Most founders fail because they’re playing the wrong game

People usually gauge startups based on their valuations, head-counts, or the headlines they generate, however there’s a much better way of looking at companies, especially from the perspective of an aspiring founder

A solo founder making a profitable iPhone utility app, a Shark Tank consumer brand, a venture-backed SaaS company, a robotics startup, and something like OpenAI or SpaceX are all called “startups.” But that label is so broad it becomes almost useless. These companies are not simply different in size. They are different in kind.

They demand different levels of ambition, network, different kinds of founder psychology, different funding structures, different timelines, and different tolerances for risk. That’s why I’ve started thinking about startups in seven levels.

This is not a ranking of worth. A Level 3 company is not morally inferior to a Level 6 one. In fact, a Level 3 business may create a better life for its founder than many Level 5 companies ever will. This framework is not about prestige. It is about calibration; someone fresh out of college might not want to take a swing at starting a Level 7 company right off the bat.

Some people spend years building companies beneath their true abilities. Others try to build companies wildly above their current weight class. Some are supposed to be building durable cash-flow businesses, but convince themselves they need venture capital. Others have the instincts for category-defining or frontier companies, but trap themselves in tiny projects because those feel safer.

Not every founder is meant to build the same kind of company.
And not every phase of life is meant for the same kind of bet.

The real skill is knowing what game you’re actually playing.

Level 1: The Starter Startup

This is the simplest kind of startup: something functional, shippable, and capable of making a little money or attracting a real audience.

Think:

• a niche mobile app
• a small AI productivity tool
• a browser extension
• a basic B2C subscription product
• an indie game with modest traction
• a tool for a very specific professional workflow

A company like this might make thousands a month, maybe more if well executed. It might live off App Store revenue, ads, subscriptions, or a niche user base. It is not necessarily trying to dominate a market. Its real value is that it teaches the founder how to build, launch, distribute, and iterate.

This is where many founders should begin. Not because it’s glamorous, but because it compresses the feedback loop between effort and reality.

At Level 1, you learn the most important startup lesson of all: the market does not care how clever your idea was before you shipped it.

Examples here are often not household names. They’re the countless profitable micro-products, utility apps, Chrome extensions, and indie tools that quietly exist because one founder was disciplined enough to make something useful.

This level is underrated, and often where serial entrepreneurs are born.

Level 2: The Small Exit or Niche Asset

Level 2 is when the startup becomes more than a project. It becomes an asset.

These are companies that solve a clear enough problem, for a real enough customer, that they can become:

• a modest acquisition
• a meaningful niche software business
• a strategic add-on for a bigger player
• a product with enough traction to create real optionality

These businesses are usually more focused than ambitious. They do one thing well. They do not need to become giants to be successful.

Examples might include:

• a developer tool acquired by a larger platform
• a vertical SaaS product for a niche industry
• a workflow tool folded into a broader suite
• a profitable ecommerce utility brand with strategic buyer appeal

This is the level of the smart flip, the sharp niche, the well-positioned wedge. It rewards founders who understand where incumbents are weak and where a compact product can create real leverage.

A lot of great founders build Level 2 companies and win.
The world just doesn’t celebrate them the same way because startup culture tends to confuse visibility with quality.

Level 3: The Strong Business

This is where “Shark Tank” usually lives.

Level 3 companies are polished, credible, investible-looking businesses with real revenue potential and clear market demand. They may raise money. They may scale significantly. But at their core, they are still more excellent businesses than pure venture moonshots.

Think:

• strong consumer brands
• clever DTC businesses
• profitable SaaS companies
• products with real margins and strong founder control
• businesses that can become life-changing for their founders without needing to conquer the world

Examples might include companies like:

• Spanx in its earlier growth phase
• Ring before becoming a massive strategic acquisition
• many of the better Shark Tank companies
• profitable vertical SaaS businesses that never become public but make founders wealthy
• creator-led brands that turn distribution into a durable machine

The defining trait of Level 3 is not smallness. It is that the company is primarily built to be a great business, not necessarily a venture-scale empire.

This level deserves more respect than startup culture gives it.
A healthy, profitable, growing business with strong margins and low chaos is often a far better outcome than a sexy pitch deck attached to a broken company.

A surprising number of founders would be happier if they admitted they want Level 3, instead of cosplaying Level 5.

Level 4: The True Venture Startup

This is where the startup becomes legibly venture-backable in the classic sense.

The difference between Level 3 and Level 4 is not polish. It is math.

A Level 4 company has:

• a large enough market
• scalable enough mechanics
• a strong enough wedge
• enough upside potential
  that institutional investors can reasonably believe it might return a fund.

This is the world of:

• breakout SaaS companies
• high-growth network-effect products
• infrastructure platforms
• marketplace businesses with real expansion potential
• software businesses designed for institutional scale

Examples here include companies like:

• Notion in its scale-up phase
• Figma before becoming a design-industry standard
• Datadog
• Snowflake in its earlier trajectory
• Canva before it crossed into category-defining territory

At this level, the founder is no longer just building a product. They are building a machine. Hiring matters more. Capital matters more. Distribution matters more. Storytelling matters more. The founder must become someone who can recruit talent, sell a vision, and maintain velocity under pressure.

A lot of people think they want this level. Fewer actually want the life that comes with it.

Level 5: The Category Company

Level 5 startups do not just grow. They shape how the market itself is understood.

These are the companies that become the reference point for a category, or the company that made the category feel real to the mainstream.

Examples:

• Airbnb
• Uber
• Shopify
• Stripe
• Oculus
• Peloton
• Coinbase in crypto’s institutionalization phase

These companies feel bigger than “good venture-backed startups.” They become verbs, benchmarks, cultural objects, or default infrastructure. Even people outside the industry start to recognize them.

