Today's tweet thread is on my thesis on the Downfall of Gatekeepers.

What is it? Why? And where will gatekeepers continue to exist?

Read on >>

1) First let's talk about what a "gatekeeper" is. It's basically a middle(wo)man -- a middle layer.

You see gatekeepers in marketplaces. In supply chains. And as "helpers" of access.

Why do gatekeepers exist in the first place?

2) Traditionally, for a few reasons:

-distribution power
-purchasing power
-openers of doors / access
-curation of quality or service

Let's dig into a few examples.

3) In supply chains, if you're selling vegetables, getting vegetables to the end consumer was previously challenging.

So we have middle(wo)men who take veggies to a holding stn. And have bulk purchasers & eventually a retailer sells 1 celery stalk to a consumer.

4) Beyond vegetables, a lot of supply chains look like this as well. Raw goods -> bulk buyers -> end user.

It applies to materials. Eye glasses. Food. Pharma. Clothes. Etc.

But w tech, you can cut out those middle(wo)men. We have many port cos @HustleFundVC who are doing that.

5) And that wave is just starting. If you are knowledgeable about a particular supply chain, chances are, there is a real opportunity to cut out many middle layers.

Everything around us is on some sort of long supply chain.

6) This also is the driver for other trends.

E.g. DTC - why go to a big box store and pay 30% more than just getting something directly from the seller?

During the pandemic, some makers of flour were even selling directly to the consumer.

Stores become obsolete.

7) But middle layers were not just established for easier distribution / movement of goods.

They were also established for access -- either helping keep ppl out or elevating ppl.

Startup investing is probably the best example of this.

8) For a long time, most people did not have access to be able to invest in startups. There is still a long way to go on this, but this is changing.

In this case, the barriers were legal (SEC rules on accreditation or limit on # of investors, etc)

9) When you think about it, VCs are fundamentally a middle(wo)man business! We are a middle layer between our investors and startups. And LPs of funds are another middle layer.

We're going to see some changes in these middle layers as well.

10) If you can cut out middle layers to save money, then there's obvious opportunity ripe for disruption. And I think this will affect many fund mgrs.

BUT, if your middle layer is MAKING you more $ on the net, they won't be disrupted. These funds will stay.

11) This is because middle layers can be good for curation of quality or service. This applies to funds and many other areas as well.

Ppl use Airbnb because if things go wrong w/ the host, there is someone to complain to. Ppl use AMZN because of their amazing logistics.

12) I think we will see more hybrid models of going direct + curation of middle(wo)men.

Eg, in investing, angels/microangels may want to invest direct. But many want someone to guide them on quality. For this reason, I'm long on syndicates who curate + have skin in the game.

13) We also see this in public stock investing as a trend -- there are influencers who publish on Reddit or other social media platforms their stock picks. And ppl want to copy them. They aren't running a middle(wo)man fund, but they are influencing / curating decisions.

14) We are starting to see this elsewhere. E.g. Traditional freelance mktplaces like Upwork are daunting. There are so many ppl w 5 star reviews you could hire!!! That makes these platforms frankly useless.

This is a big opening for curated mktplaces & trusted guides to lead you

15) So where are the opportunities?

In your everyday life, if you pick a random object or do a particular activity, think about who are the middle layers involved to deliver a good or service to you. Chances are, there is a biz opp waiting to cut out some middle layer.

16) Or, if there is a middle layer that is SUPPOSED to be delivering some value (e.g. honest reviews / curation / opening of doors) BUT is not, that's also an opportunity -- because it means the middle layer is worthless.

E.g. sites w/ review-inflation. Mktplaces w/ bad service.

17) Today, gatekeepers have to earn their right to continue because we are seeing fast disruption in every industry.

If a gatekeeper's job is to make you $$ / deliver great quality / open doors / or provide great service, they need to deliver on that. Those who do will stay.