Alliance Dialogue Starpower: How Web3's YC is Rising?

Author: Starpower

"An important point about Alliance is that we don't actually pick specific directions; we pick founders."
Guest: William Robinson, Alliance Director & Accelerator Mentor
Host: Laser (Co-founder of Starpower)

Starpower is honored to invite William Robinson—Director of Alliance and a seasoned mentor in the crypto space—to share his valuable experiences in the crypto and energy sectors. This episode delves into the upcoming mainnet launch of Starpower, the challenges and opportunities of the DePIN project. Will also discusses several successful cases he has mentored in the accelerator, including how strict requirements and high standards for teams have driven explosive growth in projects, and why he values and chooses Starpower. Through this interview, we will explore how DePIN bridges Web3 and energy management, promoting the construction of smarter and more efficient energy networks.

The audio record and translation are generated by GPT, so there may be some errors; please listen to the complete podcast.
YouTube podcast link: https://youtu.be/K5vVpGvRSws?si=sGWZQ-Ib_odnJqLL

Background Story

Laser: Hi, Will, it's a great honor to have you as our third guest on the DePIN Power podcast today. Before we officially start, I would like to introduce the background story of why we have this podcast today. Starpower has just graduated from the 13th cohort of the Alliance accelerator. And you, I believe, are one of the best mentors at Alliance, and most importantly, you are also the most popular mentor in our cohort. So, since we plan to launch the mainnet in the coming months, we wanted to invite you for an in-depth discussion. Today's topic will focus more on Alliance, DePIN, and your insights after seeing so many projects as a mentor. What advice do you have for founders? So, let's start with you briefly introducing yourself, your background, and what drove you to join Alliance.

Will: Sure, let me introduce myself. My name is William Robinson, and I am the Director of Alliance and a mentor in the Alliance accelerator. I have been with Alliance for three and a half years, and I have gone through ten cohorts of the accelerator, mentoring about 200 teams. My background is a bit unusual. I worked as a crypto auditor at Grant Thornton for three and a half years, helping audit companies that hold crypto assets on their balance sheets and communicating with regulators. For example, if you are a foundation or fund in the Cayman Islands with crypto assets on your balance sheet, you need to report to SEMA.

And SEMA requires auditors to verify your assets. If you are the Ethereum Foundation based in Switzerland, you also have reporting requirements for crypto asset holdings. The same goes for exchanges worldwide, so I spent about three and a half years deeply researching these companies to ensure they correctly held crypto assets and to inform Grant Thornton of the associated risks. Essentially, I mastered enterprise-level government-recognized compliance controls. This was also the reason why Alliance initially hired me, to bring a new perspective based on enterprise-level government-recognized compliance controls.

Most people, when building protocols as engineers, typically think: just do it. We write code and manage security ourselves, and as time goes on, projects grow larger, and demands increase. If they want to IPO, these demands will balloon. Before this, I had a Ph.D. in game design and taught game design for about seven years. My background is primarily in mechanism design, which is also why I initially entered the crypto space.

At that time, I was basically researching how to modify game design in video games to change player behavior. Then my cousin Dan, who is a researcher at Paradigm and entered the crypto space before me, told me, "You should leave the gaming field and do mechanism design in crypto; it will be more interesting and impactful." He was right on both counts; making games is completely different from playing them, and making games is much more tedious. So I’m glad I made that choice.

Yes, at Alliance, I help teams with many things, including fundraising, preparing for Demo Day, considering compliance issues, thinking about gamification strategies, helping our community grow, and so on. As the community lead, in addition to all my other responsibilities, my job is to be the friendly face of Alliance and make everyone want to be part of the community.

Laser: Yes, you also help everyone graduate smoothly from the accelerator and achieve high-quality project outcomes.

Will: Yes, setting high-quality standards is a skill that takes time to master. When I first joined Alliance, I didn't have the confidence or even the social skills to tell founders that they were doing poorly and needed to work harder and smarter. But after so many times, it is now very easy to clearly tell founders where they went wrong on Demo Day and how I can help them improve.

