June 5, 2022

What a Web2 fintech founder learned after 3 weeks of Web3 immersion

While there's still a big gap between hype and reality, fintech founders can learn a few tricks from web3.

Anh-Tho Chuong Degroote

Most “Web2” founders are still sceptical of the Web3 hype. But I asked myself seriously: can a fintech founder afford to stay completely away from the "next iteration of the internet"? 

I didn’t know the answer, but I didn’t want to take the risk of being wrong. 

So I took a deep dive into Web3, for three weeks, seven days a week, with the most open mindset possible. Perhaps I’d find a killer differentiator for Lago, which is still 99% Web2. No matter what, at least I’d impress my friends with my crypto knowledge. 

For those of you that aren’t familiar, Web3 usually refers to blockchain-powered technology that prioritises decentralisation, versus Web2 which is more about centralised platforms — your Googles, Microsofts, Facebooks and so on. 


Long story short: my research was nothing short of disappointing. There’s a huge gap between Web3 ideology and the current reality, and for everyone who gets rich on NFTs, there are more who don’t get anything at all. 

That said, I did learn a few things. 

Apart from one exception, there is no market for 'crypto startups' yet

Beyond the “getting richer thanks to crypto”, Web3 is full of solutions in search of a problem, especially among startups building for other crypto startups.

But do we really need a CRM (customer relationship management) or a B2B bank for crypto-native companies? How specific are their needs, and how great can a new Web3 product be compared with its Web2 equivalent? Remember that B2B SaaS took a decade to emerge, and prove that SMEs — a massive pre-existing segment — were worth building software for. So it looks early to build exclusively for "crypto SMEs". 

Web3 is full of solutions in search of a problem, especially among startups building for other crypto startups

There might be emerging Web3-related needs such as token-gating access to some resources, or payments, but the best positioned to win are Web2 scaleups. They can spin up specific crypto taskforces to build dedicated feature sets in no time, and so play on both tables. This is what Stripe did: they announced a partnership with Crypto.com and Blockchain.com earlier this year, after quitting the crypto arena in 2018. Stytch, the authentication unicorn, also recently launched Web3 features. 

👉 Read: Web3 startups investors have their eyes on

The only exception might be “pure” crypto infrastructure companies. Not the ones building an equivalent of a well-known productivity SaaS “but for Web3” (i.e. Asana for web3), but the ones building the Amazon Web Services or Microsoft of crypto. Great examples of this are Alchemy and Polygon — respectively valued at $10bn and $13bn. Indeed, there’s just a higher competitive moat and more resilience within the infrastructure space: it will always be needed, whatever the use cases and applications of crypto will be. 

The most promising companies are using crypto behind the scenes

As a fintech founder, the applications of Web3 in the Web2 finance system are what intrigued me the most. While some Web2 fintechs only think of crypto as a “trading feature to add” (something that has been very profitable for Revolut), others leverage Web3 technology to solve Web2 problems. 

The most obvious example might be international transfers and payments, especially from or to underbanked or generally grey-listed regions such as Africa. It can still take up to a week to send money there, with hefty fees attached. 

The most massive market opportunity might still involve bringing Web3 to the masses, by adapting Web3 to Web2

This is what Chippercash is solving for: they offer instant payments and transfers to Africa, at a lower rate, using cryptocurrencies and especially stablecoins, cryptocurrencies pegged to another currency or asset like the US dollar or gold. They interestingly barely mention “crypto or “Web3” on the website, and it’s probably part of a strategy to attract a mainstream user persona, not only the crypto enthusiast. Other companies, such as Ejara in Western Africa or Xend.Finance in Eastern Africa, use cryptos to design savings products for this underserved but booming market. 

👉 Read: The most active Web3 seed investors in Europe

The most massive market opportunity might still involve bringing Web3 to the masses, by adapting Web3 to Web2, as a first step, in underserved regions, rather than betting on everyone switching to a 100% permissionless model. This may happen, but we’re still very far from it. 

Web2 companies need to steal Web3’s hiring and motivation tricks

Even if the most promising companies might not make it evident to consumers that they’re using a Web3 product, Web3 will still be something that these companies want to communicate to talent. 


While Web2 companies keep competing for talent with never-ending perks and all-time high packages, Web3 organisations attract elite tech talent without even committing to pay them. 

I’ve seen top executives spend their early mornings, late nights or weekends participating in DAOs (decentralised autonomous organisations) or building protocols. 

What motivates them? This upbeat energy of building the future. The best way to describe it is to visualise Web3 as a whole new planet or continent: for builders, this means you can reinvent everything, every concept and shape it as you like. In most cases, they are given the possibility to co-own part of the DAO, through ownership tokens, earned based on their contribution. 

This has big implications for Web2 founders. Don’t let some people with “digital monkey photos” make you feel bad about being Web2. That’s okay. But you’ll need to work hard to give talent the same kind of excitement — and potential upside — in order to compete.

Anh-Tho Chuong Degroote is CEO of Lago

Anh-Tho Chuong Degroote

Anh-Tho Chuong is the cofounder at Lago.