Brian Flynn, wayfinding in web3
The founder of RabbitHole talks about DAO onboarding and how web3 needs a mindset shift.
Written by Shreeda Segan
Illustrations by Jesse Auersalo
Brian Flynn is the CEO and founder of RabbitHole, a learn-to-earn web3 platform that helps protocols onboard quality talent. Flynn, who was a professional gamer in high school, describes his transition to web3 as natural. “I missed the mobile boom and the dot com bubble, but saw crypto as an opportunity to start building my career,” he says. “Since I was already into games at the time, the concept of a digital economy made sense to me.” But it took some time for Flynn to find a canvas for his interests. He worked as a business analyst at Foursquare in 2017 and became an early hire at OpenSea in 2018. He also started publishing one of the industry’s first NFT newsletters. By 2019, he moved to Dapper Labs, where he worked on product.
In 2020, he founded RabbitHole. Flynn wants crypto to be seen as an application layer and not just an investment class — a tool to help people rethink how they approach work instead of just an asset to make money off.
According to Flynn, the hard problem of web3 is onboarding, or teaching people how to use DAOs correctly and recruiting the right people to join them. He spoke with Shreeda Segan about RabbitHole’s mission to make this hard problem easier and the mindset shift that he believes web3 needs to undergo.
I find onboarding onto a DAO overwhelming. You see all the different channels on Discord and the new people and it's really hard to situate yourself. Why is it like that? Is it just the nature of Discord?
You hit the nail on the head. We're trying to retrofit a new type of organization into the platforms that we already have, like Discord.
Governance in these DAOs happens on a token-weighted model. The more tokens you have, the more say you have. But Discord doesn't really work that way.
Information flow is set by the creator of the Discord, the moderators, and the members. You can have a member with one token who might happen to be very popular inside of the DAO say something. But then we get to the actual vote, where someone who's very quiet and not saying much might actually be able to turn the outcome.
Those two things are not lined up correctly. We need to be able to figure out what communication platforms we can create as an industry that make sense for the governance mechanisms that we have.
So what do you think the ideal web3 onboarding experience will look like?
What we're missing is a central place where someone can come in and understand what you can even do on-chain. We need a place for basic on-chain actions, as well as details on where all of these different interfaces and smart contracts live, and what their functionalities are.
Once you learn on-chain actions, then you can go into these different DAO communities and figure out, "Okay, how do I actually participate as this sovereign member to then help make decisions and grow the community?
Is there a gaming metaphor in DAOs? Where you’re dropped in a world, start from a random place and then need to situate yourself, choose-your-own-adventure?
It's a pretty accurate metaphor. You need the training grounds to try out the path you want to go down, prove yourself in the training grounds as an apprentice, and then get recruited by a guild or get recruited by your tribe.
That's essentially what RabbitHole is at its core. We're helping people figure out how to make sense of web3 and what its taxonomy is. If you explore our different skills and credentials, you'll understand what the big use cases for web3 are. Then, we have these quests, which are earning opportunities that give you access to these different DAOs through that knowledge that you've learned.
I saw your tweet on April 11th: “the problem with most [web3] onboarding platforms is that they unconsciously teach users how to buy into Ponzis rather than teaching the skillset to become self-sovereign.”
What is the mindset shift that people need to make in order to have that happen?
It starts with your intent to use web3. Is your goal to make money? Or is it to have an entirely new career and an entirely new identity?
I can now build my transaction history and create my resume, which gives me access to new opportunities, instead of just taking my money from my bank, putting it into a crypto wallet, investing in some fork or some yield-farming opportunity to then earn a bunch of money, and then just bring it back to my account. Those are two entirely different mindsets.
If you don't want to emphasize making money, why does RabbitHole reward people with actual money?
We see it as rewarding people with ownership and not money. It just happens that tokens are financialized. But ownership is the primary feature of tokens.
A very basic example is Uniswap, who we’ve worked with to add users who are using their protocol for the first time. So a simple swap and providing liquidity into a liquidity pool will grant someone Uniswap tokens, which gives them rights into governance. Now, they can actually make decisions on how the Uniswap protocol should function, because they received that token from the RabbitHole quest. It’s not about the financial value of the token.
It sounds like if you had a thesis around onboarding, it would be that people would need to both understand a protocol or DAO and also reveal whether they, themselves, are actually going to be valuable to the DAO, too?
Yes, exactly. The users who are holding the tokens today don't actually care about those protocols. They just want the financial upside and expect value because their friend told them to buy the token, because it has a lot of opportunity. It’s not that they’re bought into the mission or that they're the best possible person or a user to improve that protocol.
What do you think DAOs are supposed to look like, if not like companies?
A DAO should look more like r/WallStreetBets, where you have hundreds of thousands of members collectively participating in a single thing in a very short period of time. There are three things that a DAO should really do to be successful.
- They need to be really good at capital formation. How do you actually pool capital together inside of a treasury?
- They need to be good at capital allocation. Once that capital's formed, how do you actually distribute it to members? Is it through ownership or an asset that’s being formed?
- Once that capital is distributed to members, how do you make sure that it's turned into productive output so that the treasury value actually grows?
You could say maybe only a handful of DAOs have really solved one of the three. No one has solved all three.
How can DAOs or other web3 orgs ensure that the right person is finding the right job? Especially because it’s permissionless, the wrong people might be working on the wrong problem and wasting their time.
It is one of the most unsolved questions in the space today. There are a couple of ways to look at it.
- There's your on-chain reputation that is built up from just transacting on-chain. It's immutable. If you’re coming into a DAO, they can see everything you’ve done on-chain in the past and it gives you a basic reputation.
- There’s also your community-specific reputation. So that is that you're completing bounties and specific DAOs, like Cabin. And then you're building a better reputation over time with the more work that you complete.
The former is a lot of what RabbitHole's trying to answer. How do you build that baseline reputation by just doing things on-chain and proving that you're trustworthy, and proving that you can actually do the work?
Why is anonymous membership important for DAOs? Does it help make it more of a meritocracy? What values are you promoting? What are we fighting/promoting/addressing on a values level?
The eradication of trust is prolific today, so if we have an entirely new way to trust others, that means a lot.
With on-chain reputations, you have a verifiable way to prove what people say they've done is actually true and that you're not trusting some third-party oracle anymore [like background checks and references].
I think one question that people might have while reading this Q&A is: what’s wrong with companies now and why are we redesigning work?
First, I'll give you a simple reason — you can coordinate with other strangers anonymously over the internet with shared incentives. And that is a very basic answer, but when you think about what that unlocks for society, it's pretty enormous.
Now, I'm going to put my Balaji hat on for a second. With DAOs, you can create a city state that actually becomes decentralized and exists across many different countries around the world, where the GDP of that city is stored on the internet and on-chain. If someone needs funding in the city state and they're in a different country, you can send them money and they can coordinate with other people to actually get that thing built.
We’re starting in this digital realm. But in the next 10 or 20 years, this will start to proliferate in the physical world as well.
It's like the inverse of the internet, where we first tried to figure out what the internet means for the physical world. But in web3, we’re doing the opposite, we’re saying: "Okay, well let's test this out first in the digital world, where we're trying to build things digitally."
Right now, it doesn't really have an impact on the physical world. But over time, it can. We can actually coordinate across the world together to build things together. And that’ll be its real impact.
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