Interview: Mensh, ChainCatcher
Guest: Will, Core Contributor of Alliance DAO
Founded in 2020, Alliance DAO is the leading Web3 accelerator and founder community, helping the top 1% of Web3 founders start and grow their companies through a 10-week program led by renowned Web3 experts. Alliance DAO’s community includes founders, lawyers, auditors, liquidity providers, market makers, and more.
So far, Alliance DAO has held 14 startup acceleration camps, with the total market value of the incubated companies reaching $11 billion. In this cycle, incubation projects such as Pump.fun, Moonshot, and Glow have all performed very well.
In this conversation, we invited Will Robinson, the first employee of Alliance DAO, to share his personal experiences in the Web3 space and insights on how to filter projects and founders.
Personal experience
ChainCatcher: Let's start with your personal experiences in the crypto space.
Will Robinson: My career began as an academic researcher. I studied for eight years in graduate school, researching video games, tabletop games, and sports, focusing on the history and culture of games. I worked in the English, sociology, and communication departments, studying mechanism design and how games help game designers create more artistic games. The focus was on indie games, especially those that are shocking and not just for entertainment. For instance, I designed a game about when the 'best time' to commit suicide is during high school. Researching the mechanism design and incentive structure of those who had early suicidal thoughts. These are the themes I explored, and they presented significant design challenges.
Later, I left game research and academia because my cousin Dan (whom I believe is one of the smartest people in the crypto space and the head of research at Paradigm) introduced me to Bitcoin. He told me how research in mechanism design could help people in the blockchain space. That was early 2017, and I was about to finish my PhD, so I decided to switch careers. I started attending meetups in Montreal, looking for opportunities among a group of passionate cryptocurrency enthusiasts.
After four or five meetups, I found a job helping people promote audit businesses. The pay was very low, and I had no work experience, but my academic background made me good at storytelling and marketing. They wanted me to help them promote their products. We help anyone who needs to prove to regulators that they indeed hold cryptocurrency on their books. For example, if you are the Ethereum Foundation, you need to report financials in a specific way according to Swiss regulations during the first few years and then have stricter reporting structures after a few years. We have worked with Swiss entities like the EOS Foundation and Lisk Foundation. Additionally, if you are a fund based in the Cayman Islands holding cryptocurrency on your balance sheet, you need to report to the local regulator, CIMA (Cayman Islands Monetary Authority), to ensure you fulfill your fiduciary duties.
We audit Cayman funds, foundations, and exchanges around the world. Exchanges usually have regulators, and we ensure they hold cryptocurrencies safely, correctly, and intelligently, training employees, conducting penetration tests, and risk assessments. I worked there for nearly four years, gradually becoming an expert in the field. Starting as a marketer, I shifted to becoming an auditor or audit expert, all while learning more about cryptocurrencies in the process of promoting products and gradually adapting to the tech field. Then I applied to join Alliance as their first employee to help establish the accelerator program.
By now, I have been working here for almost four years. I have tried almost every role, including fundraising, mentoring, marketing, and research, among many others. Constantly shifting roles to find the direction I enjoy. While working in a startup, you can decide what the most important thing is next and then hand off tasks to those who are better at them. I love communicating with people, so I spend a lot of time mentoring.
ChainCatcher: In startups, which role do you enjoy the most?
Will Robinson: I love helping teams prepare for Demo Day. We have 20 teams in each batch, and about 10 to 15 teams will be ready to present to venture capitalists at the end of the batch. I spend a lot of time communicating with each team, teaching them how to tell their startup story, how to tell it quickly and engagingly, making people want to invest.
By working with 100 to 150 startups, it not only provides the team with a compelling story to attract investors but also gives them a deeper understanding of themselves regarding why the company is important and what sets it apart. We put a lot of effort into preparing for Demo Day. Up until the last batch, this was one of the parts that founders liked most about Alliance, which makes me very proud.
ChainCatcher: How does your academic background influence your subsequent work?
Will Robinson: During my PhD studies, I did not learn much that could be directly applied to the Web2 gaming field. Because Web3 gaming is completely different from Web2 gaming, at least in the foreseeable future.
However, I learned how to present, how to collaborate with others, and most importantly, I learned how to face a very difficult problem alone and spend a long time completing it under extreme mental duress (like dealing with a complex problem in isolation). Therefore, the most important thing my PhD studies taught me was how to deal with ambiguity. Facing questions that have no ready answers, no formulas to refer to, everything needs to be created anew by yourself.
