Guaranteeing Vibrancy in an Open Metaverse with Ryan Gill - Step into the Metaverse Podcast: EP12

Good day everyone and welcome to the Step into the Metaverse podcast. My name is Marc Van Reimenam and I'm also known as the Digital Speaker. I'm a future tech strategist and I think about how emerging technologies change organizations and society. This podcast is part of my new book called Step into the how the Immersive Internet Will Unlock a Trillion Dollar Social Economy. The book is available as an ebook, hard copy and audiobook. As part of this book, I did nearly 100 in depth interviews with the stakeholders involved in creating the Open Metaverse. The investors, the developers, the artists, the collectors, etc. And I've turned a selection of these interviews into this podcast as I think that these conversations are too valuable to leave them on my computer. In this interview I interviewed Ryan Gill. Ryan is the founder of the Open Meta Dao focused on building an open Metaverse. Ryan is also the founder of Crucible, which provides an easy on ramp for game engine developers to access new decentralized web technologies such as DeFi or NFTs and networks of players and marketplaces where users are spending billions. And he's a Venture partner at Layer Ventures. During the interview we discussed the Open Metaverse and what it takes to get there. We also covered the role of NFTs in decentralized finance and what kind of new business models we can expect in the Metaverse. Enjoy the conversation.

So maybe you can share a bit first, what's your background and how you are involved with the Metaverse?

Sure, yeah. So I've worked for about a decade in innovation broadly and I really came at it through sort of the lens of exponential technology and change. And so it sort of gave me a viewpoint across different industries and across many different borders and nation states. And once you learn that lesson of exponential change and pace the rate of technology and how it's affected things, you really start to kind of look for the blue oceans, or at least I did. And I worked a lot in the US with a guy named Peter Diamandis and then I kind of did some work on my own in Japan and kind of live there on and off and sort of the culmination of that experience really. Just I formed my own thesis of where I think things were going and pretty much immediately started a company around that. And so the thesis was the Open Metaverse and making sure that it was built on these open standards of protocols, things that create a lot more access for other people. And then the gaming industry really having the lead in terms of shaping the technology that the Metaverse will be built with was kind of shaping up around. So the company Crucible I started in November of 2018 and it was really meant to be kind of an action plan on that thesis and on the sort of theoretical side of what I saw was happening. But it was very early, as, you know, like three years ago. All these words now that people are running around saying nobody really could wrap their head around it. And I actually traveled to about 15 countries, sort of just really taking a lot of meetings with investors, going to a lot of working groups for the standards themselves around self sovereign identity and around these standards being written. They're all still very nascent in early stages. So I would say that it was a very long, drawn out R and D process which was necessary because the world really hadn't come around to the ideas yet. Then, right as I got some traction with investors and started raising money about two or three weeks later, you know, Covid locked everything down and then kind of thrust us into a period of time that accelerated everything very quickly, you know, and we're not even out on the other side of COVID yet, but the impact can already be felt. And pretty much every stakeholder from the Web three communities to startups, to big corporations and governments are all really starting to come to these conclusions. And a lot of the work that I've done, the language that I've formed, the seeds that I've planted in the community, and even the meetings that I took two, three years ago are now coming full circle again and the world is ready for what I've been talking about and what we've been spending time building. So I think the market timing is right and I feel even more compelled than I have in the past. And I feel confident that what we're doing is right and it's important.

Yeah, no, definitely. I think that's absolutely right about that. So you actually build stuff yourself as well, or you're not too much a developer, but more like the strategy person?

Well, yeah, it's my company. I'm the founder and the CEO.

Yeah.

And we're a software developer. The company Crucible is sort of a software development company. And we've actually sort of designed and in a lot of ways invented some of this stuff. And at the core it's really around identity, like persistent identity, digital sovereignty, and how to simplify these tools. Web3 is made up of a lot of these blockchains and open source software, but it's very technical, it's very complicated. You know, the barrier to entry is pretty high for your average person. And so what we're doing is simplifying these Web3 tools for game developers specifically.

Okay, so a question I'm asking everyone that I talk to, what is the metaverse according to you?