Laser: Yes, I must admit that I have improved a lot through this experience. I think there were probably over 30 emails back and forth discussing how to improve my presentation and Demo Day video. Yes, so.

Will: That's not too many; some teams have reached 95 emails, so you can work even harder.

Advice for Founders

Laser: Haha, yes, I know. So, I really appreciate your insistence on high standards; I think it has allowed all our projects to graduate with high quality and has contributed to the success of Alliance, especially this year. You mentioned that you have mentored about 200 projects. Do you have any particular insights, or what are the main characteristics of successful projects after such long-term mentoring?

Will: Oh, yes. It depends on the direction of the project and the type of problems they want to solve.

In the consumer space, successful teams are those that can iterate quickly. This field is driven by "hit products." This means you basically need to try multiple times and develop many products. For example, Pump.fun developed three products during their time at Alliance, and only the third product was truly successful. The previous products didn’t show much promise. For many game projects, their biggest regret is not creating enough prototypes early on and not exploring enough possibilities.

So I value teams that are flexible and able to change their ideas, which also means they must be able to deliver quickly and have strong technical capabilities. I think this is also part of the philosophy we inherited from Y Combinator when selecting teams: you need to find teams with a lot of engineering talent among the founding members so they can quickly launch a minimum viable product (MVP).

Thoughts on Team Size

Laser: This year, many people have asked me why Alliance has incubated so many successful projects. From your perspective, what do you think has contributed to the success of Alliance? I don't want to emphasize just this year, but rather the past few years, this year, and the future of the teams.

Will: So, I mean, we have had some great startups in past projects, like Stepn and Pendle. I think this year, of course, Pump.fun has garnered a lot of attention, and we have recently achieved considerable success in the consumer space. When your success comes from consumer-facing applications, more of the public will know about you. Because more of the public uses these applications. For example, the difference with Stepn is that it targets many ordinary users who are not on crypto Twitter, while Pump.fun targets the entire crypto Twitter, so everyone eventually hears about us, and our success becomes widely known. But Stepn once reached a market cap of $22 billion, which is an extremely successful company.

So yes, we have achieved some accomplishments, and I think we have played a small role in the success of the Alliance team. The vast majority of the work has always been done by the founders. The success of these teams had 90% of the decisive factors before they came to Alliance. We are very good at attracting teams to apply. Then we work very hard for these teams so that they can tell others to apply in the future.

For example, Pump.fun was referred to us by another team. In fact, about 60% of the teams are referred to us by previous alumni. This is the snowball effect we have been promoting for a long time. In the early days of Alliance, we even had to work for free. We had to help teams that had no exposure because no one knew who we were, and no one trusted us. But if we were willing to work for them without any return, why not? We proved our value, and then they would tell others in the market, "You should apply to Alliance; they will really help you." This is how we attract talented teams.

After teams join our program, the one thing we really do is keep them focused. Focus on product-market fit. We don’t tell them to issue tokens, we don’t teach them token economics, and we don’t help them with hiring. In fact, we often help them fire members. I think the size of the team tends to shrink after joining Alliance rather than grow because we know how important it is to maintain a lean and agile team to achieve product-market fit.

Laser: Yes. So I think the best teams attract the best teams. And I remember a few months ago when we first met online, you mentioned that the overall IQ of a team tends to decrease as the team grows larger. So I still remember that topic, and I have applied it. So compared to that time, our team has probably shrunk by about a third, yes, compared to back then.

Will: Wow, that really works. Yes, this is something David Vorik taught me. He is the founder of GLOW, another DePIN project in the energy sector. He participated in the Alliance accelerator three cohorts ago, and he learned and taught me this from his experience at Sia. Every time your team size doubles, its IQ tends to drop by about 5 points, yes, from 1 to 2 people, from 2 to 4 people, from 4 to 8 people, it’s always like this. And every time your audience size doubles, its IQ also drops by 5 points. So your initial 10 users are very smart, but the next 10 users know less about crypto. And when you have a million users or a hundred million users who know about your product, you have to design the simplest thing in the world. I think this is a very good insight.

