The role of a product manager (PM) is uniquely diverse and varied. However, if you’re a PM for a Web2 company transitioning into Web3, there are several differences between the roles to consider. Understanding the nuances and mechanics of Web3 is essential for anyone looking to gain employment in the industry. As a Web3 product manager, you’ll need an adaptive skill set and be capable of wearing multiple hats at any given time. Furthermore, Web3 product managers making the leap from Web2 will experience a shift in priorities when it comes to community engagement and strategy. Nonetheless, an exciting and meaningful career awaits those bold enough to make the jump from Web2 into Web3 product management.
In this article, we’re going to dive deep into Web3 product management. We’ll explore the role of a product manager in Web3 and how it differs from that of a regular PM. Also, we’ll explore the versatile skill sets product managers in Web3 must possess and why an otherwise successful PM might not suit the role. Furthermore, we’ll outline some of the best avenues for Web2 PMs looking to transition into Web3.
What is Web3?
Web3 (or Web 3.0) refers to a decentralized internet that uses blockchain technology to democratize our online experiences. The term refers to a series of privacy-preserving, user-owned protocols, and applications that operate without a central authority. Web1 was the first iteration of the internet. It mainly consisted of static images and text with no real interactivity. Plus, content creation required a thorough understanding of computer science and programming. Web2 is the version of the internet most of us are familiar with today. It features interactive applications and websites where anyone can create content. However, most of the Web2 landscape is under the control of a small number of powerful companies that prioritize profits over users.
Moreover, Web3 aims to address this by taking control out of the hands of powerful companies and placing it into the hands of people who build and use applications. Cryptocurrencies help to build token economies that incentivize community governance and allow Web3 platforms to exist without a central authority. In addition, Web3 incorporates blockchain, smart contracts, non-fungible tokens (NFTs), metaverse gaming platforms, decentralized social media, decentralized finance (DeFi) protocols, and much more.
Web3 Product Managers
In Web2, a product manager may overlook community interests in favor of profits and exposure. However, Web3 product managers are often tasked with nurturing and engaging with the community. This may include reaching out to developers, analysts, NFT creators, designers, and the broader Web3 community. Also, Web3 product managers may have to consider tokenomics, security, growth, and product design, for example.
Furthermore, if you’re a PM for a Web2 company, you’re likely expected to prioritize long-term strategies. Naturally, this is an essential aspect of a Web3 PM’s role. However, Web3 PMs must often focus more on execution than strategy per se. This is because a lot of the strategy has already been thought out or predefined via a whitepaper or technical document.
When it comes to execution, a Web3 PM needs to be on the ball and be ready to dive into a Telegram group with developers, test a new service, or create an audit. Also, with such a rapidly evolving technological landscape, spending too long strategizing can result in missed opportunities. As such, building and developing new products and getting them to market takes precedence.
Moreover, because the Web3 industry is so young, a Web3 product manager often has to do more than their Web2 counterparts. Accordingly, an excellent Web3 product manager will comprehensively understand the blockchain landscape and be willing to learn and adapt daily.
Why are Web3 Product Managers Different from Others?
As a Web3 product manager, the demands of your role and your day-to-day activities will differ somewhat from those of a Web2 PM. Naturally, you’ll still have to plan, develop, and launch core products throughout their lifecycle while interfacing with developers, designers, marketing, and other teams. However, a person in Web3 product management needs to have a particularly flexible and adaptive skill set. Also, because the web3 industry is so young, critical decision-making in the face of limited data or high uncertainty is essential. This issue becomes particularly apparent when attempting to A/B test a new product or service.
Furthermore, because a significant number of Web3 projects have achieved success without a PM, there’s often no benchmark for how they should perform. Also, while many successful Web2 companies rely on PMs for finding an early product-market fit, many successful Web3 companies and their users prioritize financial incentives and token economies over the initial product experience. In fact, many prominent Web3 projects start with pretty modest teams and only expand to include non-essential roles after becoming well-established.
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Web2 vs Web3 Product Managers
Web2 companies often aim to convert users from other platforms or use free plans to convert them to premium options. However, in Web3, exclusivity is less important. For example, most people who use a DeFi app will likely interact with more than just one. Therefore, creating incentives through higher yields, better security, or higher levels of stability is often more important than adding new features to boost engagement. Also, because of the open-source nature of Web3, developers often copy or fork the codebases of popular protocols. This means that the standard for what is acceptable is already established. Plus, a seamless UX is often secondary to ROI, reliability, and speed.
Another important consideration if you’re a PM transitioning from Web2 into Web3 is the difference in how you analyze and track users. Because users don’t need to provide names or email addresses to interact with Web3 apps, it can be challenging to get to grips with how people use a product and if it genuinely fits a given market. Also, due to the financial incentives that draw users to specific protocols, it’s not always clear how well an application performs. Furthermore, common analytics tools can only get you so far in Web3, so on-chain analytics and user feedback are essential.
