Episode 100: Hans on Web3, Investing at an unprecedented pace, ESG and Proudest Moments

**Hans Tung** (0:19)
Coming to you from GGV Capital, this is Evolving for the Next Billion, where we interview local champions and global giants in tech industry who are shaping the lives of the next billion Internet users.
My name is Hans Tung. I'm a managing partner at GGV Capital, and I've been working at and investing in startups across the US., China, and other emerging markets for the last 20 years.

**Rita Yang** (0:45)
My name is Rita Yang. I'm the marketing manager at GGV Capital. On this show, you will hear stories about ambition, ingenuity, and resilience, unfolding every day from Singapore to St. Polo, Beijing to Bangalore.
We also recommend you to join our listeners community on Slack, WeChat, and WhatsApp, where you can connect with like-minded people and attend our offline events across the world. You can join by visiting nextbn.ggvc.com.
Hey, hello, Hans. Welcome back to the show. Happy New Year.

**Hans Tung** (1:22)
Happy New Year to you as well, Rita. What an interesting year it has been in 2021

**Rita Yang** (1:27)
It's just really hard to think that we haven't seen each other still since 2019

**Hans Tung** (1:33)
Since January 2020 Yeah, I was in Beijing the first week of January.
Yeah.

**Rita Yang** (1:43)
What are the two years? So if you were to describe the past 2021 in just one word, what would that be?

**Hans Tung** (1:51)
Oh gosh, probably what I would use is volatile or volatility. At the end of 2020, you would think that with vaccine coming out in 2021, that the situation, the vaccine situation would be a lot more manageable.
Then obviously Delta and then most recently Omicron vary and become much bigger issues than most of us expected.
Then you see the valuation of the tech sector come through huge growth in 2020, very quick recovery, and then surpassing historical levels in the second half of 2020 And then 2021, February was a high point, and then November was another high point, but the valuation has come down a lot, almost back to near pre-COVID level for many stocks. So that kind of volatility is something that we haven't seen in a long time. And for most younger professionals or founders, or even VCs, it's the first time people have seen this kind of volatility. But at the same time, you also see new areas emerging, like become hotter and become more mainstream, at least in terms of publicity and fundraising and attention like Web3 and so forth. So it's been a very up and down year, much more volatile than any one of us expected.

**Rita Yang** (3:08)
Yeah, definitely. And you mentioned Web3, and it's one of those buzzwords that we cannot escape from. And since you're in Silicon Valley, and you met with all the cutting edge founders all the time, and Coinbase, you actually led GGV's investment in it.
What would be your general observation on this big buzzword everyone is talking about? Even my grandma was asking me about it. Right.

**Hans Tung** (3:33)
I think when Jeff and I threw an intro of our friend, Simei Oshar, to invest in Coinbase, it was a small check from GGV, just kind of learn about the market. Back then, Bitcoin was out of the rage, and a lot of people thought it was overhyped, that since the governments don't want any decentralized currency out there, that affects their ability to control their fiscal monetary policy, people think that we will go down to zero. At some point in the future, when hype is down, many people compare it to the tulip phenomenon from the Netherlands in the 1600s. So with all that as a backdrop, we still thought it's, we're not sure, but that's given a volatility increasingly around the world. Maybe it's, and US government continue to print US dollars, maybe having something like Bitcoin would be an investable asset that people will like. But we all thought that we need to have real world application around Bitcoin in order for this to be truly valuable. And we're both right and wrong. Bitcoin still doesn't have true end consumer applications, but it's a storage of value. It has continued to go up in this increasingly volatile world. And we only wrote a small check, so we can't take too much credit for it, but it's just impressive to see how it has exceeded our expectation for sure.
And then you look at all the recent debate between, for example, Jack Dorsey at Twitter, and then Mark Andreessen at X16Z, and you see Elon Musk making fun of Web3 as a marketing buzzword.
It just, there's a lot of different kinds of opinions out there. And I like the blog post that my old friend from Bessemer, Chris Dixon at Andreessen has published. He compared Wikipedia and YouTube to the competitor before back in the early stage, and the second one in Web 2.0, in Web 1.0. And it just to see that the free ecosystem that's emerging where it's a lot more open, developers can add value to it, and there's no centralized figure that can monopolize is upside, ends up helping to build a more valuable ecosystem over time. If I think back to Web 1 where Google and Amazon, Amazon argues Google is Web 1 and then Google starting at 99 is Web 1.5. Those are the companies that are, ends up being more centralized and keep more of the profits itself. And then you see more open system emerging, Android, which is acquired by Google. And then you see Wikipedia, you end up seeing that there's more value being created by the more open system over time. As it cuts up to a value proposition, good value proposition from a centralized system that can be good early on. But over time, the system that's more open, developers can make money, more people can benefit, ends up surpassing the value, catching up to the value created by the closed system. So you can argue that Web2.0, I remember investing in Web2.0 companies, and a lot of people doubt that Web2.0 companies would exist, that Web2.0 company would just take over.