It’s been an exciting couple of weeks – and no, I’m not just talking about market gyrations. I’m talking about deep and profound new connections and insights that I’m excited to share with you.
It all started when I stumbled on a book written in 2012 called The Intention Economy by David “Doc” Searls. Doc’s work has been a revelation for me, particularly because he was on to these trends way back in 2006. We will get to what Doc’s thinking has to do with investing soon, but first let me explain his key insights.
In 2006, Doc was editor of the Linux Journal and was covering a conference on emerging technologies in San Diego on the theme of “the attention economy.” While at the conference, Doc had this big “aha” moment: There’s a difference between attention and intention. Doc was thinking about these ideas in terms of commerce (i.e., buyers and sellers, or customers and vendors).
In Doc’s mind, customers should spend money when they have an intention to do so, whereas the internet upon which the economy was being architected way back in 2006 centered around the principle that vendors should capture customer attention first and then work to modify (aka manipulate) customer behavior to get customers to spend money with the vendor.
In that “aha” moment, Doc conceived of the intention economy and contrasted it with the budding attention economy of the 2006 internet. Doc wrote the following visionary words “on the spot” at that conference:
The Intention Economy grows around buyers, not sellers. It leverages the simple fact that buyers are the first source of money, and that they come ready-made. You don’t need advertising to make them. …
The Intention Economy is built around truly open markets, not a collection of silos. In the Intention Economy, customers don’t have to fly from silo to silo, like bees from flower to flower, collecting deal info (and unavoidable hype) like so much pollen. In the Intention Economy, the buyer notifies the market of the intent to buy, and sellers compete for the buyer's purchase. Simple as that. …
The Intention Economy is about buyers finding sellers, not sellers finding (or “capturing”) buyers. In the Intention Economy, a car rental customer should be able to say to the car rental market, “I’ll be skiing in Park City from March 20-25. I want to rent a 4-wheel drive SUV. I belong to Avis Wizard, Budget FastBreak and Hertz One Club. I don’t want to pay up front for gas or get any insurance. What can any of you companies do for me?” – and have the sellers compete for the buyer’s business.
Doc’s conception of the intention economy got a lot of initial attention. He was given a fellowship at Harvard University’s Berkman Klein Center for Internet & Society, where he created ProjectVRM to encourage the development of tools that make customers both independent of companies and better able to engage with them.
Along the way Doc wrote two great books (the other one is The Cluetrain Manifesto), gave endless speeches, and helped start new technology companies. He co-founded the Internet Identity Workshop, which is held twice yearly and is now in its 17th year. He has collaborated with and influenced countless technology leaders, including the recently deceased Kim Cameron, who worked to create a humanistic system of digital identity as Chief Architect of Identity at Microsoft.
Doc also formulated and refined his key theses:
- Free customers are more valuable than captive ones; and
- Free markets require free customers.
If you’re like me, you’re taking in Doc’s ideas and saying, “Yes! This is how things should be. The internet should be customer driven. It should be organized around customer intentions rather than the capturing of customer attention. I can’t believe Doc saw this in 2006, along with others, and has been working tirelessly to make this superior architecture a reality.”
Also, if you’re like me, you’re looking at the internet today as we wrap up 2021 and asking, “What happened and when will we wake up from this nightmare of runaway internet architecture built on a resource extraction model, where the resource is human attention?” Doc blogged about this question a couple of months ago. His thoughts are definitely worth checking out.
Last week I had the great pleasure and privilege to speak with Doc and his wife, Joyce. In an email prior to the call, Doc described his wife as “the source of much wisdom for which her husband gets the credit.” God bless him for saying that. (How many of us should say that regularly about our own spouses?) I can personally attest that he was spot on.
On that call I got to ask Team Searls, “What the heck happened? Why are we still living in a tyrannical and increasingly techno-totalitarian attention economy?”
As true economic historians, Doc and Joyce answered with the perspective of 150 years. “The flywheels of the industrialized economy – where customers are first captured and then controlled – are bigger than we ever imagined.”
That perspective really broadened my mind to the bigger battle we’re fighting. It’s not just about fighting abusive tech giants. We’re fighting a legacy paradigm inherited from the highly centralized needs of industrialized economies.
Most businesses today believe that to be successful they have to capture their customers and get as much data on them as possible so that the business can learn how to get the customers to buy more stuff – stuff the customers may or may not actually need (i.e., get them to buy stuff they had no intention of buying).
Doc shared with me how venture capitalists always ask, “What’s your lock-in?” Get it? How does your business “lock-in” its customers? Locked-in customers are captive customers. They are not free customers … and, no, “free services” does not mean free customers! Remember, we don’t have free markets if we don’t have free customers.
Wow, it’s never really occurred to me until now just how corrupted the word “free” has become by the Silicon Valley user-as-product business model of free services. Free services produce captive customers who are constantly bombarded with false choices that create the illusion of freedom. Captive customers are not free customers. We do not have true agency. We do not have true choice. We only get to choose from the options that our feudal overlords decide we, their digital serfs, can choose from.
What does all of this have to do with successful investing? Today I’ll cover the most obvious answer, and in the next issue of The RISK Rituals, I’ll tie it all back to how and why risk management fits into the big picture. So …
We are investors, and as investors we can help shape the future of the economy. We can decide to invest our capital in enterprises that support free customers and not invest in the most egregious abusers of the current attention economy.
In the last issue of The RISK Rituals, we asked the question “Why do you invest?” We talked about the importance of values, purpose, and meaning. Do you value freedom? Do you reject the idea that a corporation (or government) should be able to surveil you in ways that you’re unaware of and then modify your behavior without your consent?
I’m not saying we should abolish all marketing. I am saying we need more transparency and authenticity, and less hyperbole. Moreover, I believe if we can build an economy with a higher level of trust and transparency, we will unlock new value, the likes of which we can hardly imagine from where we stand today.
That is what I believe and that is my purpose as an investor and as a technologist.
I hope you’ll join me in a tip of the hat to intention economy pioneers like Doc and Joyce Searls. As a good friend of mine (and mutual Searls admirer) said, “Being 20 years ahead of your time can be exhausting.” We can pay back these pioneers by doing our part to support a new intention economy as intentional investors and by becoming empowered consumers who avoid the worst traps of the (captive) attention economy.
After all, as both investors and customers, it’s our money!