DeFi's Open Sourced Counsel Memo
DeFi's Open Sourced Counsel Memo
Wang's Wisdom Wins
[Note: A Penny Ahead will be taking a bit of a hiatus while the keenly insightful and devastatingly handsome author tries to take a vacation.]
A few weeks ago, renowned DeFi advisor Qiao Wang made public a counsel memo entitled “Common Pitfalls for Web3 Founders.”
This not only stands as advice for marketers in this space, but offers tons of valuable insight into how to build a startup — from hiring to community management and more.
Wang’s memo got me thinking about some of the common marketing fallacies among young companies in the Web3 space. There’s a ton to react to in his memo and it would be crazy to try to parse all of it. So I wanted to build on it with a bit more detail from my perspective.
These marketing fallacies are:
When absolutely everything is a “marketing problem” — What Wang describes as an “unhealthy obsession with marketing” has a very clear cause. The prevailing logic (and I know I’m stressing the structural integrity of that word here) goes something like this: Memecoins like DOGE and SHIB are valued in the billions of dollars, even though they have very little utility and are, in fact, jokes. Therefore, absolutely any other project with an even slightly higher level of technical sophistication should do at least as well, right? This of course neglects economics, market forces, product-market fit, and a host of other variables. But, you see, marketing is “easy,” so it’s tempting to boil everything down to a “marketing problem.” This is fatally wrong.
“Strategy” as meaning “I thought about this really hard” — By way of example, Wang says he hears phrases like “Any advice on our Twitter/podcast strategy?” from founders. I’ve found there is no word more tortured and abused in business than “strategy.” In fact, people leading the biggest brands say this kind of thing all the time, to say nothing of freshly minted DeFi founders. Most often, the word “strategy” is used in meetings to signal a presumed level of relative seniority to other people in a group. (As I’ve said before, the degree to which most people use this word is too often inversely proportional to the strategic import of their contributions.) More properly, in Wang’s example, engaging on Twitter and pitching podcasts should be in service and support of a strategy. Anyone saying “What’s our Twitter strategy?” is just trying to play executive and fill airtime in Zoom calls. (As a corollary to this, there’s also the apologetic use of the word “tactical,” meant to signal “I don’t want to be seen as caring about details that I believe are below my station, but…”)
Agencies are a necessary (even sufficient) growth factor — We are aggressive in-housers at Bloq. The only real exception is when we are entering an industry where we don’t already have substantial communications and marketing expertise. Why go this route? I frankly do not have the time or budget to pay for another organization’s on-the-job training in this industry. For the amount of money that an agency will demand, I’ll often lean toward bringing in superstar in-house talent and tools.
Happy community is always success. Angry community is always failure. — It’s worth tying together Wang’s threads about tokenomics and community management. Big airdrops and paying extortionate influencer fees may make for a very happy community, but doesn’t take the long-term view. At the same time, an angry community is often a sign of a group that cares about a project. I thought that’s want you wanted? This realization separates the bad community managers from the good ones.
Again, I strongly recommend that anyone — in crypto or otherwise — read and circulate Wang’s memo. Too often, I think marketers are browbeaten into “do something” mode far too early, rather than taking (or demanding) the time to look at the business problems in front of the organization. There are no playbooks for this space, but this is an excellent start.
Recommendations
CULTURE: “When Twitter Can Ruin A Life: Isabel Falls’ Complicated Story,” Vox (2021) — This story raises a lot of questions about online anonymity, satire in a “cancel culture” world, the “own voices” trend in literature, and so much more. “But Twitter is a platform that rewards divisive opinions, which are more likely to drive engagement (hearts, retweets, and the like). So, many influencers with the biggest reach on Twitter are also people whose core identity is expressing divisive opinions. Where this becomes an issue is when influencers from different worlds start to cross-pollinate.”
Parting Shot
Ukrainians rejoice. That captured Russian tank does not need to be reported as income.