The Future of Social Media is Dynamic Ownership

Reddit, Yelp and cryptocurrency — oh my!

In November of 2011, I received a phone call from an executive recruiter. She was involved in the CEO search for Reddit and wanted to know about my interest. As a long time Redditor, I loved the idea — but being anchored to San Diego, it wasn’t in the cards. Nonetheless, it got me to thinking: what would I do if I were in charge of Reddit?

I had been spending time chatting with a lot of “Next Edge” thinkers like John Robb (more on John in a moment) and had some pretty interesting ideas. Although I wasn’t going to be able to implement them myself, I asked my friend Angelo Sotira (of deviantART Fame) to connect me with Alexis Ohanian (one of the founders of Reddit) and fired off an email. Alexis never responded and I considered the matter closed.

With the recent announcement that Reddit will be launching its own cryptocurrency and giving a small percentage* to the community, my thoughts returned to these conversations. John Robb has written an excellent blog post updating his own “open source venture” concept from last decade into the language (and ideas) of 2014 and arguing that “dynamic ownership” is the future of social media.

I agree. The simple fact is that “value created should equal value returned” and while places like Yelp (and Twitter, and Facebook and Reddit and . . . ) provide some value back to their reviewers, there is a big asymmetry between what the community creates and what the community gets. As platforms to enable dynamic ownership get more traction, I foresee a major refresh of the entire social media landscape.

Last night I got curious. What else was in that email to Alexis and what, if any of it, would be meaningful or useful today? I dug it up this morning and while some of it was a little embarassing, I thought it would be interesting to share. I continue to believe that some or all of these notions are “from the future”. If any of these ideas inspire you — take them and run with them!

Alexis,

Nice to meet you. I’d like to put the CEO concept to the side — I
know you guys have a process running and I’m not interested in jacking
that process (at least not at the moment . . .). Given that the
spinout and new CEO provide a window for Reddit to be more strategic
about its behaviour, I wanted to drop some of my ideas on your front
porch, ring the doorbell and run. If some of them find their way into
reality, so much the better.

First, I think that the powers that be need to make sure that they
reconceptualize Reddit away from being a “news site” or even an
“Internet site” towards being a community. I mean this in the sense
that Geoffrey West describes a City
(http://edge.org/conversation/geoffrey-west). Very few online
services are real communities (perhaps some of the MMORPGs, 4Chan,
some of the tighter BBSs, etc.) — certainly not FB, Twitter, etc.
Positioning as a community simultaneously bounds and expands the
activities that Reddit can undertake. Clearly a fundmental rule is
that no activity can be undertaken that is dissonant with the raison
d’etre of the community: no pimping the community. More interesting
is the ways that activities can be expanded. Some possibilities:

* Reddit can launch a sister Credit Union (Creddit). I know that this
has been mentioned on the site before. It is not a bad idea at all.
A credit union requires a “common bond” — not the sort of thing you
get out of FB or Twitter. But I’m quite confident that Reddit could
qualify. A typical CU will earn revenues on the order of $600 per
member per year and income of $250 per member per year. The notion
here would be that Creddit would be a typical CU, but that it would
contract with Reddit for technology and marketing services — to the
tune of say $10–20 ARPU. With 1 million people moving from banks to
CUs in the last week, there might be real potential here.

* With or without a Credit Union, Reddit could launch a virtual
currency (Creddits). The model here is also pretty simple — you can
buy Creddits for some fixed exchange rate ($1 = 1CR) and keep them in
your Reddit account. You could then do two things with your Creddits:
1) Send them to someone else; 2) Convert them back into a legacy
currency (probably have to limit to 3–4 major ones to start with).
Person to person transfers should happen at zero transaction costs.
Convert back into currency happens at some discounted exchange rate -
but lower than PayPal or credit card transaction fees. The concept
would be to position this as a tool to enable easy donations (to OWS
or Wikileaks perhaps?), easy and wicked cheap payment to fellow
Redditors or just a plain old competitor to credit cards and PayPal.
With the right branding and launch strategy, this could bootstrap past
the “Catch22" problem that hamstrings most such efforts and obviously
has significant implications if it plays out.

* In a slightly related domain, Reddit should build an anti-ad
network. This is a Reddit branded mashup of Angies List, Yelp and
AdWords. Essentially, if I had a choice between hiring a graphic
designer from the blue or hiring one who was also a fellow Redditor -
I’d choose the latter. That is the essence of a *community* that is
different from a plain old website. A system whereby people could
list their skills and/or projects and get matched-up, rated and paid
would be easy to set-up and would drive that community sentiment
deeper. The same goes for restaurants and service providers. I want
to know which pizza company has the Reddit thumbs-up. Going deeper
(the AdWords side) I want to know which anti-spyware software has the
Reddit seal of approval. This could be a largely user-generated
effort or could be something where Reddit populates the brands and the
community supplies the evaluations. I imagine ultimately a sort of
wikipedia of stuff being generated with each item having a karma
rating (or somesuch) and a nice long list of reviews.

* Turn Reddit into an Open Source Venture. The idea OSV was coined by
John Robb to address the problem of “cognitive slavery”
(http://globalguerrillas.typepad.com/globalguerrillas/2010/09/cognitive-slaves.html). In an OSV, value is provided to users in some effort to equal the
value that they contribute. This can be done through a number of
mechanisms, but an easy example is equity: Reddit should be owned by
its community. A potential vector —- Reddit goes public, but does
not list on an exchange. Rather, it complies with the ‘34 Act but
launches its own internal exchange: only Reddit members can hold
Reddit shares and can sell only to one-another (on the internal
exchange). (SAIC did this for a long time.) On a continuing basis,
Reddit members are *issued* equity in accord with rules associated to
their contribution of value (e.g., posts, comments, karma (!),
friends, minutes on the site, etc.). There is a lot of complexity in
wiring this correctly, but its not mayhem. This notion can be
fruitfully linked up with any/all of the ideas above and has the
notable advantage of providing liquidity for existing investors
without sacrificing the community on the Nasdaq altar. There is going
to be a major OSV play in the medium term — the idea is just too good
and too timely. Right now I think Reddit is by far the best
positioned to do it.

There is a lot of stuff here and I can go frightfully deep on any of
them, but this seems like a good time to stop spewing. If any of this
sounds interesting, I’m happy to chat further.