The leap from Level 4 to Level 5 is subtle but important. Level 4 companies participate in large markets. Level 5 companies bend those markets around themselves.

To build one, the founder needs more than execution. They need timing, narrative, talent magnetism, and the ability to make an emerging behavior or category feel inevitable.

This is often where founder identity begins to matter almost as much as the product. The company starts to pull ecosystems into orbit around it.

Level 6: The Frontier Startup

Now we move into a different species entirely.

Level 6 companies are frontier bets. They pursue major technical or industrial leaps with real complexity, real capital intensity, and long timelines.

This includes:

• advanced robotics
• aerospace
• defense technology
• industrial automation
• biotech platforms
• energy breakthroughs
• manufacturing innovation
• autonomy systems

Examples:

• Anduril
• Apptronik
• Shield AI
• Figure
• Relativity Space
• Zipline
• Synthego
• Helion Energy

These are not just “hard startups.” They are startups trying to move the frontier. They operate in the world of atoms, regulation, scientific uncertainty, supply chains, hardware, and institutional complexity.

A Level 6 founder is not simply a founder with a bigger dream. They are someone willing to endure longer cycles of doubt, heavier execution burdens, and a much higher ratio of friction to visible progress.

This is where startup advice from consumer apps starts to break down. “Move fast and break things” sounds very different when the thing you’re building flies, manufactures, diagnoses, or touches national infrastructure.

Level 7: The Civilizational Startup

This is the rarest level.

A Level 7 startup does not merely build a huge company. It changes what humanity believes is possible.

These are companies that create a before-and-after moment.

Examples:

• OpenAI
• SpaceX
• arguably NVIDIA in its platform-defining role for modern AI, though not a startup now
• Google in its early years
• Amazon in its transformation from ecommerce company to internet infrastructure giant
• Apple at its most category-resetting moments, though again not a startup in that phase

The point is not valuation. The point is consequence.

These companies do not just win markets. They redraw them. They alter talent flows, capital allocation, geopolitics, developer ecosystems, public discourse, and the boundaries of what other founders dare to attempt.

Level 7 founders are usually not just more ambitious. They are operating with some combination of extreme conviction, historical timing, unusual agency, and the ability to recruit extraordinary people into a mission that initially sounds impossible.

Most people should not casually aspire to this level.
Not because it is noble, but because it is consuming.

These companies often require an almost irrational degree of persistence. They can absorb years of a founder’s life before the world understands what they are becoming.

Why this framework matters

The point of this framework is not to pressure every founder into climbing higher.

The point is to make founders more honest.

A founder who is naturally built for Level 3 should stop feeling embarrassed about wanting a strong business instead of a moonshot. A founder with real Level 6 instincts should stop wasting years building disposable consumer fluff just because it seems easier to fund or explain. A first-time founder trying to build a Level 7 company should understand that vision alone does not substitute for capacity.

Every level demands different muscles, and are suitable for differet type of founders

Level 1 rewards shipping, anyone can start here
Level 2 rewards focus, founders who want to make a quick buc
Level 3 rewards business sense, for those looking for passive income
Level 4 rewards scalability, for the traditional Silicon Valley archetype
Level 5 rewards Experience, for older or 2nd, 3rd time founders
Level 6 rewards frontier execution, favours those with large financial or political networks.
Level 7 rewards history-bending conviction, this is a wildcard.

The mistake is not aiming too low or too high.
The mistake is being uncalibrated.

Some people are playing a lifestyle game with venture expectations.
Some are playing a frontier game with indie-hacker habits.
Some are trying to skip levels of founder development altogether.

And that usually ends badly.

The question founders should ask themselves

Most founders ask, “How big can this become?”

A better question is:
What level of startup am I actually equipped to build right now?

Not permanently. Right now.

Because your answer changes with age, skill, network, capital access, emotional tolerance, technical depth, and stage of life.

The founder you are at 25 may be perfect for Level 1 or 2.
The founder you become at 35 may be capable of Level 5.
Some people are born with Level 6 instincts but need years of scar tissue before they can carry that kind of mission.

Startups are not one ladder.

They are seven different games disguised as one.

And a lot of success comes down to realizing which one you’re actually meant to play.

Last year we got all excited about the concept of Account Abstraction (AA); where it was supposed to revolutionize blockchain wallets by making them more flexible, user-friendly, and secure leading to the potential of mass adoption. Fast forward a year, a web3 landscape is still very much the same.

So why didn’t (AA) catch on?

Account Abstraction (AA) was designed to replace Ethereum’s Externally Owned Accounts (EOAs) with smart contract wallets, offering advanced features like social recovery, gas sponsorship, and custom transaction validation. However, its real-world adoption has faced significant challenges.

For AA to fully realize its potential, major protocol changes — primarily through ERC-4337 — are required. One of the biggest hurdles for developers is the need for a new type of transaction bundler and relayer infrastructure to process these transactions. Additionally, smart contract wallets come with a major cost drawback: they require more computation, leading to higher gas fees.

The biggest barrier to AA adoption is the challenge of gaining traction in a slow-growth (bearish) market. While many new startups are building on AA and smart contract wallets, the lack of fresh Web2 users entering the space makes it difficult for these innovations to gain widespread adoption.

Additionally, because AA is still in its early stages, it lacks native support for fundamental interactions like signing in and user authentication. The scarcity of tutorials and educational resources leaves users confused and increases the risk of exploitation by malicious actors. Meanwhile, AA’s core benefits primarily reduce friction for new adopters, offering little incentive for established platforms like MetaMask, which already dominate the crypto wallet market. For these incumbents, the cost of modifying and refactoring their infrastructure to support AA far outweighs the potential benefits, further stalling adoption.

