Conventional wisdom holds that if an app or service is free, it’s users who are the real product. But what if there was a way to make actual cash off of the data you generate online?
As new barriers emerge for advertisers trying to harvest consumer data, some see a business opportunity. John Roa, the New York City-based founder of Caden, believes there’s an untapped market for “ethically sourced, first-party data” that users actually nets users money.
Caden, which launched today, aims to give users an easy way to vacuum up their information from the online services they use, and then sell the combined data for some extra money. Users could one day make $50 a month using his app, Roa claims—that’s if Caden can turn around the ad tech industry. (In the meantime, starting rates will probably be closer to $10.)
“We’re not a disrupter; the disruption is already happening,” Roa says. “Across ad tech and MarTech, everyone is seeing prices go up and effectiveness go down—there’s just chaos and there’s noise, and no apparent solutions.”
Caden’s answer is to make it simple for users to extract and anonymize their own data through a slick user experience. He shared with Fast Company a demo video that shows a hypothetical user connecting the app to Airbnb through a login layer, with options to connect to Netflix, Uber, Amazon, Apple Health, and their bank and credit cards as well.
Roa argues that it benefits companies like these to participate in Caden. “The way we see it, these companies are losing a lot right now: the ability to market to their customer, to even understand who their customer is,” he says. The idea is that companies would pay good money to buy data that isn’t siloed within an app or brokered by a third party, but instead aggregates a user’s digital life—“the best data, the most accurate data, fully consented, fully provenanced,” as Roa puts it.
Caden wouldn’t be the first to attempt something like this, though previous efforts haven’t exactly caught fire. A now-dead startup called DataCoup launched in 2012, paying users as little as a dollar a week for the data generated by their tweets, Facebook posts, and credit card purchases. Another app, CitizenMe, launched in 2014, but pays users just a few cents to complete surveys.
Roa says his app is better-timed to respond to recent turmoil in the ad business. Pressure has been growing on lawmakers to pass data privacy laws in the United States; Roa mentions the 2018 California Consumer Privacy Act, which granted residents the right to demand a copy of the data businesses collect on them, and to opt out from their data being sold. Online advertising has also been roiled by tech giants like Apple, whose recently-unveiled “Do Not Track” feature cost Meta $10 billion last year, according to the social media giant’s CFO Dave Wehner.
As users grow increasingly savvy about privacy, Roa thinks Caden could offer them another benefit: high-quality recommendations that they consent to. “You could imagine opening Netflix and it could say, ‘Hey, since you booked that trip to Morocco in three weeks, here’s a documentary you should watch,’” he says. “And since you consented to it, that interaction goes from creepy and probably illegal to really delightful.”
So far, Caden’s vision has attracted 13,000 waitlist users, Roa says. It’s also won over Yahoo’s billionaire founder Jerry Yang, who joined Caden’s $3.4 million seed round last year (the company raised another $6 million of seed funding in January). In an email, Yang said that “this space has definitely been crowded,” but he invested in the company because its “approach to create incentive for both consumers and marketers is a novel and creative one.” Caden sets itself apart by “making the user experience frictionless, building a big technology moat, and being fully transparent with the user on reward and consent,” he added.
That last piece is what Roa believes will carry the day. “Adtech has been predisposed to doing things undercover. They don’t philosophically believe that you can incorporate the user or that a user could possibly understand this stuff,” he says. “We give users more credit, and believe that the moment you put this stuff above board, it all starts working again.”
The post This startup hopes to pay users $50 a month to sell companies their data appeared first on Fast Company.
