as a gamer, as soulbound talk. That's also credentialism. That's going on here. Right, it's got nothing to do with dollar value.
Speaker 1:All that is fair. The only question is does the behavior of wanting to protect your financial history change?
Speaker 3:I think it can entirely change, because I grew up in a somewhat conservative society and I was told that, hey, you shouldn't upload your photo to Facebook because that's just weird behavior. And then I grew up seeing all those same people that said don't upload your photos, uploading their pictures every day. So I feel like it's a function of time and what's socially acceptable. I'm just saying change can happen really fast when it becomes consensus Possibly. Change can happen really fast when it becomes consensus Possible.
Speaker 2:Absolutely so. I do think you know it'll always be optional. You know, technically we have solved the privacy problem, so it's not a technology issue, right. Privacy is, like, totally possible. You know we've solved it with ZK, proofs and stuff, right, it just has an adoption problem. I think you know people are going to totally have the option between what do they want it to be public and a part of their brand, and then what do they want it to be private. Today they're not making a conscious choice. Tomorrow they would.
Speaker 2:Does that option exist in 0x people right now? People? You know one is the right way to do it, which is, you know, you take out your wallets, you know, into an exchange or, like you know, into a mixer, and then you sort of seed a completely new wallet and no one can tell that it's your wallet. You know that's obviously the way to actually clean your on-chain footprint. If you want to do it 0x people are not Whether you're a user of 0x people or not, you know. Otherwise you're trackable. If you really want to do that, that's the correct way to do it.
Speaker 2:Now, on 0xpeople as well, you know you have this sort of concept of private wallets where you can sort of track the assets. You know you can have a sharing settings of these wallets. You know you can say, look, I trust some of my friends, I'm okay with sharing my wallets with some of my friends. They can see my transactions. You know I would love to talk about my trades and their trades with my friends, but not to the entire world. And you can have those sharing settings today at 0xPeople where within a smaller group, you can share your wallets and interact within that group but the rest of the world can't really see it.
Speaker 3:I think, prasanna, this is one of the things that's not very apparent in the product. Yeah, it's not.
Speaker 1:Just as a user, I think even Thor must have not got it I mean, I saw there was an option of like, something like that, where you had the option of not sharing one of your wallets, but uh, I didn't see an option of saying that, okay, this is not my wallet, or something like that. Like once you sign in with a wallet, and yeah, I mean, of course you can't do that, but yeah, it was not very apparent yeah, definitely that's a work in progress.
Speaker 2:We'll definitely fix that.
Speaker 1:And another aspect that I wanted to talk about is I think is Twitter a major social graph on 0x3PL at the moment. Yes, yes, Twitter is the biggest Right, so is there a possibility that Twitter also adds this lens in the future?
Speaker 2:You know, obviously anything is possible.
Speaker 1:I mean something like what happened with Clubhouse, right, it was killed with spaces. Yeah, I mean it's also something that you mentioned that when you borrow a social graph and, like you, are just a feature for that particular social graph, then it becomes difficult for your survival, right?
Speaker 2:No, for sure, for sure. So the bet here is there is significant amount of time before the entire user base of Twitter migrates on chain. So you know, if Twitter is doing anything in this space at all like, even if I was running Twitter, I would be in a hard position to justify spending time on like 0.01% or 0.1% of my user base, and you know they themselves are creating. You know, this is a net new behavior that we are trying to create. You know, the behavior that we are trying to create here is create a small circle of trust where it is actually okay to share your bank account, it is okay to share your transactions and to actually talk about these transactions.
Speaker 2:Right, this behavior is actually so orthogonal to twitter. It first, first of all, it doesn't exist on Twitter or it exists in, like, you know, a massively sort of like scaled down version. It exists in Twitter and Telegram, where people do talk about, like what they buy and sell, but kind of like pretty rarely. If you're buying like 20 things, you know 30 things, 40 things, you talk about maybe one of them, right? So this is actually creating something of a vacuum of conversations that didn't exist in Twitter right now. Right, and it is building for a tiny sort of niche of Twitter users and is so orthogonal from the core use case and utility of Twitter that you know again, it's like kind of like hard to imagine them going for it.
Speaker 1:Okay, makes sense. Okay. So what's happening with 0x people? What should we be looking forward to at this point?
