Last week, I was in Amsterdam at the Next Web conference, giving a talk about "Purpose, Mission and Strategy" -- how companies can strengthen the connection between these to align efforts and make tough calls more easily (will post video when it comes online). From that talk:
Last week, I was in Amsterdam at the Next Web conference, giving a talk about "Purpose, Mission and Strategy" -- how companies can strengthen the connection between these to align efforts and make tough calls more easily (will post video when it comes online). From that talk:
The idea here being that there are tough, tough calls to be made every day, whether that's what feature to prioritize, who to hire, what market to enter, what policies to enact, or whether to back down in the face of conflict or stand up and fight. When I think about the connection between purpose, values and strategy, one of the companies that always stands out most brightly is Cloudflare. Anyone who operates a website or app probably knows Cloudflare but regular folks may not -- they provide performance and security services for millions of websites, and currently handle over 10% of global internet traffic. Sitting in that privileged position, they must have a strong sense of their purpose and values, and strong backbone when it comes to living up to those. This comes up in all kinds of ways. For example, it was recently revealed that Cloudflare had been fighting an FBI national security letter, under gag order since 2013, and even after the NSL was rescinded and no data was handed over, they continued to fight for the right to be transparent about the process:
"Early in the litigation, the FBI rescinded the NSL in July 2013 and withdrew the request for information. So no customer information was ever disclosed by Cloudflare pursuant to this NSL. Even though the request for information was no longer at issue, the NSL’s gag order remained. For nearly four years, Cloudflare has pursued its legal rights to be transparent about this request despite the threat of criminal liability."
I call that dedication to purpose and values. At the USV CEO summit a few weeks ago, Cloudflare CEO Matthew Prince made the comment that one way to "tell the story" of your company, both internally and externally, is to talk about things that you do or did, that others wouldn't. In this case, the story is that Cloudflare is willing to stand up and fight, even when it's well beyond their short-term corporate interests. Today, this is playing out again in the context of patent trolls. Those outside the tech industry might not be aware of the detrimental impact of this activity on the tech ecosystem and startups in particular. In a nutshell, these Non-Practicing Entities (NPEs), aka "trolls", will buy the rights to patents purely for the purpose of shaking down operating companies for settlements. The claims are almost always specious, and the strategy is to get startups to settle for just below the cost of litigating. Pay me to go away. It's a huge problem: at best an expensive distraction and at worst a company-killing scenario. That's why I am so proud to see that Cloudflare, in the face of an assertion from a patent troll, has decided not to settle, but instead is standing up to fight. And they are not just doing the bare minimum, they are going fucking nuclear. Rather than do what many or most companies would do, just to get the troll to go away, they are standing up, not just for themselves, but for the whole ecosystem. For more on the story, first read this, and then this. Cloudflare is not only going to litigate this case the full distance, but are also:
crowdfunding research to invalidate **all** of blackbirds patents
investigating blackbird's business operations to expose some of the opaque and untoward inner-workings
filing ethics complaints in IL and MA regarding the unusual and likely unethical structure of blackbird (more detail in the posts)
To tie this back to purpose and mission, here is Matthew's take on why they are digging in here:
"Cloudflare’s mission has always been to help build a better Internet. So it won’t be surprising to frequent readers of this blog that Cloudflare isn’t interested in a short term and narrow resolution of our own interests. We’re not going to reach a settlement that would pay tens of thousands of dollars to Blackbird to avoid millions in legal fees. That would only allow patent trolls to keep playing their game and preying upon other innovative companies that share our interest in making the Internet work better, especially newer and more vulnerable companies."
Kudos to Cloudflare for standing up here and doing more than they need to. If more companies follow their lead, we stand a chance to make a dent in this issue.
