#21 Fabian Vogelsteller
Founder of LUKSO (new creative economy blockchain, $200M market cap). ex Early team & Lead Dapp Developer at Ethereum (top global blockchain, $380B market cap), author of key ETH pieces like ERC20
Fabian is a developer and thought leader on blockchain technology. He is currently the founder of LUKSO, a multiverse blockchain network with a $224M market cap (on 13th Sep 2021) providing a state of the art infrastructure for a new crypto based creative economy where the worlds of fashion, gaming and design intersect within a social framework.
Previously he was an early team member and Lead Dapp (decentralized applications) Developer at Ethereum, community-run decentralized open-source blockchain with a $380B market cap (on 13th Sep 2021), including smart contract functionality powering the cryptocurrency ether (ETH) as well as thousands of decentralized applications on top.
👤 Story: web dev since kid, early Ethereum, scale up, LUKSO
🥇 Win: help build and scale up Ethereum out of nothing
🚫 Fail and lesson: time management and getting burned, get timing right
🚀 Ideal founder: makers, do things, create, future forming vision, transcend
💸 Ideal investor: get paradigm change, fat protocol theory, token economics
📈 Markets: blockchain, virtual reality, space, robotics, electric vehicles
What is your story?
I come from a web development background and I’ve been building stuff and programming since being 7 years old. Along the way I studied media design, built a management system (feindura.org is still that system) and some more things.
Then in 2013 I heard about blockchain, bitcoin and months later altcoins came into existence. I got sucked into it and started following all that stuff simply because it was really interesting. A new way to connect, p2p based and without middlemen? Super fascinating. Crypto, bitcoin, altcoin … I followed this whole thing from the beginning.
And then Ethereum called my attention because the idea of making blockchain programmable and empowering people to do whatever they want, thus opening a lot possibilities.
Funny enough I met the Ethereum team literally a day before they started their pre-sale, they said they will be opening an office in Berlin and I started working with them 6 months later, building things like the first web3 browser, dev tools and a lot of the basic building blocks that are still used today, underpinning DeFi, NFTs and other applications.
Being part of this during 6 years, specially as a coder, was an amazing experience. Lots of things happened, the DAO, tools, ICOs …
Now for the last 3 years I am working on LUKSO, Ethereum like blockchain network dedicated to a new blockchain based creative economy. I am mainly focused on building the network, smart contract standards and tools, making it easy for people to integrate it with applications and use it on LUKSO, or other Ethereum-like blockchain. LUKSO is less financial and more lifestyle focused. I believe it is a very interesting and useful project that will change the blockchain landscape.
What is the biggest win in your life?
The most interesting thing is to see how you can create an open decentralized community that is self run and self propelled, funded and with an early team totally made by developers. This was Ethereum.
Experiencing that explosion of possibilities, many new projects and people driving new things - having their own ideas, writing research, building tools and flourishing so much!
At Ethereum what we did was building core pieces and seeing other people build other stuff on top of it. The education happening around it was an incredible experience. Especially taking into account that it all come from an Open Source community, without a single proprietary line of code. Complete different dynamic to the norm. Today a startup has proprietary code, people use it for features but they do not own it and do not feed it.
What we made did help people define the world for themselves, you can be the next big thing, or build a useful protocol, all things are possible and you can make your own road. It is very interesting to see this from the front line, all these amazing things becoming possible. It happened on Ethereum, and will likely now on LUKSO … really fascinating experiences.
Who would have thought that there would be Open Source projects with more money than some of the largest corporations in the world, and with the most driven stakeholders counting thousands of people, not just 3 big funds, 10 angel investors and a few founders, but thousands of people with a stake in it while having massive size and speed of development.
These experiences are unprecedented and I believe it challenges the whole idea of what companies are, how we can work together on a global scale. Fascinating.
What is your biggest failure and lesson?
The toughest thing is time management. When you are building things, managing time between personal life and work in a way that you don’t burn yourself out.