ChainCatcher: There are many trivial matters to handle when helping startups. How do you manage your time?
Will Robinson: I spend a lot of my time connecting teams with venture capitalists, from preparing for discussions to making formal introductions. I maintain a very long list of venture capitalists to ensure I can introduce teams to 50 to 100 potential investors. This is very time-consuming.
In addition, I also spend a lot of time reviewing potential applicants or future alumni, as they will apply to our programs. We receive nearly 2000 applications in each batch. These applications require time to read, and it takes time to interview applicants, sometimes requiring a second interview.
Another major task is fundraising for our third fund. Alliance already has two funds and is currently raising a third fund.
Decision-making process of Alliance DAO
ChainCatcher: How do you efficiently filter projects? What does the decision-making process look like?
Will Robinson: Each application is evaluated from two aspects: whether the team is excellent and whether the idea is outstanding. I believe that an excellent team is more important than an outstanding idea, perhaps two to three times more important. The idea is more about proving that the team can come up with a good idea rather than the importance of the idea itself.
Alliance is not fixated on specific domains; we focus more on great founders. Because we get involved very early, it is almost certain that they will pivot at some stage. We help them adjust, collaborate with them, and even support their pivot.
For instance, the Pump.Fun team joined us as Caviar and later built a 3:3 application based on Friend.tech. If we had rejected them because we didn't like Caviar, it would have been one of the biggest mistakes of our lives. But we didn't do that because we knew this team was exceptional.
What is an excellent team? I think this is central to early-stage venture capital, and it requires firsthand observation. Excellence does not necessarily mean having attended prestigious schools, having worked for big companies, or having previously founded a startup that successfully exited. As Alliance founder Qiao said, to be an excellent founder, you need to be 'traumatized and a bit reclusive.' Only a truly 'broken' mind can succeed in this space. We are looking for extreme drive.
Most founders don't even know why they are motivated to create their companies. Therefore, an important part of my interviews is guiding them through self-reflection. I try to get them to tell me why they want to do this. They often start with, 'It's to solve this problem.' Then I ask, 'But why do you want to solve this problem?' They say, 'Because it's an important issue.' I continue to probe, 'Why do you personally want to solve this problem?' They might say, 'Because I had this problem before.' Then I ask, 'Why don’t you let someone else solve this problem? Why does it have to be you?' I keep digging until I uncover something, like what happened when they were six years old that made them have to solve this problem. This deep exploration is crucial.
ChainCatcher: How many rounds does a team need to go through to enter Alliance?
Will Robinson: Two rounds. Usually, the first round is 15 to 20 minutes, and the second round is 30 to 45 minutes. Y Combinator only does 10-minute interviews at a time. As you practice more, you find that you can quickly gauge whether someone is exceptional. We call it 'heat.' We ask each other, 'Can you feel the heat in the interview?' Some people have heat, and some do not, and the manifestation of heat varies. Since we are still building a community, Alliance is also a DAO, and this community cannot have bad apples. Because we are still small, one bad apple can spoil the whole bunch.
ChainCatcher: What percentage of projects stand out to you that make you feel 'heat'?
Will Robinson: We interview 20% of applicants, then interview 20% of those, and finally accept 20% of that.
ChainCatcher: Are there any missed opportunities for excellent founders?
Will Robinson: I can give two examples. In the last batch, there was a company called Force Prime. The team consisted of three older gentlemen from Eastern Europe who had a lot of experience in the Web2 gaming field but had very little understanding of Web3 gaming. They applied, we rejected them. They applied again, and after the interview, we still rejected them, explaining the reasons. They applied for the fifth time, and I finally let them in.
Part of the reason is that I realized my biases were affecting my judgment; they are actually very excellent developers, smart and eager to learn. I was also happy to let them struggle outside for a while because their initial ideas were indeed terrible. They didn't understand Web3 enough and later became increasingly sophisticated, becoming more familiar with how Web3 works. I enjoyed working with them; the founders were exceptional.
Of course, there are cases where we reject applicants, and they do not apply again. One case stands out particularly, which is Monad. At that time, we were uncertain whether they could build a community, and their valuation was quite high. In the early days of Alliance, we did not have strict limits on valuations for entry projects, allowing teams of different valuations, sometimes even very high valuations. But at that time, we lacked 'purchasing power,' we had no reputation, and people did not think it was worth giving us 7% of their company. Now, we no longer face this issue; enough people believe we do very well and that such dilution is worthwhile.