So is that the end of the line? Is web3 destined to be this janky high friction tech bro circle jerk?

Perhaps not, enter EIP-7702

In a nutshell, Vitalik and his friends at the Ethereum Foundation hears all the feedback from ERC 4337 and decided to make some drastic changes. EIP-7702 essentially chooses a pragmatic approach by making EOAs temporarily function as smart contracts, without requiring a full migration to new wallet infrastructure. This significantly reduces complexity while keeping the benefits of AA.

Instead of requiring users to create a new wallet, EIP-7702 allows existing EOAs to act as smart contracts temporarily within a single transaction. This means users get all the goodies promised by (AA) like gas sponsorship, transaction batching, and custom validation without needing a separate smart contract wallet. To add a cherry on top, since EIP-7702 switches between normal and smart contract mode on demand, it avoids the need for additional contract calls like (AA) does keeping transactions lightweight and thus more gas-efficient.

From a security standpoint since EIP 7702 works within Ethereum’s existing transaction system without needing bundlers and relayers mentioned earlier, the potential attack vectors that (AA) could be prone to also get eliminated, making it a lot more attractive for users and also easier for developers to adapt without complicated migrations.

In summary, by minimizing friction, enhancing gas efficiency, and ensuring seamless compatibility with existing Ethereum infrastructure, EIP-7702 has the potential to unlock the true benefits of smart accounts while preserving Ethereum’s usability. Personally, I’m excited to see how this impacts the user experience in decentralized gaming. The ability to bundle transactions for “one-click” asset trading in an MMORPG could significantly reduce the need for Web3 studios to rely on centralized servers to track asset exchanges. Additionally, the gas sponsorship feature is a game-changer, enabling free-to-play developers to cover transaction costs and truly decentralize the Free-to-Play model in Web3 gaming.

Of course, like with Account Abstraction (AA), only time will tell if these innovations will fully materialize. However, one thing remains clear — the Ethereum Foundation’s relentless push for adoption and frictionless user experiences is a beacon of hope, especially in this desolate market.

SWIM_404 and a new take on conservation

In my decade-long career in immersive tech and crypto, I’ve constantly seeked ways to give back to the community. As I lay in bed the other day drafting the Blast launch article, it dawned on me that perhaps I could siphon some of this market action into trying something different.

What if I can provide the community an opportunity to make money through crypto degeneracy yet still provide a meaningful and positive contribution to society? The plan is simple: launch a series of projects using the most up-to-date web3 protocols for good causes; starting with $SWIM_404 on Blast.

Introducing the star of our show, the Axolotl

Axolotls are a critically endangered species of salamanders native to Mexico. Aside from their adorable smile, Axolotls have a unique ability to regenerate their limbs and even their brains. Studies on these unique organisms are pushing the boundaries of regenerative medicine in biotech today. SWIM_404 will launch 5000 Tearful Tadpoles tied to 1,000,000 $SWIM Tokens on BLAST where 100% of BLAST GOLD (Developer points) distributed to holders and 10% of initial proceeds and all future native yields will go towards the conservation of Axolotls.

Why 404

Pandora changed the game when they launched their ERC404 standard. Although the idea of merging fungible and non-fungible tokens into a new standard isn’t novel, having a working implementation of native fractionalization allows NFT projects to grow their members beyond their maximum supply (e.g. 10,000 Bored Apes). Since the NFT floor price is tied to the token price, holding the tokens alone can give you enough exposure to share in on the upside. Furthermore trading tokens burns and mints NFTs automatically, which means the act of trading itself is re-rolling your NFT Traits, naturally incentivizing liquidity and trading volume.

Furthermore, the 404 community has continued to iterate with DN404 improving the gas efficiency of ERC-404 by splitting the contracts in 2; paving the way also for marketplaces like Blur and Opensea to be able to display and move 404 assets without error. Ultimately 404 standards bring liquidity and native fractional ownerships to digital assets, giving NFTs a modern twist.

Why Blast

Yes, there was lots of backlash surrounding the Blast mainnet launch last week. I’ve written an article myself highlighting several of their shortcomings as well, however at the end of the day if we isolate their tech from their marketing debacle, launching a charitable 404 project on Blast makes total sense. While 404 provides liquidity and uncapped membership potentials to NFT projects, Blasts' optimistic rollup provides users and projects alike with native yield from Eth Staking and T-bills from MakerDAO. This means on top of project profits, if we launch blast native pools for our charitable project with ETH or stablecoin pairings, the 3–5% yield generated can continuously fund our conservation targets indefinitely.

Conclusion

I am beyond grateful for the community support over the past year as I try to bring unbiased, thoughtful analysis of the web3, gaming, and VR/AR to light. Hopefully, SWIM_404 is the first of many conservation-focused projects where we bring Impact Investing to web3; we can all live a little easier when financial freedom goes hand in hand with saving the planet.

Launch Time: March 20th at 1:00 UTC

IDO Price for $SWIM set at 0.0005ETH

200 $SWIM = 1 Tearful Tadpole NFT

2 Tearful Tadpoles MAX per wallet

Learn more here:

https://twitter.com/SWIM_404/status/1765637484137038004

Like many people, I was very much excited and looking forward to the launch of Blast’s mainnet this Thursday. The same team behind the stellar execution of Blur, a fresh new chain offering native yield, and a record-breaking 3000 projects actively being developed within the ecosystem. Perhaps that should’ve been the early warning signs but I digress.

For my own sanity, let’s take a closer look at their launch strategy and why it created so much FUD.

