The Purpose Built L1 Thesis
Why L1? Why a 3x (Seed/A/B) a16z fundraise? What real problems does Story solve?
Story's journey makes it clear that the next generation of blockchain infra needs to be Purpose Built.
Most infra projects and new L1s cannot even answer the basic question: "What novel apps are enabled on ___ that aren't currently viable on existing rails?"
- Community and culture are important, but it's a cop out answer.
- Economic mechanisms are important, but it's a cop out answer.
- Given L2s/Solana as a baseline, faster TPS is important, but it's a cop out answer.
New apps are the only thing that matters. And only Purpose Built infra can do so.
STORY'S JOURNEY TO L1
Story never set out to build an L1. We started with a guiding problem and searched for the right solution, not the other way around. We arrived at our L1 after 2.5+ years of building. Story's journey in a nutshell:
- A single Programmable IP franchise ->
- A smart contract protocol to support Programmable IP ->
- A L2 for atomic composability of IP ->
- A L1, after realizing it is the only solution to create the HTTP for Intellectual Property.
Here's the entire founding journey, as unsexy and meandering as startups often are:
When and I started Story, Hollywood was going on strike, digital creators were seeing their IP scraped up by generative AI models, and the pen-and-paper printing press legal system could do nothing to stop it. We set out to tackle the widespread problems in IP ownership, monetization, and growth for creators.
PHASE 1: IP FRANCHISE
Our initial solution was to use blockchain to empower transparent ownership and IP growth by creating a Programmable IP franchise. We quickly realized that "IP on-chain" was a misnomer, as any licensing or real IP remixing required lawyers and bespoke contracts from every side of a deal—like calling your bank and KYC-ing every time you needed to do a DEX swap.
PHASE 2: SMART CONTRACT PROTOCOL
So we decided to build a smart contract protocol that bridged code and law, allowing any piece of content to set its licensing terms onchain and have that reflected by a real legal contract backing it. This worked great for individual partners as well as the IP franchise we set out to build. However, the moment we started supporting projects on multiple chains, we experienced a massive issue: composability.
Our vision was that any IP on the internet could be remixed across apps. Just as DeFi enabled composability across applications and protocols, we believed IP could be unleashed in the same way. Yet our protocol, deployed for individual apps on individual chains, was more of a series of IP archipelagos rather than a unified and global IP repository. It was extremely difficult to license a Pudgy from Ethereum mainnet and a Clayno from Solana into, say, a comic without many cross-chain calls.
Story needed to be extremely interoperable across all blockchains, in addition to offchain settings. We didn't want to build backend SaaS for each project with isolated silos of IP for each project or at best each chain, we wanted to unlock a single atomic settlement layer for composing IP across all chains. To address this, we decided to own our blockspace in a hub and spoke model. Without this interoperability, there would be nothing new: just IP siloed by software instead of pen and paper.
PHASE 3: LAYER 2 (experimental testnet)
We spun up a simple L2 using the OP Stack with the help of my good friends over at Caldera. We also deployed the Proof of Creativity Protocol on our L2. It was easy for partners to migrate and spin up, and we had apps humming along quickly. Yet just as quickly, we ran into significant issues.
IP, like open source code and social networks, is always represented in a graph structure. A single node can have 10s, if not 100s, of parents, with each potentially having the same number of ancestors. Revenue needs to be distributed across all the nodes. This exponentially growing graph traversal problem produces an explosion of gas costs.
As a result, we had to limit the protocol—and our application partners—to a maximum of 2 parents per IP Asset. This means that you could only bring in 2 characters, or perhaps one character and one song, to create an IP Asset. Anything else was blocked.
This was not what we had envisioned at all - we could not in good faith claim that we were making IP multiplayer in any way.
After much internal debate, we started from scratch — just one week before our L2 public testnet launch. This was one of the hardest decisions we've made at Story, especially pausing so many ongoing partner conversations. It also meant investing an insane amount of research and resources to build a new L1. We could not and would not have made this decision without seeing it through the lens of the ever-present north star of making IP truly composable and multiplayer across the internet. The problem took precedence over the solution. Our vision demanded a purpose-built solution.
PHASE 4: L1 - THE WORLD'S IP BLOCKCHAIN
An L1 allowed us to tailor the entire stack for IP. Every single detail was optimized based on the many learnings we'd accumulated in the process of building a single IP, then an IP protocol, then a L2.
With the L1, we got the composable blockspace that the L2 offered, but we could customize not only the execution layer (also possible on an L2) but also the consensus mechanism, validator node storage, and novel validator features.
On the execution level, we added many tailor-made optimizations for graph traversal and computation onchain that massively reduced gas costs for IP graph related interactions and unlocked thousands of layers of parent IPs instead of just two parent IPs on the L2.