Moreover, any Web3 app is subject to the quirks or limitations of the blockchain network it is built on. Also, it’s subject to its cross-chain compatibility. Understanding the value propositions of each blockchain is essential for any PM in Web3. Also, any Web3 app or protocol that has a native token will require a PM to have a clear understanding of tokenomics and how it can affect adoption.
Other Considerations
Whenever a team deploys a smart contract, the code within is immutably stored on the blockchain. You can’t simply create a quick patch or edit the underlying code. Accordingly, smart contract audits require careful consideration and can take up a lot of time. Also, open-source code and composability are commonplace in Web3, making it challenging to retain users long-term because of proprietary tech. Because of how frequently forks occur, proprietary code and complex interfaces are rare.
Another vital consideration is community decision-making. When a Web3 protocol is owned by its community of token holders, they get to decide on the direction of the project. This means that, despite efforts to steer a project in a particular direction, a Web3 PM may not have as much control over the roadmap for any given product launch. Also, you may need to adjust your expectations at any given time when the community votes on an obscure proposal that sits outside of your expectations.
Understanding the quirks of smart contract security is essential for any Web3 PM. Moreover, interacting with smart contracts can be cumbersome and often results in user errors. However, balancing usability with security is a delicate balance that must be carefully considered.
When Does Web3 Product Management Become Important?
Although not every project will warrant a Web3 product management role, some key indicators often prompt those in need of one to take action. For example, a PM might be a viable solution when an engineering team becomes so vast that it becomes inefficient and lacks direction. Also, whenever a user journey increases in complexity, such as when new features are added to a product or when a UI is updated, a PM may become a vital piece of the puzzle.
Often, when a Web3 project becomes successful and scales quickly, it becomes apparent that coordination is lacking between growing teams. When a product has multiple iterations and spans several different teams, a PM can be helpful in tying together the various elements. Moreover, some Web3 businesses will opt for multiple PMs when the complexity of their product offerings increases on multiple fronts.
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How to Get into Web3 Product Management
Despite the many differences between the role of a PM in Web2 and Web3, it doesn’t take much to begin the transition from the former to the latter. Naturally, a Web2 PM’s skill set is still applicable to Web3. However, there are a few important things you’ll need to be familiar with if you’re not already. If you only have a basic knowledge of blockchain, crypto, and Web3, it’s worth investing in your education. Study the Bitcoin whitepaper and read up about smart contracts. Learn how smart contracts form the foundational layer of Web3. Also, learn about their various use cases in DeFi.
Furthermore, you can learn a lot about Web3 from any of the top Web3 books. This is often a great way to get to grips with the philosophy of Web3 and the specific technologies powering it. Also, you can learn a lot by simply participating in the Web3 economy and interacting with various dapps on different blockchain networks. Take the time to learn about layer-2 networks, NFTs, and what makes a good dapp. Additionally, learn why interoperability is important and the role of decentralized autonomous organizations (DAOs).
Learning how to build and deploy smart contracts will give you an advantage when applying for Web3 PM roles. You don’t need to be overly proficient. However, a baseline understanding of the processes involved will likely pay dividends.
If you’re new to the Web3 industry and want to gain a firm understanding of blockchain and smart contracts, check out the Blockchain and Bitcoin Fundamentals course. This course covers everything you need to know to get started in Web3. It includes consensus mechanisms, forks, dapps, mining, and much more. Join our community of over 60,000 students and take your Web3 education to the next level today with Moralis Academy!
Web3 Product Management – Summary
From product testing to growth hacking and meme creation, Web3 product managers undertake many responsibilities that are not commonplace for Web2 PMs. Being a Web3 PM allows you to be at the forefront of innovation. Plus, it lets you shape the future of the decentralized internet. However, because the role is somewhat of a novelty for many Web3 companies, there is no clear framework for what’s expected of you between companies.
Working in Web3 product management for one company may seem similar to working in Web2. On the other hand, some PM roles for Web3 companies will be almost unrecognizable from a Web2 PM. Nonetheless, as a Web3 professional, you get the opportunity to be a part of something special. You get the chance to help build innovative products that democratize the internet.
If you want to learn how to build smart contracts but have no coding experience, check out the JavaScript Programming 101 course at Moralis Academy. Here, we teach students how to build a decentralized exchange (DEX) on Ethereum from scratch using JavaScript, HTML, CSS, and Moralis. Also, check out our blockchain guides and Web3 ebooks to expand your Web3 knowledge. So, take your first steps towards a life-changing career in Web3 today with Moralis Academy! Plus, make sure to check out our how-to programming tutorials at Moralis. We explore how to implement blockchain-based authentication and how to use a multichain NFT API!