First, the Blast team announced a new farming vehicle called Blast Gold. Blast Gold is essentially a new ponzi that you must participate in to maximize the results of the farming you have ALREADY done. Now this normally wouldn’t be too terrible except in order to continue farming you have to risk being rugged by participating in the thousands of unfiltered and unvetted applications listed on Blast’s own official website. No pre-screening at all has been done to the hundreds of Uniswap clones, it’s like Blast is sacrificing their early adopters to help them screen for scams in their own ecosystem.

Second, for anyone who participated in the early mining on Blast, in order to withdraw their ETH or do anything with it, they have to manually migrate to Blast Mainnet. With network congestion at the time it ranged from anywhere between 50–100 dollars, leaving many budget investors completely frozen. Again this normally wouldn’t be too ludicrous until you recall that the entire TVL is staked into a single mutliSig wallet, why not just transfer that Balance to Mainnet themselves and save everybody the hassle?

Third and probably the most sickening is the indirect threat of dilution. Upon transferring to the mainnet your points are automatically 10Xed, this essentially means the token values were artificially inflated by 10X.

Additionally, once your assets hit the mainnet, you’ll start earning points every hour with a multiplier between 1X to 12X. To increase your multiplier you have to interact with unvetted DApps as mentioned earlier in this post once again risking being Rugged. So here your trade-off is either getting diluted or continue playing their game and risk losing everything by connecting to a bunch of random smart contracts.

In conclusion, Blast’s Launch strategy was quite ingenious. Incentivize developers to build by promising them 50% of Blast points. Then encourage developers to give away all their Blast points to users as a way of lowering customer acquisition costs. The end result fueled by the predatory multiplier effect and Blast Gold mentioned above is a record-breaking adoption number.

All of this being said though, I myself am still quite bullish on the chain as a whole. The tech behind it is rock solid; a layer 2 supporting native yield will most definitely find product market fit in the current cycle. I believe as the scammers run out of steam the ecosystem itself will be able to nurse itself back to health as more serious developers begin launching their projects. One thing to make note of is that the documentation really only did come out a few weeks ago; to even fathom launching a product in this short amount of time is beyond me.

So stay strong fellow stakers, trust in the process, trust in the tech, for serious developers and serious projects are coming soon!

With the crypto world rapidly adapting to a post-BTC ETF world, the web3 market looks to other places for speculative gains. This past week, the degen gods brought us to Pandora.

No, not the semi-sentient planet filled with giant cat-eyed smurfs from James Cameron’s Avatar, but the crypto project by pseudonymous developers Ctrl and Acme touting a new token standard aiming to merge the functionalities of both ERC-20 and ERC-721.

First, let’s address the elephant in the room. ERC-404 is not an actual ERC standard; it has not gone through rigorous audits or stress testing, nor has it been approved by the Ethereum community. In fact, the standard itself is just in the process of being submitted as an Ethereum Improvement Proposal (EIP).

Despite all this, however, the Pandora NFT token soared 12,500%, with a trading volume reaching over $230 million on decentralized exchanges in its first week of trading, and the standard itself has been subsequently accepted by many Centralized Exchanges including Binance and OKX.

So why is ERC-404 a big deal and how does it work?

One of the biggest problems facing digital asset collections or NFTs since their inception has been the lack of liquidity in the secondary market. Like luxury products, once a product hits a certain price range, the available buyer’s market begins to dwindle, and so the price will correct. However, unlike fungible assets, pricing the product and finding subsequent buyers can be a time-consuming process. This has spurred a wide array of projects launching workarounds to fix the issue, including fractionalization of the token or launching the digital asset on a bonding curve.

With ERC-404, the concept of fractional ownership is built directly into the asset contract.

When a user buys a certain amount of fungible tokens, an NFT is automatically minted into their wallet. Subsequently, if the user decides to sell their fungible tokens, then the NFT associated with those tokens is automatically burned. Since the fungible tokens are easily traded by AMM or order books on decentralized and centralized exchanges alike, the NFTs by default also enjoy the same amount of liquidity; for example, rather than listing the asset on OpenSea and waiting for a buyer, a holder can just take profit by selling the token on Uniswap.

While the concept is novel, the surrounding effect brought on by this implementation, in my opinion, is even more exciting than the mechanism itself. Since selling the tokens burns your NFT, buying back the tokens allows you to re-mint your digital asset. As long as people keep trading the token, the collection will never mint out; projects aren’t under intense pressure to “sell out” their collections immediately.

Furthermore, collectors can continue buying and selling their holdings to re-mint and effectively re-roll the metadata of their NFTs in order to acquire assets with more favorable traits. This supercharges the token’s trading volume and liquidity, attracting more holders into the project, which in turn further increases the value of the collection.

Finally, the industry response to ERC-404 poses an interesting question. For the first time, an unaudited and unvetted Ethereum standard has been adopted by industry leaders. Is this a one-time thing, or will we begin to see new standards popping up from smaller developers around the world? Is this dangerous and detrimental to the web3 community, or does this actually push the philosophy of decentralization further, relegating the bureaucratic process of EIP voting to the past?

Today, there are already more than 20 projects building on ERC-404. Furthermore, the developers of the standard themselves launched ERC-404+ to the community, fixing some of the more serious issues plaguing the original contract, including NFT ID Caps exceeding the maximum supply. We can expect in the next coming weeks to have more and more projects join this listing frenzy. Only time will tell whether this new standard will be sustained into the future, changing the course of launching ERC standards forever.

One of the biggest barriers to entry for Web3 adoption is the concept of wallets and asset ownership. While the idea is straightforward — don’t trust banks, hold your digital currencies — in practice, it becomes much trickier. There is no denying that the world is full of terrible actors; put a veil of anonymity over humanity, and a cesspit of evil begins to brew. All one has to do is look at the comment sections of popular social media platforms to see what I mean.