Laser: Yes, I feel that not only does the intelligence of the team decrease, but the efficiency of the team also decreases as the team size increases.

Will: Yes, absolutely. The efficiency of the team really does decrease as the size increases. Because you have to spend more time and energy on management and coordination rather than focusing on executing tasks. This is why many rapidly growing companies eventually experience bottlenecks. As the team grows, communication costs increase, the decision-making process becomes slower, and the flow of information is affected. We have experienced similar situations in our own team development.

We have learned a lot, especially about when to scale the team and how to maintain the team's flexibility and efficiency. An efficient small team can respond quickly in a short time, which is very important for product iteration and market adaptation.

Okay, here is the content you provided, and I have adjusted it according to your request, merging the repeated paragraphs:

Choosing the Right Founders

Laser: Yes. Another question I want to ask is more general. This year you are also focusing on the new cohort of the accelerator, which I believe is the 14th cohort. So what trends are you seeing, and what are the hot topics?

Will: Currently, the biggest trend in the crypto space, from our perspective and from the founders applying, is the intersection of AI agents and meme coins. A lot of AI culture tokenization is happening. Many excellent founders are applying with these ideas. We still see classic ideas from the past four years that have improved over time.

Will: An important point about Alliance is that we don't actually pick specific directions; we pick founders. So if the best founders are making games, even though the gaming market is very small, we will still work with those excellent founders. We focus not only on founders with strong execution but also on those who can join our community. We hope they can think critically and find the right ideas. Most importantly, they can adjust their direction and ultimately find the right path.

Laser: Yes, so you focus more on people rather than trending topics or teams with popular narratives.

Will: We can't afford to invest in projects that are just hot topics. For example, if you were developing an L2 on Bitcoin a year ago with a team of 20, your valuation might be $50 million, while ours would only be $5 million. So when a topic is hot, we can't invest. This forces us to think in reverse and consider market directions six months ahead. Sometimes we invest in these hot topics through side funds as potential strategic investments, but that is not part of our accelerator program. Our accelerator program constitutes the vast majority of our investments.

Laser: Yes, the best people usually take paths less traveled. So you focus more on the future, on what the next season or next step will be. Your approach provides leading signals for the industry, especially this year; I believe this will become a trend for the coming year.

Laser: This is somewhat similar to our past. For example, when we started creating Starpower two years ago, the term DePIN didn't even exist. And now, DePIN has become a popular narrative, but we have been building for two years. Like you mentioned earlier about Alliance, you have also mentored DePIN projects like Glow. What are your thoughts on DePIN projects? Are these projects more challenging in terms of user acquisition? Can they serve as a bridge between Web 2 and Web 3?

Will: DePIN projects indeed require smarter thinking in terms of user acquisition. Take Glow as an example; they have recently achieved tremendous success in fundraising. Although they have a great protocol and product, solar farms have a lot of hesitations when transitioning from Web 2 to Web 3. They took a very unique approach: directly purchasing these solar farms, acquiring and enhancing their profitability, forcing the farms to join the Web 3 ecosystem. This approach, while crazy, is also extremely effective. For these successful protocols, you need to start thinking from fundamental principles, which is something David Vorik excels at. As a founder, he can focus on solving the most important problems rather than getting distracted by trivial matters.

Will: Currently, most DePIN projects are attracting users through token airdrops. But I believe that token airdrops are only effective when your protocol can immediately provide something valuable to users. If users come just for the tokens, it will be very difficult to manage. For example, I like Starpower's Starplug because it can regulate energy usage and save costs for users, providing some useful metrics. Even without a token airdrop, it is a great product. Adding a token will make it more attractive, allowing for faster network expansion and ultimately forming a real energy market.
Energy DePIN

Laser: In the past three weeks, I have met about 60 people, all of whom are projects you introduced after Demo Day. Many people asked about the token issue, especially regarding user acquisition. For projects like ours, there is real-world demand. Whether it's solar panels, outlets, or batteries, Web 2 people will buy these devices. What we are doing is actually adding token incentives on top of this infrastructure, which helps to expand the network more quickly.

