What Are Blockchains Useful For? - Balaji Srinivasan + Àlex Rodríguez Bacardit

Yeah.

First of all, thank you for coming and thank you for creating aaron.com. maybe we want to start with explaining a little bit where you come from. How did you come up with the idea and why did you think it was a great idea to pay to get a reply from Mark Andreessen?

Sure. Okay. Yeah. So you know where we come from. So I'm currently a partner at the venture capital. In 2015, I took over a company that, you know, had gotten into some trouble and turned it around. And one of the technologies it had at that time was some micropayments technology. And back in 2014, the Bitcoin Core group was actually led by Gavin Anderson, who wanted to focus on micro payments and large scale transactions. By late 2015, early 2016, that was the case anymore. And nevertheless, so the micro payment software we have built and the company had taken over, we need to figure out a way to repurpose it to do something of value. So we put together a spreadsheet of a number of different kinds of applications, and of those, not the very smallest level of Microciptium, but the mezzanine level were basically paid emails. And one thing that's interesting is if you look at the Internet right now, there's two sets of queries on the sender side and on the receiver side of email, which aren't really being addressed like kind of an unmet market need. On the sender side, there's many, many people who are googling how to buy email lists. And typically if you buy an email list, the people on that list haven't given their consent and they're not getting a cut of the proceeds from the sale of that email list. And as such, they're reticent to actually go and let their information be sold. Conversely, on the other side, you have lots of searches for make money online or make money at home, make money on the Internet, et cetera. So if you could somehow solve all those problems at the same time, allow senders to buy email lists and allow people to just make money online, that'd be actually pretty good because there's very few social networks. You know, all kinds of networks where you can get followers and make friends, but very few where you can actually make money. And we think that that might be the next 5, 10, 15 years of social networks where you accumulate not necessarily just followers or friends or likes or favorites, but actually negotiable digital currency.

I was going to, I was going to ask, because you guys started first at 21Co, why did you rebrand to aaron.com before we go much more into product.

Yeah, sure. So, right, so the company that took over was, was called that, and that was named after the 21 million cap on Bitcoin. And that's cool. You know, I think it's a cool name or whatever, But I think Earn.com conveys a value proposition of basically making money online for completing tasks and responding to messages. And it's also a dot com, so it's easier for people to remember and pronounce and type in and whatnot.

Then didn't that earn you some sort of like, bad repetition? As in, like, if I receive an email from earn.com, make money online is perceived as something G, then you have these kind of problems at the beginning?

No, I don't think so, actually, because the thing is that when you have a, you know, like Earn.com is a, you know, for. It's a premium domain name. Right. And so if there's going to be a reputable place to make money online, to monetize yourself, to monetize your email, etc. I think it's going to be from a spot where, you know, it's wholesome. Right. If you look at Earn, it's all got positive connotations in the dictionary. You're earning your daily bread by, you know, completing tasks and so on.

Do you think you can replace the messages that are being sent on LinkedIn to the top people? Right. When people like Mark and Recent, for instance, by having your product, as in, do you think it's more like qualified emails or propositions that you are getting through your platform?

Yeah. So I think probably the most direct alternative to what we're doing is LinkedIn InMail. And if you folks have used LinkedIn, there's a feature on it, you may not know the name of it. It's called InMail, which is basically your inbox on LinkedIn, where other people on LinkedIn can message you. And the thing is that right now there's no incentive for people to reply to those inmails. And so as such, it's just another inbox to check. But ours is like a LinkedIn in mail where you actually get paid. So if you're being cold messaged by somebody outside your social network, you can actually get compensated for that. Now, one question you ask a related one. So first is, would the general average person want to get paid for this? Yes. Now you might say, well, why would the very richest or most successful kind of people want to get paid for this kind of thing? And what's interesting is at $1 per minute to give a quick one minute reply that actually annualizes to about 120,000 a year. At $10aminute for a $10 reply, that's like 1.2 million a year. So you actually have to be fairly rich, extremely wealthy in order to not do $10 for one minute for a reply. But there's lots of senders who would definitely pay $10 per reply. For example, if you're looking for folks who want to lease office space, or if you're trying to sell very valuable enterprise software, $10 per reply might be very cheap for you because any one conversion might be worth tens of thousands or hundreds of thousands of dollars. So it depends on kind of who the recipient is. But there's a very large number of people, more than you might think, who could rent out their time online.

