I lost 97000
thousand dollars because of you,
I bankrupt because of you.
Yes, yes.
You keep changing every day.
Hold on a second.
What have I changed about black,
huh?
You changed the whole business.
What? You drop the prices on
on black. Yes, you did.
Well, we started with twenty
dollars.
We started with twenty dollars.
You know. How much is the Mile now
2.75?
You know what? What?
Some people don't
like to take responsibility.
They blame
everything in their life on somebody else.
Why do you send email
for towncar? Good luck.
Yes. This story, the 2010s
saw a distinct trend.
A wave of classical industries were
digitized upon a new Internet
platform.
Their success came after they
achieved a network effect that
attracted an influx of venture
capital investment that then
unleashed a cascade of unintended
consequences.
The age of Internet middlemen had
begun.
And after a decade of doing business
with these types of platforms, we
still have yet to ask the most
important question of them all.
Who really is better off because
of them.
There are continued questions about
how sustainable this on
demand food delivery model can be.
It strikes me that Uber, at
the end of the day is like is
literally ground zero for income
inequality, that it's figured out a
way to have this two class system.
Median wages haven't budged in
40 years and we haven't created
full time jobs in a decade.
We create these part time contingent
flexible jobs.
Work has come apart and income
inequality is only getting worse.
The Internet giants we know today
all came from humble beginnings.
In our example of Uber, it
began with only a few employees,
but their biggest challenge was
teaching both consumers and drivers
to act in an entirely new way.
Riders have been hailing cars for
more than a century, but no one had
done so by just using an app.
This was the perfect situation that
only money could solve, Uber
received this money by convincing
investors that they were different
as they were able to showcase they
had the potential to scale
exponentially by taking this money,
Uber put many new drivers on the
road, which meant customers had a
new convenient transportation
option. That was at the time
very affordable.
Repeat this process over years, and
the platform creates a network
effect, increasing both adoption
and demand within the platform.
This process was replicated across
many platforms from Airbnb
to Up Work, and digitizing
age-old Industries was so effective
that they seemingly carved out new
markets for themselves, which gave
them full control of their users
behavior.
But this dynamic eventually had to
come into balance.
Soon, Ubers investors wanted to
see their return, which meant Uber
was no longer so generous to the
drivers.
This is complicated, but it can be
visualized by one simple
graph.
I give you the S curve.
As any new platform launches,
consumers get an affordable or
even free product, and in the case
of Uber, workers were decently
compensated in the beginning.
This enabled user adoption to
skyrocket.
But as time went on, drivers
earnings began to drop as investors
demands extracted more from
the platform.
These shareholder owned networks
eventually see a war between two
parties take place, putting the
platform at a crossroads.
Do they continue to cooperate with
their users or begin to give returns
to their original investors.
Now long term, across many
platforms, this has led to more ads
on Facebook, higher fees on Airbnb,
and more money taken from your
freelance gig on Up Work.
And with these types of market
forces playing out, one truth has
always remained through hundreds of
years of capitalism, and that is the
customer gets with the customer
wants.
Which leads us to an important
question.
Is there a way for these types of
platforms to commit to continued
cooperation without sacrificing
their users experience over
their investors?
Deep in the Rocky Mountains, there's
someone hiking along a trail wearing
a sustainably sourced jacket made
from the little brain known as
Recreational Equipment Inc.
REI was born as a co-op
and has developed into a massive
community controlled by its members.
The power of a co-op is that they're
owned and operated by its members,
giving them the capability to decide
the values of the enterprise.
This democratic style of ownership
has led to what many retail brands
would deem as unthinkable.
As a co-op REI still grosses
three billion dollars a year,
but it also refuses to take part
in the most important day in
shopping, Black Friday.
The members and employees believe
the holidays were for outdoors,
not shopping, and voted to opt
out and close their stores.
Now, is this bad business
or is it ethical capitalism?
This co-op structure may work for a
company that sells outdoor camping
gear, but can it be applied
to Internet companies that have been
dictated by models of short term
profits, sucking up maximum
investment and, you know,
moving fast and literally breaking
things?
Luckily for us, just over a decade
ago, a solution was found that can
challenge platforms and their
extractive nature.
It was a new protocol development,
that let us distribute value across
the Internet without needing a
central operator or middleman
controlling these networks.
And it turns out block chain
technology gave us more than just
funny memes Entrepreneur
and Investor at Variant Fund, Jesse
Walden, explains how this
breakthrough will impact the
construction of Internet platforms
and the future.
Now that we have this means of
distributing value at Internet scale
in very granular transmissions,
and that is technology
breakthrough of tokens, it's no
wonder that users are
going to take the next step and
start to contribute to platforms in
deeper ways. It's not just going to
be open source code
or content or products.
It's going to be actual operations
of the platform itself.
And that's what you see in Bitcoin.
That's what you see in Ethereum. That's what
you're going to start to see across
many more consumer facing
marketplaces and networks,
and if you do, if this does play out
and it already is, it
means that the cost to building
these networks drops dramatically
because no longer are you hiring
people into a company.
Instead you're outsourcing the work
or you're crowdsourcing the work
from users who earn a
direct stake in the platform
value for further contribution.
And that's just a much more
efficient model, both both
economically in terms of financial
capital and production capital
than than some of the corporate
model where you have to raise tons
and tons of value and you can only
sort of tap into the talent pool of
people that are willing to
or allowed to work at your company
and earn equity investment.
So that's another reason that
I think these networks can be more
valuable due to their sort of
efficiency gains.
Still confused, let's look at a
company achieving this so-called
Token strategy, Brain Trust connects
tech freelancers and companies
looking to hire them.
Unlike Up Work and other talent
marketplaces, brain trust is set
up as a nonprofit charges a nominal
fee to the companies looking to hire
freelancers.
And meanwhile, the freelancers
keep 100 percent of their
earnings and additionally
get a say in the future of the
network.
Now, how is this possible
that users, both the freelancers
and companies, gather tokens
from brain trust, allowing them to
vote on the future of the network?
Over time, the users can decide
which categories of work brain trust
should include, what the platform
fee should be, or the rules of the
platform and other network
governance topics.
Now, this should lead us to ponder,
how can other talent marketplaces
like Up Work and others even
compete with this model?
Simple answer.
They can't.
With the distribution of tokens to
its users, Brain Trust takes on
a public goods ownership structure
that allows the users to remain in
control of the network, which means
they can potentially grow larger and
stay aligned with their users in the
long run instead of
traditional Internet platforms that
have been hording their profits at
the top while extracting so
much from their users down below.
With this breakthrough, we've been
presented the first real opportunity
to slow the large networks who have
exacerbated inequality by
distributing ownership and
governance of Internet platforms,
we can open up the potential for a
more equitable future to millions
across the globe as
the world continues to be more
nomadic and borders are crossed with
bits instead of bodies.
These platforms give us the chance
to earn more and work on projects
that leave us more fulfilled
by taking back our power from
those at the top, the platforms
and networks can once again
create a new path for society,
a path that points us to more
opportunity and ultimately
more happiness.