Speaker 2:Oh yeah, absolutely. So I think you know the thesis in 0x people is basically you know, crypto is still pretty hard to use if you look at you know. So, first of all, you know 0x people, we're trying to build, you know, a decentralized social network for crypto natives. You know something that the crypto natives are using all the time right, we want to be the homepage of Web3. And if we become the homepage of Web3, this should be the primary place through which people discover interesting apps, the new apps that are launching. You know this would be the sort of primary distribution point for new internet apps, web3 apps that are launching. So that's the goal that we're going for. The same way, google or Facebook was the discovery point, or like the primary distribution method for a lot of the web two apps, you know, for a lot of the applications on the internet that get launched, right. So that's the sort of eventual, sort of not set, not star end goal. Now, you know, to get there, you know we need to build a great product for the existing users. So I see our journey as like two parts. One is a single player mode, which is, you know, when users, when the first set of users, the first 1000, 2000 users who join us, who have joined us, come in. They need to be entertained, even though their friends are lot less likely to be on the app. So that's what we've been working on for the past couple of years.
Speaker 2:Through the bear market, you know, we built a massive index. I put millions of dollars of my own money. You know we've been building through this bear market. We built a fairly deep product and you know the step one is to solve the single player mode. How do you entertain people when there is, you know, no one else around? So that's where you know you come in.
Speaker 2:You connect your Twitter. We find your friends on chain. You can follow them. You can see what they're doing in a fairly easy to understand format. You know we index all these chains so you can add your Cosmos wallet, evm wallets, solana wallets, and we index all these different blockchains and show one representation of what your money is across all these different blockchains, but also where your money is. Even if it's inside different Web3 apps, inside these smart contracts, we're still able to pull them out, locate them and like, show it to you, you know, in one single portfolio. So that's the single player mode.
Speaker 2:There are two simple use cases for it. You know, follow what your friends are doing. They don't need to be on 0xpeople, you can still follow them because we have one of the biggest directories of Web3. So, you know, we'll help you find your friends and follow them across blockchains. And you know, follow your own money. You know, see where your money is across different blockchains and apps. So that is a single player mode. That's what we've been working on. That's what that's where we got into at this point.
Speaker 2:So right now we have around a couple of thousand users in the app, about like a couple of hundred daily active users really small numbers. But, like you know, we sort of see a high rate of retention. You know people are of the week eight. It sort of stabilizes week eight to week 12. Retention is around 25%. So people are. You know, a decent portion of the users are hooked. They keep coming back Right and especially, there's a huge correlation between users who are doing things on chain on a weekly basis and the users who actually retain. So you know we feel good about that trend because you know we're on. You know, know we're on. You know we're on the right side of the trend. We know that, like more and more people are going to do stuff on chain and like that has been a massively growing part of the economy and this black hole can suck more and more people. Even the 75 who didn't retain will be sort of eventually get sucked into this black hole.
Speaker 3:So so I'm just curious how does this evolve from here? Right like right now, you have a feed which primarily looks at defi, nft, I think Lens too. You also allow people to post on Lens, farcast and Twitter. What does zero-waste people look like a year from now?
Speaker 2:Yeah, yeah, so absolutely great question. So that was step one, right. Step one is the single-player mode. Now we are sort of entering into step two, which is a multiplayer mode Once you have a decent you know quantity of users. Next you need to unlock the multiplayer social experiences, which is entirely what we've been focused on. That's what the next year looks like for us, you know. So step two is like enable the multiplayer mode and this was all a part of the you know the founding vision we wrote. We'll get to step one. Then you know we'll sort of you know the kpi there is retention and then we go to step two and you know what we and the kpi there is actually like you know conversations on transactions and you know transactions based on other transactions. So that you know we're sort of like entering step two, which is like how to truly make crypto a social game.
Speaker 2:So what the next few months or like year looks like for 0x people is to make crypto more social. So so, basically, you know, the question is you know any new social network has like two aspects. You know one you need to bring in your existing trust network. So that means you know Joel trusts Saurabh, you know and Sid, and like you sort of like import some portion of that trust network you know into the social network. So you know, how much can we sort of like you know, enhance that and like make that happen and within that trust network, create like a net new behavior? So you know, for us the net new behavior is like conversations on transactions and potentially copy trading on transactions. Right, it might not even be trading, it might be minting an NFT or whatever, but like the point is like a social transaction. So that's our kpi is you know one, is you import your existing trust network and joel and saurabh and, like you know, you guys talk about each other transaction. It's sort of private only to you guys, it's not exposed to the entire world and, uh, to sort of massively increase those you know conversations on transactions and also like enabling those transactions.
