Why CollabTech

What is CollabTech?

The average person spends a third of their day at work. This is more than we spend on entertainment, connecting with friends and family, or gaming.  CollabTech is what we call those tools that we use to work together - efficiently, effectively, and enjoying ourselves.

The traditional corporate world calls these tools “B2B SaaS”, which is a key business vertical with a market valued at USD 327.74 Billion (2023). It is projected to reach USD 1088.15 Billion by 2030, growing at a CAGR of 18.7%.

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CollabTech can be thought of as the category of which B2B SaaS repesented the 2000-2020s period. Moving forward, CollabTech is likely to continue serving most of the needs that B2B SaaS did.  However, software-as-a-service with pay-per-seat might no longer be the ideal business model; Cloud infrastructure would be replaced in good part by blockchains; AI will play a huge part; new areas like reputation, automated legal, and peer2peer contracting will take off; and the ways of working supported are more likely to be Swarms (collaborative networks of small teams and tech-augmented freelancers) than monolithic top-down hierarchies. Welcome to the future of work.

The Case for Collaboration Technology in Web3

We can think of the first Web3 effort at CollabTech as The DAO in 2016.  It is a very early example, but also a cautionary one. Web3 CollabTech remains largely underdeveloped despite its long history. On top of the challenging volatility of the space, important setbacks have included large-scale hacks (e.g. The DAO), ill-conceived forms of governance that led to the quick rise and downfall of DAOs as a meme, lack of sustainable business models in NFT communities, and an adverse regulatory environment in the USA. These early and frequent setbacks have reduced interest in the category and led to it being frequently misunderstood - placing it in the canonical Trough of Disillusionment. 

Despite CollabTech’s complicated history, there are numerous and significant reasons to take it seriously as a key opportunity for Web3 ecosystems to invest in. Namely: 

• CollabTech is a Large Market with Rapid Growth.
• B2B SaaS (Web2 CollabTech) is ripe for disruption.
• There’s low competition in Web3 for this vertical.
• CollabTech already generates significant sequencer fees for Blockchain ecosystems and multiple promising use cases are yet to be explored.
• The vertical lacks a clear market leader in Web3 and there’s low competition.
• The benefits for an ecosystem to invest in CollabTech are both economic and capability development.
• Additionally, CollabTech unlocks significant positive social impact (positive externalities).

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Check out our upcoming October online Hackathon at collabtech.xyz

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Large Market with Rapid Growth

CollabTech is a market valued at USD 327.74 Billion (2023), projected to reach USD 1088.15 Billion by 2030, growing at a CAGR of 18.7% (using data only from B2B SaaS).

Beyond this B2B SaaS market, we also have the growing world of DAOs, collaborative networks, freelance and gig work platforms, and other fluid arrangements for knowledge workers. The gig economy is reported to represent already 12% of the global labor market, and is growing healthily in the developed world (e.g. 14th in North America) and extraordinarily fast in the developing world (e.g. Sub-Saharan Africa, job postings on the largest digital platform grew by 130 percent in 2022-23).

A market ready for disruption

What work means is rapidly changing, as we can see with the rapid growth of gig work globally and also with large organizations adopting more fluid and platform-like models (e.g. Haier). There’s a massive opportunity for CollabTech tools to evolve beyond traditional B2B SaaS, unlocking new ways of connecting, automating, and working together that are suitable for remote-first organizations, automated bureaucracy, reduced middle management, fluid work, and collaborative networks.

The Web2 CollabTech stack is heavily fragmented, with financial assets, governance, accounting, and other systems all living in silos. Additionally, legal contracting is still largely a pen-and-paper process, with growing but still poor standardization, and expensive billing. The combination of blockchain and AI offers a solution to these issues, and can lead to all organizations (whether decentralized or not) eventually moving on-chain and benefiting from trustless and cost-effective automations.

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Web3 can improve the current tooling because CollabTech gets built on key concepts that Web3 is uniquely suited for (Identity and Permissions of people and objects, Attestation and Verification, Agreements and Commitments, Data Management, etc.). 

Traction, Sequencer Fees, and New Use Cases

CollabTech is already the #1 sequencer fees generator in Arbitrum thanks to Quest Protocol (RabbitHole), and with the right strategy, the success of Quest Protocol could be emulated by a host of projects in CollabTech.

