Interview: Building Web3 Cities
BuildCities.network co-founder Angelo Alessio on their new Web3 platform to connect – and eventually build – new communities on-chain.
You’re reading Startup Cities, a newsletter about startups that build neighborhoods and cities.
This week: an interview with BuildCities.network co-founder Angelo Alessio.
Themes:
Mapping your digital tribes
Municipal DeFi & Gitcoin
Transparency in municipal finance
Meeting co-founders online
Building startup communities
The three types of startup cities
DAOs
As with all these interviews, my goal is to give innovators a fair hearing. Enjoy!
Meet Angelo & BuildCities
ZC: Who are you and what are you building?
AA: My name’s Angelo and I’m the founder of BuildCities, which is a protocol for startup cities. We overlay digital communities in existing cities to form the foundation for building on and improving those cities with digital infrastructure.
What do you mean by “a protocol for Startup Cities”?
In short, we’re building infrastructure for anyone or any community or even group of communities to incubate, develop and scale Startup Cities around the world.
We view ourselves as the infrastructure layer for this new space that's emerging in Startup Cities and the Network State adjacent area. We’re a product company. We just launched our first public beta last week, which represents phase one of this foundation.
What are you hoping that people do in the new product?
The prerequisites for someone who's accessing it today is a Discord and a MetaMask, which basically covers everybody in web3 and crypto from what we've seen.
What that allows us to do is surface everybody's digital community or “digital tribes” as we like to say. One of our premises here is, hey, people are sometimes more aligned with their digital communities than they are to their physical ones.
Once we surface those, we have them select their top three communities. That’s a design constraint. They’re not selecting 200 because I don't think you can be vested in so many.
Then we have them select their top three cities around the world. We have 50 to start in the beta. The first thing they'll see when they log on and go through the onboarding is a map. They’ll see the network stack — all the different folks in their digital networks in their cities.
Each city has its own directory. Let's use the example of your newsletter, Startup Cities.
Imagine this site had its own Discord, right? Everybody who logs in and uses the app would be able to see everywhere around the world that there’s 10 people from the Startup Cities community in Sydney, Australia. Or there’s 20 people in New York, etc.
So let’s do a meetup there. We’re forming that connective tissue or bridge between our URL and IRL lives, as we like to say, in this new kind of crypto industry.
Moving From the Digital to the Physical World
So I arrive to your software and I'm able to connect with some people in a community. How does this end up affecting the real world?
The idea is that we eventually bring each city in that platform on chain. I’ll say that each city essentially becomes a DAO for the sake of our conversation.
We then allow those city chapters to fill up with more people. That’s the main prerequisite for the next phase: crowdfunding. For crowdfunding we focus on both ventures and real estate in each one of those cities.
The crowdfunding element leads us into phase two of the product. We’re calling phase two: “Municipal DeFi.” Basically: what does a crypto native municipal bond look like? We can finance things in cities and actually build them.
You just mentioned a transition to “the next phase.” What are the four phases?
Yes, we have four phases.
The first phase is discover. So, socializing the network. We bring that connective tissue between our cloud based or “digital lives” with our in real life lives and discover what that looks like. We figure out the digital tribe in your backyard and around the world.
The next phase is engagement. We already have a bunch of features laid out that start to engage those communities more actively in those given cities.
The third phase is empower. That’s the actual on-chain activation component. We feel there's sufficient amount of time for a lot of this to ride the tailwinds of the crypto industry. We think that there would be a sufficient amount of capital pools in each city to actually subsidize innovation: to fund startups and then crowdfund real estate itself.
There’s still some debate about phase four, so I’ll leave that out.
But what is Municipal DeFi? Can you explain more?
Cities today are financed through general obligation bonds, revenue bonds. Given that we’re building on web3 infrastructure, we look at this as: what does a crypto native municipal bond look like?
You might ask, what are the downstream implications for that? One fascinating thing to consider about the citizenry of cities today is that we pay city taxes and federal taxes and both basically go into a black box.
But what if at the end of your TurboTax filing you could actually allocate on a percent basis to each agency within that given city? Then you click submit and you see exactly where all your funds go based on your allocation.
We think that transparency alone would create a much more vested citizen. We’ve already done some pilots to crowdfund infrastructure in one city.
Build seems to transcend any particular national identity. The relevant unit is the city. Can you talk about this aspect of Build and how that’s reflected in your team?
Our team came together purely digital first. All of our co-founders found each other online first. I published a white paper about this just over a year ago now. That’s how we brought in our contributor network.
We have a co-founder based in Lagos, Nigeria. We have a co-founder in Coeur d’Alene, Idaho. I’m located in Jersey City. All of our philosophies on what we’re doing were aligned. It takes more time to kind of establish trust over the internet, for sure. But where we were able to solidify those bonds in person that helped.
It’s the same for our contributor network. We have a lead designer who did the whole landing page, the product, in Eastern Europe. We have some contributors from Brisbane, Australia, Montreal. One from every continent at least.
Can you talk about the projects that already have a footprint IRL?
Our co-founder in Lagos is our technical lead. We met him from CityCoins. I think that’s a cool project that penetrated the public conversation about Municipal DeFi — how do we use crypto to fund in real life goods?
Our real estate and community lead is Nick Smoot, our co-founder in Coeur d’Alene, Idaho. And he’s been doing a lot of our thesis IRL for the last decade. A lot of that thesis is based off of Startup Communities by Brad Feld, which talks about his time building up Boulder as a startup ecosystem.
If you read that book it jives with what the Startup Cities Map of Adrianople Group is saying. “Type one” startup cities are cities that attract startups. I think that’s the core building block for any startup city. If we’re talking about type three, which are cities that are startups themselves — which I know is one of your main focuses in a lot of your writing — we think the prerequisite is still type one.