There has been lots of attention this week on cryptocurrencies and blockchains, what with Consensus conf and the Token Summit and lots of related announcements. And with like lots of new things (thinking back to Twitter circa 2010) I find myself spending a lot of time explaining to people what blockchains and cryptocurrencies are, and why we think they're interesting. It has taken us years to peel away layers of understanding around Bitcoin and blockchains -- see "Bitcoin as Protocol" (2013), "The blockchain as verified public timestamps" (2015), "The Golden Age of Open Protocols" (2016), "Fat Protocols" (2016). We've been chewing on this idea that cryptocurrencies aren't just digital money, they're something else -- they're a new way of storing and verifying data, a new way of building tech platforms, and a new way of monetizing activity on the web. One way I've been thinking about it recently is that cryptocurrencies are the native business model for open source and open data. I come from a background working in open data, open source, and open standards -- mostly in the context of cities and governments. I spent the better part of 2008-2011 working to advance standards like GTFS and Open311, and searching for the super-forces that would drive adoption (see Where Do Web Standards Come From?). The big takeaway from that time was that standards don't propagate themselves -- you need some sort of major driver to pull them into market (in the case of GTFS it was Google Maps). What we have now learned from cryptocurrencies and blockchains is that they can provide that driver. By creating an economic incentive -- the cryptocurrency or token -- to create a shared open data asset, we now have powerful driver for open data, interoperable through open standards. This is the point of Joel's Fat Protocols piece -- that with cryptocurrencies and blockchains, we can now monetize the underlying token and let the data be open, rather than controlling the data and monetizing access. This is a really big deal. Take that a step further, we can now re-think how we build "platforms". Think social networks like Twitter, who have historically been forced to close down their APIs in order to keep attention within their own ecosystem, rather than let it "leak" to third parties. Blockchains and cryptocurrencies offer an alternative here as well -- by monetizing through an underlying cryptocurrency, we can now afford to be "open" when it comes to platform interoperability. As much as I dislike the Rare Pepe project because of its racist roots, one thing stands out: the way it's open and interoperable by default. From this article describing the project:
"Interoperability Finally, the potential of rarepepe model doesn’t end with simple digital asset collection and trading. What’s even more remarkable about this token model is that third party developers or projects can bring external value and use cases to pepe tokens thanks to their open and permissionless nature. Interoperability and permissionless nature is what differentiates tokens on the blockchain from closed proprietary systems or private blockchains whose essences are control and permissioned. Whether you like it or not, as long as it’s on an open and public blockchain people will create unexpected use cases and synergies that even token issuers cannot imagine sometimes. In my opinion, this is the biggest advantage of using tokens on a public blockchain and this type of cross collaboration has started to emerge already with Pepe. For example. the Rarepepeparty project is developing a trading card game with some RPG element utilizing rarepepe tokens and user created memes. If you own those cards in your wallet and prove its ownership, you will be able to play your dank pepecards within the game."
So what we have here is now a new business model for platforms. Whereas in the past, you had to lock down your platform in order to control the flow of eyeballs, either for transactional revenue or ad dollars, now the incentives are flipped -- the more people who use it and build on it, the better, so let it be open. So really, what we have now is a new business model for attention. One where we can be open to share attention with others, as long as we are bound by an underlying cryptocurrency or token. This is relevant to any platform or network with an advertising-based business model. As everyone knows, it's hard to make money in the ad business if you're not Facebook or Google, so it's exciting to think that maybe you don't need to be in the ad business to build a successful and sustainable social platform. This is what Kik is pioneering today with the launch of the Kin token, and if this works I suspect it will be a model that many ad-supported networks follow.
I'm writing this from a plane. I've been in the air for an hour and everything is fine, but for a few minutes before the flight, things weren't fine. At roughly the time we were supposed to board (on an already late in the evening flight), the gate attendant came over the mic to announce that there was a staffing problem on our flight, and they were "beginning the process" to get it sorted out. He'd get back to us when he had an update. Huge groan across the hot and overcrowded gate area. Then, maybe two minutes later, he gets back on the mic and says: "update on this -- we've got our staffing problem resolved, thanks to Dave!" (and points to our new flight attendant Dave, who is standing next to him, ready to board the plane, grinning). The room erupted in applause, interspersed with an extended round of "yeah Dave!" and "attaboy Dave!". Smiles everywhere. Excitement. Good mirth. Everyone was not only relieved that our flight wasn't terribly delayed, but they were more happy than if there had been no problem at all. This is an (admittedly trivial) example of one of my all-time favorite phenomena, the Service Recovery Paradox, defined on wikipedia as: "a situation in which a customer thinks more highly of a company after the company has corrected a problem with their service, compared to how he or she would regard the company if non-faulty service had been provided." Amusingly, the first example on wikipedia is a canceled flight. And it held true in this case. After the first announcement, the attitude in the room was "dammit Jetblue, get your shit together". And after the second, it was "love Jetblue because they have Dave!". But in all seriousness, it wasn't the swift recovery that mattered, it was the way the team at the gate handled it. I think about this all the time, and it just underscores how important it is not just to prevent bad things from happening, but being ready to respond really well when they do. Whether that's a hack, a bug, or just a plain old mistake. And it's a great reminder that when a problem does happen, your work isn't over; it's just beginning. And that you have the chance to not only fix it, but to make things better than they were.
