Web 3.0, is becoming a key focus for VCs.

On March 16, 2022, Microsoft, Japan's SoftBank and Singapore's Temasek announced the completion of a new $450 million round of funding for startup ConsenSys, making a big push into the Web 3.0 space.

On March 17, venture capital firm The Spartan Group announced the launch of a $100 million Web 3.0 fund.

Also in March 2022, Sequoia Capital also made a lot of moves in the Web 3.0 track. After leading a $450 million investment in blockchain company Polygon in 2021, Sequoia Capital led a $12 million seed round of funding in EthSign, a Web 3.0 electronic protocol platform, on March 9, 2022; and participated in a $32 million funding round in Espresso Systems, a Web 3 privacy-focused system, on March 7.

Earlier, Sequoia Capital quietly launched a $600 million program focused on investing in Web 3.0-related technology startups.

Michelle Bailhe, head of the fund, believes that both gaming, consumer and live shopping will move to Web 3.0, just as people are moving from PC to mobile Internet.

Whether or not other VCs are ready for Web 3.0 at this point, the capital giant, which was founded in 1972 and has previously invested only in the energy, finance and Internet tracks, has already made an example of shifting its attention to the new generation of Internet technologies that are more cutting-edge.

In fact, VCs have already entered the Web 3.0 race to the bottom.

More aggressive is another Silicon Valley venture capital platform: a16z.

On March 17, 2022, a16z and others completed a $200 million capital injection into the Aptos project of former Facebook team members.

In January 2022, a16z is raising $4.5 billion to form a new fund, of which $1 billion will be used for its seed investments in the Web 3.0 space.

The fund has even attracted domestic capital subscriptions. a16z recently announced that it will use no more than $35 million of its own capital to participate in the subscription and become a limited partner.

Some institutions predict that the market size of Web 3.0 in the application side will exceed $50 billion in 2022.

With the huge space and the influx of capital, Web 3.0 has ushered in the spring?

Understanding Web 3.0 is not a simple matter, here is a common explanation of Web 3.0: 1.0 can only read information, 2.0 can read and write information, 3.0 can read, write, and own information.

Before 2004, the Internet was in the Web 1.0 era, whose main feature was that people got information from the Internet in one direction, and information and knowledge were produced and organized by large companies, such as Yahoo, Sina and other kinds of portals.

Since 2004, the Internet has entered the Web 2.0 era, where knowledge and information are more often produced by users, and commercial organizations build platforms, collect user information, and distribute effective information.

Sharing an opinion piece in Zhihu, sharing an original song in ShakeYin, all these are operating based on Web 2.0. In addition, Weibo, Youtube, and Xiaohongshu are also products of Web 2.0.

All of these Internet platforms are peddling user information to distribute advertisements as their main revenue. According to statistics, in 2021, the advertising revenue of Jindo and Weibo accounted for more than 80% of the total revenue, while that of Racer and Baidu exceeded 50%.

But is this reasonable? Imagine, creators pay huge time and effort costs, but the biggest profiteer is the platform. Not only have we become a profit tool for large companies, but our personal data privacy is also threatened. People are becoming aware of the problems of big data killing, privacy abuse, and bait advertising.

In the Web 2.0 era, due to the pressure of government departments in various countries to regulate Internet data, user data privacy management was only gradually taken seriously by Internet platforms, and we saw Facebook being sent to hearings and Apple being pressured to give up IDFA opening rights to users.

In 2015, Tim Berners-Lee, the father of the World Wide Web, Gavin Wood, co-founder of Ether, and others proposed Web 3.0 with the goal of protecting user privacy, aiming to "decentralize" the Internet: personal information will be given to users to keep on their own, and users will have the choice to report to the platform. Users can choose to send or keep their personal information to the platform, and the data cannot be traced and will not be leaked.

In the evolution to Web 3.0, many hybrid products between Web 2.0 and Web 3.0 have emerged, such as the NFT trading platform Opensea, where art creators list their works on the platform and maximize their revenue, while the platform collects fees for profit, similar to the combination of traditional e-commerce and decentralized trading models.

In 2021, as the NFT trading market exploded, Opensea's trading volume surged, with data showing that it exceeded $3.4 billion in a single month in August alone. Previously, OpenSea received a large amount of financing from well-known investors such as a16z and Coinbase at a "low valuation" of $1.5 billion.

