Fintech

Investing is not enough: Andreessen Horowitz has a new crypto research lab

The firm is trying to bridge academia and the crypto industry, an unusual investment in VC.

Tim Roughgarden, left, and Dan Boneh, right.

Tim Roughgarden is head of research and Dan Boneh is senior research adviser at a16z Crypto Research, a new research lab focusing on bringing academic research into crypto and Web3.

Photos: a16z

Andreessen Horowitz is starting a new research unit designed to bring academics into tackling some of the hardest problems in Web3 and crypto.

It’s called A16z Crypto Research and it’s modeled after research labs such as OpenAI and Alphabet’s DeepMind. Tim Roughgarden, a professor at Columbia and Stanford who has written extensively on Web3, is its head of research.

“Usually whenever there's a new groundbreaking technology that has general purpose and can be used for all sorts of different things, there's an opportunity for an industrial research lab to bridge the world of academia with the world of industry practice,” said Ali Yahya, a general partner at Andreessen Horowitz who previously worked at Google on Google Brain.

Dan Boneh, a professor at Stanford, is being promoted to senior research adviser and four others are joining as research partners: Joseph Bonneau, who’s written extensively on cryptocurrency; Benedikt Bünz, a Stanford Ph.D. student and chief scientist at Espresso Systems; Scott Kominers, a Harvard Business School professor; and Valeria Nikolaenko, a former research scientist for Novi at Meta.

While many crypto firms have hired research teams, A16z is attempting something bigger: an entire research lab to take on crypto.

The research unit aims to create a pipeline from research to industry, working with a16z’s engineering, regulatory and marketing teams.

As part of the venture firm, a16z Crypto Research will work with the firm’s portfolio companies and investors to help determine what topics to take on. The group will seek to address broad industry challenges, Yahya said.

It will aim to produce work that is open source and that the entire industry can benefit from. This approach is better than a university-based lab, because it is closely aligned with people working in the industry, Yahya said. “All we only, really want from all of the work that comes out of the research lab is for it to be open source,” he said.

Like other research labs such as Bell Labs, SRI and others, the research is designed to bring academic and scientific research into eventual commercial use. While that could happen through deployment by a16z portfolio companies, projects could also be spun out into independent companies, Yahya said.

The researchers could join a portfolio company to work on the ideas or they could potentially start companies using the ideas. “And in those cases, then we might fund them, which would be a success case,” Yahya said.

And as part of the venture firm, everyone involved in the lab will have upside in the work in a way that’s not possible in a traditional academic research lab, he said.

Topics of study could range from technologies to achieve consensus on blockchains or Layer 2 scaling solutions to application layer issues, automated market makers or NFT design, Roughgarden said.

The research will likely initially flow from team members’ interests. Kominers, who is an expert on applications, could work on issues such as the design of NFT marketplaces. The other three focus more on cryptography and security: Bonneau, who wrote a book on crypto; Bünz, who worked on zero-knowledge proofs and verifiable delay functions; and Nikolaenko, an expert on proof of stake. The team will grow by “many multiples,” Roughgarden said.

Computer science often ranges from very specific to general theories, but this new unit will be able to address real-world problems, he added.

“These are the problems that our portfolio companies are struggling with that you see over and over again across different projects,” he said. “That's kind of a telltale sign that this could be your next great academic research paper capturing the essence of where everybody is stuck.”

Workplace

An IPO may soon be in Notion’s future

Notion COO Akshay Kothari says there’s room to grow, aided by a new CFO who knows how to take a company public.

Notion has hired its first chief financial officer: Rama Katkar.

Photo: Courtesy of Notion

It’s been a year since Notion’s triumphant $275 million funding round and $10 billion valuation. Since then the landscape for productivity startups trying to make it on their own has completely changed, especially for those pandemic darlings that flourished in the all-remote world.

As recession looms, companies looking to cut costs are less likely to spend money on tools outside of their Microsoft or Google workplace bundles. Enterprise platforms are bulking up and it could spell trouble for the productivity startups trying to unseat them. But Notion COO Akshay Kothari says the company is still aiming to build the next Microsoft, not be the next Microsoft. And in a move signaling a new chapter of maturity, Notion has hired its first chief financial officer: Rama Katkar, Instacart’s former VP of finance.

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Lizzy Lawrence

Lizzy Lawrence ( @LizzyLaw_) is a reporter at Protocol, covering tools and productivity in the workplace. She's a recent graduate of the University of Michigan, where she studied sociology and international studies. She served as editor in chief of The Michigan Daily, her school's independent newspaper. She's based in D.C., and can be reached at llawrence@protocol.com.

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From 5G to artificial intelligence, IP protection offers a powerful incentive for researchers to create ground-breaking products, and governmental leaders say its protection is an essential part of maintaining US technology leadership. To quote Secretary of Commerce Gina Raimondo: "intellectual property protection is vital for American innovation and entrepreneurship.”

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Fintech

How neobanks are helping consumers game credit scoring

The CFPB says it is closely monitoring secured credit cards offered by neobanks.

Regulators are scrutinizing neobanks' card offerings.

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About one in six Americans has a credit score below 619, according to the CFPB. Another 23% have too thin a credit file to score or no file at all. That puts them in a credit trap: To build credit, these consumers need someone to give them a line of credit with which they can demonstrate good financial habits. But with scores that low, few lenders are prepared to offer them anything.

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Policy

Steel decided World War II. Chips will decide whatever is next.

“Chip War: The Fight for the World’s Most Critical Technology” foreshadows the coming battle between nations over semiconductors.

“Chip War” outlines the nature of the coming battle over semiconductors, showing how the power to produce leading-edge chips fell into the hands of just five companies.

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“World War II was decided by steel and aluminum, and followed shortly thereafter by the Cold War, which was defined by atomic weapons,” Chris Miller, a professor at Tufts University’s Fletcher School of Law and Diplomacy, writes in the introduction to his latest book. So what’s next? According to Miller, the next era, including the rivalry between the U.S. and China, is all about computing power.

That tech rivalry and the story of how the chip industry got from four to 11.8 billion transistors are all part of Miller’s book, “Chip War: The Fight for the World’s Most Critical Technology,” which comes out Oct. 4. “Chip War” outlines the nature of the coming battle over semiconductors, showing how the power to produce leading-edge chips fell into the hands of just five companies: three from the U.S., one from Japan, and one from the Netherlands.

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