I don't know if we could really distill it down into a single definition, but conceptually and symbolically, to me it's the Internet when it's built by game developers. And I get pushback a little bit on that. I think game developers, at least in the AAA industry, are used to building very high quality experiences with game engines, things that the web really can't support right now. But the web is what provides a lot of accessibility so people understand the Internet. We had web developers early on and then we had mobile, and that's really scaled the Internet globally. This now is just moving into that third phase where it's going to start to become more game like, so game developers really take the lead. And for us personally, you know, Web3 only can come through decentralization. That's a really important sort of key point, is that to get to this, this next stage, we need to embrace the decentralized tech that exists.

Yeah, so you of course you talk about the open metaverse, you have also the Open Meta association recently launched. What are some of the key steps that we need to take to build this open metaverse to ensure it's not a world garden metaverse, but it's open and accessible to anyone?

Well, this is where it starts to break down a little bit for people, because Web3 as a whole, and all these concepts as a whole are very technical. And I think it's really important that we begin to talk about them more humanly and the impact of this technology on human lives. And so every choice I've made has been sort of directed to a true north of like, what is the ultimate goal here? And the thesis summed up is basically that the metaverse is inevitable, we're marching towards it. You know, the Internet in its current form with Web2 is not really great for the individual, the actual human being. And even though the Internet was built on the concepts in Web one so that it was for individual people, Web two really prioritized the business and the shareholder. And so the current sort of form that we have with servers collecting all this data, optimizing it for behavior that buys or buys into things with an advertising model is a nightmare scenario really to bring the metaverse into reality. I think a metaverse optimized for advertising is certainly not what we want. There's a lot of science fiction about that. And so the sort of subculture of open source software has been working for decades on things that pose solutions. Right. So the open metaverse just means embracing those things and creating an infrastructure where they underpin this complete new sort of economic explosion that's going to take place. And so that means sovereignty for the human identity. That means sovereignty for ability to accumulate wealth and hold assets across the board. I'm beginning to think more and more that this generation will be defined by this war on digital sovereignty. And when we look back on it, this will be a pretty transformative time where we can kind of take back some of the agency and the individual sort of rights within the Internet and within the way that technology has sort of taken over our lives.

Yeah, I couldn't agree more with that. A couple years ago I wrote a thesis on that. No, I think we're moving to a division of how data is being used. And you have either surveillance, you have corporate surveillance, or you have individual empowerment. Or ideally you would end up in a world where there's empowerment for the end user and no control. Surveillance by the state or by corporates.

Yeah, yeah. I mean, I read three books at the end of 2018 that really kind of kickstarted this business in a lot of ways. And one was a sovereign individual. And the concepts around that, even back when they wrote it, to have the foresight of getting most of it right. I think they didn't get everything right, of course, but I think conceptually they were there. And then the second book was who Owns the Future? By Jerome Lanier. And that was kind of illustrating a potential future where we actually did build it this way and it wasn't closed, it was open. And what would that really look like practically? And so to read one book that was basically predicting the way that the future was going to go from the perspective of the rate of technology changing so fast that the nation state couldn't keep up, and the power of that technology actually being concentrated to the individual. And then the other book that really talked about in very simple terms that companies have really grown and evolved to become just servers that collect data, and that's the way the economy runs. And if it wasn't that way, if we didn't allow those companies to own the future and we did distribute that money and that power in a more balanced way, what could that possibly look like? And then the third book was Gamer Theory by Mackenzie Work, which was really good lesson in the concept of games, but not totally defined by video games. This idea that we live and we operate in game spaces. And I think in the NFT space we're starting to see that now. And it's kind of fascinating because it's like story driven game theory. They're like creating this IP and these characters on these game mechanics which ultimately allow people to accumulate digital wealth. And we're just scratching the surface.

Yeah, definitely. So you mentioned NFTs. Of course we've seen the hype in the past year, but I think that's a starting point of NFTs. How do you think that NFTS will impact decentralized finance?