In addition, according to the investment network statistics, overseas VCs such as Bridgewater Fund, Sequoia Capital and VISA have entered NFT.

Blockchain practitioner Meng Bo introduced to the investment network, most Web 3.0 projects are small in scale, the market does not see returns in the short term, and most VCs use the traditional investment structure, the portfolio can only select equity projects with scale, so that most Web 3 targets are sieved.

Taking Sequoia Capital as an example, its structure has been adjusted in 2021, breaking the traditional VC investment model of 10-year cycle, and trying to create a permanent open structure, which has cleared the institutional obstacles for direct investment in Web 3.0 projects with long investment return cycle and difficult to assess value.

Michelle Bailhe, head of the fund, believes that VC, like all living things, either evolves or dies. And predicts that in the next ten years, the number of Web 3.0 users and developers will increase 10 times or even 100 times, and Sequoia Capital will continue to bet hundreds of millions of dollars in capital.

Michelle admits that most Web 3.0 projects are found on Twitter. Michelle has 5000+ followers on Twitter, and the first few users in her follow list are all Web 3.0 entrepreneurs, including the founders of Paradigm, Coinbase, OpenSea and other star projects invested by rival a16z.

According to a16z founder Mark Anderson, the reason they were able to invest in these modest Web 3 projects early as angel investors is that their fund can "write checks as small as $25,000 and as large as hundreds of millions of dollars.

The long-term hold and small investment strategy has certainly been successful in the blockchain circuit. According to statistics, in 2021 alone, 43 companies in a16z's portfolio will have completed IPOs or M&A, covering emerging concepts such as Web 3.0, DAO, NFT, and more. One of the famous cases, is a16z from 2012 has been holding Coinbase shares, IPO day return reached a staggering 4,000 times.

Trapped with the traditional investment strategy, domestic VCs can be on the eye of the Web 3.0 projects are few and far between.

"Most investors will claim they are investing in Web 3.0 or even the next generation of the Internet, but the reality is still Crypto that logic." For domestic Web 3.0 investment, Meng Bo said he is not optimistic.

Another perspective, the domestic market liquidity regulation of Token also inhibits Web 3.0 entrepreneurial activity. nft platform entrepreneur Zang Chengdu believes that previously Token as the most mainstream financing channel for blockchain projects in addition to equity financing, if the community is well run and maintained, the Token issued by it has the advantages of high flow and high premium at the same time; and without liquidity, investors are naturally Without liquidity, investors are naturally not motivated and instead turn their attention to overseas markets.

The debate about Web3.0

Of course, the crazy capital support does not let everyone stay optimistic about Web 3.0. Such an advanced and magical concept has led veteran industrialists to come out and blast this new term that has been "hyped" out of the circle by VCs.

Former Twitter CEO Jack Dorsey is extremely unhappy with Web 3.0: "You don't own Web 3.0, VCs and their limited partners do, and Web 3.0 will never escape their (financial) stimulus."

Tesla CEO Elon Musk was similarly skeptical, tweeting, "Has anyone actually seen Web 3.0? I haven't anyway." And he posted an image to sarcastically peddle the Web 3.0 concept to everyone in sight and encourage users to join the DAO.

"It's somewhere between a and z," Jack Dorsey replied below Musk's tweet, suggesting that Web 3.0 is being controlled by a16z.

A16z partner Chris Dixon shot back, "First they ignore you, then they laugh at you, then they criticize you, then it's your day to win."

Jack Dorsey then took to Twitter to take down Coinbase CEO Brian Armstrong, as well as a16z founder Mark Anderson, who was not shy about pulling Dorsey out of the loop.

So, is Web 3.0 really the new tool for VCs to cut chives?

A blockchain project manager shared her opinion to the investment network, Web 3.0 does exist, but it's also a concept that is in the eye of the beholder. Many domestic so-called Web3 projects are not even decentralized in nature, and the current track is a mixed bag of fish eyes.

Another blockchain technical staff from the technical point of view to the investment network, most of the current Web 3.0 project, can only be considered Web2.5, the basic layer of data computing limits the development of Web 3.0, the core foundation of the blockchain "off-chain computing" has not been solved, the current consensus mechanism and cross-chain far from Web 3.0 standards. At present, the consensus mechanism and cross-chain are far from the standard of Web 3.0, but it may be realized in 5 years.

