Avara, the company behind Aave, Lens, and Family, is announcing a $31 million funding round led by Lightspeed Faction. With Lens, Avara is building a decentralized L2 network that could serve as the infrastructure for social and consumer apps.
This funding announcement comes a few weeks after Lens unveiled a completely overhauled version of its protocol, Lens v3. Originally built on the Polygon blockchain, consumer apps that are using Lens v2 include NFT creation and sharing app Zora, Twitter-like platforms Hey and Kaira, and subcommunity-focused app Orb.
Why are crypto developers still trying to create the next big social network? It comes down to decentralization and focusing on users.
Users interacting with a Lens-powered app own their identity and content. Apps built on top of the Lens network are interfaces to interact with the blockchain. The Lens team even calls these apps clients. If users want to migrate to a new social platform because they're unhappy with some changes, they can just sign in to another Lens-powered app.
Similarly, while consumer social apps incentivize creators with rewards programs and subscription systems, the companies behind those social networks dictate the rules.
"I think social networks are very financial as of today, but most of that financial value goes from advertisers to the platform and very little for the user," Avara founder Stani Kulechov (pictured above) told TechCrunch. In addition to that, he feels like users are "locked into a specific database."
With a decentralized social app, "that basically turns the model upside down where the users are more important, and they have more power than the platform itself," Kulechov added. It could potentially lead to more transparent revenue-sharing contracts with better rewards for creators.
With Lens v3, the company is tackling one of the biggest issues with web3 social experiments -- the cost of transactions. Writing a post on a web3 platform means signing a transaction on an underlying blockchain. While layer-2 networks have contributed to driving transaction costs down over the past few years, it remains a barrier to entry for large-scale consumer apps.
"We launched it on Polygon, but the network doesn't scale to mainstream usage ... where one transaction might cost a fraction of a cent. And that's basically why we chose a stack where we wanted to have the benefits of Ethereum. All these transactions that happen on Lens Network, we take them, we package them with ZK proofs and then put these transitions into Ethereum," Kulechov said.