Thus, in the crypto industry, the age-old battle of good and evil has evolved into a battle of security vs convenience. The scary thing is, with society growing more and more accustomed to tech-fueled micro-efficiencies, where almost anything you desire can be done absent-mindedly with a click of a button, convenience almost always wins.

For Web3 to gain mainstream adoption security needs to be able to catch up with convenience, and perhaps, ERC 4337 is the inflection point that makes this possible.

ERC 4337: Account Abstraction

Account Abstraction is an update to Ethereum that drastically improves the User Experience of decentralized applications on EVM compatible chains. However, before we get into it, let’s take a look at the fundamental problem first. There are two types of accounts on Ethereum, externally owned accounts (EOA), and smart contract-controlled accounts. In short, EOAs are free to spin up but are limited in functionalities, whereas Smart Contract accounts can store and execute cold but require gas fees to interact with them.

Today most of the popular crypto wallets like Metamask are EOAs. This means while it’s super easy for a user to make an account and start receiving stablecoins like USDT, learning to spend it pushes the user down a steep crypto rabbit hole.

Imagine a first-time web3 gamer who just joined an on-chain game for the first time. He follows the instructions to set up and connect his Metamask account. He then plays the game for a few hours and receives some ERC20 tokens and even some NFTs as his reward. While trying to transfer or spend his hard-earned assets, however, everything falls apart. Since he does not have any ETH in his new EOA wallet, he cannot pay the required gas fees to interact with the game’s smart contract.

With no easy way to acquire ETH, this is where the majority of churn happens for web3 onboarding. Enters Account abstraction. As part of the ERC 4337 update, this problem effectively goes away with the introduction of a paymaster. Instead of being left hanging due to a lack of ETH, the player can now push their transactions through with just the erc20 tokens while the game company’s paymaster contract can sponsor the ETH upfront while taking a cut from the player’s erc20 transaction to make themselves whole.

What about Account Abstraction (AA) Wallets?

What Account Abstraction did was blur the lines between a User Account and a Smart Contract Account. This new hybrid concept enables every account to function like a smart contract giving them added security and flexibility while being incredibly intuitive to use.

An AA wallet account can be stacked with more versatile verification methods beyond the EOA’s ECDSA signature scheme. AA Wallets can even make use of social recovery systems to relegate the “12 words hold your entire net worth” meme to the past. In a traditional EOA wallet if you lose your device and your seed phrase, your chances of recovering your funds are statistically zero.

In an AA wallet, however, “Guardian” keys can be set up and held by other trusted parties and can be used to aid in the creation of a new signing key.

This is not to say that AA Wallets are perfect, the benefit of them being smart contracts also comes with some downsides. While EOA wallets are limited in their functionality, creating them essentially requires just finding two large prime numbers. However, creating smart contract accounts alone will require gas fees. This means most likely the game company themselves will have to set up some treasury reserves for customer acquisition.

At the end of the day, despite its cost-based shortcomings, I believe the future of web3 adoption will still come from Account abstraction-based wallets. Its existence means a traditional gamer can sign up for a web3 game without even knowing they’re playing a web3 game. The best part is whenever the time comes, that same gaming account representing the player’s in-game identity is a fully functioning soulbound crypto wallet ready to jump into any web3 endeavor the player might be interested in down the road.

While everyone raced to build one in the past year, no one has come close to catching up with any of these previously mentioned titles, let alone surpass them.

Minecraft took the world by storm when it launched more than 10 years ago giving creators procedurally generated worlds made of blocks to shape and cultivate; to play God in their own tiny universe. Fortnite leveraged the hype of battle royale and took free-to-play to a whole new level with season passes filled with must-have skins akin to luxury goods like watches and branded garments.

Finally, Roblox built an empire on the idea of Lego sets. Anyone can build a reality and share it with the world. These unique attributes differentiated these titles from one another, each captivating a portion of a child’s imagination, serving different purposes to channel their creative and social outlets.

With the tech industry’s obsession with LTV (the lifetime value of a customer), the power to captivate the attention of an entire generation of youth became the new holy grail 🏆kicking off the space race to dominate the “Metaverse”. Microsoft acquired Minecraft, EPIC Games poured everything they have into Fortnite, and Meta, of course, launched Horizon Worlds in an attempt to replicate Roblox in a VR walled garden.

However, while these experiences have been enough to get kids hooked for hours, they have not been able to permeate the adult market in the same way. Despite the overall gaming market for adults skyrocketing in the past decade, the 💫“Metaverse” remains something for kids only.

So what’s stopping adults from adopting this medium?

After all, it’s adults who have been leading the hype and fangirling over cult classics like Ready Player One and Sword Art Online (SAO). Why aren’t they living what they preach?

Minecraft review

While Minecraft grants the player infinite procedurally generated worlds to explore, the simplicity of its “mine and forge” mechanic and the lack of progression ends up making the game one-dimensional. Yes, there have been bosses like guardians and dragons added to the game in newer updates, but there really isn’t any incentive to seek them out. So while a child may be able to easily grab a few schoolmates to hop in a world together, an adult with a stressful life and demanding job might not choose Minecraft as a place to spend lounge in at the end of the day.

Fortnite review

Fortnite on the other hand makes a great after-work destresser; a round of fast-paced excitement with flashy graphics and theming, reminiscent of the old pinball days. While the game is fun and captivating, when the only premise is to shoot or be shot, there really isn’t any room to form meaningful emotional investments. The game does not give players enough decisions to make to be a real “metaverse”, thus it becomes a pastime that some millennials enjoy once in a while whenever they remember its existence.

