How to use crypto to fix the internet?
In this episode of Bankless, hosts Ryan Adams and David Hoffman are joined by Antonio Martinez to discuss all things advertising, social media, Web3 and more.
Read our notes below to learn more.
About Antonio Martinez
Started at Goldman Sachs pre-2008.
Moved into a combinator startup AdGrok which he sold to Twitter in 2011.
Worked as director of Facebook’s ad exchange.
Left Facebook in 2013 and wrote a book titled “Chaos Monkeys: Obscene Fortune and Random Failure in Silicon Valley”.
Had a brief stint at Apple in 2021.
Now the founder of Spindl which is a Web3 attestation platform.
Paying for the internet
Facebook is worth something because there’s 3 billion people on it.
In a state where you have network effects and you have a mass consumer product, advertising almost has to play a role.
New York Times started as a publication that was not overtly partisan.
Journalism gave us this sort of golden period of relatively somewhat objective and non-partisan media.
The fact that there’s magic internet money that’s programmable money and that Web3 can financialize itself is very interesting and unique.
He thinks the blockchain makes other business models viable that weren't viable before but doesn’t think just making subscriptions easier is kind of good enough to change the dominant business model.
How advertising works
The rise of programmatic advertising was something that changed the course of human history.
It unbundled the audience from the publisher and the publisher here is just the person who produces the media.
Decoupling the audience and breaking it out of the publisher is what basically wrecked the mainstream media.
He thinks the problem with the Facebook model is that people can run a Facebook page that would have a level of reach that it wouldn’t before but Facebook sits there and takes all the cash off the table.
There’s some key concepts when it comes to advertising like Customer Acquisition Costs or CAC and Lifetime Value or LTV.
If you’re a business and you’re advertising to have growth, the LTV has to be greater than the CAC.
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Facebook Culture
Antonio joined Facebook when the employee count was around 2,000 and Antonio was the first product manager on ads targeting products.
He introduced programmatic advertising to Facebook.
98% of people still ignore the ads because it’s mistargeted and like ads are still a statistical fluke but you can make them less fluky with data.
They take first party data, which is the valuable data then use that to inform ads on Facebook and that’s what made Facebook into the behemoth that it is today.
Attribution
Some of the things that Facebook shipped that completed the picture were much better targeting and better ad units.
He worked at one company called branchmetrics which is one of the biggest independent attribution companies.
He asked himself what in Web2 should be rebuilt along blockchain lines, what is trustless and permissionless that requires system-wide consensus, is responsible for large sums of money moving around and establishing like a ground truth attribution.
If you look at the entire media funnel, the human internet experience is varied, chaotic, frantic and all over the place.
Double-edge sword of social media
Privacy is a complicated issue and a relatively novel invention that didn’t appear in the dictionary in our modern sense until the 19th century.
Privacy was the right to live as a stranger among strangers was a very obvious reaction to the urbanization of life.
There’s this notion of what’s called contextual privacy that means privacy exists within a certain context.
Free speech
The problem is humans have decided to refract their entire existence through a cell phone.
One of the real problems is there’s a truism in startups that everyone thinks what’s broken in a startup is like a technical problem because that’s what’s easy to fix.
He’s anti disinformation or misinformation policing the thought that in a developing situation like Covid, war or whatever that you’re going to be able to discern a truth online is as ridiculous as a premise.
Bot traffic is super annoying.
Digital Identity
Under GDPR which is the reigning European Union Law, there’s what’s called the right to be forgotten and to summarize it, there’s two things which is who owns the data about you and how it can be deleted.
Owning Web3 Data
He thinks we’re going to have a new regulation because GDPR doesn’t apply to Web3.
Privacy is never actually a product that anyone pays for except for in extreme cases or when it comes to things like financial stuff.
Web3 Today
The FTX incident is way smaller compared to the dotcom bubble because back then, NASDAQ crashed 80% from it’s value in 2001 and it wrecked lots of people.
Everyone assumes that all these companies were always amazing and great and there wasn’t like this drum beat of hatred going all the time, there was just like there is now in Web3.
Quantifying data that involves retention rate and other things are just the V1 of Spindl.
Growth in Crypto
Spindl is building a fully Web3 native attribution system so that the Web3 companies actually do the growth that they need to do.
Antonio
If you have the right idea and ability to execute, you can totally change the course of a technology.
Web3 Ad Model
It has to be something cool and interesting that’s not just like little colored squares that interrupts your mobile experience.
Check out these important links
TODAY’S EDITION IS BROUGHT TO YOU BY LEDGER STAX WALLET
Ledger’s latest innovation, the Ledger Stax, is a credit card-sized hardware wallet complete with touchscreen and Bluetooth capabilities. Did we mention it’s designed by Tony Fadell, the creator of Apple’s original iPod?
Act now, click the link below and preorder the Ledger Stax to use crypto on the go.