Web 3.0, is becoming a key focus for VCs.

On March 16, 2022, Microsoft, Japan's SoftBank and Singapore's Temasek announced the completion of a new $450 million round of funding for startup ConsenSys, making a big push into the Web 3.0 space.

On March 17, venture capital firm The Spartan Group announced the launch of a $100 million Web 3.0 fund.

Also in March 2022, Sequoia Capital also made a lot of moves in the Web 3.0 track. After leading a $450 million investment in blockchain company Polygon in 2021, Sequoia Capital led a $12 million seed round of funding in EthSign, a Web 3.0 electronic protocol platform, on March 9, 2022; and participated in a $32 million funding round in Espresso Systems, a Web 3 privacy-focused system, on March 7.

Earlier, Sequoia Capital quietly launched a $600 million program focused on investing in Web 3.0-related technology startups.

Michelle Bailhe, head of the fund, believes that both gaming, consumer and live shopping will move to Web 3.0, just as people are moving from PC to mobile Internet.

Whether or not other VCs are ready for Web 3.0 at this point, the capital giant, which was founded in 1972 and has previously invested only in the energy, finance and Internet tracks, has already made an example of shifting its attention to the new generation of Internet technologies that are more cutting-edge.

In fact, VCs have already entered the Web 3.0 race to the bottom.

More aggressive is another Silicon Valley venture capital platform: a16z.

On March 17, 2022, a16z and others completed a $200 million capital injection into the Aptos project of former Facebook team members.

In January 2022, a16z is raising $4.5 billion to form a new fund, of which $1 billion will be used for its seed investments in the Web 3.0 space.

The fund has even attracted domestic capital subscriptions. a16z recently announced that it will use no more than $35 million of its own capital to participate in the subscription and become a limited partner.

Some institutions predict that the market size of Web 3.0 in the application side will exceed $50 billion in 2022.

With the huge space and the influx of capital, Web 3.0 has ushered in the spring?

Understanding Web 3.0 is not a simple matter, here is a common explanation of Web 3.0: 1.0 can only read information, 2.0 can read and write information, 3.0 can read, write, and own information.

Before 2004, the Internet was in the Web 1.0 era, whose main feature was that people got information from the Internet in one direction, and information and knowledge were produced and organized by large companies, such as Yahoo, Sina and other kinds of portals.

Since 2004, the Internet has entered the Web 2.0 era, where knowledge and information are more often produced by users, and commercial organizations build platforms, collect user information, and distribute effective information.

Sharing an opinion piece in Zhihu, sharing an original song in ShakeYin, all these are operating based on Web 2.0. In addition, Weibo, Youtube, and Xiaohongshu are also products of Web 2.0.

All of these Internet platforms are peddling user information to distribute advertisements as their main revenue. According to statistics, in 2021, the advertising revenue of Jindo and Weibo accounted for more than 80% of the total revenue, while that of Racer and Baidu exceeded 50%.

But is this reasonable? Imagine, creators pay huge time and effort costs, but the biggest profiteer is the platform. Not only have we become a profit tool for large companies, but our personal data privacy is also threatened. People are becoming aware of the problems of big data killing, privacy abuse, and bait advertising.

In the Web 2.0 era, due to the pressure of government departments in various countries to regulate Internet data, user data privacy management was only gradually taken seriously by Internet platforms, and we saw Facebook being sent to hearings and Apple being pressured to give up IDFA opening rights to users.

In 2015, Tim Berners-Lee, the father of the World Wide Web, Gavin Wood, co-founder of Ether, and others proposed Web 3.0 with the goal of protecting user privacy, aiming to "decentralize" the Internet: personal information will be given to users to keep on their own, and users will have the choice to report to the platform. Users can choose to send or keep their personal information to the platform, and the data cannot be traced and will not be leaked.

In the evolution to Web 3.0, many hybrid products between Web 2.0 and Web 3.0 have emerged, such as the NFT trading platform Opensea, where art creators list their works on the platform and maximize their revenue, while the platform collects fees for profit, similar to the combination of traditional e-commerce and decentralized trading models.

In 2021, as the NFT trading market exploded, Opensea's trading volume surged, with data showing that it exceeded $3.4 billion in a single month in August alone. Previously, OpenSea received a large amount of financing from well-known investors such as a16z and Coinbase at a "low valuation" of $1.5 billion.

