Your Protocol is The Product - Part 2
Who is the customer of a Protocol?
The default, but simple and unfortunately wrong answer, is "everyone."
Nearly any protocol which has this answer (which is too common) will long-term trend to failure.
However, the current hype and relative indexing (similar to the concept brought up in this article on the valuation of L2), too easily leads to this, especially mercenary vs missionary leaders.
Because if you skip the hard work to understand the customer, you immediately get to "billions and billions".
Protocols, like products, still need attention to the customer and the problem being solved.
Perhaps, unlike typical products, protocols can have multiple stakeholders interacting via mechanism design; this is very real and the exciting part of the design space.
But who is your customer and what do they get from the protocol still seems to matter.
The tricky part is that, often times, the best first customer is a product.
Huh?
I think building the right first product experience on top of the protocol is what is essential to success.
In this way, the thought process should ultimately be two questions being asked:
- Is the product built serving customers at a meaningful scale?
- Is the protocol serving the product?
This potentially becomes a virtuous cycle.
The difficulty is having empathy for both at the same time.
Empathy is hard enough as it is.
“You never really understand a person until you consider things from his point of view… Until you climb inside of his skin and walk around in it.” Harper Lee, To Kill a Mockingbird
What do your Users want?
This is the core question for every Product.
And getting this right is difficult.
But by building a product on the protocol, you at least have one customer of your protocol, that one product.
Similar to the adage that indie entrepreneurs build for themselves, so that they at least have one customer.
Warpcast being built on the Farcaster protocol is a clean B2C illustration.
If you can build a protocol that attracts builders who create great products from the jump, then you're probably already doing something right.
One of the products is a Dropbox like service that uses Arweave's permanent storage.
But sometimes knowing what products can succeed on the protocol aren't fully understood. And without that understanding, building incentives for the protocol is difficult.
In the same way that you can't build a product for personas you don't understand or, worse, don't exist, a protocol doesn't magically attract builders.