How to apply concepts emerging from the world of web3 to your business

Whether you’re a blockchain enthusiast, you think NFTs are a fad, or you feel wary of investing in crypto following its many ups and downs, IDEO’s Tara Tan says there are valuable lessons to take away from the technology powering web3. It can tell us a lot about what people desire from businesses and services and how to meet those needs.

Tara, a General Partner and Investor at IDEO Creative Capital, joined us on the Creative Confidence Podcast to share three themes she’s seeing emerge in the world of web3 and how to apply those ideas to your business, whether you’re in the digital space or not. “Web3 is a cultural shift, even more than a technology shift,” Tara says.

Listen to the full podcast episode to hear more about these themes, examples from the world of web3 and beyond, and ideas for how you might experiment with these mindset shifts in your own business.

Listen on Spotify or Apple Podcasts

Tips for Evolving Your Business Model

• Consider alternate forms of ownership for your products and services, like fractional or transferable ownership.
• Go beyond user research to create tighter feedback loops and give customers a stronger voice in business decisions.
• Empower your customers and employees to self-organize and have a stake in your business’ success.
  

Mindset 1: Trying new ownership models (like fractional or transferable) in your business

“That fundamental thought around proof of ownership is something that opens up entirely new market categories.”—Tara Tan

Think about the blockchain as a universal database or Excel sheet that anyone can look at and anyone can verify. This technology enables greater trust in peer-to-peer transactions because it’s much easier to confirm proof of ownership. It removes the need for middlemen-type businesses (think of a platform for reselling concert tickets) and enables trading at much faster speeds and building of new kinds of marketplaces. This allows easily transferable ownership—something consumers are showing they desire.

It also allows you to break down investments into much smaller sizes, enabling fractional ownership. This opens up the opportunity for more people, beyond the wealthy, to invest and see returns. Examples from the web3 world include Masterworks, where you can buy fractional pieces of blue-chip artworks like a Picasso. What this shows is that consumers desire new forms of ownership, beyond what is broadly available now.

Ask yourself: How might we shift our business model to allow for a broader range of ownership options?

This could mean enabling your customers to co-buy your products (like purchasing a car with several friends), allowing them to transfer ownership or trade products on a marketplace, or to buy fractions of a good or service.

Learn a proven process to create a winning strategy in our course Designing Strategy.

Mindset 2: Allowing employees and customers to have a stronger voice through community-first design

“We now have the technology to do this easier online and do this globally, but at the core of it, the human desire to organize and coordinate is the same.”—Tara Tan

We’ve heard a lot about DAOs, which stands for decentralized autonomous organizations. DAOs are groups of people that perform actions coordinated by the blockchain. But the origins of DAOs stem from a not-so-new concept: co-ops. The simple definition of a co-op is a user-owned organization that is controlled by and operated by its members, rather than outside investors.

What web3 has enabled is to modernize co-ops through internet-first ways of coordination. Some interesting experiments in web3 include social clubs like Bored Ape Yacht Club, investing syndicates like MetaCartel, and even protocols like Ethereum, where token holders can vote on actions and proposals. The excitement around DAOs shows there’s a desire for people to self-organize and have a stronger voice in their areas of interest.

Ask yourself: How might we give our customers and employees a stronger voice in business decisions?

For entrepreneurs building a business, ask yourself: How might we involve our community from day one?

For example, a retail company might go from doing user testing before launching a new product to a crowdfunded or on-demand model, where customers can buy products before they’re made.

Mindset 3: Aligning emotional and financial incentives so everyone has a stake in your business’ success

“There’s something so powerful about being able to tie together emotional and financial incentives.”—Tara Tan

This mindset builds on the idea of new forms of ownership, but goes beyond outside investors (in fact, doing less of that) to share ownership with customers, employees, and partners. Giving your employees a stake in your business’ success can help with retention and motivation. At Royal.io, musicians can sell portions of their song royalties to fans. Fans are now “invested” in the artist, not just in an emotional capacity but in a financial capacity.

Ask yourself: How might we align emotional and financial incentives to better meet the needs of our customers and employees?

An example outside of web3 is Huddle, a job platform that allows startups to compensate freelance workers in cash and equity. And Haidilao, a large food and beverage chain from China that gives out equity to all of their employees, from the branch manager to the wait staff. They are known for giving unparalleled customer service—because every employee is invested in making Haidilao a great experience.

About the Speaker

Tara Tan
General Partner & Investor, IDEO Creative Capital

Tara is a design-driven investor backing good humans and great ideas in the world of web3. At IDEO CoLab Ventures, she invests in early-stage distributed web startups and co-creates with them to ship new products and protocols. Her background is in crypto, consumer, and creators. She believes design is a superpower in early-stage ventures—where rapid prototyping, left-field ideas, and magic moments thrive.

Learn how to unite rigor and creativity to create a successful strategy in our course Designing Strategy.