What is Web3? The Internet, rebuilt for ownership
The internet has been rewritten twice already. We're living through the third rewrite now.
Most founders I talk to know something big is happening with Web3, but they're not sure what it means for their business. The jargon feels impenetrable, and the technology seems abstract. And frankly, much of the conversation has been dominated by speculation rather than practical application.
Here’s the truth: Web3 isn’t some alien future. We're transitioning from an internet where we consume and create content to one where we can own our digital presence, data, and the value we generate. It's a fundamental restructuring of how digital economies work.
Let me break down why this matters, especially if you're considering building something new.
The history of the internet: From reading, to writing, to owning
The easiest way to understand Web3 is through the evolution of what we can do online:
✦ Web1 (1990s-2000s): Read
The early internet was like a massive digital library. You visited websites, consumed information, but couldn't contribute much beyond filling out basic forms. Think back to early Yahoo, static company websites, and online brochures. You were a reader, not a participant.
✦ Web2 (2000s-now): Read and Write
Social media changed everything. Suddenly, everyone could publish content, share opinions, and build audiences. Facebook, Twitter, YouTube, TikTok, the creator economy, user-generated content. You became both consumer and creator.
But here's the catch: While you could create, you didn't own what you built. Your followers, your content, your data, your audience relationships, all lived on someone else's platform under someone else's rules.
✦ Web3 (now-future): Read, Write and Own
Web3 adds the missing piece: ownership. Your content, your data, your digital identity, your community relationships, secured on blockchains and represented through tokens. It’s a shift from creating value to capturing it.
Think of it this way: If Web2 was about us using the internet, Web3 is about us owning it.
Web3 through everyday analogies
The best way to grasp Web3 is through practical comparisons to what you already know:
The social media example
Web2 today: You post a photo on Instagram. Meta owns the platform, controls who sees your content, keeps all the advertising revenue, and can delete your account at any time. You have 50,000 followers, but you can't take them with you if you leave.
Web3 tomorrow: You post in a tokenized community. You own your content cryptographically, maintain direct relationships with your audience, and may earn tokens based on engagement. If you want to move platforms, you can take your reputation, followers, and earnings history with you.
The creator economy shift
Web2 today: YouTube takes 45% of ad revenue from your videos. You have no say in platform changes, algorithm updates, or monetization rules. Your entire business depends on their goodwill.
Web3 tomorrow: Creator communities where fans can buy tokens that represent ownership stakes in your content. Revenue flows directly to token holders. Major decisions get voted on by the community. You're building a business, not just an audience.
The gaming revolution
Web2 today: You spend $500 and hundreds of hours building up characters and items in a game. The game company owns everything. If they shut down servers or ban your account, you lose everything.
Web3 tomorrow: Your characters, items, and achievements are NFTs you actually own. You can trade them, use them across different games, or sell them when you're done playing. Your time investment becomes real value.
In every case, you're not just the product. You're a stakeholder.
Why this matters for startups and marketers
For early-stage founders, the shift to Web3 unlocks three fundamental advantages that reshape how you can build and scale:
1. Ownership creates deeper user engagement
When your customers own a piece of what they're helping build, their relationship with your product changes completely. They're no longer just users; they're investors in your success.
For startups: Imagine if your earliest customers owned tokens that appreciated as your product gained traction. Customer acquisition becomes community building. Retention becomes investment management.
For marketers: Traditional loyalty programs give points or discounts. Web3 ownership gives customers equity in your brand's success. Your most engaged users become your most powerful marketers because they're financially incentivized to promote growth. Word-of-mouth marketing transforms from hopeful outcome to aligned business model.
✦ Example: Axie Infinity players don't just play a game; they own digital assets that appreciate based on the game's success. This creates a virtuous cycle where engaged users actively promote growth because they directly benefit from it.
2. Building trust through transparency
Blockchain technology makes business processes transparent and verifiable without requiring customers to trust you personally. This is especially powerful for new companies that haven't built reputation yet.