Well, I don't know. To me, the NFT term will probably fall to the background a little bit more. Its significance is owning digital things. I think we've been sort of conditioned and not trained, but we've been conditioned with our use of the Internet to think that like these digital files and you know, these infinite digital copies of things don't actually have intrinsic value to them. You know, they're infinitely available and you can screenshot images or you can sort of torrent files. And so we've been just used to it being free, you know. And I think what NFTS is proving is that we can build scarcity. Right. And value back into those things. And in some ways humans do want that. Right. They want to collect things. Again, even if you can screenshot it a million times, you could only own it and sell it if you can prove that you are the one that holds that. So it's definitely an interesting experiment. I think it's kind of a cornerstone piece of any virtual economy. I think we would have to have figured this out first in order for that to be viable.

Yeah. And so linked to that. Of course, these digital assets that we can own, we also see a move towards more direct to Avatar business models. How will that change the retail industry, you think? Or any industry for that matter?

Well, so I think you're referencing. There's a term that I sort of came up with in the middle of lockdown actually and published a Forbes article which was Direct to Avatar. And at that time we were living with direct to consumer basically as the only way to get access to the things that we needed. Right. If we didn't have Amazon and all this delivery, like we wouldn't have actually had access to most of the things that we need on a daily basis. And so as a way of defining supply chain, I really wanted to kind of define the next step of the supply chain in that way. And so people really understand direct to consumer how part of the supply chain was sort of dematerialized and, you know, remove some intermediaries to go straight to the front door of the customer. And in a lot of ways, sort of Direct to Avatar is just fully dematerializing that supply chain and actually having, you know, digital products sent to digital customers, and those digital customers being avatars. So if you point to gaming, Fortnite and all these games that make billions, that is a direct to avatar model. And what happened in forbes is like CEOs and marketers really kind of picked that up, and we're really excited about what it meant for them. But I was actually also talking about it in terms of startups in a number of years. If you're some kid coming out of college and you have an idea for a startup, you know, maybe that becomes a direct avatar business model where you can actually drastically drop costs down for supply chain and production, really almost nothing, and then stand up a real business, you know, within one of these virtual worlds.

Yeah, I think the direct avatar business model that you described has almost infinite potential. What kind of other business models do you see happening in the Metaverse? You know, also, we have also Play to Earn, for example. How will these and others play out in the years to come?

Yeah, Play to Earn has been a really interesting one. This idea of game worlds becoming places people spend a lot of time and money, and collectively all of the players really contributing the value to that. Traditionally, we're seeing those companies collect all of that. Play to Earn is really about kind of breaking that open and allowing the sort of cash flow of that game world to distribute to each player individually. So players who contribute a lot to the game world and add value to it can actually accrue that value back. And so it's interesting, on one hand, I think you probably would have heard that idea and just kind of rolled your eyes and thought it was a little bit ridiculous. But what happened in Covid is it sort of caught on and in the Philippines, and it became really meaningful for an entire community of people that were out of work. And so because Axie Infinity saw that traction, the Yield Guild spun out of that. And these are all emergent things that are really supporting people that are benefited by this Play to Earn model. Because in the Philippines, they are traditionally early adopters with things like farmville. They were first to really jump on Axie Infinity, this new game that allowed them to earn NFTs. And it took some of them off the street. It allowed some of them to buy houses in the middle of COVID And that's really kicked up a huge storm. There's been a lot of excitement around that in the VC world. Andreessen Horowitz leading the round for Yield Guild. A lot of people making a lot of money from Axie Infinity. And so it showed this sort of positive sum type model where game developers, game publishers, tech founders, web3founders look at that and can build off those ideas. So I think we're about to see a huge wave of more Play to Earn games, both native, brand new and also AAA level teams kind of integrating or changing or implementing these ideas. One example, I work closely with Ubisoft. They've now formally announced that they're embracing Play to Earn. You know, so that's one of the first big AAA publishers to do that. And I think a lot more will come. I don't know where that goes. I think none of us really know. But it is an exciting thing to be able to reward players. I think, you know, in the gaming industry the one thing everyone can agree on is that the player is the priority. Right? The player is the most important thing. Whether you're a corporate gaming company or whether you're the most innovative game modding company, whether you're mobile platform doesn't matter. Right. The player is the most important thing. You know, providing them an experience that keeps them engaged, keeps them coming back and inviting their friends and enriching their lives is sort of the ultimate goal. So Play to Earn is very aligned with that and there are certainly regulatory issues coming up. I just saw that South Korea is beginning to ban specific Play to Earn games. You know, so it's going to be a long road in terms of what countries will allow this and what publishers adopt this. But ultimately this to me, I think is a very important new business model that will grow and will likely swallow up other more traditional business models like Free to Play.