Let's go into this because this breakout stage is also very focused about blockchain and crypto. So you are giving people, you are retributing these people with crypto. Actually you were, let's say crypto, digital crypto native, if you allow me. Why did you come up with this idea?

Yeah, it's a good question. So one way of sort of thinking about it is, you know, stripe's innovation over PayPal was improving pay ins, right? That's say, improving the process of putting in your credit card. Online payouts are actually even more primitive in some ways than pay ins. One way of demonstrating that is, if you think about it, there's many, many websites, probably hundreds, if not thousands of websites, if you think about it, that you put your credit card into, but very, very few that you put your bank account into. There's lots of websites that you can pay, but very few that will actually go and pay you. And that means that empirically there's a large hole on the Internet where for some reason it's been technologically challenging for websites to set up business models where they pay $1 or $5 to thousands or millions of people. We believe that part of the reason for that is that in order to receive payments on the Internet prior to the blockchain, you need to go and input your bank account. And inputting your bank account is actually very high threshold activity. That's to say, first, you don't have too many bank accounts, so replacing it is a pain. It takes hours or days to replace it, often. Second, if somebody compromises your bank account or gets those credentials, then they can debit money from your account, not just credit it. And third, you've got your life savings there. So it's a very large downside of your account. As such, people are reticent to give out their bank account addresses. However, if they give out a Bitcoin address or an Ethereum address, that actually solves all those problems because they can generate them in seconds or throw fractions of a session, they can only receive money and no one who knows the address can debit from it. And you can have arbitrarily small or large amounts in there. And so it can be set up and you can just come to the website and start earning without the overhead of having to go and get a bank account. We think that's one of the major reasons that payouts become much easier with what we're doing with blockchain and.

Exactly. That's why we wanted to give the example of Earn.com as a practical example of the blockchain.

Right.

Because we are seeing lots of speakers, lots of conference about the blockchain crypto and all that. And it's all theoretical speeches and keynotes and all that. But very rarely you get to drill down on what's the practical applications of that. So can you explain a little bit more about how do you use it in the tech side, perhaps?

Yeah, absolutely. So we have thousands of senders using us. We went and keynoted Salesforce actually just a couple of months ago. And the, the use case is very simple. If you're a business that wants to get people to reply to emails or fill out surveys, you use earn.com and so some concrete examples. So I mentioned fill out surveys, right? So you've got a long survey, you want people to fill it out, Boom. You can send it to 10,000, 100,000 people. Or number two, you want to get feedback. Market research, that's like a subset of the survey problem. But you can go and just send that out to all of your users, give them a paid task, and you can pay them one or two dollars to fill the survey. And that makes it much more likely they're going to do it.

Right.

If you're doing sales, what you can do is you can blast, let's say 10,000 people with a single question. You can say, for example, are you using containers in production? And let's say 1300 of those people say, yes, I'm using it at work, I'm using it in production. Then you can follow up with them with a $10 task to try to get them to go and do an interview. And so in this fashion, it's like a new kind of social network. Like if you go and put out a tweet on Twitter, maybe people will engage with it, maybe they won't. Right. But with earth.com, you're actually paying them. You're making a payment conditional upon their engagement. And that's possible with blockchain because we can pay people out small amounts in any country at any time, all that type of stuff. Right. So blockchain has enabled this new kind of thing. It's practical, it's useful for any kind of business that wants to go and get emails, replies or survey completions.

Another thing that you probably didn't predict back in the day when you started business is like you have gathered around this community of crypto because I'm getting a lot. I'm using error.com and I'm getting all these emails and messages that, hey, we were selling tokens for our ICO and all of that pre sale, join us here, register to our telegram channel and all of that. Did you foresee this was going to happen or are you profiting from having this community around the product?