Speaker 2:You know, if joel bought, minted a new nft, sauro should be able to click on it. He shouldn't go to like 10 different websites to understand you know what did joel do, and like he shouldn't have to like scan through stack traces to understand like what happened. He shouldn't have to like search the entire internet or twitter to figure out. Okay, yeah, joel interacted with this smart contract, has some stack trace, but which website is it? And then you know like all the way to like actually sort of like doing the transaction, finding the actual website to mint the nft and like actually doing the transaction, bridging his money to the chain and actually doing the transaction. It's like so much work. We want to simplify that.
Speaker 3:We want to yeah here's a funny thing about this, right. Actually, today morning one of our team members were doing a particular trade and then sid saw that and then he actually mimicked the trade and then we had a lengthy discussion internally about doing that trade together. So you know, to a certain degree we are likely forming this behavior internally, right, like although it's maybe you know, you can also argue that it's likely that it takes time to scale this to 10,000 users like this behavior. But you know that this, that this is of can we create an interface that enables people to do group behavioral you know, group traits is actually happening. Slowly but steady is what I would say Absolutely, absolutely. Just to you know, double click on this right. Do you see content being directly posted on 0x people, or would you always be indexing on Chintator? What's the role of a creator on 0x people? Or would you always be indexing on chintator? What's the role of a creator on 0x people at this point?
Speaker 2:the role of a creator on 0x people is to, like you know, do interesting transactions or you know, and slash or discover them and comment on them and talk about them like that's the you know role of the most valuable people that would get followed and, like you know, like friendship and trust also, sort of you know is is a big factor in it. You know, like sure, like you know, someone is, you know, discovering an interesting thing that's happening and like he's posting about it, you're intrigued. But if Sid is doing something, like you know, there is already like an existing degree of trust. So you know, that's kind of how we see it Now, again, you know, this interaction of like sharing your bank account and exposing your transaction is a scary behavior, is not an existing, pre-existing behavior. So we're trying to create a net new behavior and you know, oftentimes when you do that, you would have to start doing that within existing small circles of trust, which is what Facebook did and which is often what, like Instagram did. So you have to start with like small circles of trust where it is okay to do this stuff and you have to also create, you know, additional connections in the circles of trust.
Speaker 2:So you know, today you don't sort of trust some guy like Prasanna. You know we spoke maybe for the third time, but over time, you know, if you, if you've been introduced to my life history and, like you, see a bunch of my, you know what I'm, what I'm up to, over time you'll sort of trust me. And the role of a social network is to, like you know, create the discovery for people who could become, you know, into circles of trust. Right, it could be. You know you guys sort of share the same interests and whatever, right? So, yeah, it's about, like you, ability to import your existing circle of trust and also expanding it and, you know, making sure this new behavior is getting created and seeded into it. The new behavior is actually conversations on transactions and transacting on transactions.
Speaker 1:Okay, so I want to understand what's in it for users, like how can people use 0xpeople to their benefit?
Speaker 2:Crypto already is a very social game. So, first of all, crypto is actually pretty scary to most people. You know people are scared about their trades. It's full of scams, you don't know what to trust. So you know, it kind of like already sort of has devolved into these circles of trust. You know most people who are like doing things on chain. They're in like one or more telegram groups or signal groups where, like you know, with a bunch of their friends, they're talking about things that they're buying or selling, you know. So these behaviors are already happening in sort of fairly inefficient ways. It is so scary that circles of trust already form on telegram or signal or whatever. Right, so that is what is in it for the users is basically knowing. Okay, I trust this guy, what is this guy doing? I about his ideas, I care about what he's doing on chain, I care about the new apps that this guy is using and you know, I want exposure or discovery into the new hot thing that's coming up and in a trusted, sort of vectored way that I don't. You know that it's not like a scam or something. So we're just like taking the existing behavior and like amplifying it, making it like 100x easier.
Speaker 2:Today, people you know, make like 20 trades, 30 trades, and like maybe talk about one of those trades in those groups. But you know what, if all of those trades are, like, visible and available to people who trust you and you know most of them are not relevant or not interesting to like a lot of these people, but like some of them are, and people would self-select on what it is that they want to talk about, you know, it's also like a discovery problem. It's an N-square problem, like you know. I mean, there's a lot of personality about me, right. Like you know, I talk a bunch about startups. I talk a bunch about, maybe, education. Sometimes I talk something about travel. You know, I'm sure Joel is not interested in my travel, you know.