Yeah, and so you mentioned, you know, publishers moving into this model as well. How do you think other brands can tap into the Metaverse and how should they move from web 2 to web 3 if they want to truly engage with the next generation?

Well, this is a really interesting point. I think we're watching it happen in the early stages now. And I think the truth is that no matter your position in the world right now as a brand, you need to cross this chasm and reinvent yourself in some respect authentically to be accepted into this new world that's being built. And it's not guaranteed. Right. Like your position of influence and power and legacy. The money that you have can't buy you trust, can't buy you the customers, the people embracing you in this new world. Because you look at other brands that are native to this moment, like Bored Apes or Cryptopunks or any of these new IP that are actually being built from becoming NFTs. The trust, the passion is so high. It's a smaller number of people, but it's so high that it has so much to build off of that, you know, this generation of kids now will value Bored Apes more than they do Rolex. You know, and the concept of, of luxury and the place of legacy that brands have had may not mean as much as they're used to, you know, and I have a lot of these brands reach out to me and kind of try to. They're doing fishing expeditions, they're trying to understand it, you know, and what I say to all of them is like, the best way that you could have good form in what's happening right now is to truly embrace the communities behind everything happening, become a part of the community. You know, I think we're seeing Adidas pull it off pretty well right now. You know, they did a partnership with Coinbase, they just announced a partnership with the Bored Apes. And it's because they're hiring a whole new team of strategists in Adidas to understand this stuff and come from it that are part of the community. So the best thing you can do as a brand, if you want to plant seeds in the Metaverse and not just buy a billboard in a virtual world, but really reinvent yourself, is make hires of people in the community, artists, community builders, allow them to come in as a division in your company and create a strategy that is intrinsically a part of the community. Because in Web three and in the Metaverse, community is driving and front running everything. There's no institution that has more of a lead than we all do in the community.

So basically, in short, how do we ensure a rich and vibrant Metaverse economy?

It's my belief that the most interesting things will happen in an environment that rewards the people who create them. And when you're stuck in a sort of system that is client services and, you know, artists and world builders are hired by a brand to just create a marketing campaign or, you know, create new IP that becomes a television show that they sell to some network that is less vibrant than what we're already seeing in the Web3 community, which is you've created a community of people who share values and you've set many of them and yourself into lifetime Financial freedom. And you just want to sort of do more, to have more people have access to that. You want to reach down and help other people. And the nature of building these things, whether it's new IP or characters or games, it is fully owned by you and the community that you've built. And that level of ownership is something that breeds vibrancy, I think, you know, we're in the very early stages of it now, so these are all case studies. But certainly you could look at the old model of doing things, and if that's financially successful, I think that's great. But is there vibrancy in the communities? Is there trust and passion and excitement? Is there a level of energy? Because you can't look at anything happening in the metaverse and not see that. And, you know, most people who have chosen to do this full time don't regret it, and, you know, are, are having the time of their life with their best friends, you know, And I think an economy built on those principles and those values will be vibrant if this war on digital sovereignty can be won by the people.

Yeah, but of course, it's no guarantee that it will happen. What are some of the ethical challenges that the metaverse will also bring?