Yeah, so. Good question. So basically, the kinds of senders that are on Earn.com right now are enriched for people who are in the crypto community because the senders understand crypto, the users understand crypto, the product is built on crypto, etc. So that's a community where there's insane product market fit already for a lot of these token airdrops, because what a token airdrop can do is they can push a button, they can pay 10,000 or 100,000 people $1, and they can also give them some of their free tokens and it's a great free trial kind of thing. And to get 100,000 people like real verified users to respond or engage with what you're doing, it's actually not that easy on other kinds of platforms. You won't get like the actual human beings and so on. Instead you'll just get about 100,000 impressions, but you won't know who it was. You can't retarget them all that type of stuff. So absolutely, there's definitely a product market fit within the crypto community, but we do think it diversifies and broadens beyond there. For example, right now there's folks who are paying users like $1 per installation on Earn.com to install a crypto wallet, but that's easily generalized outside of that, because pay to install is a multibillion dollar business for many other kinds of apps. So you can imagine easily broadening this out to Fintech and other kinds of verticals.

After this I wanted to ask is there any some sort of verification from these senders of these, of these campaigns, of these paid messages? Because one of the fears I have is like when are the scammers going to sign up for him.com or like spammers if you will, or like companies who are not relevant to this market but they sign up because precisely for them it's profitable to join this and send a million emails through your platform.

Right? So one of the big things is the fact that the sender is paying the recipient in cryptocurrency does reduce the, I can't, I'm not saying it completely eliminates it, but it does reduce the number of true outright spammers and scammers because they have to put down like a $50,000 Bitcoin or Ethereum deposit to send a $1 message to 50, 50,000 people. That's the kind of thing where okay, maybe they might be running a scam but it makes it much less likely, right? Because at a minimum they're going to quote, lose $50,000. The reason that email spam works is because there is no, you know, meaning like the spam that you get in your Gmail inbox or what have you because there's no cost per message. Then the spammer can just send 10 million messages and get 30 replies or what have you with this. Because there's a cost per message, it tends to attract it a sender who, you know, maybe they're not like, you know, Amazon.com or whatever yet, but they're a startup that's not like completely non reputable.

Right.

Like they can actually have the capital to put down a deposit like that. With that said, in the medium term we're going to be doing even more like sender filtering and whatnot. But right now we don't really have that issue.

Do you foresee that in the future? Because you mentioned the subject of spam. Right. And probably it's not spam when pretty much like underdogs, like young entrepreneurs and everything they want to access market reasons or however really important people inbox. So do you foresee that in the future we're going to pay people who are not in our first or second or third degree of contact, something like that. Are you disrupting the email inbox?

So that's actually something we think about a lot and here's why is most people are neither on your white list nor your blacklist, right? So blacklists are spammers, whitelist is your social network, right? But maybe your social network has, you know, a few thousand or maybe even tens of thousands of people if you include, you know, friends of friends, right? But the vast majority of the 7 billion people in the world are on your green list. That's to say, the folks who the natural interaction is a commercial one. They're not your friends, they're not your enemies, they're your potential future business partners. And that entire swath of kind of the human relationship right now is based on cold email. And one way of thinking about that is, you know, the personal inbox itself. Over the last 10 or 15 years, all person to person email was taken out and pulled into text messaging and Snapchat and Facebook and whatnot, right? And all internal intra company email was pulled out into things like Slack, right. What's left is really a lot of business to business email and also like login stuff, notifications, things like that, right? So transactional email of two different varieties. And so we believe that the business to business email is the kind of message, you know, that's the kind of connection that naturally has a dollar sign on the edge, right? In the sense that when you're pitching a commercial relationship, when you're saying, hey, I'm recruiting you, please join my company, or hey, you know, I'm doing a survey to improve my business, or hey, you know, I'm trying to sell the SaaS software. Well, that's something which is inherently commercial. So it's not totally inappropriate to put a dollar sign on the edge and to value that computer.

So kind of like Google Ads, but for email, do you see, like we're going to pay the feature to access somebody else's email just because we are not in neither of the black or whitelist.