In addition, according to the investment network statistics, overseas VCs such as Bridgewater Fund, Sequoia Capital and VISA have entered NFT.

Blockchain practitioner Meng Bo introduced to the investment network, most Web 3.0 projects are small in scale, the market does not see returns in the short term, and most VCs use the traditional investment structure, the portfolio can only select equity projects with scale, so that most Web 3 targets are sieved.

Taking Sequoia Capital as an example, its structure has been adjusted in 2021, breaking the traditional VC investment model of 10-year cycle, and trying to create a permanent open structure, which has cleared the institutional obstacles for direct investment in Web 3.0 projects with long investment return cycle and difficult to assess value.

Michelle Bailhe, head of the fund, believes that VC, like all living things, either evolves or dies. And predicts that in the next ten years, the number of Web 3.0 users and developers will increase 10 times or even 100 times, and Sequoia Capital will continue to bet hundreds of millions of dollars in capital.

Michelle admits that most Web 3.0 projects are found on Twitter. Michelle has 5000+ followers on Twitter, and the first few users in her follow list are all Web 3.0 entrepreneurs, including the founders of Paradigm, Coinbase, OpenSea and other star projects invested by rival a16z.

According to a16z founder Mark Anderson, the reason they were able to invest in these modest Web 3 projects early as angel investors is that their fund can "write checks as small as $25,000 and as large as hundreds of millions of dollars.

The long-term hold and small investment strategy has certainly been successful in the blockchain circuit. According to statistics, in 2021 alone, 43 companies in a16z's portfolio will have completed IPOs or M&A, covering emerging concepts such as Web 3.0, DAO, NFT, and more. One of the famous cases, is a16z from 2012 has been holding Coinbase shares, IPO day return reached a staggering 4,000 times.

Trapped with the traditional investment strategy, domestic VCs can be on the eye of the Web 3.0 projects are few and far between.

"Most investors will claim they are investing in Web 3.0 or even the next generation of the Internet, but the reality is still Crypto that logic." For domestic Web 3.0 investment, Meng Bo said he is not optimistic.

Another perspective, the domestic market liquidity regulation of Token also inhibits Web 3.0 entrepreneurial activity. nft platform entrepreneur Zang Chengdu believes that previously Token as the most mainstream financing channel for blockchain projects in addition to equity financing, if the community is well run and maintained, the Token issued by it has the advantages of high flow and high premium at the same time; and without liquidity, investors are naturally Without liquidity, investors are naturally not motivated and instead turn their attention to overseas markets.

The debate about Web3.0

Of course, the crazy capital support does not let everyone stay optimistic about Web 3.0. Such an advanced and magical concept has led veteran industrialists to come out and blast this new term that has been "hyped" out of the circle by VCs.

Former Twitter CEO Jack Dorsey is extremely unhappy with Web 3.0: "You don't own Web 3.0, VCs and their limited partners do, and Web 3.0 will never escape their (financial) stimulus."

Tesla CEO Elon Musk was similarly skeptical, tweeting, "Has anyone actually seen Web 3.0? I haven't anyway." And he posted an image to sarcastically peddle the Web 3.0 concept to everyone in sight and encourage users to join the DAO.

"It's somewhere between a and z," Jack Dorsey replied below Musk's tweet, suggesting that Web 3.0 is being controlled by a16z.

A16z partner Chris Dixon shot back, "First they ignore you, then they laugh at you, then they criticize you, then it's your day to win."

Jack Dorsey then took to Twitter to take down Coinbase CEO Brian Armstrong, as well as a16z founder Mark Anderson, who was not shy about pulling Dorsey out of the loop.

So, is Web 3.0 really the new tool for VCs to cut chives?

A blockchain project manager shared her opinion to the investment network, Web 3.0 does exist, but it's also a concept that is in the eye of the beholder. Many domestic so-called Web3 projects are not even decentralized in nature, and the current track is a mixed bag of fish eyes.

Another blockchain technical staff from the technical point of view to the investment network, most of the current Web 3.0 project, can only be considered Web2.5, the basic layer of data computing limits the development of Web 3.0, the core foundation of the blockchain "off-chain computing" has not been solved, the current consensus mechanism and cross-chain far from Web 3.0 standards. At present, the consensus mechanism and cross-chain are far from the standard of Web 3.0, but it may be realized in 5 years.