Roblox review

Finally, Roblox is a game that’s not really a game but a platform dedicated to simplifying game engines so that kids can build games for each other. While variety is definitely the spice of life and there is no shortage of experiences and mini-games to dive into, the lack of a main storyline or core game loop for the players to follow or journey through makes it incoherent for many people.

The rules are always changing, and new hyped worlds are always bursting onto the scene. While this fast-paced ever-changing universe is exciting for children with the energy to keep up, any responsible adult will probably get an aneurysm after just a week or two of playing.

Is the Metaverse that companies dream of as the next Social Media just a pipe dream then?

Looking at both Ready Player One and SAO we realize that although both premises involve a virtual world so complete that players can seemingly lead just as complex a life within them as they do in real life. We also see that the foundation of both concepts surrounds an MMORPG (short for Massive(ly) multiplayer online role-playing game).

This is because, beyond the game loop seeded in combat, there are various slice-of-life moments that often push players to pursue mundane tasks like running errands, managing finances, buying homes, or even cooking.

These meager features, although not significant on their own, woven together become the perfect tapestry to suspend the player in disbelief.

MMOs give players entire worlds to explore with deep rich backstories and characters that come to life as their stories intertwine. Most of all, an MMO is a multiplayer game built in a way that while everyone writes their own story, just like in real life, you can write it 🤝 together with friends.

So why don’t metaverse companies just build MMOs?

MMOs are the hardest games to build, often taking a minimum of 5–6 years to develop. The storytelling, worldbuilding, and sheer production assets required are astronomical. Every task given to the player needs to be meaningful and contribute towards them becoming better at living this alternate life.

Player classes have to be balanced and leveling up needs to be challenging yet engaging. Weapons, armor, props, and mounts all need to be designed and built along with monsters, towns, and the very laws of physics that power the game. These are investments that most companies jumping on the Metaverse bandwagon just aren’t ready to make. After all, why take the risk when cloning Roblox can be done at a fraction of the cost where the creative juices are outsourced to the players themselves?

👾 Great MMOs do exist though, with decades of refinement and a passionate team, games like World of Warcraft, Maplestory, and EVE Online, though outdated, have become the escapism of choice for hundreds of thousands of people around the world.

It’s a shame that independent studios don’t generally have the funding to make an MMO, and deep-pocketed tech companies are too cautious to take the risk. So here we are a “metaverse” industry in stasis.

Enter AI

Things are about to change, now I don’t want to focus on the alluring promises of AI-generated worlds where a semi-sentient machine replaces rows and rows of human creatives to spawn beautiful fantasy worlds out of thin air. Although these topics have been covered countless times across various news sources, procedurally generated “AAA’’ worlds are still at least 10 years away, so instead I want to focus on what is already happening today.

Launching an MMO is sort of like launching a social media platform. Network effect is required to snowball adoption, this is usually why people in the industry say MMOs have one chance to launch. Fail the debut and there’s no recovery, thus this constitutes part of the reason why it’s so risky to develop one. The requirement of an initial network effect is crucial because despite the extent of world-building, without real players running around with you breathing life into the game, the experience quickly becomes creepy.

Non-essential NPCs that fill the world are often soulless mannequins with a few lines of pre-written scripts to regurgitate at you, and even essential NPCs are only complex enough to help move you through the main quest line.

However, recent advancements in AI are looking to change this. Imagine if every NPC in an MMO is as dynamic as another player. They might not pass the Turing Test per se but they can very well carry out a conversation not unlike GPT-4 (the most up-to-date version of ChatGPT). A predefined game lore is programmed into their NPC database but beyond that, they also hold the ability to take the player’s words as input and learn to augment its understanding of the world through the player.

Here’s an 📹 example of how smart NPCs can spice up a newborn world with enough entertainment for early adopters to stay a while, giving the developers time to fix bugs and polish gameplay experiences.

Taking things one step further, Stanford researchers published a paper on Generative Agents this year that gives NPCs not only the ability to remember things but also reflect on them and plan ahead. Within the paper, we witnessed how a cohort of 25 NPCs were placed in a simulated virtual world together each powered by ChatGPT. They were given basic parameters and were set to interact with one another as if the corresponding agent were a real human being.

The results were incredibly intriguing as we witnessed an agent plan a party with several other of its “friends”, and another agent creating a political campaign to run for mayor of this simulated neighborhood. We even saw evidence of agents adding additional details to events like a human being would fill in missing gaps with assumptions.

Predictions

With this precedent in mind, we could easily foresee how an MMO could expand on a system like this to power the entirety of NPCs within their world. Imagine a database connected to thousands of NPCs. A basic layer of programming will determine the initial state of each NPC, what they know, and what they don’t. Then provide relationship information on them to kick off the game. As the server goes live the NPCs forge deeper relationships with players as well as each other to shift these parameters. Weeks, months, and even years will go by with the world’s inhabitants coming to life as dynamic agents with unique motives and intent.

We are on the cusp of a revolution that will not only change gaming forever but the idea of what a social platform is. As brands move into metaverses, NPC store clerks powered by AI will begin finding new ways to push products by connecting with players on an emotional level that no operators could’ve done.

MMO play-styles will expand so that even players with agoraphobia or a general fear of socialization can experience the same feeling of comradery in boss fights and dungeon raids without ever having to talk to a real person.

I believe as we move to eliminate loneliness in the metaverse, we will have taken the first steps towards adult adoption.

🥷Sad Creativity is the path of tech samurais. We observe the industry’s drawbacks and are forced by our instincts to take action by building what others cannot. Are you one of us?