Well, I actually think that when you move from paying for attention to action, you can 10 or even 100x Internet ARPUs. And I know that sounds like a very bold thing to say, but right now people spend, you know, dozens or hundreds of hours on Facebook a year and you know, Facebook like their arpus and they us are about like $7200. But most people, you know, if you just take a minimum wage and multiply by the number of hours on Facebook, there'll probably be thousands, if not, you know, tens of thousands of dollars. So there's a huge gap between how much existing Internet companies are monetizing per user versus how much you could monetize if you could actually tap their brains and their actual work ethics and their skills and obviously cut them in on some of it as well.

Right.

So right now we have this completely, you know, baroque system for monetizing, you know, online, which is ads, because you're just paying on the basis of attention. If you can monetize on the base of action, you might do much better.

I wanted to ask a little bit more about the product itself, right? Because probably some folks over here, they're not familiarized with it. I wanted to ask. Let's talk about the bounce, because this, like, for me, it's a revolutionary concept. Maybe you can explain what is it about and what have you learned?

Yeah. So one of the features that we have@earn.com is a personal paywall. Okay? So if somebody from outside your social network sends you a message, you can send a bounce back to them that says, hey, if you're outside my social network, please pay me. And you'll only pay if I reply to your message. Conversely, if they're your friend, you can be on the white list. So some examples of why this is helpful right now. One thing that many people do, by the way, is they donate the money they receive in this fashion to charity, right? So if you're, you know, a venture capitalist, for example, you're getting, you know, dozens, sometimes hundreds of cold emails a week, and, you know, if you can turn that into two, $3,000 that you can just go and give to charity, that's actually, you know, pretty good. If you are a executive who's getting lots and lots of pitches for, you know, this and that company. Well, what if you could just auction off your inbox time and actually make it valuable? And now, rather than find 500 unsorted cold emails where they just try to nag you into submission, you have an ordered inbox where the folks who really want to get in touch with you can do so even if they don't know you. Right? A third example, many journalists have many PR people pitching them constantly to try to get attention for their startup. Now, the journalist could take a paid message and then do one of three things with it. Keep something for themselves, split it with their parent company, or donate it all to charity, or some combination of those three. Right? And different journalists will have different kinds of arrangements with their parent company for that kind of thing. So anybody who's got kind of email overload, often the reason they do is because their attention is monetarily valuable, but they have no way to actually monetize that or put a paywall up. And with Earn.com we allow you to do that.

I want to ask right now, in order to use earn.com you need to go to your platform. Sign in there, signing, sorry, sign in there and just use it through the pump. Do you envision that by having it somehow built into your email inbox that will increase conversion and the time that people are using your platform. Do you see this something that your guys envisioning?

Yeah, definitely. I mean, the way we think about it is that's like another client. If you guys know how many web apps and other things are built today, you build an API brain and you've got the web client, you've got the iOS client, you've got the Android client. So we'd have like a Gmail client, we'd have like an Outlook client and so on. So think of that as also basically reading and writing back and forth. And there's ways to kind of do that with plug ins or other kinds of things.

And what are the. Let's talk a little bit about like lessons learned. What are the top three lessons learned that you have learned through iron.com, probably about product or even team management or.

Yeah, so it's interesting. So. Well, first is, you know, the blockchain space is interesting because, you know, I'm fortunate to have gotten in very early and you know, it's been really fascinating to watch, you know, the whole thing go vertical.

Fun.