If we reach a sufficient number of users, the revenue threshold on the supply side will decrease, forming a new layer of income. This is also why DePIN projects can serve as a bridge between Web 2 and Web 3.

Laser: I want to explore this issue further, especially since you mentioned that both Glow and Starpower are energy DePIN projects, and we have recently received funding support from top VCs. You mentioned that an energy company in Montreal, Canada, was already working on virtual power plant projects a year ago. How do you think DePIN can help the energy industry address climate change issues?

Will: Let me provide some background first. The emergence of virtual power plant projects in my area began about two years ago. The Quebec government has a monopoly on energy production and controls most of the energy supply. Although they produce a lot of cheap hydroelectric power, there are challenges in regulating the grid during peak periods. Therefore, the Quebec government launched the Hilo project, aimed at alleviating grid pressure by changing residents' energy consumption patterns. This project encourages people to preheat their homes before peak periods or turn off water heaters at midnight. In this way, the government can regulate the grid more effectively and avoid wasting resources.

Will: I think this is a very good idea that can make the grid smarter, and virtual power plants are an important way to achieve this goal. When you applied to join Alliance, I was one of your biggest supporters because I witnessed the technology and its tremendous potential. I believe that through virtual power plants, we can address energy consumption issues more effectively and tackle climate change.

Will: Any solution that can regulate energy is beneficial for climate change, and this is one of the biggest challenges our generation must solve.

Cryptographic technology can play a key role here, helping to coordinate people globally. Starpower and other similar DePIN projects are great examples of actively influencing the grid by coordinating different individuals and resources, promoting the adoption of sustainable energy.

Laser: Regarding why we are doing this project, I want to respond. As someone who has been in Web 3 for nearly seven years, I personally hope to make a meaningful impact on the real world through Web 3. For the past decade, Web 3 has still felt like gambling, but I believe it will become a huge industry, just like the internet did 20 or 30 years ago. The driving force behind Starpower is that we want to promote things that benefit the public through Web 3, blockchain, and token economics.

Laser: Additionally, I want to respond to the concept of "coordination" you mentioned. The last word in DePIN is "networks," and we can coordinate people globally at low cost through blockchain and Web 3's token economics to achieve goals that were previously unattainable. This is the uniqueness of DePIN.

Advice for Alliance Applicants

Laser: One last question, if there are founders who want to apply to Alliance or are interested in the Web 3 industry, what advice do you have? What should we build?

Will: For those founders who want to apply to join Alliance, I have some advice. If you want to join our community of over 300 founders and receive the support you need the most, it is very important to tell us who you are and why you must do this. What makes you unique? Some founders may have Ivy League degrees, or have worked at Google as IC 12, or have won Olympic gold medals. But what we value more is the unique motivation and drive behind the founders. Entrepreneurship is painful, and it takes something very special to sustain it.

Will: If you have a very strong drive, even if it’s an awkward or ridiculous reason, don’t hide it. The entrepreneurial journey is full of challenges, and you must have a very strong emotional drive to succeed. This is my advice to applicants.

Laser: Thank you for your advice. Indeed, we often find ourselves discussing and sharing ideas with those who are willing to do meaningful things for the world.

Will: It’s a great honor to participate, and I wish you all the best.

Laser: Thank you, that’s it for today. Thank you very much for your time, Will.

Will: Thank you, and good luck to you all.

Disclaimer: This interview is for informational exchange only, and all content represents the personal views of the guest and does not constitute any form of investment advice. Starpower and its guests make no investment commitments or guarantees regarding any content, views, or opinions expressed in the interview.