Further, we were able to leverage the best in class Cosmos SDK and its subsequent CometBFT consensus for fast finality. More important than the consensus algorithm itself, however, are the ability to customize the validator node storage and logic.
Though not in our day 1 mainnet release, we are actively researching the ability for nodes to host a graph DB to further optimize large IP graphs as we plan for every piece of content on the internet to be made programmable through Story. Further, we want to explore the ability for Netflix, YouTube, TikTok, and other offchain content platforms to stream live IP interaction and revenue data onto Story to enable our smart contracts to automate payments and licensing at internet scale.
Story's path to building the World's IP Blockchain started with a problem, and ended in a solution. Too many projects start with a solution, and look desperately for problems to fill in.
WHAT REAL PROBLEMS ARE WE SOLVING?
To go back to the initial question: "What novel apps are enabled on Story that aren't currently viable on existing rails?"
- Apps that license/remix/stream royalties for IP in a single click without needing a lawyer, where that IP can be registered from any other Story integrated app.
- Apps that want to support creator owned AI models where creators register IP as fine-tuning data on Story and set the terms for how AI can train on it, sharing upside with AI remixers as well as the source IP providers.
- Apps that want to tap into one of the largest asset classes in the world in IP, and tokenize IP as an RWA, unlocking an entire universe of IPFi applications.
You'll see many concrete examples of these apps come to life in the coming weeks. Stay tuned.
PURPOSE-BUILT INFRA: THE WAY FORWARD
A Purpose Built L1 redefines its entire stack for a specific problem, and unlocks new classes of applications that could not exist before.
The generation of alt L1s that merely make incremental improvements on Ethereum and Solana will come to an end when these general-purpose incumbents swallow their roadmap. Many L1s reached PoS over a year before Ethereum, but its improvements were swallowed by Ethereum eventually. The same will happen for alt L1s. Novel use case differentiation, not technology, is the only moat in crypto — by design.
Purpose Built L1s will thrive by dominating a real problem space that general purpose solutions are not built to address, offering services to offchain applications, existing general purpose L1s, and native applications to solve specific problems.
The future of blockchain infrastructure — and of genuinely new applications in crypto — is Purpose Built.
I am insanely proud of our team for shipping Story's public testnet in less than 5 months after deciding to build a Purpose Built L1. And I am grateful to the many investors, advisors, and community members that believe in our long term vision, our winding journey, and the guiding purpose of Story.
Why L1? Why a 3x (Seed/A/B) a16z fundraise? What real problems does Story solve?
Story's journey makes it clear that the next generation of blockchain infra needs to be Purpose Built.
Most infra projects and new L1s cannot even answer the basic question: "What novel apps are enabled on ___ that aren't currently viable on existing rails?"
- Community and culture are important, but it's a cop out answer.
- Economic mechanisms are important, but it's a cop out answer.
- Given L2s/Solana as a baseline, faster TPS is important, but it's a cop out answer.
New apps are the only thing that matters. And only Purpose Built infra can do so.
STORY'S JOURNEY TO L1
Story never set out to build an L1. We started with a guiding problem and searched for the right solution, not the other way around. We arrived at our L1 after 2.5+ years of building. Story's journey in a nutshell:
- A single Programmable IP franchise ->
- A smart contract protocol to support Programmable IP ->
- A L2 for atomic composability of IP ->
- A L1, after realizing it is the only solution to create the HTTP for Intellectual Property.
Here's the entire founding journey, as unsexy and meandering as startups often are:
When and I started Story, Hollywood was going on strike, digital creators were seeing their IP scraped up by generative AI models, and the pen-and-paper printing press legal system could do nothing to stop it. We set out to tackle the widespread problems in IP ownership, monetization, and growth for creators.
PHASE 1: IP FRANCHISE
Our initial solution was to use blockchain to empower transparent ownership and IP growth by creating a Programmable IP franchise. We quickly realized that "IP on-chain" was a misnomer, as any licensing or real IP remixing required lawyers and bespoke contracts from every side of a deal—like calling your bank and KYC-ing every time you needed to do a DEX swap.
PHASE 2: SMART CONTRACT PROTOCOL
So we decided to build a smart contract protocol that bridged code and law, allowing any piece of content to set its licensing terms onchain and have that reflected by a real legal contract backing it. This worked great for individual partners as well as the IP franchise we set out to build. However, the moment we started supporting projects on multiple chains, we experienced a massive issue: composability.
Our vision was that any IP on the internet could be remixed across apps. Just as DeFi enabled composability across applications and protocols, we believed IP could be unleashed in the same way. Yet our protocol, deployed for individual apps on individual chains, was more of a series of IP archipelagos rather than a unified and global IP repository. It was extremely difficult to license a Pudgy from Ethereum mainnet and a Clayno from Solana into, say, a comic without many cross-chain calls.