I’m the Sad Creator — the VR purist, the gaming enthusiast, and the builder. If you’re reading this, we might have something in common.

Tech has not done well in the last couple of years, what was once seen as a new renaissance has crumbled into a pathetic state of apathetic innovation. Endless new apps are being built to needlessly fine-tune the solutions to barely noticeable problems. While investments grew larger, ideas grew smaller, and as Silicon Valley descended into madness, disappointed developers like myself sank into a deep SADNESS.

However, engineering is a lifestyle and chained by our inability to stop tinkering, we continue to build and Create. As a lifelong fan of virtual reality I witnessed the biblical rise of Oculus, and am watching closely the almost inevitable demise of Meta, what I can only hope to achieve is to rally enough enthusiasts and developers to salvage the industry before the ignorance of corporate culture ultimately destroy it.

2022 was the year the wheels fell off the metaverse bandwagon, which had been the most hyped narrative as the year began. HOWEVER…

The Metaverse IS NOT DEAD. It’s inevitable, as generations of children grow up in immersive digital realms, the real world will eventually move into the “Oasis”. It is here to stay, it is just waiting for the right people to build it into the future.

💫 The Metaverse is a part of the bigger vision

VR apps are not working today, the model of big tech walled gardens is not ideal for a community-owned future. If the Metaverse is to be determined by the inhabitants in it we need to focus on decentralizing both power and responsibility.

🔮Web 3.0.

Decentralized. Blockchain-based. Cryptocurrency-enabled. Artificially intelligent and automated. Web3 hosts so many exciting features that will translate our online interactions into an absolutely new way we interact, create, own, and experience life online. The Web3 market capitalization is currently estimated at $27.5 billion and is expected to reach a worth of $81.5 billion by 2030. Despite the bad rep, it’s gotten today, the industry has seen the strongest resilience ever, bouncing back faster and stronger after every regulatory crackdown or black swan event.

🤔Too big to be ignored, isn’t it?

Coming from an extensive background in building virtual worlds, I’m bringing together a like-minded community where we can openly discuss all things metaverse, gaming, blockchain, AR/VR, and other aspects of innovative tech. We’re here to build knowledge and meaningful connections.

Follow my Telegram, Discord, and Twitter threads to stay always informed about where the emergent Web3 technology is now — and where it’s heading.

🖼️ Sad Creator’s Builders Den

While most of the knowledge and my future events will be publicly available on Twitter, there always should be a place for those who want to take things one step further.

I am starting the Builder’s Den. A close-knit group of supporters and developers alike to help bring this industry to the next stage. Enter the Den to participate in discussions on upcoming projects, join open-source development guilds, work together in the metaverse, or just relax with others who share the same fate.

The community will begin on my Discord Server accessible exclusively to holders of our NFTs. Then we will migrate into Virtual Reality as we work together to build it into the metaverse.

Subscribe to my newsletter to be the first to know about the launch of our highly anticipated NFT collection!

Looking at the current state of the industry, we’re a far cry from the vibrant world of the Oasis promised in Ernest Cline’s cult classic Ready Player One. From plastic-looking low poly worlds to the horrendous misuse of the term “Metaverse”, it’s no wonder that critics have claimed the nascent industry was dead before it even began. However, all of us working on the technology side of the industry knows this is far from the truth.

The vision of walking into a digital world had been a quest for scientists and enthusiasts alike since the 1800s, from Morton Heilig’s Sensorama which embedded stereoscopic sound and displays into an arcade cabinet with smell generators and a vibrating chair to the Sega VR-1 and Nintendo Virtual Boy during the console war era in the mid-90s, consumer virtual reality had always been on the cusp of arriving.

However, it took an unruly hardware modder by the name of Palmer Luckey and a team of gaming titans along with an enthusiastic tech billionaire to bring virtual reality to the modern era. The question had always been whether or not this generation of VR would fall back into its slumber like all previous generations did before until another tinkerer would awaken it in the distant future with a new set of technology.

Industry leaders pondered this question since 2015, as the endless flow of cash from Facebook (Now Meta) was enough to keep the industry afloat, but not quite enough to trigger generational tech breakthroughs.

While mobile chipsets got smaller and more powerful and displays got brighter and denser, the general technology of virtual reality remained as a rearrangement of today’s smartphone technology. Even with the advent of integrated headsets, the processor, the screen, the speakers, and the operating system were still very much an Android phone.

So how do we go forward from here?

In the next part of the article, I’m going to identify 4 things that I think need to happen in order for this generation of Virtual Reality to survive.

Reprioritizing gaming

With the rapid expansion of the Metaverse concept into mainstream media, VR companies have been spread thin trying to cover all the “possibilities” of this technology. This pivot away from gaming practically alienated the biggest supporter of this technology since day 1.

A successful business identifies a small group of people who love their product and then scales their business by learning from their users.

What Meta has done recently is aggregate a large group of people who have mediocre interest in their product, most have never even tried their product. It’s no wonder they have no idea how to continue leading the industry. With the rise of PSVR, I’m hoping the VR developers can steer themselves back to focusing on the people who love them.

UX consistency

While a standard for the web has been established over the past two decades, virtual reality in contrast is still in its infancy. During the era of the Oculus Quest, locomotion in virtual reality had been standardized into two main categories. Continuous movement and teleportation with various comfort adjustment settings in between. This has made the process of content development much easier but there are more to be desired.

For example, how to grab stuff, hold on to things, throw said things, or add said things to inventory. Even further beyond this, communicating in virtual reality has also been challenging, especially for those who aren’t comfortable with voice chat. A more seamless virtual keyboard solution would definitely greatly enhance the playability of multiplayer content.