The idea here being that there are tough, tough calls to be made every day, whether that's what feature to prioritize, who to hire, what market to enter, what policies to enact, or whether to back down in the face of conflict or stand up and fight. When I think about the connection between purpose, values and strategy, one of the companies that always stands out most brightly is Cloudflare. Anyone who operates a website or app probably knows Cloudflare but regular folks may not -- they provide performance and security services for millions of websites, and currently handle over 10% of global internet traffic. Sitting in that privileged position, they must have a strong sense of their purpose and values, and strong backbone when it comes to living up to those. This comes up in all kinds of ways. For example, it was recently revealed that Cloudflare had been fighting an FBI national security letter, under gag order since 2013, and even after the NSL was rescinded and no data was handed over, they continued to fight for the right to be transparent about the process:
"Early in the litigation, the FBI rescinded the NSL in July 2013 and withdrew the request for information. So no customer information was ever disclosed by Cloudflare pursuant to this NSL. Even though the request for information was no longer at issue, the NSL’s gag order remained. For nearly four years, Cloudflare has pursued its legal rights to be transparent about this request despite the threat of criminal liability."
I call that dedication to purpose and values. At the USV CEO summit a few weeks ago, Cloudflare CEO Matthew Prince made the comment that one way to "tell the story" of your company, both internally and externally, is to talk about things that you do or did, that others wouldn't. In this case, the story is that Cloudflare is willing to stand up and fight, even when it's well beyond their short-term corporate interests. Today, this is playing out again in the context of patent trolls. Those outside the tech industry might not be aware of the detrimental impact of this activity on the tech ecosystem and startups in particular. In a nutshell, these Non-Practicing Entities (NPEs), aka "trolls", will buy the rights to patents purely for the purpose of shaking down operating companies for settlements. The claims are almost always specious, and the strategy is to get startups to settle for just below the cost of litigating. Pay me to go away. It's a huge problem: at best an expensive distraction and at worst a company-killing scenario. That's why I am so proud to see that Cloudflare, in the face of an assertion from a patent troll, has decided not to settle, but instead is standing up to fight. And they are not just doing the bare minimum, they are going fucking nuclear. Rather than do what many or most companies would do, just to get the troll to go away, they are standing up, not just for themselves, but for the whole ecosystem. For more on the story, first read this, and then this. Cloudflare is not only going to litigate this case the full distance, but are also:
crowdfunding research to invalidate **all** of blackbirds patents
investigating blackbird's business operations to expose some of the opaque and untoward inner-workings
filing ethics complaints in IL and MA regarding the unusual and likely unethical structure of blackbird (more detail in the posts)
To tie this back to purpose and mission, here is Matthew's take on why they are digging in here:
"Cloudflare’s mission has always been to help build a better Internet. So it won’t be surprising to frequent readers of this blog that Cloudflare isn’t interested in a short term and narrow resolution of our own interests. We’re not going to reach a settlement that would pay tens of thousands of dollars to Blackbird to avoid millions in legal fees. That would only allow patent trolls to keep playing their game and preying upon other innovative companies that share our interest in making the Internet work better, especially newer and more vulnerable companies."
Kudos to Cloudflare for standing up here and doing more than they need to. If more companies follow their lead, we stand a chance to make a dent in this issue.