For startups: Instead of asking customers to trust your data practices, security measures, or business model, you can make them verifiable. Trust becomes a technical feature, not just a brand promise.
For marketers: Brand trust traditionally takes years to build through consistent messaging and delivery. Web3 transparency lets you prove trustworthiness immediately through verifiable actions. Your marketing claims become mathematically checkable, making trust a competitive differentiator rather than just a brand aspiration.
✦ Example: DeFi protocols like Uniswap publish all their transaction data on-chain. Users can verify exactly how the system works without relying on the company's promises.
Ownership and trust reshape how companies grow and how people engage with them.
3. Community as co-creators
Web3 enables customers to become active participants in product development, not just feedback providers. They can vote on features, propose changes, and share in the value they help create.
For startups: Your power users can become formal stakeholders with voting rights on product direction. Customer feedback becomes customer governance.
For marketers: Instead of running focus groups or surveys to understand customer needs, you can give your community direct influence over product roadmaps. Customer research becomes customer participation. Brand loyalty deepens because customers aren't just buying your vision, they're helping create it.
✦ Example: Compound is a cryptocurrency lending platform where users earn COMP tokens for participation. Token holders vote on interest rates, new features, and strategic decisions— essentially governing the product's evolution. It's like if Netflix users could vote on which shows to produce and subscription pricing.
There is a trade-off: Community governance can slow decision-making and sometimes prioritizes popular features over strategic ones. You'll need resources to manage the governance process, and vocal minorities can occasionally hijack discussions. But for brands willing to navigate these complexities, the engagement and loyalty benefits often outweigh the operational challenges.
Where AI fits into Web3
Right now, AI feels like it belongs to Big Tech. OpenAI, Google, Meta— these companies control the models, the data, and the outcomes.
Web3 asks a different question: What if intelligence itself could be decentralized?
This intersection is creating fascinating new possibilities:
Verifiable AI through Proof-of-Intelligence (PoI)
Companies like Bittensor, Gensyn, and others are developing ways to cryptographically prove that an AI output actually came from legitimate compute resources, not just claimed results from a black box.
✦ Why this matters: You can verify that AI results are genuine, that models weren't tampered with, and that compute was actually performed. Trust in AI becomes mathematically verifiable.
Community-owned AI models
Instead of AI development happening behind closed doors at major corporations, Web3 enables community-funded and community-governed AI development.
✦ Why this matters: Projects like Stability AI started as community efforts where token holders could influence model development and share in the value created, democratizing AI innovation beyond Big Tech.
Data ownership meets AI training
Web3 enables individuals to own and monetize their data contributions to AI training, rather than having it harvested for free.
✦ Why this matters: Your personal data becomes a valuable asset you can choose to license to AI companies, with smart contracts ensuring you're compensated fairly for its use instead of having it extracted without compensation.
In short, pairing Web3 with AI means:
AI you can audit and verify.
Intelligence that doesn't sit in a corporate vault.
Communities that share in both the data and the value AI creates.
Personal data that works for you, not against you.
Common misconceptions about Web3
Before we go further, let's address the elephant in the room. Web3 has been associated with speculation, scams, and environmental concerns. Here's the reality:
“It's all about crypto trading”
The misconception: Web3 is just cryptocurrency speculation and get-rich-quick schemes.
The reality: While financial applications were the first to gain traction, Web3's core value is about ownership and governance structures. Most interesting Web3 applications aren't focused on trading at all.
“It's bad for the environment”
The misconception: All blockchain technology is energy-intensive like Bitcoin.
The reality: Modern blockchain networks like Ethereum 2.0, Solana, and Polygon use energy-efficient consensus mechanisms that consume a fraction of traditional proof-of-work systems. For context, the traditional banking system — with its physical branches, ATMs, data centers, and cash printing operations — actually consumes significantly more energy than most modern blockchain networks.
“It’s too technical for normal people”
The misconception: Web3 requires understanding complex cryptography and blockchain technology.
