Werd I/O

I've been seeing a lot of presentations lately as part of the run-up to Matter Eight, and thinking a lot about my experience as an investor vs as a founder. I think there's a longer piece on this that I should write.

I actually applied to Matter twice (once with Known, and once with Wavelist, a social network for podcasts) and got to the finalist round in both cases. Known was, of course, funded, and I've been a part of the community ever since.

The result of that experience - and the other two startups I either co-founded or had a core part in running - is that I can't help but put myself in the shoes of anyone who's pitching me. It's hard. It's nerve-wracking. It can feel really awful. And the truth is that if you don't get funded, it's not a value judgment on your project; it just might not be a fit.

It might also be that the investor, or one of their partners, is wrong about something core about the venture - not because you described it badly (although storytelling skills are vital), but because of assumptions they have. We've started running mini bias training sessions before each day of pitches to try and prevent this. But declaring your core assumptions and justifying them is a really smart thing to do - at least then you can have an informed conversation about them.

Anyway. Seeing pitches is the best part of my job, but making decisions is the hardest - I ideally would love to support everyone. In most cases I can see the potential, and I can definitely empathize with what the founder is going through.

Fascinating story about Instagram dropshippers by Alexis C. Madrigal in The Atlantic:

Ganon searches out some lion-themed objects, including the one that he anticipates making the most money from, a gold-plated lion bracelet that he puts on sale for $0. He gives some tips for finding popular dropshippable items, too. He sorts Shopify-hosted sites by traffic with myip.ms, and then digs below the most popular stores, which generally sell products they make themselves. Deeper into the top 1000 stores, there are dropshippers reselling Aliexpress goods, just like Ganon is, so if can ferret out what products are selling at high-performing stores, he can siphon off some of those dollars. All he’d need to do was do reverse image searches to find the listings in Aliexpress, suck those products in with Oberlo, and he could effectively clone the store in a few minutes.

There's nothing particularly new about any of this, but I've seen an uptick in ads for these Everlane-lite products in my Instagram feed and had wondered what the model is.

I'm curious about the effectiveness of the storytelling involved: one store discusses a founder who "had a constant desire to present himself well but didn’t believe fashion and style should come with such a high price". I don't think I could count the number of times I've seen an online store with a founder story like this. It never came across as authentic, but over time the bullshit factor surely becomes overpowering.

Also, importantly: the cross-platform techniques described aren't going to work under the GDPR, because they heavily depend on targeted advertising. Embedding a Facebook pixel in your Shopify site is going to necessarily be a thing of the past, at least in Europe. So hounding someone with ads because they happened to visit a product page on a website may become a thing of the past, forcing marketers to find more authentic and user-friendly ways of reaching potential customers.

This seems like such a soulless way to build a business, and if these aren't technically scams, they sit on the very blurry edge of the border of scamland. I won't be sad if, through a combination of legislation, better privacy features, and new business models, this kind of dropshipping becomes a footnote in the history of social media; just one more reason why targeted advertising is insanely bad.

PageFair has some really interesting GDPR consent designs:

In late 2017 the Article 29 Working Party cautioned that “data subjects should be free to choose which purpose they accept, rather than having to consent to a bundle of processing purposes”. Consent requests for multiple purposes should “allow users to give specific consent for specific purposes”. Rather than conflate several purposes for processing, Europe’s regulators caution that “the solution to comply with the conditions for valid consent lies in granularity, i.e. the separation of these purposes and obtaining consent for each purpose”.

The sample wireframes they've come up with are hilariously onerous, and Europeans will have to opt in on every single site where data is collected. The result will be that almost nobody agrees to give their information universally across all sites, which is the current status quo (because right now, nobody's being asked for anything).

As David Carroll points out on Twitter, it's a fairer negotiation:

New wireframing work by @pagefair illustrates how the forthcoming cognitive load to accept being invasively tracked and targeted lets people have a say in setting the privacy policy and terms of service in a fairer negotiation. #GDPR #ePrivacy https://t.co/7NFSv29O33

— David Carroll 🦅 (@profcarroll) January 9, 2018

I see two big wins from this:

1: Constraints breed innovation. In order to allow advertising and tracking companies to continue to survive, they will need to become more compliant very quickly. We're going to see a new breed of technologies that respect user privacy.

2: More importantly, we're going to see publishers and platforms move to different business models. I'm particularly excited about this. Targeted display advertising has been a catch-all business model for a long time, and the GDPR removes this lazy route to monetization. Everyone is going to need to think harder and more carefully about how they make money - and the result is likely to be something that aligns readers and publishers (or users and platforms). Display ads do the opposite, as the arms race between ad companies and ad blockers has shown.

Sure, there's an argument to be made that the EU shouldn't be interfering with the digital economy in the way that they are, but I think it's dead wrong. Government should be adjudicating and legislating around issues like privacy. I strongly suspect that similar legislation will make its way to the US and other countries - and either way, this is the internet, so the effects will be felt worldwide.

I've been pretty cynical about cryptocurrency, not least because of a lot of the community around it. It's hard for me to get excited about something when it presents as bro-fessionally as crypto does. But it turned out over New Year that a $20 joke investment in Dogecoin that I made in 2014 was worth almost $500 - so I decided to pull it out and invest it in a "real" currency to see what all the fuss was about.

Eventually I identified Stellar Lumens as something that fit the bill for me: a kinda sorta fork of Ripple that has a much more palatable governance model and ambitions. The project is trying to make it easy to build global financial applications for humans, and one of their stated goals is to help immigrants send money back to their families. Okay. That sounds interesting to me.

But to get my funds there, I had to sign up to a bunch of services that all made me feel like they were going to take my money and run. I needed to convert Dogecoin into Ethereum, then move it to another exchange, convert it to Lumens, and then withdraw it into my own private wallet. Various exchanges went down while I was doing this, and none of them made me feel at all safe. It looks like I made it under the wire with at least one, which has decided to close registrations for new users.

Stellar has done okay since then: I'm up, but not by a lot.

Contrast with Coinbase, which provides a beautiful, safe-feeling interface for Bitcoin, Ethereum and LightCoin. It makes trading those currencies significantly easier - and it and related services are likely partially responsible for their value. User experience leads to real value, and it'll be interesting to see the effect if and when it adds others. (I'm sure they're aware of this.)

My bigger question is: is this socially useful in any way, or should we be worrying about bigger things?

This year, I’m moving back to blogging on a regular basis. Blog posts are shorter than full-length articles, and usually contain some brief thoughts around an issue or a link. I’ve been blogging since 1998, but sadly not in a consistent place, and over the last few years I’ve let Twitter take more of a focus.

If you use a feed reader (I’m a paid user of Newsblur), you can follow my posts by subscribing to https://werd.io/feed - or I’ll continue to cross post to Twitter. I may add a newsletter later (although, aren’t we all fighting our inboxes almost all of the time?).

I’m writing this on public transport, and this will also encourage me to keep improving my own mobile posting experience.

And finally, comments are off - so if you disagree with what I write about, you’ll need to post your replies on Twitter or on your own site. I’ll see them.

Onwards!