ICOs are disrupting late stage venture capital. Shawn Cheng was working at the Vayner/RSE VC, but now he’s working with Ethereum co-founder Joe Lubin’s Consensys where he’s helping to manage a portfolio of over 40 blockchain companies. Cheng talks about how the coopitition ecosystem dynamics of blockchain companies is completely opposite to how VC thinks about value creation. Supporting a unicorn companies can make or break a VC investment, and the entire VC-industry has been aimed towards hitting these home runs.

Value creation for a blockchain company is more about the cultivation and nurturing of an entire ecosystem that can’t always be reduced down to a single number. This is part of why Lubin is reinvesting his money made off of being a co-founder of Ethereum into so many of these blockchain projects that are trying to develop these different ecosystems.

I talk to Cheng about how the trends of blockchain decentralization are leading to open source software, open protocols, open networks, being permissionless, censorship resistance, and how immutable, malleable, accessible data is leading to a free market of innovation in the blockchain ecosystem.

Whereas “Web 2″ focused on enterprise companies that added value, but consolidated power and influence, the “Web 3″ is more focused on the individual being able to contribute and add value and participate.

There are many idealistic and optimistic potentials for the future of the blockchain, but there are also many open questions and challenges around scaling, creating viable long-term infrastrucutre management, and whether or not all of this will change the fundamental dynamics of the consolidation of wealth and power.

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Music: Fatality

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