Crypto as an extension of the internet
At sixteen years old, the abstruse boredom of being a teenager in a sleepy rural manufacturing town led Austin King to found his first business, King Resale (“a pretty inventive name,” he adds). It was essentially a white glove service to help people to use internet sales platforms to get rid of their stuff. Hardly revolutionary or hugely profitable, it gave Austin two things: 1) strong conviction in the power of the internet to give anyone, anywhere a start, and 2) enough cash to fund his next enterprise, an iPhone app, which quickly failed due to a lack of a deep enough understanding of the challenges his freelance developers faced.
Austin saw that to create a successful technology company, he needed to have a real understanding of the tech itself. Stanford University had open sourced their computer science class, and because his high school didn’t offer one, he persuaded his teachers to allow him to use the classroom for an hour each day to take the Stanford course as an elective. Austin went on to study computer science at Harvard University, and while there, developed a keen interest in crypto–despite finding the overall attitude towards crypto at Harvard to be one of skepticism.
In his senior year, he committed to creating a crypto startup, raised capital for it, and spent eighteen months building it. The company, Strata Labs, was an infrastructure provider for crypto businesses, offering nice, simple APIs to get set up. As a technical founder, he quickly became aware of the monumental chasm between computer science and engineering. He had spent most of university doing math proofs and abstract logical work, and was now tasked with building reliable systems–a trial-by-fire experience that forced Austin and his team to become better engineers, fast. Strata Labs expanded rapidly and processed 10 billion payments before accepting an acquisition offer by Ripple. After working and vesting at Ripple for a year, Austin decided to give himself six months to come up with his next idea.
Reflecting on what to do next, Austin recalls, “In the 2018-2019 ICO era, there were a bunch of projects that were like, mechanical turks on-chain or machine learning on-chain. But it soon became clear, almost laughably obvious in hindsight, that the first killer app would be in finance, with on-chain decentralized exchanges, derivatives, and more.”
Solving a clear pain point in DeFi
Driven by strong conviction in the promise of decentralized finance (DeFi) to revolutionize finance, Austin and his new co-founder, Tyler Tarsi (a former quantitative trader and Harvard grad), set up Rift. And they spotted a clear pain point in DeFi to solve for.
Decentralized autonomous organizations (DAOs), which are governed by tokens, were spending millions of dollars (sometimes a month) for liquidity to enable communities to buy and sell these tokens. Rift’s first product is designed to solve for liquidity at a fraction of the price. The system they built has had a promising start: the protocol processed $50 million in payments within the first six months, which Rift believes shows there is significant demand for more tools to establish a sustainable financial foundation on which DAOs can build and grow.
Rift has raised $18 million from Pantera Capital, Two Sigma Ventures, Coinbase Ventures, and others–an order of magnitude more than his previous startup, which had raised $800,000. This capital is enabling Rift to continue to expand their services and liquidity coverage, already sourcing over $70 million for DAOs including Fantom, Aurora, and many others. Two Sigma Ventures’ lead investor, Andy Kangpan says, “DAOs have limited tools at their disposal to create and maintain a healthy community. Rift’s initial focus on helping to create sustainable liquidity should provide a key foundation for these organizations, and we’re excited about the positive reception they have seen from many of the leading DAOs in the Web3 space. We are thrilled to support Austin and the rest of the Rift team on their mission to provide a strong foundation for DAOs to succeed.”
Towards the future of DAOs
Austin is a big believer in what DAOs represent–new opportunities for people around the world to come together and collaborate in new ways–and mindful that their toolsets need to evolve beyond a multisig (shared wallet) and a few financial tools. He highlights how today, “there are many countries where it’s ver bureaucratic to start any common enterprise. That’s what I care a lot about, supporting anyone that has the motivation to make something happen–the enterprising spirits–by creating tools where it will be incredibly easy for them to make things happen.”
To support other DeFi builders and broaden the ecosystem, Rift recently launched their open-source software, Neptune, making it easier for others to build crypto dapps. And they’re looking for more engineers who share their vision to join their highly technical team of five, which Austin describes as a unique, timely opportunity to join a crypto company that is well financed and prepared to weather the bear market and emerge even stronger.