Well, I don't know, you talk to a lot of us and you know, we have this sort of like David mindset against Goliath. It's, you know, I say a lot where many Davids versus a few Goliaths, you know, it's that kind of mindset. Like it is not totally realistic, it is a bit crazy. But, you know, a lot of us just believe that, like, these big corporations don't stand a chance, you know, because of this idea that like, you can't really beat open source, you know, and we're young, in the sort of maturity of open source becoming fully cultural, like open source has been very technical for a long time, but we're now watching it become culture, right? We're now watching it become everything other than tech in our lives, like music and fashion and every other use case that we're going to see. And to me, maybe that's the most significant thing happening is that the open source philosophy is starting to eat the world, Right, and eat culture. And I think you just can't really compete with that because in open source, you solve a problem once and then it's available to everybody, you know, and if you don't like something that's happening, you could fork it, you could create an improvement from it. And even though these are trillion dollar companies and Nation states, they don't have the lead on this stuff. You know, they can outlaw it, certainly with regulation, but open source is underground. It finds a way. You know, it's. Yeah, that's where I think, like our confidence comes from, is just over time on a longer timeline. This will live and it will thrive. And even if it's just another option of something to invest your time, your work, your life into, it will be there, it will be viable, and it will likely be a lot more fun and a lot more exciting and big tech can continue to do what they do, but I don't see any way that they can compete with that, you know?

Yeah, I completely agree with you. Of course, Web2 has a lot of the problems. We have scams, we have hackers, we have malware, we have deepfakes, we have misinformation. Will that also exist in the metaverse? And what are some of the dangers of the metaverse?

It will, yeah. I think again, worst case scenario is that we just sleepwalk into the metaverse with our current incentive design, you know, and our current structure of the way things are built. Like, I think it was Chris Dixon that said recently, like, Web3 is basically the way power and money will be distributed over the next 10 years. And to me, like, that's the same as saying the metaverse, right? The metaverse is the way that power and money will be distributed from here for the next decade. That's why it's important. It's why you should take it seriously. And it's why everyone's buying up for that. Everybody's revving up for this fight. You see Facebook completely switch their brand. You hear Apple start to talk about it. Microsoft and Nvidia are embracing open source, which is really promising. But every company, most countries will throw their hat in the ring for this because more and more people are realizing the level at which this is going to be important in the future. And there's a lot of ethical issues around it. And when you think about it as a human being practically, right, like this is something that goes into your brain, into your body, it's going to be much more intrusive. It's going to take over what, what work is. It's definitely going to take over what play is, where you spend time with your friends. And I think everybody's got to ask themselves from whatever stakeholding position you have, whether you're an executive or a shareholder at a big company or not, what kind of world do we want? Because what we build, we're going to have to live with that, you know?

Yeah.

And there are tons of security holes. There are tons of vulnerabilities in the current system, and Web3 is putting forward a lot of potential solutions for that. And we got to decide, are we going to embrace it or not? And for those who really want to continue to build in a way that doesn't embrace it, to me, that's kind of one of the worst case scenarios.

Yeah. And I completely agree with you.

Mental health and emotional intelligence. I think definitely my DAO that I'm forming will be really taking hopefully a lead on this discussion, which is right now, screen time is being optimized, but it is destroying our mental health. Right.

Yeah.

And the metaverse just means more screen time, so those vectors don't align for more better mental health. Right. So if the current design of things is destroying and deteriorating on mental health, then just putting that on steroids is not a good direction to go. So I think we got to talk about that. I think it should be incumbent upon big tech companies to do this research, you know, and to share this research and to know how to answer these questions, because, you know, it could go a very poor way for the mental health of an entire population of people if we do it wrong, you know, and then also we're also losing emotional intelligence at the same time. And those things should be priorities into whatever the metaverse becomes. And in our design decisions and in our marketing decisions and the way that we sort of begin to scale and adopt these new technologies, we should be thinking about that.

Yeah, that's a very good point. All right, well, thank you so much, and have a great Sunday evening.

Cheers. Bye.

All right. Bye. Bye.

And that wraps up the conversation with Ryan Gill. If there's one thing that stands out for me from the conversation, it is how important an open metaverse is and why we need to do whatever it takes to achieve the vision of an immersive Internet controlled by all and owned by no one. I completely agree with that, which is why my new book, Step into the Metaverse, is meant as a blueprint for an open metaverse. If you enjoyed this conversation, don't forget to hit the like and subscribe button on your favorite podcast platform so you will be notified when any of the other interviews will become available. Thank you and see you in the metaverse.