Speaker 2:So Twitter has these algorithms to like sort of, you know he can just joel can just say I, I like this guy, I follow this guy, but then twitter also knows, like, in which way does joel follow me? You know. So you know, in some sense, you know there is a hard n square problem for this behavior to amplify. But, uh, you know, algorithms can detect that, like, joel is more interested in nfts and you know, in new nfts and like when a person he follows actually interacts with a new nft. Maybe joel wants to see that more than you know.
Speaker 2:Joel doesn't care about like lending and borrowing and like new lending and borrowing protocols that I'm using, he doesn't care about it, right? So, you know, in some sense it's taking an existing behavior where the users have already opted in and they already know it is something that they want and just like simplifying it, amplifying it and, like you know, solving N-square problems in it, which is, you know, each person can't express interest into every other person and specifically in every other asset of that person and, like you know, have algorithm solve it.
Speaker 1:But you know, one of the potential issues with this is obviously people are going to be careful as to what address they disclose to Zero Victory. And let's say that I buy a token, or Joel buys a token, and because Joel bought it, other people buy it too, but from a completely unrelated address. Joel can't doubt the same. So what do you think of those edge cases?
Speaker 2:Look, I don't think they're edge cases. I mean, I think you know he could do that anyway today. Yeah, but today people don't think they're edge cases.
Speaker 1:I mean, I think you know he could do that anyway today. Yeah, but you know, I don't know to that extent that joel is the one buying it. And let's say that joel has, I don't know, 100, 000, 200, 000 followers and he can really move markets yeah look, I mean you know blockchains are sources of truth.
Speaker 2:Ultimately we enable people to see the truth and you know people understand.
Speaker 2:You know I mean the markets will sort of self-correct and understand at some point that you know, like joel is dumping or whatever. And, like you know, the thing is like we make blockchains like super transparent that a sourabh can go and find out that, like dude, like you know which wallets have insider bought joel's recommendations. You can actually run.
Speaker 2:We have a tool called screener through which you can run a query that you know what are the common wallets find me all the wallets which are, you know, the first hundred holders or, like you know, of these five tokens that joel has recommended or like they bought this before this date. And like now you are sort of like sql engine goes and finds those set of wallets which are most likely to be insider Joel wallets and you can tag them like you know you're you can contribute that to the Wikipedia wallets and tag them as, like Joel insider wallet and then you know anyone who trusts you. Like you can, you can sort of create a thread saying I think these are Joel insider wallets. Here's why you can share your query for like what sort of brought up these wallets. You can share your ideas on it and anyone who trusts you can follow the Joel Inseto wallets.
Speaker 1:All right, yeah, I think that's totally fair. What are the top let's say top two challenges ZeroX3P faces at this point?
Speaker 2:Absolutely. I mean, I think for us the top two challenges have always been, you know again, you know we need to solve for step two, we are creating a net new behavior. That behavior needs, like a net new circle of trust to get created. So we have the classic chicken and egg network effects problem. We need to sort of create this new culture and like this new behavior and amplify it. So you know, that is our KPI and that is our biggest challenge, that is our biggest risk. You know, creating new behavior is not easy. You know we think it's possible because it's already an existing behavior. We're just trying to amplify it. But that is our biggest risk and that's our biggest challenge. So a lot of you know what we're working on squarely relates to that Fantastic, I think.
Speaker 1:Before we close, I have one question has MetaCoin told you about anything off late that we can buy into?
Speaker 2:So Metaagone is actually right now, you know, I mean I think he's crazy for this and I've always thought he's crazy for doing this and I don't have exposure into it, like, even even though I know what his position, I don't have a position in it. He's actually all in on Polkadot, like you know, literally all in on Polkadot. He's one of the biggest bulls in Polkadot right now. He holds a lot of Polkadot meta and beta and you know that is totally crazy, that's totally insane. You know it feels like a failing ecosystem, but you know that is the meta called meta at the moment. Yeah, yeah, and I'm actually very, very, very, a very big whale on Atom. Actually that's the other sort of dying ecosystem, or maybe not. But yeah, metacorn's meta right now is Polkadot and dying ecosystem, or maybe not. But yeah, metagons meta right now is polkadot and you know he's actually in polkadot beta a lot. Like you know he owns a lot of the parachains and stuff.
Speaker 3:I think your interest in atom is evident if you go to your 0x people absolutely all right? Uh, all right, I think. Thanks for enough pleasure speaking to you. Great chatting guys, thank you so much.
Speaker 2:This was fun.
