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World 2.0 Startups

The first TV shows were cameras pointed at radio shows. The first mobile phones looked like miniature desktops. When new paradigms come online, we have a tendency to first clone the old before making something transformative, like Westworld or the iPhone.

Before we transition in to the truly native format, we often first make a transitional product that’s halfway in-between worlds. In 2020 parlance, we’ll call these “World 1.5” products.

Take encyclopedias for example. We went from books (1.0), to Britannica CDs (1.5), and only then to Wikipedia, a truly World 2.0 product. Internet-first. Design is another example of an evolution from easels (1.0), to Photoshop (1.5), to Figma (2.0).

1 -> 1.5 -> 2.0. Once you realize this pattern, you cannot unsee it:

World 1.0 World 1.5 World 2.0
Encyclopedia Britannica CDs Wikipedia
Store-front Adobe Dreamweaver Webflow
TowerRecords iTunes Spotify
Paper ledger Excel Google Sheets
Bars OKCupid Tinder
Easel Adobe Illustrator Figma
Punchcard Library CVS Server Github
Concert SoundCloud Cloud Raves
Cycling SoulCycle Peloton/Zwift
Broadway Recorded Plays Westworld

Plenty open areas for building:

Tape Editing Final Cut Pro TikTok?
Dark Room Adobe Photoshop Instagram?
Piano Ableton ?
Conferences Zoom Conferences ?
School Zoom School ?
Doctor Telemedicine ?
Theatres Netflix ?

Key Feature #1: Natively Collaborative

JWZ’s famous quote – “Every program attempts to expand until it can read mail” will be forever true. The deepest human desire we have is to interact with others. At some level in the chain, this is the ultimate purpose of every piece of software, so a common element of World 2.0 products is turning what was an email attachment into a native multiplayer experience.

Key Feature #2: Fat, Not Lean

Figma took 3 years to get to launch. It’s not that simple to build something like this and it’ll certainly be a labor of love by the founder who is obsessed with the craft as opposed to someone looking for a cheap SaaS hit. I think this is also why we might see several companies as opposed to a monolithic Adobe. You need to be crazy to build Final Cut Pro in a browser. This insanely great passion might not be possible to create within an organization. You might only find those people in the deep space galaxy of entrepreneurs.

Key Feature #3: Cheap or Free

Figma is much cheaper than Adobe Illustrator and Spotify more vast than your iTunes collection. Some achieve this with ad models, others with “whale models” (charging a large enterprise significantly more than a single consumer).

Unlocking Teenagers

Teenagers are the most adaptive species on the Internet, quickly migrating like nimble wildebeest to whichever grassland is the most interesting. They’re also much more likely to learn something new, because they have less of a set point. Just like music, tool preferences seem to get set early in life. (This is why education discounts are so powerful!)

They also have no money. That’s why they pirate software. It’s not that they’re evil. It’s just that there’s… no other option. What’s exciting about these new alternatives is that they remove the gauntlet of pricing from the equation of use. Anyone can get started with Webflow or Figma – no credit card required. This should theoretically enable much more creation by the most underrated, hyper-productive asset class in the world: teenagers.

The Bedrock is Ready

Some people ask, well, why now? If this is such a clear winner of idea, why hasn’t it happened until recently? Two things have changed. First is that the web stack has matured to the point where you can build something as dynamic as Figma. You couldn’t have done this in 2004, where the achievement of the year was Gmail’s AJAX.

Secondly, there are many more people online. When Netscape originally launched, there were 30 million people on the Internet. In total. That was considered revolutionary. Facebook has 1.7 billion daily active users.

And it’s not just the number of people, it’s the high median dexterity of a customer. Skeuomorphism isn’t necessary. People aren’t printing emails anymore and more users understand intricate UX.

Market

An interesting question for these companies is market sizing. If Figma becomes something everyone in the company uses, not just the designers, they could become 10-100X larger than their predecessors (Photoshop and Illustrator). The frictionless nature of collaboration software allows for much more viral spread and adoption.

In other industries, we might see fresh commercialization ideas that couldn’t have been thought of previously: A variant of Logic Pro with built-in SoundCloud, enabling a lot of enabling new revenue pipelines for the company.

Theme: Creative Suite 2.0

It’s worth highlighting a particular theme that’s going on: a new generation of the Creative Suite. Figma is making an Internet-first Photoshop. Webflow is doing the same for Dreamweaver. Reduct is doing this for Final Cut Pro. You could take any Adobe product and re-create it in an Internet-native format. Music, photos, videos, etc – essentially any email attachment you send – and rebuild it as a startup in an Internet-native way.


In closing, I’m excited about World 2.0, and probably most excited about the new Creative Suite – a whole new way of turning beautiful ideas into colorful realities.