Nick has done the “type one” approach. He’s built a community around innovation. Over the last 10 years they have two giant community spaces. It’s like a tech-forward town hall. It’s a really awesome space.
They have an underground cigar and bar lounge. They have this giant TV area for families. I went in on a Saturday and families are just there hanging out. That’s the blueprint property or at least the blueprint for what we want to replicate around the world. He’s done that. He’s the expert there. And the place is in Coeur d’Alene — a beautiful area, right on the lake.
That’s our anchor point in IRL.
Municipal Defi
You have a Gitcoin listing to source solar panels in Nigeria. What’s up with that?
That’s related to co-founder, Ronald Maduka, who is our technical lead and founder of Khalon Bridge. We helped incubate the development studio that’s his. He’s attracted an amazing talent base of folks in Lagos. They’re also the primary tech contributors for our product. Collectively, Ronald and the Khalon Bridge network lead the Lagos and Abuja chapters of the network.
Lagos suffers a lack of electrical infrastructure. The average house gets four hours of electricity per day. Most businesses and residences, the ones who can afford at least, are paying for petrol for their generators just to power their houses. That makes a polluted atmosphere. So we thought: why aren’t we solving this?
That grant was a pilot for figuring out how we might crowdfund infrastructure in cities around the world. Let’s do it for ourselves first. We raised enough to get six solar systems. The results have been great. The developers now have 24/7 access to the digital economy. Their bills have gone down. It’s a win-win for everybody involved.
I think Gitcoin is a tremendous platform that does that for a variety of projects. We view this as a great pilot and MVP for what we want to have in our platform.
You tease some features that are still in development in the beta, including TownSquare, Treasury, and Hubs. What are these?
TownSquare is an engagement feature that surfaces what people ship today, what they discover, or what they question on a given day. It’s a design constraint to focus conversations around: what did we build today?
As more people come in and we have a critical mass, we’ll go ahead and introduce that engagement feature. It will take some A-B testing to get right. TownSquare is to socialize that network even more than now.
Treasury is a placeholder for Municipal DeFi. We’re not gonna have every city come on chain as a DAO right away. We’ll likely build for ourselves first. Then we’ll start with Coeur d’Alene, Lagos, and Jersey City. We’ll eventually fund public infrastructure with crypto there.
Hubs are the in-real-life access points to this protocol. So Coeur d’Alene, Idaho today is a hub. It exists. We informally direct members to go there and check it out. The Hubs feature will be a formalized version of: “hey, you wanna check out this space?”
We’re still exploring what types of properties we allow on. Is it primarily for a certain type of commercial property? Is it more for third places? Hubs is already built out, we just haven’t released it yet.
Speed Round: Cold Starts, DAOs, and Highly Concentrated Venture Capital
The hardest problem of building a startup city is?
Ask me in 10 years.
The internet is the missing piece to solve the cold start problem for Startup Cities.
Yes and no. The internet is the new entry point for community building and city cohesion of the Startup Cities of the future. But they’ll never be realized without proper acknowledgement of challenges in the real world that we’re all used to.
80% confidence, yes. I agree 80%.
The most promising existing city is?
The one you call home.
The most successful Startup City of the next 15 years will not be in the United States.
I know this is another kind of dodgy answer, but I think it depends how you define success. If I was to-
Well, what's your standard for success?
In 2018, I wrote an article that threads together my journey on this whole thing. It’s called Putting the Venture into VC. It’s got all the pitch book and CBInsights data and showed the concentration of venture capital.
Venture Capital needs to be distributed everywhere around the world. It needs to go to the Coeur d’Alene and much smaller ecosystems because everybody can build great startups.
We shouldn’t be telling people where to go. That’s just convenient for the capital pools that exist in those areas.
There’s this other concept from Rise of the Rest, a fund founded by Steve Case. The idea is “tentpole companies," let’s find the tentpole companies in cities around the world. A tentpole company is the one that, once it becomes a successful startup, is able to reinvest the economic benefits into that city. It becomes the foundation for a startup city going from type one to type three, we think.
So to answer your question directly, I am a 70% confident that your statement will be true, and that it would be outside the U.S.
It’s more practical to reform existing cities than to build new ones.
Depends on the city.
The most successful cities of the future will be run by DAOs.
Again, how do you define success?
I think the attributes of how that city operates are going to look much different. The level of difference will be such a great delta that people living there or not living there will define success very differently.
But I don’t think we'll see the level of success of, let’s say, a top five city in the world run by a DAO for another 15 to 20 years.
DAOs should operate as radical democracies.
Not fully. But the most successful DAOs should capture the intent of its most engaged members.
The most effective lever for changing existing cities is digital technology.
It’s one increasingly large part of the puzzle, but still not the biggest lever. I don’t think will be for a while.
I think brick and mortar, IRL, practicalities, physical infrastructure, things that do not require what we consider software will always be the bread and butter and the foundation of a city. When we’re talking about technology with respect to hardware, that changes the conversation a little bit more, but I can’t expand on that too much.
How can people get involved with Build?
If you have a Discord and Metamask, go to buildcities.network and launch the app.
Try out the app. See what we’re talking about in this protocol. We also have FAQs there, we have the roadmap. We’re updating it frequently. Our Twitter is joinbuild_.
And feel free to reach out directly to my DMs on my personal Twitter, our company Twitter, and on LinkedIn, just message me directly and I’m always happy to chat with people who want to talk about this stuff.
Thanks for reading and don’t forget: Startups Should Build Cities!
Interesting