The reality: Just like you don't need to understand TCP/IP protocols to use the internet, Web3 applications are becoming increasingly user-friendly. The complexity gets abstracted away.
For example, you might buy an NFT with a credit card through a simple checkout flow, or join a tokenized community that feels just like any other membership platform. Companies like Coinbase and OpenSea are already creating user experiences that hide blockchain complexity behind familiar web and mobile interfaces.
Practical Web3 applications for different industries
Let's look at how Web3 principles could apply across various sectors:
Content and media
Longevity: Creators own their content and audience relationships.
Monetization: Direct creator-to-fan payments without platform fees.
Governance: Communities vote on platform policies and revenue distribution.
Supply chain and manufacturing
Transparency: Every step of production recorded immutably.
Trust: Customers can verify authenticity and ethical sourcing.
Efficiency: Smart contracts automate payments and compliance.
Healthcare
Data ownership: Patients control access to their medical records.
Interoperability: Health data moves seamlessly between providers.
Research: Patients can monetize their data contributions to medical research.
Education
Verification: Degrees and certifications become tamper-proof.
Portability: Academic achievements follow students across institutions.
Incentives: Students and educators share in the value of educational content.
Building your Web3 strategy: A framework for startups
Phase 1: Identify your ownership opportunity
Ask yourself: What valuable assets do your users currently create that they don't own? For example:
User-generated content: Reviews, tutorials, templates, creative works that drive traffic and conversions.
Community contributions: Forum discussions, knowledge sharing, peer support that reduces your support costs.
Data and insights: Usage patterns, preferences, feedback that inform your product development and business decisions.
Network effects: Referrals, connections between users, audience growth that increases your platform's value.
✦ Note: This isn't the same as your unique value proposition. It's about identifying what your users contribute that has value beyond just using your product. The ownership opportunity could become part of your UVP if you let users own and monetize those assets. Like: “The only project management tool where you own and can sell your productivity templates.”
Phase 2: Design for stakeholder value
Ask yourself: How can giving users ownership stakes improve your business model?
Deeper engagement through aligned incentives.
Viral growth through stakeholder promotion.
Reduced customer acquisition costs.
Premium pricing for ownership features.
Phase 3: Choose your implementation
Web3 doesn't require rebuilding everything from scratch:
Light integration: Add token rewards to existing systems.
Medium integration: Create community governance features.
Deep integration: Build core product logic on blockchain infrastructure.
Phase 4: Build community first
Web3 success comes from community engagement, not just technology:
Start with passionate early adopters.
Give them real influence over product direction.
Share value creation transparently.
Iterate based on community feedback.
The bottom line: What Web3 means for your business
The internet is being rebuilt. Instead of just logging on, you’re now holding the keys. Web3 isn't about scary jargon or speculative trading. It's about flipping the script from platforms owning us, to us owning platforms.
Rather than just extracting value from users, successful Web3 companies create systems where everyone who contributes value also captures value.
For both startup founders and marketers, this represents the biggest shift in business model innovation since the advent of software-as-a-service, and rethinking some basic assumptions:
Customers as stakeholders, not just users.
Transparency as a competitive advantage, not a liability.
Community governance as a feature, not just feedback.
Ownership as engagement, not just retention.
Consider these strategic questions:
What valuable assets do your users create that they don't currently own?
How might ownership change the relationship between your business and your customers?
What parts of your business would benefit from increased transparency and trust?
How could community governance improve your product development process?
You don't need to become a blockchain expert overnight. But you do need to think about how ownership, transparency, and community governance might reshape your industry. Understanding these principles will help you identify opportunities to:
Build stronger relationships with your customers.
Cut acquisition costs.
Design sustainable business models.
Create moats through shared ownership and network effects.
Because ultimately, Web3 isn't about the technology. It's about user empowerment. And empowered customers become the strongest advocates, the most loyal users, and the most valuable stakeholders you can have.
Web3 is changing how customers engage with brands, just like AI is changing how brands engage with customers.
Let's discuss how to position your brand and engage your community for sustainable growth.