There has been lots of attention this week on cryptocurrencies and blockchains, what with Consensus conf and the Token Summit and lots of related announcements. And with like lots of new things (thinking back to Twitter circa 2010) I find myself spending a lot of time explaining to people what blockchains and cryptocurrencies are, and why we think they're interesting. It has taken us years to peel away layers of understanding around Bitcoin and blockchains -- see "Bitcoin as Protocol" (2013), "The blockchain as verified public timestamps" (2015), "The Golden Age of Open Protocols" (2016), "Fat Protocols" (2016). We've been chewing on this idea that cryptocurrencies aren't just digital money, they're something else -- they're a new way of storing and verifying data, a new way of building tech platforms, and a new way of monetizing activity on the web. One way I've been thinking about it recently is that cryptocurrencies are the native business model for open source and open data. I come from a background working in open data, open source, and open standards -- mostly in the context of cities and governments. I spent the better part of 2008-2011 working to advance standards like GTFS and Open311, and searching for the super-forces that would drive adoption (see Where Do Web Standards Come From?). The big takeaway from that time was that standards don't propagate themselves -- you need some sort of major driver to pull them into market (in the case of GTFS it was Google Maps). What we have now learned from cryptocurrencies and blockchains is that they can provide that driver. By creating an economic incentive -- the cryptocurrency or token -- to create a shared open data asset, we now have powerful driver for open data, interoperable through open standards. This is the point of Joel's Fat Protocols piece -- that with cryptocurrencies and blockchains, we can now monetize the underlying token and let the data be open, rather than controlling the data and monetizing access. This is a really big deal. Take that a step further, we can now re-think how we build "platforms". Think social networks like Twitter, who have historically been forced to close down their APIs in order to keep attention within their own ecosystem, rather than let it "leak" to third parties. Blockchains and cryptocurrencies offer an alternative here as well -- by monetizing through an underlying cryptocurrency, we can now afford to be "open" when it comes to platform interoperability. As much as I dislike the Rare Pepe project because of its racist roots, one thing stands out: the way it's open and interoperable by default. From this article describing the project:
"Interoperability Finally, the potential of rarepepe model doesn’t end with simple digital asset collection and trading. What’s even more remarkable about this token model is that third party developers or projects can bring external value and use cases to pepe tokens thanks to their open and permissionless nature. Interoperability and permissionless nature is what differentiates tokens on the blockchain from closed proprietary systems or private blockchains whose essences are control and permissioned. Whether you like it or not, as long as it’s on an open and public blockchain people will create unexpected use cases and synergies that even token issuers cannot imagine sometimes. In my opinion, this is the biggest advantage of using tokens on a public blockchain and this type of cross collaboration has started to emerge already with Pepe. For example. the Rarepepeparty project is developing a trading card game with some RPG element utilizing rarepepe tokens and user created memes. If you own those cards in your wallet and prove its ownership, you will be able to play your dank pepecards within the game."
So what we have here is now a new business model for platforms. Whereas in the past, you had to lock down your platform in order to control the flow of eyeballs, either for transactional revenue or ad dollars, now the incentives are flipped -- the more people who use it and build on it, the better, so let it be open. So really, what we have now is a new business model for attention. One where we can be open to share attention with others, as long as we are bound by an underlying cryptocurrency or token. This is relevant to any platform or network with an advertising-based business model. As everyone knows, it's hard to make money in the ad business if you're not Facebook or Google, so it's exciting to think that maybe you don't need to be in the ad business to build a successful and sustainable social platform. This is what Kik is pioneering today with the launch of the Kin token, and if this works I suspect it will be a model that many ad-supported networks follow.
I'm writing this from a plane. I've been in the air for an hour and everything is fine, but for a few minutes before the flight, things weren't fine. At roughly the time we were supposed to board (on an already late in the evening flight), the gate attendant came over the mic to announce that there was a staffing problem on our flight, and they were "beginning the process" to get it sorted out. He'd get back to us when he had an update. Huge groan across the hot and overcrowded gate area. Then, maybe two minutes later, he gets back on the mic and says: "update on this -- we've got our staffing problem resolved, thanks to Dave!" (and points to our new flight attendant Dave, who is standing next to him, ready to board the plane, grinning). The room erupted in applause, interspersed with an extended round of "yeah Dave!" and "attaboy Dave!". Smiles everywhere. Excitement. Good mirth. Everyone was not only relieved that our flight wasn't terribly delayed, but they were more happy than if there had been no problem at all. This is an (admittedly trivial) example of one of my all-time favorite phenomena, the Service Recovery Paradox, defined on wikipedia as: "a situation in which a customer thinks more highly of a company after the company has corrected a problem with their service, compared to how he or she would regard the company if non-faulty service had been provided." Amusingly, the first example on wikipedia is a canceled flight. And it held true in this case. After the first announcement, the attitude in the room was "dammit Jetblue, get your shit together". And after the second, it was "love Jetblue because they have Dave!". But in all seriousness, it wasn't the swift recovery that mattered, it was the way the team at the gate handled it. I think about this all the time, and it just underscores how important it is not just to prevent bad things from happening, but being ready to respond really well when they do. Whether that's a hack, a bug, or just a plain old mistake. And it's a great reminder that when a problem does happen, your work isn't over; it's just beginning. And that you have the chance to not only fix it, but to make things better than they were.
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