The Y-combinator business model combines providing funding and support with technical know-how and marketing. This model has delivered enormous RoI for the investors and the investee companies.
Y-combinator has been a super-successful investor in start-ups. The valuation of all its alumni companies, combined, is in excess of $400 billion as of 2021. The better-known of its alumni companies are Airbnb, Dropbox, Coinbase, etc.
However, the downside of the YC model is the length of time required. Its portfolio companies took 16 years to reach a combined valuation of $400 billion.
Such a length of time would be unthinkable for DeFi. Projects on Web3 take only a few months to reach unicorn status. YC companies take at least a decade and many rounds of funding to reach a similar valuation.
The ecosystem of Web3 allows faster growth. However, this also requires investors with a different mindset and a different level of technological expertise.
Blockzero Labs is working on a model to enable start-ups to grow rapidly.
The existing model of venture funding requires founders to part with equity in return for venture capital. Web3 will change this. It will enable ownership such that the business’s users have more control than the owners.
DeFi provides tokens to enable owners to contribute to the protocol’s governance. This model incentivizes those who are early to adopt and are active users. DAOs help, through tokens, to provide a decentralized mode of ownership and governance.
The decentralized model has also upended the traditional work structure. Now, dApps allow 24/7 working with no downtime. In the traditional VC funded model, the VC funds and the investee companies follow entirely different work models. Blockzero aims to transform these aspects.
.Blockzero will be structured as a DAO. It will have no downtime since the users and the firms are decentralized. Blockzero’s strategy is driven by the thought that since Web3 is always on, accelerators should be too.
Thus far, Blockzero’s aim of being the YC for the decentralized world is on track.