You have to be smart with your resources and think wisely about how do you allocate them. Sometimes working 10 hours/day or 3 hours/day is the same in terms of result. There is a timing to the game and its not always is about rushing it. You can be too early and lose or too lazy and the train passes. It is about finding the perfect time.
In crypto in general we are still very early. Some people however feel they are too late, I have heard “it is already over” quite a lot in the last 7 years.
To work against the potential failure of not getting time right, I believe it is important to understand the underlying movement, the tech, the trend … and focus on building.
What is your ideal founder profile?
Makers vs takers.
Makers do things, makers create. They are initiators, create things out of nothing.
Takers are good employees, they want tasks given to them.
I think a good founder has to be a maker and obviously create something, invent and create, see beyond the current trend. A good founder has a vision and does not jumps on every trend.
A successful founder, even if it is within a hot trend, has its own vision that transcends the momentum and forms the future.
What is your ideal investor profile?
The first thing that needs to be understood is that from the investor point of view, there is a significant paradigm change if talking about crypto vs traditional investment like VC.
In a VC world the investor wants control because she feels that if the founder messes up, they can shift the ship by themselves.
In a crypto token based project, you have no control and you don’t want control, because if you want that you might have made a bad bet to start with. In crypto, it is about a community based organic growth, if you control too much you kill it.
At the same time, you are more liquid with tokens, as opposed to traditional VC investments where you don’t have so much liquidity and you hope for an exit.
The benefit of crypto is being liquid and fluid, and massively more dynamic. If you look at crypto vs current stock markets, you can see trade volumes for relatively new projects that are very high in comparison to well known publicly traded companies in the stock market. And that’s because they are so liquid and accessible. For instance, Tesla had an average trading volume of around $30M and LUKSO managed to get up to $9M on peak times, both in the same period of time. Plus in crypto you do not even close the exchange on weekends, so it is 24/7.
Completely different market context where the old world feels a bit like a joke, and this is still not even fully visible to the mainstream yet I believe.
So how to be a good investor in blockchain? It is a growing market so if you don’t invest in shitty things you will probably make money. That being said, in my opinion is the best to invest in the right blockchain infrastructure rather than in the apps built on top. You can be hands on helping in growing the network and improving its usability, but a good investor in this area should be careful to not force it too much following the old VC model, because if you put too much centralization in you will stifle the real growth potential. Also be mindful on understanding the token. Lots of times tokens end up being a barrier to adoption for the projects because they were unnecessary to begin with. The question needs to be: does this token makes sense? Can I replace this token with nothing or the native coin of the network? If yes, then it should not exist. On the other side, if it is a key piece of a protocol and the protocol does not work without it, then it will likely be useful and necessary long term.
What markets are you most interested in?
I’d say 3 main techs, blockchain, VR and new hardware developments, specially within robotics, EV, space and transport as a whole.
About blockchain, the next wave of apps will be creative or more social, not about money nor about trading, but about lifestyle and social aspects. Having control of your identity, being yourself or any character you want using many profiles that you control. Being able to interact with social tokens or cultural currencies, building new digital communities or creating new platforms for this new creative economy …
This whole NFT thing is just getting started and it will not be only digital but physical, identity for all assets and will create completely different channels to relate with art, brands and its creators.
We will see a new way to leverage the power of individual creators, designers, brands. A new creator economy with thousands of new apps possible just in this new realm alone, by having applications with easier UX, new use cases and more social angle.
I believe this will open a whole new breed of crypto users, a larger audience, when compared with what it is right now, the big growth of today will look like a small niche compared to how it is going to be tomorrow.
About VR, it will become a medium to experience new 3D virtual worlds, transporting yourself into a different reality, your own ideal living space. AR will also be big, but VR is about teleporting you anywhere, while AR will be the new iPhone - your all online self in the world.
Finally, I find new hardware developments super interesting and impactful for society at large. Electric cars, robotics and space are some of the top areas for me, it is really fun to watch and see the building pace that some of the companies working in these fields are achieving is super exciting!
3 startups you like and why?
I do not look to a lot of other stuff because I am too busy with my own, but here are a few companies that I like:
SpaceX. Super excited about space and what they are building.
