🎧 Learning Through Play
A conversation with Parin Shah from Lego Ventures
A few weeks back, I had a very enjoyable conversation with Parin, who is on the investment team at Lego Ventures. We delved into the Lego thesis, discussing 21st century skills, ideas around the metaverse, blockchain solutions in gaming, the passion economy and the future of education.
Parin is a gentleman with a very interesting range of experience. After studying natural sciences at the University of Cambridge, he worked as a banker at Merrill Lynch, then spent time at Babylon Health during a period of incredibly rapid growth. Now he invests from seed - series B in companies supercharging the future of edtech and gaming.
You can listen to the recording (apologies for audio quality - I'm a big believer in hacking “good enough”. The Twenty Minute VC this is not!). Alternatively, check out some of my favourite insights below…
21st Century Skills
Lego Ventures look at investments through the lens of “learning through play” or, as Parin puts it, “stuff that doesn’t smell like homework.”
It seems obvious in retrospect that this has always been at the core of Lego’s success. It is why kids and adults alike love Lego. I agree with Parin that learning through play is likely to become more and more relevant as we enter a period of rapid technological and societal changes that will require us to upskill constantly.
We discussed the “three C’s of 21st century skills”: creativity, collaboration, and critical thinking. They lie at the core of Lego’s thesis.
In a fast-changing economy, the argument goes, these are the skills which will stand the test of time and allow people to adapt to new environments and ways of working. They are the fundamental building blocks (thank you, I'm here all night) of all other skills, and thus essential to learning.
Great games, Parin believes, teach us these three C’s: creativity, collaboration, critical thinking. Let's dig in…
Take, for example, Roblox - the sort of company Lego surely regrets missing the opportunity to invest in. What is fascinating about Roblox is that its success hinges on being the polar opposite of a simple mobile game providing “junk food” dopamine hits (à la Candy Crush). In Roblox, there are complex mechanisms for users to build their own games, work together with other people to achieve shared goals and think objectively to solve challenging problems.
You are not mindlessly tapping, you are collaborating with your peers to build and explore whole worlds - worlds with their own rules, logic, histories and narratives. I’m not a gamer, but this has me excited…
The Metaverse, blockchain and the future of play (and maybe everything)
From the example of Roblox, we delved into a brief history of the Metaverse and ways in which blockchain might come into play in this context. For those unfamiliar with the term, the Metaverse is a somewhat utopian 80’s sci-fi vision of a collective virtual environment where people can add their own creations, build, share, trade and interact in ways limited only by their imaginations. Essentially, a fully customisable digital universe inside which limitless games, characters and even whole worlds would exist.
Whilst the original idea behind the Metaverse was to have a singular, persistent online world where people spent a lot of their free time, it would now seem more likely that multiple metaverses will emerge, catering to specific needs and target markets. This is where blockchain becomes interesting. Blockchain has potential not only to operate as the underlying payments and trading infrastructure for all the different metaverse(s), but also to act as a universal protocol that makes the currencies and assets you buy and earn in various games useful outside of those games, and potentially even usable across games. For example, I could take a pair of Nike trainers I won for my character on Fortnite, move them out of the game via a blockchain and wear them on my character when I play Call of Duty.
The thing that is so special about blockchain is that it allows you to make these digital assets non-fungible (programmatically unique) and therefore of high value. This means other people will pay you large amounts of real money to buy them. Parin highlighted the example of Dapper Labs (the makers of 2017 sensation Cryptokitties), who focus on blockchain gaming experiences. Dapper recently partnered with the NBA to make “NBA Top Shot NFTs”, which are licensed digital collectables of NBA player highlights. Essentially, they’re 21st century equivalents of football stickers, Pog tokens, Pokemon cards, etc. This sounds like fun and games, but the market potential here is serious. Since its launch in late 2020, there has been $50 million of trading volume on the marketplace for NBA Top Shots.
Other areas like digital artwork offer an interesting use case for NFT’s. Grimes sold $6 million of digital art in a single day auction on Monday this week! Pretty wild.
The potential here is vast: the creation of digital assets is low cost and is not environmentally taxing in the same way making more physical goods is. In a Western society running out of space to grow into, we may have found a new outlet. In Parin’s words “imagine the whole economy, then double it”. Certainly we are in a wild, speculative NFT boom at the moment, but bubbles happen in new markets for a reason…
The Passion Economy, automation and retraining
These conversations on 21st century skills, metaverses and blockchain in gaming led us to examine the broader economy and, subsequently, the education models of the future.
It seems self-evident that the “passion economy” is just getting started, and likely to take a more dominant role in the way we work in the future. That is to say, we will work and make money doing things we are truly passionate about. This is, of course, already underway - YouTubers, newsletter writers, community builders, Shopify brand owners and AngelList syndicates are all early examples of “solo capitalists” doing what they love and earning money doing it.
However, we must chasten our optimism. For every Grimes making $6 million in a day, there is a Deliveroo rider scraping by on sub-minimum wage, or a taxi driver being put out of work by Uber. It is vital to remember that many working people are struggling with the transition to the new economy and that this will cause a great deal of unnecessary suffering if we are not careful. As Larissa Schiavo notes in Lessons in technological worker displacement,
People are what they repeatedly do. Losing what they repeatedly do is a loss of identity.
Parin and I share the view that as an increasing number of jobs become automated and workers are displaced, we urgently need to figure out a way to tax and redistribute wealth in a novel manner in order to generate a universal basic income. The pandemic has given governments an opportunity to test these models. We must seek to do more, faster.
If we can, this should, in theory, help displaced workers transition from the old economy to the new economy. People must have the safety net and time to take what they are most passionate about and think about how they can turn it into a new income stream. But they must also have the tools to learn, and the current education institutions are not doing enough, fast enough, to make this happen. This is where the invisible hand of the market can do its magic…
Before us lies a huge market opportunity, in the picks and shovels of the future of education. Tools that help us become autodidacts, explore and teach our peers. Platforms like Udemy, Coursera, Chegg, Codecademy and the Khan Academy for adults, or Homer and Outschool for kids, are likely to be of increasing importance in the coming years.
Many investors have previously snubbed edtech as a market in which it is difficult to make money. However, it looks like the patience and foresight of those who made early bets is starting to pay off.
I share Parin’s belief that we are just at the start of a revolution in the way we learn, and that the people who get it right will build some of the most important businesses of this century.
Thank you Parin for taking the time to speak with us! Community members can connect with Parin on our community platform.
If you’d like to join future discussions…
Co-written by P.R. and Jon
📚 Go deeper:
Epic Games Primer - Matthew Ball
Decrypt’s introduction to NFT’s.
The Rise of the Solo Capitalists - Nikhil Basu Trivedi