Story needed to be extremely interoperable across all blockchains, in addition to offchain settings. We didn't want to build backend SaaS for each project with isolated silos of IP for each project or at best each chain, we wanted to unlock a single atomic settlement layer for composing IP across all chains. To address this, we decided to own our blockspace in a hub and spoke model. Without this interoperability, there would be nothing new: just IP siloed by software instead of pen and paper.
PHASE 3: LAYER 2 (experimental testnet)
We spun up a simple L2 using the OP Stack with the help of my good friends over at Caldera. We also deployed the Proof of Creativity Protocol on our L2. It was easy for partners to migrate and spin up, and we had apps humming along quickly. Yet just as quickly, we ran into significant issues.
IP, like open source code and social networks, is always represented in a graph structure. A single node can have 10s, if not 100s, of parents, with each potentially having the same number of ancestors. Revenue needs to be distributed across all the nodes. This exponentially growing graph traversal problem produces an explosion of gas costs.
As a result, we had to limit the protocol—and our application partners—to a maximum of 2 parents per IP Asset. This means that you could only bring in 2 characters, or perhaps one character and one song, to create an IP Asset. Anything else was blocked.
This was not what we had envisioned at all - we could not in good faith claim that we were making IP multiplayer in any way.
After much internal debate, we started from scratch — just one week before our L2 public testnet launch. This was one of the hardest decisions we've made at Story, especially pausing so many ongoing partner conversations. It also meant investing an insane amount of research and resources to build a new L1. We could not and would not have made this decision without seeing it through the lens of the ever-present north star of making IP truly composable and multiplayer across the internet. The problem took precedence over the solution. Our vision demanded a purpose-built solution.
PHASE 4: L1 - THE WORLD'S IP BLOCKCHAIN
An L1 allowed us to tailor the entire stack for IP. Every single detail was optimized based on the many learnings we'd accumulated in the process of building a single IP, then an IP protocol, then a L2.
With the L1, we got the composable blockspace that the L2 offered, but we could customize not only the execution layer (also possible on an L2) but also the consensus mechanism, validator node storage, and novel validator features.
On the execution level, we added many tailor-made optimizations for graph traversal and computation onchain that massively reduced gas costs for IP graph related interactions and unlocked thousands of layers of parent IPs instead of just two parent IPs on the L2.
Further, we were able to leverage the best in class Cosmos SDK and its subsequent CometBFT consensus for fast finality. More important than the consensus algorithm itself, however, are the ability to customize the validator node storage and logic.
Though not in our day 1 mainnet release, we are actively researching the ability for nodes to host a graph DB to further optimize large IP graphs as we plan for every piece of content on the internet to be made programmable through Story. Further, we want to explore the ability for Netflix, YouTube, TikTok, and other offchain content platforms to stream live IP interaction and revenue data onto Story to enable our smart contracts to automate payments and licensing at internet scale.
Story's path to building the World's IP Blockchain started with a problem, and ended in a solution. Too many projects start with a solution, and look desperately for problems to fill in.
WHAT REAL PROBLEMS ARE WE SOLVING?
To go back to the initial question: "What novel apps are enabled on Story that aren't currently viable on existing rails?"
- Apps that license/remix/stream royalties for IP in a single click without needing a lawyer, where that IP can be registered from any other Story integrated app.
- Apps that want to support creator owned AI models where creators register IP as fine-tuning data on Story and set the terms for how AI can train on it, sharing upside with AI remixers as well as the source IP providers.
- Apps that want to tap into one of the largest asset classes in the world in IP, and tokenize IP as an RWA, unlocking an entire universe of IPFi applications.
You'll see many concrete examples of these apps come to life in the coming weeks. Stay tuned.
PURPOSE-BUILT INFRA: THE WAY FORWARD
A Purpose Built L1 redefines its entire stack for a specific problem, and unlocks new classes of applications that could not exist before.
The generation of alt L1s that merely make incremental improvements on Ethereum and Solana will come to an end when these general-purpose incumbents swallow their roadmap. Many L1s reached PoS over a year before Ethereum, but its improvements were swallowed by Ethereum eventually. The same will happen for alt L1s. Novel use case differentiation, not technology, is the only moat in crypto — by design.
Purpose Built L1s will thrive by dominating a real problem space that general purpose solutions are not built to address, offering services to offchain applications, existing general purpose L1s, and native applications to solve specific problems.
The future of blockchain infrastructure — and of genuinely new applications in crypto — is Purpose Built.
I am insanely proud of our team for shipping Story's public testnet in less than 5 months after deciding to build a Purpose Built L1. And I am grateful to the many investors, advisors, and community members that believe in our long term vision, our winding journey, and the guiding purpose of Story.
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