TheDistrictVR. VR clubbing experience where you can party together with other people in a digital environment and even the DJ is in VR. It’s one of my startups.
VR chat. Very open and experimental community creating a collection of new social VR experiences.
Decentraland. Ethereum based global community empowering users to operate in a shared virtual world where they can interact, play games, buy and sell digital real state, explore, etc.
The Sandbox. Virtual world built on the Ethereum blockchain where players can create, own, play and monetize virtual experiences.
3 investors you like and why?
There are a few ones, and in my point of view, the right approach for me is that which Joel Monegro wrote about when he was at USV in his post about Fat Protocol Theory. This theory is the value is in the underlying blockchain protocol, while the application layer has less value, as its just a representation medium and not the data controller anymore
Right now, in the internet and without blockchain, the control of users and data are gathered in the applications, so the application layer is valuable. And the protocol is actually free, there is almost no value there, but the application is where everything is.
That is shifting significantly with blockchain, where the protocol becomes the real value and that is why Ethereum is worth tens of billions. The application layer will be smaller, like an interface and there will be many interfaces interacting with the same protocols and smart contracts. You can pick and choose what interface you are gonna use so there is no much control on the app level anymore. The smart contract protocol that has the value might be a completely general purpose one, that nobody controls. If that’s the case the value moves to the underlying database if you want to say so, the underlying blockchain. The more people build on it, the more people use it, the more valuable it becomes.
And if you have this common database is not only a shared thing, but a way to share value, where everybody can have a stake, which massively increases interest. Users want to get in it, protect it, decentralize it, build on it.
If you can create a successful blockchain that is worth a lot, that is where the value is. Apps on the other hand, you have to be careful with the hype. Everybody can make tokens and everybody wants tokens, but they might not be useful or necessary to begin with.
3 books you feel everyone should read and why?
Some of the books on Ethereum are interesting. The whole story behind it, the people behind it, the things that we experienced, the DAO, how did it all evolve, also a bit of drama - It is a very compelling story because it literally came out of nowhere and it is what it is today. Probably someone will make a movie out of this in the future.
Also, I am lately hooked in:
Hologrammatica by Tom Hillenbrand. The interesting about this one is that it is a sci fi book where the whole world is full of layers of holograms, and with some special glasses you can strip these layers away, experiencing the world in different ways. But there are 2 you can not strip, one that makes thinks look better and the security layer that in hides doors and other things that you are not supposed to see. This concept of a world made up by hologram layers really reminds me of a potential future that could happen with VR/AR advancement where everybody start to wear glasses that put a really immersive 3D layer on top of reality. We will have things like this and they will probably be blockchain based under the hood, ensuring some things can be owned or shown. Very interesting book where I think the author is onto something with his way of describing the future.
Could you share with us your comprehensive overview of the current state of crypto and your vision of its future? What are you building with LUKSO to tackle this opportunity and why is it important?
The current crypto world has figured out how to do things with blockchain; how you can build different complex systems with many people while not having a single controlling person and still being trustworthy. However we need better UX and a lot of stuff is still too hard for mainstream use.
ERC20 solved one problem and this token standard part became a whole industry (DeFi, NFTs, etc). But the second column that is still missing is identity. And I am not talking about passports or personal data of that kind, but about one of your public identities, user identity - whatever you want it to be. Whole NFT space, applications, et depend on that identity factor. NFTs alone are worth nothing without it and currently is a joke on a technical level.
To create a new creative economy we need new pieces in place and we are working on building these underlying gears at LUKSO.
The future of crypto is tech not about the tech being in the front. It should not be about gas, coding, standards - nobody understands that. We want them to say “oh what a cool app, click and let’s go”. We want to make the blockchain tech disappear, but right now with current established standards that is actually impossible.
Too many multiple accounts to use in too many different places. It is time to log in everywhere, with all protocols, in a decentralized way with a look and feel that is right and understandable.
Big thanks Fabian for sharing your views with us !
Big thanks to you, reader, for your time and interest !
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