SaaS Interviews with CEOs, Startups, Founders
BrainTrust is Fiverr Owned by The Talent via Crypto Token
24 Aug 2020
Chapter 1: What is Braintrust and how does it function?
You got it. It's a very, very capital efficient platform, right? Because most of the people contributing are actually doing so in exchange for tokens, right? If you're going to build a user-owned network, like get your users involved early. And so it's a very, very low burn operation. That's why it's already profitable on the 6 million we raised two years ago.
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My guest today is Adam Jackson. He's a software engineer turned tech entrepreneur and investor who started four VC-backed companies and an asset management company over the last 16 years. He's looking to create open, equitable marketplaces that use customer-focused technology to boost collaboration between users without the cost and friction of conventional channels.
Adam, you ready to take us to the top? Absolutely.
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Chapter 2: How does Braintrust differentiate itself from platforms like TopTal and Fiverr?
So we instead of shares of stock, we use tokens. And these tokens are given out in proportion to given out to people in proportion to the value they drive, inviting people, vetting people, bringing clients on. And the usefulness of that token is voting control of the network. OK, so so right now, the fee schedule is really simple.
Zero percent charge of talent, 10 percent charge of clients, you know. People say like, well, why would why do people care about voting on network rules? Right. It's like, well, I'll give you an example. Like you remember last year when DoorDash roll out this new feature where you can tip your Dasher cash after the delivery. Well, then so they they roll it for a year. DoorDash Inc.
decides to book all those tips as revenue and basically steal the money. Right. If DoorDash had been run like Braintrust, where it was a user-owned and operated network and rules had to be approved by the users first, that money could have never been stolen. So that's the incentive to get our token and have influence over this platform you make a living on.
So just to be clear, it's not Bitcoin in the sense of a payment layer, but it is a contract sort of token, ERC-20 token built on the Ethereum blockchain.
Right.
It's an ERC-20 token built on the Ethereum blockchain.
Exactly right. Roger that. So you have to decide how many tokens there are at the beginning for people to compete for. And there has to be a limited supply. Otherwise, if anyone can get them at any time, there's no value to them. So how many tokens did you start with?
We're going to start with an initial supply of 250 million tokens. We can never print it anymore.
Okay. And just quickly, this is an aside, from a regulatory perspective, how do you actually set that limit? What do you do to register that or get it going?
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Chapter 3: What unique business model does Braintrust employ?
Yeah, great. Great question. So so so even today, before the live token is actually on the blockchain, we're still on testnet today. We've we actually have thousands of people working toward earning credits that will convert into our token. Right. So we just keep track of them in a database.
But these are people that are developers, designers, building the marketers, people making introductions to clients. They're all earning credits. credits that will convert into this token when we launch next year. So when we launch, a big portion of the tokens will already have been spoken for and will be distributed to these folks that have been helping us for two years now.
The rest that have been unallocated will sit in treasury. And that's exactly, it's basically what you just described. It's this wallet that
nobody can touch that only the smart contract can give out to people who who help build the network and we basically distribute those tokens as bonuses for people who refer business so nathan if you refer microsoft to brain trust and you use your unique code and microsoft that product manager signs up at microsoft and um and starts microsoft starts paying invoices
Our protocol is going to reward you some percentage of that invoice as a bonus in perpetuity. For as long as Microsoft transacts, you're going to get that bonus every month paid in token by our smart contracts.
Who controls that? Let's say someone brings in Microsoft who ends up over the next 10 years paying $10 million through Braintrust. Who controls the multiple you're applying to the 10 million in fiat as it relates to the value of a new Btrust token? Are you rewarding 0.1% of 10 million and that fiat is the conversion to the Btrust token?
Because whoever controls that ratio really actually controls the dilutive network of the token issuance, right?
Yeah.
Exactly right. So what you're getting at here is if we're giving, let's say, 1% of all transactions on the person you referred, let's say 1% belongs to you, the person who referred, that 1%, that comes in as cash because Microsoft's paying its bills in US dollars. And so let's just say for round numbers, it's a $10,000 bonus that you're owed.
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Chapter 4: How does the Braintrust token incentivize users?
Today we're at about probably two dozen active transacting clients. It'll be 60, 70 by the end of the year. We've done, I think we have 200 or so active projects on the platform right now and it's ramping. It's growing about 30% month over month right now.
That's interesting. And what do you define of actively transacting? At least a dollar through the platform in 30 days or what?
Yeah. I mean, the smallest job we've ever done is probably 10 grand. The average job size around 55,000. And, and so yeah, active means you're, you're, you paid an invoice this month.
Got it. And 29, so 2 million this year, 2019, what'd you do?
Almost nothing. We were building most of 2019. Okay.
Got it.
Got it. We just started this. We just, we just came at, we got into private beta in Jan, 2020. That means funny story. Do nice month in January, nice month in February, March, We see the lockdown hits. We see everybody hit the brakes at the same time. We're like, oh shit, like we're done. I mean, we're out. And then May, April sucked, down 55%. May was awful.
And then in June, we started having clients pick up the phone and say, Well, look, I mean, our stocks didn't go to zero like we thought they might in March and like the world didn't explode.
And now the Fed is buying our ETFs. So we have and now we have cheap debt capital, too.
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Chapter 5: How is the token supply structured and its significance?
I don't know if you follow the compound protocol on DeFi at all. Does that ring a bell?
I don't.
I don't. They just went through this exact ā and it can get rocky. Crypto is all about ā What's it called? Compound what? Compound finance. So they're the biggest protocol in DeFi, which means decentralized finance. And they have a token called the comp token. Our token has a lot of similarities with that comp token.
Interesting.
Even though they're a bank and we're a labor network.
I mean, Adam, is this one of the reasons you're waiting to launch the token is you need to have more products going through the system so that you make sure it is valuable the day you issue the token? Otherwise, this whole thing tanks.
Absolutely. The reason we're taking our time, we'll be three years old by the time this thing publicly launches-ish. The most important thing is that the network can sustain itself by its own users, right? So I can't be in the middle anymore. Our team can't be pulling all the strings and calling all the shots. It has to be a real decentralized network.
where people care about what happens to it and are taking care of the network itself. And so we're like two thirds of the way there, but, but you know, we've got some more work to go before. This is a real self-sustaining thing. Just look at Ethereum, right? Nobody owns Ethereum. I mean, Vitalik is sort of the brainchild, but like he could go away and Ethereum is just fine, right?
There's a lot of parties involved there. We're following the same path.
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