The power dynamic between online social capital and offline experiences
Why do we care about likes?
Along with Peter Thiel, Elon Musk, Phil Libin, one of the tech celebrities I always carefully listen to is Chamath Palihapitiya. He is one of the key people who drove Facebook’s growth from 30 million users in 2005 to 550 million users in 2011 (the year he left). Very insightful and, in a good way, opinionated on a wide range of topics, among other things, Chamath has a very good understanding of the sociological trends in today’s world.
One of the points which caught my attention in his interview to early adopter technology evangelist extraordinaire Robert Scoble is when Chamath was explaining the investment philosophy of his VC fund — ‘The Social+Capital Partnership’. ‘People value online social capital and offline experiences which feed the online social capital. That’s the power dynamic. The validation comes from the reactions of those around us: both loose and strong ties’, he noted. That’s why along with web/mobile (‘online social capital’), he invests in sports, real estates, water rights, food and retail, etc. (‘offline experiences’) [1].
The main driver behind the popularity of social networks of various kinds is the human desire for an external validation. Likes, retweets, upvotes, shares, favorites with our permission make us unassuming mice in the Skinner box continuously checking our phones, tablets or laptops [2]. And to have better photos and better status updates, we strive to have better experiences in the physical offline world. And that’s how we get even more likes, even more upvotes, even more retweets. This viciously obvious in retrospect cycle goes on.
Notes
[1] ‘None of those two things matter if you die’, Chamath adds. Hence, the third area of his focus is healthcare. His portfolio companies in this space make EMG biosensors woven to your clothes which show all your muscle and power extortions to prevent injuries. They do integrated plasmonics — ‘frighteningly ambitious’ product which will let anyone do the blood analysis without leaving their homes. They even detect Alzheimer decades before it manifests.
[2] According to Mary Meeker’s Internet Trends 2013, just mobile users alone reach to phones 150 times a day.
