"There Will be Billion-Dollar Communities on the Internet:” Jess Sloss
In this week’s episode we speak with Jess Sloss, the instigator of Seed Club, a DAO that builds and invests in community tokens. We talk about the emergence of the social token economy, and how that’s different from the creator economy or the gig economy; the difference is that social tokens and DAOs allow individuals to create wealth rather than create revenue. They’re tools for creators, and importantly, also for creator’ fans, to build something that’s similar to equity in a company, instead of having a salary. Another concept that describes this, Jess says, is the ownership economy. This is the idea that creators and fans can have actual ownership of their communities and platforms. Jess says we’re about to see billion-dollar communities on the internet.
We talk about the difference between personal, creator, brand, and community tokens, and how value accrues to these instruments. Still, we are in the very early days of this new economy, and there aren’t any tried and true recipes; everyone is still figuring it out together.
More broadly though, DAOs and tokens enable the ability to direct resources, Jess says. They allow people all over the world to come together, pool their resources, and leverage those resources in pursuit of something greater than they could achieve separately. Those communities become valuable in their own right and tokens unlock the potential for every member to benefit from that value. The exact, best way to unlock this value, is still an open question, and the opportunity to discover that, is what’s so exciting to Jess and a growing number of creators.
The podcast was led by Camila Russo, and edited by Alp Gasimov. Transcript was edited by Owen Fernau.
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Jess Sloss: Sure. I've been an entrepreneur since I left high school. I started a gardening company to pay through university, was really early into social media, worked in the music business for a number of years and in the FinTech space. And then just really fell in love with tokens and crypto networks in 2017. As all of a sudden, I saw this opportunity to own some of the networks and algorithms and tools that were going to be cornerstones of our digital economy.
“I saw this opportunity to own some of the networks and algorithms and tools that were going to be cornerstones of our digital economy.”
And so I worked on early security token issuance in 2017 and then on a number of projects until about the summer of last year when I saw a few templating tools that have led to some of the early tokens emerge, and it really captured my attention. I've always been a believer in the value that small groups of people can create online, and have always thought that most of the value has been captured by platforms rather than people. And I think what tokens bring to communities and especially social tokens is this ability to capture more of that value that we're creating on the internet. And so I started Seed Club with a group of people back then, and it's been a wild ride ever since.
Starting Seed Club
CR: Nice. So what was the initial idea behind Seed Club? What did you want to achieve with it?
JS: So Seed Club, I think like any good DAO started as a Telegram group. I had a number of friends, like Alex Masmej, and Brian Flynn, in June, who had issued their own personal or social tokens. And we were kind of shocked, I think, by the interest and action that was happening around them. And so many folks had questions. And so we really just started a group that brought a bunch of people who were exploring this topic together, and very quickly realized that there was something here, something that a lot of people were interested in, and really just built from there. We had our Telegram group a little bit, still keeping it very curated. We went from maybe 15 members to around 62 members who exist in it today. So still fairly small compared to the opportunity out there in the world.
“I had a number of friends, like Alex Masmej, and Brian Flynn, in June, who had issued their own personal or social tokens. And we were kind of shocked, I think, by the interest and action that was happening around them.”
We ran a hackathon that really showed that there's a lot of people trying to build for the space, and there's some really exciting projects that came up from that. And ultimately, our core product is an accelerator program where we bring 10-15 community leaders, creators, founders, together and run them through a six-week program where we expose them to the latest and greatest thinking on the edges of DAOs, community tokens, social tokens. And our goal is just to launch many more experiments so that we can learn fast together, share those learnings. and hopefully accelerate this movement to empower communities to capitalize and reward and build a lot of value out in the world.
CR: Can you talk about the first batch of projects that you're seeing in the accelerator?
JS: Yes, so our first one, which seems like a decade ago, last fall, we worked with a mixture of established tokens and new ones. RAC, Connie Digital and his HUE token, and Alex Masmej along with a few new ones like ForeFront, we were working with some of the early folks in the Gitcoin Kernel community.
And it was really a good opportunity for us to learn what it’s like to launch a token and what are the challenges people have. Our most recent cohort ran for the end of winter, early spring. We worked with 12 projects, everything ranged from an NFT that was trying to build a collector DAO around it, to a B2B-focused community of brand marketers that's just about to launch, to a couple of media companies, one like Global Coin Research who's, I think, in a similar space to you, doing interesting things around how do you pay and reward writers for their content. And there's a whole bunch that are about to come out.
But yeah, I think we've seen a steady increase in the creativity and opportunity and excitement in using tokens to represent social capital in other communities or in media companies, or in DAOs being the trend right now. And our goal is just to get really really good at helping to accelerate those.
“I think we've seen a steady increase in the creativity and opportunity and excitement in using tokens to represent social capital in other communities or in media companies, or in DAOs being the trend right now.”
CR: And in accelerators in traditional Web 2.0 they usually take an equity stake in companies and sometimes invest small seed amounts of money. Do you do something similar?
JS: So our model is that we partner with these projects and want to be the early diamond hand holders of their tokens. So in exchange for membership within Seed Club, and the accelerator program and our broad network, and all the value that we can help bring to the table, we earn a small percentage of tokens for that work. We also run a studio program in a very similar way. We earn a small percentage of tokens for the work that we're doing in maybe a bit more of a hands-on way with some of the larger projects we work with.
I think it points to the big difference that tokenized communities have where we're able to invest through our effort and time and social capital into these projects, and hopefully, share in the upside. So we're making asymmetrical bets, we believe. We think there will be billion-dollar communities on the internet. You could argue there already are they just aren’t being realized in terms that value can be captured.
“I think it points to the big difference that tokenized communities have where we're able to invest through our effort and time and social capital into these projects, and hopefully, share in the upside. So we're making asymmetrical bets, we believe. We think there will be billion-dollar communities on the internet.”
And so we're very eager to go and take bets on smart people and great communities, and align ourselves over the long term through a token stake that gives us an opportunity to be active in building in the community, to being core members of the governance process, and to helping to grow these things over the long term. We do not make capital investments into these projects directly, though a few of our projects have purchased NFTs that kind of act as an unlock for the community that you could argue is a new way of investing in these on-chain communities.
The Ownership Economy
CR: Got it, perfect. Okay, so now taking a step back, and going a bit high level, what are social tokens on what is the creator economy? And I would love for you to compare this new creator social token enabled economy with past trending topics of the gig economy, the subscription economy. We see these different economies jumping into headlines and stories, every few months or so. So what's a distinguishing factor or why do you think this economy is better, if you think it is?
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