Composability is to software as compounding interest is to finance

March 19th, 2022

Composability is to software as compounding interest is to finance 🧵

A very high percentage of the software in the world is open source. Most datacenter software is open source, mobile phones OSs make heavy use of open source, most next-gen devices like self-driving cars, drones, and embedded computers run mostly open source software.

Open source began as a fringe political movement in the 80s and remained mostly a curiosity through the 90s, but started growing exponentially in the 2000s and after.

Why? Because open source unlocked the power composability.

Composability is the ability to mix and match software components like lego bricks. Paraphrasing @naval, it means every software component only needs to be written once, and can thereafter simply be reused.

One of the most exciting aspects of web3 is the composability of protocols and tokens. We see this is in DeFi when protocols build on top of each other the way composite protocols like Yearn or Element do.

People are beginning to explore composability using NFTs, with Loot and the ecosystem around it being a really interesting example.

There are various exponential forces in the world to look out for, as they can be indicators of rapid future growth.

In hardware, the most powerful exponential force is Moore’s Law. In finance, it's compounding interest. In software, it's composability.


Originally published on October 22, 2021

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