Business model of the accelerator
ChainCatcher: Many VCs also want to incubate themselves. What do you think your competitive advantage is compared to VCs who incubate themselves?
Will Robinson: I believe VCs can do well with 'Entrepreneurs in Residence' (EIR) programs. Paradigm is a great example. They take in a founder, work with them, help them come up with an idea, and start a company. But they can only support a few people at a time.
I believe that running a full accelerator is beyond the scope of most VCs and is not financially viable. The operating cost of an accelerator is about $5 million per year, and management fees are even far from covering these costs. This is not a good business. You need to leverage your accelerated teams in a larger vision or other ways. In our case, this is about building a DAO focused on creating something very unique.
When VCs have other priorities, such as managing large amounts of capital, they cannot focus all their attention on these teams. They run accelerators to invest more money in Series A or B rounds. But when the focus is like that, it significantly impacts the teams that join the accelerator. If these teams do not receive follow-up investment or do not get Series A investment from these VCs, it is basically equivalent to 'dying.' Other VCs will question, 'Why didn’t your accelerator company receive follow-up investment? Don’t they have follow-up funds?' This could be due to completely valid reasons, such as excessive industry exposure or losing confidence in a certain area, rather than the teams' fault. But such impressions are often dangerous. I think most VCs have no reason to operate accelerators.
Additionally, running an accelerator requires tremendous focus, such as needing 15 full-time employees, and most VCs do not have that kind of energy. Auditing 2000 applications requires a lot of work, so my advice is that the best VCs should focus on some founders emerging in the network and support them as available resources rather than trying to run an accelerator.
ChainCatcher: Besides online applications, do you have other sources for finding projects?
Will Robinson: All applicants must apply through our website; this is how we maintain order. But the way they hear about Alliance or the website varies. More than half of the teams are referred by previous founders or alumni who tell applicants, 'Trust me, Alliance is worth your time.' Most founders should be wary of accelerator programs, as many are not worth the time. The best founders in the world know this. So to earn their trust, they need to hear recommendations from their circle. They need peers to tell them, 'These people are reliable.' That's why we have spent a long time building a large network of founders to spread the message that we are different.
ChainCatcher: Why are founders afraid to join accelerators?
Will Robinson: Great founders typically do not go through accelerators because they already know how to build a company. The projects they are building may be overvalued, or they may choose to go to Y Combinator. Top founders know that most accelerators cannot provide the value needed compared to giving up equity dilution. Therefore, it took Alliance a long time to get great founders to accept the conditions we required for application. Building that trust requires hearing it from two or three people.
Some excellent founders are at the early stages of their careers, and accelerators can really help them learn. But now that Alliance is a well-known brand and has a large community, great founders are willing to give up dilution to sell their products to hundreds of alumni. Now, many of our teams' first customers are alumni of Alliance. This way, you can quickly launch your business and get feedback.
Secondly, the legitimacy and signal brought by Alliance now hold significant meaning. You can gain a lot of market promotion and exposure because you will be listed among a series of recent success stories. I think this year we have Moonshot and Pump.Fun, along with many other emerging consumer projects. So, if you are building a consumer application, Alliance will help get your product seen by more customers, and people are willing to do that. If you are building SaaS or some kind of infrastructure, then you would want to join Alliance to sell your product to its founder community. These are two different reasons you might want to join.
Accelerators fall into two types: one is very boring, assembly-line style guidance, such as how to register a company, implement HR practices, establish hiring processes, design websites, and marketing, and even more specialized crypto guidance, like how to issue tokens.
But Alliance does not do these things. We will not tell you how to register a company or how to issue tokens. We will tell you how to create products that people want to use. Finding product-market fit is very challenging. A typical junior mentor at an accelerator cannot help you achieve this. But Alliance's mentors have been working in the crypto space for 8 to 15 years. These people are the ones who truly help you find the right product for your target users.
ChainCatcher: You mentioned that investing in follow-up rounds can be detrimental to projects. Do you sometimes invest in follow-up rounds?
Will Robinson: We never invest in follow-up rounds for the teams we accelerate. This way, venture capitalists cannot discern which are our favorites. However, we will invest in follow-up rounds for teams we did not accelerate. For example, Arbitrum gave us an investment opportunity. We invested in Axie Infinity. We have many great strategic investments, but these do not fall within the accelerator's scope.
