# An Introduction to Pilot *Pilot believes the critical step in a company's lifecycle of finding product-market fit is corrupted in crypto and Web3.* ---- ### Web3's Problem Simply put, Web3 has introduced--and is stuck in--a new unacceptable paradigm of product development. The existing practices require existential company risk exposure from application teams in any bid to ship a product and reach product-market fit. Today, teams take all possible measures (e.g. audits, time passage, re-audits on updates) at high cost to themselves, but it still does not adequately protect users. The end result? A set of **unbearable tradeoffs** for a company meant to be lean, agile, and aggressive, while users repeatedly pay a critical price. It's a lose-lose situation, and for crypto and Web3 to survive and thrive fundamental changes are required. ### Our Solution Pilot is introducing a new era of secure and agile Ethereum app development; helping teams reduce the time and costs of shipping products by creating a novel and scalable approach to on-chain insurance. How? We're building a custom [OP stack](https://stack.optimism.io/) rollup--Pilot OP--that trades fast finality for app safety, enabling the reversal of any exploits that may occur. Smart contracts deployed on Pilot OP are **insured by the rollup itself**. We envision a chain with two main use-cases for teams that occur along different times in the product development lifecycle: - Early-stage teams use our unhackable experience to develop and experiment with new product ideas or features - low cost, users are safe, can find product-market fit or A/B test new features, and build a community before investing heavily into security and freezing code - Mid-stage teams use a security-focused experience to gain "security goodwill", freeze their smart contract code, and continue to safely grow their user base - their immutable contracts become lindy over time, exploits are incentivized (but still reversed and users are still safe), prep stage before they graduate to a fast finality chain Pilot helps the Ethereum app layer achieve product-market fit and strong security, without putting user funds at risk. ### Fixing Users Trust Teams that bear the costs of security (i.e. monetary, time, and mobility costs) in efforts to prevent product exploitation, still struggle to achieve product-market fit. Users are scared to engage with early products, even after all security measures are taken as this process has repeatedly proven to be insufficient. **$418,589,089 was lost** due to exploits across 59 incidents in Q1 2023[^2]. [^2]: $418,589,089 was lost in exploits across 59 incidents in Q1 2023. $3,773,906,837 was lost in exploits in 2022. Sourced from and credit to [Immunefi's 2023 Q1 & 2022 Annual Report](https://immunefi.com/reports/) A user must weigh “wow that’s cool and potentially useful, but is it worth the risk of losing 100% of my capital?” Consequently, DeFi does not scale outside the small number of power users comfortable with the current risks and tradeoffs, and teams lack the exposure to a wider variety of users to help them develop relevant products. Pilot OP restores the trust[^3] in an application's safety, greatly expanding the set of users who can comfortably experiment and provide valuable feedback to new products or features. [^3]: Worth noting this includes exploits caused by app teams themselves. In the event of self-exploits or "rugpulls" Pilot undoes the action. App users on Pilot are truly re-empowered. ### Security Goodwill Due to the nature of composability, liquidity, and network effects employed in on-chain app design, it’s extremely difficult to displace incumbents. Underlying the stickiness of these characteristics is the **security goodwill incumbents earn** over time. Users feel safe with incumbents[^4] on a level that new projects can’t compete with, and therefore new projects fail to attract the liquidity and community needed to start the process of iteration to product-market fit. [^4]: Users feeling safe with incumbents is our observation, even when it is not specifically earned (ie. they ship new features or products that haven't stood the test of time), further proving the disadvantage new teams face. The recent [Sushiswap exploit](https://www.theblock.co/post/225473/sushiswap-hack) shows that security goodwill around a brand and team lulls users into false comfort. In an effort to compensate for the extra risks associated with their nascent products, some teams distribute token ownership in their networks to early users. This tactic, while their most powerful growth tool, backfires as it's deployed prematurely. It further corrupts their path to finding product-market fit with the attraction of mercenary users. The teams sacrifice the ability to find sustainable growth and lose their most effective tool for driving true user adoption. With Pilot OP, application teams outsource the security goodwill from their app to the rollup. This eliminates the disadvantage they currently face, as well as the downstream impacts of lacking security goodwill. ### Pilot Team The founding team of Pilot has firsthand experience with the issues plaguing Web3 product development teams, and the wider business impacts they face. As project leads who've built multiple DeFi protocols, including the first yield aggregator known as "[RAY" (Robo-Advisor for Yield)](https://medium.com/@staked/https-medium-com-staked-announcing-robo-advisor-for-yield-ray-9d7395e84769) in 2019, and more recently at Primitive in 2022, the Pilot team has been intimately engaged as builders and users in DeFi since inception. ### Conclusion We're introducing a new dimension to the concept of progressive decentralization[^5]; [Progressive Irreversibility](https://hackmd.io/@pilot/Hk_UP4fLn)--which can be leveraged to remove the existence of exploits on the app layer. [^5]: [Progressive decentralization](https://variant.fund/articles/progressive-decentralization-a-playbook-for-building/), the idea that early-stage product teams benefit from more centralization because it lets them rapidly iterate as they have more control, and gives users more confidence that apps are safe to try. Pilot enables Web3 teams to leverage the proven Web2 development model. By doing so in a novel and scalable manner, we'll help Web3 application teams find product-market fit by: - Removing existential company risk exposure from the product development lifecycle - Expanding their user market while leveling the playing field against incumbents - Increasing the speed of product iteration while reducing the cost Overall, we believe this will lead to users confidence being restored, lower the costs of Web3 product development, and steer our industry towards new innovation. This will save crypto from its existing growth issues, and push it towards a mainstream audience. We'll publish the details on our first step down this path with our network, Pilot OP, soon. ### Reach Out and Follow Along! We're excited to hear feedback as we continue to build and iterate on our vision. Please reach out to us in our Discord or on Twitter. - [@itsDSPawer](https://twitter.com/itsDSPawer) & [@sam___iamm](https://twitter.com/sam___iamm) - Join our Discord: https://discord.gg/Rs3T7CXDq9 - Follow our Twitter: https://twitter.com/Pilot_HQ