As Web3 matures out of Wild West casino culture, multiple areas offer valuable niches for commercially sustainable projects and long-term value creation. For example:

• Recruitment markets, bounties and gig platforms is a segment experiencing rapid growth thanks to the expansion of the gig economy and fluid work trends. The interoperability of onchain protocols and tokenomics incentives offer an exciting design space that’s still largely unexplored.
• Permission management and data management systems are mostly built for monolithic, top-down organizations, incompatible with fluid and gig work in networks of teams. Lack of privacy in blockchains restricted what new models could emerge. But now, chains with customizable privacy (e.g. Arbiturm’s Orbit chains, zkSync, etc.) that can settle to a universal trust layer offer a powerful unlock.
• Rewards and compensation is an ongoing pain point in organizations, and most models are ill suited for growing trends like remote work, fluid teams, and dynamic attributions of ownership. A long tail of startups needs better solutions.
• Robotic Process Automation and autonomous agents within B2B tooling can revolutionize planning, coordination, and resource efficiency. Pairing AI with blockchains as data layer and transaction layer enables composable automations and advanced governance and permissioning.
• Contracting between commercial partners, investors and investees, contributors and organizations, etc. is currently done with rudimentary and largely manual tools. Smart contracts and dispute resolution systems can open a new design space to enable more cost-effective, faster, and reliable contracting.

CollabTech can take blockchain applications mainstream, serving billions of workers worldwide.

Low competition

Despite its potential and traction, CollabTech lacks a clear ecosystem leader in Web3. Polygon has set a dedicated initiative to target Web2 customers with Web3 B2B tools, Optimism is attracting some key projects (funding DAO Spring amongst others), and Q blockchain is making some progress, but no one has yet managed to become the go-to place for CollabTech builders.

Meanwhile, Web2 incumbents are stuck in pay-per-user business models, monolithic architectures, top-down permission management systems, walled garden strategy, and themselves structured as legacy organizations.

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Despite CollabTech being a mature and sizable market (B2B SaaS), the web3 niche (including AI x Blockchain applications and riding on macrotrends around gig economy, fluid and remote work) is ill served by current players.

Improving Ops and Governance in Your Ecosystem

CollabTech is a key enabler for other projects. Early examples show how the existence of a quality multi-sig solution was key for increasing TVL in L1s and L2s as well as enabling projects to operate effectively. More recently, we cite the importance of protocols for decision-making, role attribution, grant tracking, creating quests, etc., as key for enabling the DAOs governing an ecosystem and the projects built on top to move fast and achieve results.

While traditional ways of operating constrain an organization to its managerial capacity and current resources, new generations of CollabTech enable exponential organizations: community members become incentivized evangelists, attracting further talent, capital, and users.

Of particularly high value for ecosystems is the innovations that CollabTech can offer in ecosystem development methodologies and tools. Governance challenges have led many L1s and L2s to create perverse incentives with grants that reward building without assessing user demand or relying excessively on VC-backed companies. 

Positive Social Impact

Thanks to Web3 innovations, CollabTech is a key vertical to addressing the incredibly low trust in Institutions, chronic opportunity cost attributable to poor coordination, and $8.8 trillion lost per year in employee disengagement that also leads to serious mental health issues.

CollabTech eradicates barriers to participation and economic inclusion, ensuring that every stakeholder has a voice in shaping the future. CollabTech opens up new business opportunities, creates jobs, and promotes a more inclusive economic model where value is distributed more equitably among contributors leading to a more sustainable and resilient digital economy.

The challenges of current DAO designs led many idealists to temper their excitement, but the opportunity to reinvent democracy, make governments transparent instead of corrupt, build the future of work, and improve the lives of billions is still there for the taking.

Conclusion

Collaboration Technology stands as a blue ocean market, fertile ground for developing new use cases for Web3 products that can serve billions of workers worldwide and gain market share in the hundreds of billions of dollars. From enhancing operations and governance to optimizing resource allocation, and providing positive social impact, CollabTech's role in Web3 and beyond is pivotal.

Prioritizing robust development and support for Collaboration Technology can provide sustained growth and resilience to the Web3 economy. By doing so, we ensure a future where digital collaboration is not just efficient but transformative, creating an inclusive, dynamic, and equitable ecosystem for all participants.