But I think, you know, so one lesson learned is that, you know, capital versus labor in the space is actually very valuable. That's to say, unless you have a really good idea, you probably don't necessarily want to start a company. Your best bet may just be to put that 100,000 that you go and put into the company into, you know, a basket of cryptocurrencies and just hold it, right? And then you can just kind of sit and chill and you know, watch it go up or down and then up and down. You know, that's all fun. So that's number one is really think about whether or not you want to put in capital versus labor. Because that trade off is now available to many people as individuals. And it's a very new thing because it used to be that only accredited investors could make that kind of trade off, right? The folks who could actually invest in startups and decide, hey, just want to make my startups go up or do I want to actually go and put in sweat labor? Now there's a possibility of actually putting your savings to work rather than actually going and taking stress from the start. So that's kind of number one, labor versus capital. The second Major thing is, you know, like, just thinking about the sheer scope of things that can be transformed and disrupted by blockchain. I mean, you're gonna, you're gonna hear lots and lots of talks on that type of stuff and, you know, maybe I'll publish some essays or whatever. But one thing to keep in mind is anything that is bleak, leading edge today is probably too early. It may not be too early to base a token on or a coin on because you can get marketable value out of it, but it's probably too early to base a business on something that was just launched like a couple of weeks ago. And the reason for that is you will be taking all the platform risk and all the hits associated with that. And then after development tools improve over six months or nine months, you'll only be maybe a few months ahead of somebody who has those improved tools and they can potentially catch up. Now, that's. If you're building on top of one of these new coins or tokens, you're actually building the coin or token itself. Well, then, you know, bleeding edge actually has a value in its own right because there's a market cap. So that's kind of the second thing. I'd just be cautious about building on top of stuff that is very cutting edge. That's not a new concept. But in particular in the blockchain space, I see folks who are trying to say, hey, I'm going to use Uport and filecoin and it's Ethereum and this. I'm gonna stack them all together and then you've just got an app where it's got like 10 things that are totally cutting edge and if one of them breaks and it will, then your whole thing, you know, will blow up. Whereas what I prefer to do is try to have technical risk in as small a bucket as possible. And then everything else use as standard techniques as possible, right? So it's not, it's fine to use Django or to use Rails or, you know, something like that. And then your blockchain risk, risk is just like one component. And you can of course do the whole thing in Haskell or whatever, but ask yourself if that's really giving an advantage, you know, versus not. So those are basically the two things I'd say is A, labor versus capital and B, decide whether you want to use technical bleeding edge or not.

Here comes a hard question. I want you to be completely honest about that. Did you build these in order to avoid so many emails? You were receiving too many emails at.

At recent Horowitz I mean, certainly my personal experience. I mean, but also not just on the user side, but on the sender side. Right. So, you know, prior to Anderson Horowitz, I started a genomics company, a very large company actually, now that, you know, a big part of it was trying to, you know, sell to doctors. Right. And I learned what sales was if you go and you, you know. What's the tallest building in San Francisco? It's a Salesforce Tower, Right. This gigantic building was built on the base of cold emailing people, Right. And I once tried to calculate, okay, how many emails per each floor of the building. You just imagine stacking that whole thing up, right? So cold emailing is definitely something which is valuable for the sender, but it's a very poor relationship because the guy on the other side doesn't like being nagged into submission and the sender doesn't like installing all this NSA surveillance stuff to try to track when someone's opened the message and you call them right on the phone right there. Right. So I think improving that situation, I think, is something I've thought a lot about and that's why.

Did you have any expensive learning concerning cryptocurrencies? Did you burn a lot of money in one fail experiment that you want to share about?

No, I mean, actually, that was. That was something which was done, like, prior to me taking over the company. But, you know, I think in crypto in general, if you've been in early, it's almost impossible to not have made a lot of money. So, you know, that's. That's personally not a personal brand.

I wanted to ask, so, you know, Sark Brand, we are in 375 cities in over 115 different countries. Do you envision there's any way we can help you? Because that's ingrained in our core values, Right? Our core values are basically just making friends and helping others before helping ourselves. So is there any way we can help the community at earn.com?

Well, if you guys don't have some free bitcoin, just go and sign up for Earn.com you'll get a dollar in free Bitcoin. So that's something right there. Maybe I can help you guys and.

Maybe we can wrap it up with this one. Before we call it a day, I wanted to ask. Everybody has got a useless superpower. Which one is yours?

A useless superpower.

Something you do exceptionally well. You do it every day is like, why do I know this?

I don't know. I've memorized every rap lyric from Dr. Dre and Sutor.

That's pretty useless, but it's good. All right, please give it up for him. Thank you very much. Pleasure.