Evaluation of founders and teams
ChainCatcher: How do you view the balance between a founder's ability to pivot and resilience?
Will Robinson: When we interview founders, we check several aspects. First is whether there is a strong collaborative relationship between the founders. If not, it means they might fail during the pivot process. Therefore, we place great emphasis on finding people who have been working together for a while.
Another point we focus on is whether they have an obsession with succeeding at all costs. This is also very useful. We really do not like teams that are too large. This is a big issue for teams from Asia or Eastern Europe, where the labor costs are lower, and people tend to hire quickly. However, large teams find it difficult to pivot. So we strongly favor small teams.
Generally, the first thing when joining Alliance is to teach them how to downsize. If you haven't found product-market fit, then you don't need that many employees. You need to focus on finding the right problem and the right solution. Some companies need a lot of employees to achieve this, but that is very rare. And that's not the type of company we excel at helping.
Y Combinator and OpenAI are a good example. OpenAI broke all the rules of Y Combinator. It is not like a typical YC company. It has too many employees and has had no clear product-market fit in 10 years. But it is one of the most valuable assets they have accelerated. So there will be exceptions, and we will accept them. But generally speaking, if we want them to pivot, we need them to have strong motivation, solid collaboration, and fewer employees.
(Stardew Valley) Quickly earned over $100 million with just one developer. I'm not here to create the next $2 billion (Rockstar) like (GTA7). I believe that if we are to develop games in the crypto space, it's best to stick with small teams.
Typically, the teams that come to us tend to be the largest because they come from the Web 2 space, like the traditional gaming industry, where a large team is required, and everyone is like a cog in a machine, quickly developing many different games. However, the usual outcome is that they ultimately slow down all processes due to entering the crypto space, slowly developing just one game, and overemphasizing quality at the expense of quantity. If I were to communicate with a game team, I would like to hear that they released 20 games in a year, constantly trying, even if the games might be rough, as they look for market and product fit.
We are now receiving many project applications related to AI. Many applicants around tokenized AI are proposing ideas centered around this theme, and I am excited about it. I have always wanted to provide financial services to those who cannot access banking services, but I did not expect that 'those who cannot access banking services' would include AI. I initially thought it was people in the Global South who could not access banking services, but now I find that AI is also struggling with managing funds. I am very hopeful to see crypto technology solve this problem for AI. The core interest for our alliance is great founders; whatever they want to build, we are excited to build alongside them.
ChainCatcher: What do you think is the most interesting project right now?
Will Robinson: It's Pump.Fun, as it changed the way many people behave and led to different thoughts about meme coins. Another amazing project is Glow because it incentivizes solar farms in a very interesting way and performs exceptionally well. However, there are infinitely many interesting projects, and I also enjoy being surprised.
In the first two months, we had no idea Pump.Fun would be a huge success. Initially, no one used it, and we had to beg people to try it out. This is the kind of project that starts very slowly but then suddenly explodes. Many people thought it would quickly disappear, but this was not the case. It is still unclear where Pump.Fun will ultimately end up, and I enjoy thinking about what its ultimate game mode might be. Now we see other projects starting to use it as a platform to release content, which also brings various issues, such as how to handle or whether to handle potential criminal activities. Moreover, there are many interesting challenges surrounding this team that occupy most of my thinking space.
When they joined us, they were developing an NFT trading platform called Caviar, which used some unique financial primitives to showcase its uniqueness. Although they had some user base, it was still not enough, so they tried a few new things, but the team also split. One co-founder, Mohammed Bayoumi, left to found Exo, a high-performing AI company.
The other two found new co-founders and began developing in other areas. At that time, they didn't know what to develop, and we brainstormed with them. Imran, one of the co-founders of Alliance, was also the mentor who worked most closely with the Pump team. He collaborated with Chow to explore Friend.tech, believing there were some interesting things worth exploring or developing. Thus, they began researching bond curves and speculation in social media environments.
Although Friend.tech's appeal is insufficient, and their project interest is not enough, they learned how to launch a token at an extremely low cost (only 2 cents). This ultimately became a clear milestone for community members, helping to push the project forward.
I believe a key lesson in entrepreneurship is that you need to create lucky conditions for yourself. You need to work hard in the right direction to solve people's problems, but at the same time, hope that something unexpected will eventually play a significant role. They learned many lessons through deeply understanding users and consumers, continuously focusing on the consumer crypto space while adapting directions, which allowed them to acquire domain expertise and ultimately discover something genuinely useful.