Key success factors of decentralized Web3 business models

Abstract

Web3 is a fundamental change from a centralized, platform-centric internet to a decentralized, user-owned ecosystem powered by an open-source technology called Blockchain. This shift is not just a technological evolution, but also changes significantly how value is created, delivered, and captured. It enables new products, innovations, and business models. These products are often powered by tokens, whose value is described by their underlying tokenomics. They are designed to engage the community and incentivize the people who interact with the project. The users of Web3 often come together in decentralized autonomous organizations and democratically decide on the next steps and essential developments of the organization. The business models that are now possible because of the capabilities of a decentralized web have different success factors and reasons why they fail. This thesis conducts a systematic literature review and qualitative expert interviews to identify the success factors of Web3 business models. It first lists and categorizes the prevalent Web3 business models, their structures, and revenue models, and then highlights the success factors for Web3 business models. The findings reveal the difference between Web2 and Web3 business models, highlighting the importance of community, decentralization, governance, and robust token economics.