Furthermore, the introduction of passthrough and the emphasis on mixed reality brings to the table even more uncharted areas of experience design for developers to break through. A full standardization of how players are expected to behave and interact with the world must be as universally accepted as mobile app swipes and taps for this industry to hit meaningful adoption.

Breaking the Walled Garden

The next generation of computing has to break us out of the warring state of big tech companies. While web3 has often had a bad rep, the technology of Blockchain brings true ownership into the hands of users. A new-age economy can truly flourish when users are free to spend their assets seamlessly across virtual worlds. The incentives for developers become much greater too without a massive looming shadow docking half of what they make. Furthermore, a decentralized metaverse allows the possibility of a future where virtual worlds are truly shaped by their inhabitants. Where the evolution and direction of the industry grow towards where the players want it to grow.

AI Generated Content

There are two main ways that content is produced. Professionally generated content like Netflix Originals or Breath of the Wild and User Generated Content, like YouTube and Roblox. While professionally generated content is refined and has high quality they are extremely expensive and time-consuming to produce. User-generated content on the other hand was the opposite. Easily scalable by outsourcing production to the millions of potential players however the quality obviously would be lacking. This meant that user-generated content was capped by the limitations of technology.

For example, if we didn’t all have 4k cameras in our back pockets then YouTube would never have been as successful as it is today. This is why user-generated game content always had simple and low poly aesthetics. There is only so much control you can give to the general consumer with no formal game development training. However, all of this is about to change in the next 5 years.

GPT and Midjourney have demonstrated the indomitable potential of artificial intelligence in the creative field. What was previously thought to be 50 years away has become readily available to the masses.

It isn’t ludicrous to say within the next few years all NPCs would be replaced by some sort of AI and that the growth of these virtual beings will lead to the real and virtual worlds colliding together.

A decentralized metaverse where anyone can harness the power of AI to create high-quality virtual worlds will make the metaverse infinitely bigger than the real world.

As we see from the scenarios above, hardware isn’t the problem. What we have today is amazing, the ability to trick the eyes and the ears into an immersive new world is something people have been dreaming about for decades. It is in fact the narrative, the content, and the experience design itself that we should focus on to bring about a true revolution of digital worlds.

I write this with a sinking heart, after all, since the very beginning I have been a VR purist. From the first Oculus Kickstarter campaign where a bright-eyed Palmer Luckey, full of youthful optimism ushered in a new age of gaming while standing on the shoulders of giants like Michael Abrash and legendary programmer John Carmack himself.

The Oculus story started out representing the epitome of entrepreneurship. Makers and Tinkerers come together to realize their childhood dreams. While the startup didn’t stay a startup for long with a record-breaking acquisition from Facebook (now Meta). The then seemingly bottomless cash vault along with Zuckerberg’s unwavering enthusiasm seemed to be the last straw needed for the general public to also start dreaming the same dream.

However, it didn’t take long for corporate culture to poison the streams of innovation 😢. Turnovers and shifts in business priorities quickly dismantled the original dream. With head-mounted goggles coming off the production line at record rates it soon became apparent that no pair goggles are going to help restore that original vision of Oculus.

Today marks the 6 months anniversary of the Meta Quest Pro. A killer device with specs and merits representing a total upgrade from its predecessor the Oculus Quest 2, yet it fails to deliver for the Virtual Reality community.

It seems in all its haste to bring the world into its metaverse, Meta has lost sight of the most fundamental principle of business, PRODUCT-MARKET FIT🤦‍♂️. Perhaps, more ominous than its dropping of the Oculus brand, the business priorities at Meta pressured by the economic downturn had to convince an anxious board that its multi-billion dollar brainchild is more than a tech gimmick for a niche group of gaming enthusiasts.

This created a massive cognitive dissonance between the product that is and the product that Meta’s marketing department wants it to be. It’s like if Apple were to start marketing the MacBook as a gaming console, surely there are a few games that would run great on it, but certainly not in its 🧬 DNA.

Meta had the perfect opportunity to redefine how an entire generation of gamers engage with the virtual world. But their short-sightedness squandered the long game.

🔮The Metaverse is inevitable, as generations of children grow up in immersive digital realms, the real world will eventually move into the Metaverse to meet them.

However, there needs to be a time of transition where the technology itself gets to evolve and mature. Gaming is where Virtual Reality should stay in until that happens.

Luckily, as Zuckerberg moves on to chase a new shiny object in AI, out of the ashes of Meta’s disaster comes a new hope. The PlayStation VR 2 represents the perfect example of a company taking its time to learn and playing the long game.

Ever since the beginning when the PSVR was still Sony’s Project Morpheus a team of gaming experts had dedicated their time to figuring out immersive gaming.

This year, the PSVR 2 roared into existence amidst a terrible VR winter. The PCVR community was decimated by Meta’s push for stand-alone VR, while the Quest community lost all momentum with the tone-deaf Quest Pro.

Almost reminiscent of the original Playstation’s debut at E3 in 1995, the PSVR 2 while being a latecomer brought in a refreshing outlook for the industry in general. Independent from all the trends and squabbles the PSVR 2 is a wire bond console locked headset that supports not only most of your favorite Quest games but also brings fan-favorite IPs like Horizon into Virtual Reality for the first time.

Virtual Reality had gone through a whirlwind of a rollercoaster ride this past year. From being synonymous with the hottest buzzword to the subject of major layoffs and corporate failures. One thing is for certain though, despite all its shortcomings, VR IS STILL HERE TO STAY 😎. Although my heart sinks while writing this reflection on the current state of VR, perhaps at new depths, the industry can begin anew.

This time, hopefully, with some healthy competition and a diverse vision.