The Pomp Podcast - #750 The First Decentralized Talent Network w/ Adam Jackson

Starting point is 00:00:00 what's up everyone this is anthony pompliano most of you know me as pomp you're listening to the pomp podcast simply the best podcast out there now let's kick this thing off adam jackson is the founder of brain trust in this conversation we talk about hiring networks marketplaces web three economic incentives and where the future of this industry is going i really enjoyed this conversation with adam and i hope you do as well before we get into this episode i want to quickly to talk about our sponsors. First up is Mode. UK Bitcoin investors, listen up. Mode is an app that allows you to buy, earn, and grow Bitcoin effortlessly. Not only is it an easy and safe way to buy and hold Bitcoin, Mode also allows you to pay and receive up to 10% Bitcoin cash back

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Starting point is 00:03:29 should not treat any opinion expressed by Pomp or his guests as a specific inducement to make a particular investment or follow a particular strategy, but only as an expression of his personal opinion. This podcast is for informational purposes only. All right, Adam, you there? Hey guys, how's it going? What's going on, man? I'm super pumped to talk about this. How are you? Hey, doing well. Thanks for having me on. Awesome. Let's jump right into BrainTrust. I think a lot of people have no clue what this is in terms of they've heard it. They understand that it's big, it's moving, that you guys have a lot of momentum behind you, but explain exactly what BrainTrust does from a product standpoint. Yeah, you got it. BrainTrust is a pretty new network.

Starting point is 00:04:08 It is a decentralized global talent network. So it connects knowledge workers looking for gigs with clients that want to hire them. It's that simple. That concept is not new. The ownership and control structure of the network is what's new. So this is all about Web3, right? Like Web2 is for-profit corporations in the middle taking a big rake, sending that back out as dividends.

Starting point is 00:04:33 Think eBay all the way up to DoorDash, Uber. Web3 is all about the folks who make their living on the network also owning and controlling it. And that's what brain trust is in the IT space. All right. So let's start first with just the kind of product itself. It's a marketplace, essentially, where you're bringing together two sides. Talk to me about the size or success of getting both sides of a marketplace. When you start a marketplace, you've got kind of the liquidity problem where there's supply, there's demand. Which one do you go after first? Walk us through how you've gotten there to be actually this market liquidity now where people are able to actually fill jobs. Yeah, absolutely. So, I mean, starting marketplaces is hard. You have what's called the cold start problem.

Starting point is 00:05:12 And so the Web2 playbook for this is you raise billions of dollars in venture. You subsidize one or both sides of that marketplace until you get liquidity. And if you're lucky enough to achieve liquidity, break Earth's orbit, and then you come out the other end basically with a fully investor-owned network, and those investors need a return, rightfully so, and so the rake goes up and up and up. Web three is the opposite, right? So you don't raise a ton of money. You give ownership and control of your marketplace to your users, the folks who make their living on the marketplace, and that's how you bootstrap the marketplace, right? So in Braintrust's case, we started with the talent. So we have a lot of IT professionals.

Starting point is 00:05:52 So think like UX designers, programmers, product managers, folks like that who build software and design stuff. We started with a few hundred of them, got our first couple of clients. Nestle, Porsche were among the first. We asked those first few hundred talent, hey, can you invite more talent? And in exchange, they were getting brain trust tokens for making those invitations and those referrals, add some more clients. And it's basically brick by brick.

Starting point is 00:06:15 That's how you build it. Yeah. I'm looking at your website right now. And the companies that you have listed here, these are not like, you know, mom and pop small businesses. You've got NASA, TaskRabbit, Nike, Nextdoor, Deloitte, Blue Cross Blue Shield, Nestle, Porsche, Black & Decker, Pacific Life. And that's just the ones that are on the website. Right. So when you think about this, why are they coming to you guys? Is it just simply because you're more effective at filling the roles or is there some other reason why these large corporations are choosing to work with you?

Starting point is 00:06:41 Yeah, a couple of reasons. Right. So clients like that will go wherever the talent is that they need. And look, like these days, like basically every company has to act and innovate like a tech company. Right. So if in the global war for tech talent, Facebook, Amazon, Google are winning. Everybody else is kind of just trying to keep up. And so where do you get the best talent? Well, the talent go where they're not going to pay any fees. Right. Like the talent, if they go to Fiverr or Upwork, they're paying a big rake, or they go work at Accenture or one of the big consulting firms, they're being marked up a ton, right? And it's not like you don't really get to choose what you do. In brain trust, you come on as a talent, you create a profile, you pay no rake. There's a 0% fee to talent, flat 10% fee to clients. And so the clients showed up and they're like, hey, you got this talent. Like it's way cheaper than if we went to, you know, Accenture or some other marketplace because it's, you know, the rate's almost zero. And they're like, cool. Like they're like blockchain. We don't care. Right. Like I don't care how you're doing it. You've got the talent we're in. And that's how it started. And when you start to think about from the candidate side, what is the idea here in terms of their interaction?

Starting point is 00:07:59 Is it just simply like they normally apply to a job as they would on any other kind of talent network? Yeah, I think it's like any other marketplace in that sense. So talent comes on, they create a profile. Sometimes you need to get approved by the community, vetted, make sure you are who you say you are and your skills match up and all that stuff. But then you're looking at a job board, basically. You're looking at, oh, here's Goldman Sachs needs Java developers for their mobile apps. Nike needs developers. and you look at a job you want, you submit a proposal. If the client likes it, you agree on

Starting point is 00:08:32 a price and you get paid through the platform. Got it. And then talk to me about this fundraise that you guys are announcing in terms of you raised $100 million, which is not a small amount of money. So where's this money coming from? What are you going to do with it? Why are people investing? Yeah, this is kind of interesting. It's not like your typical fundraise. So So it was the firm Kotu actually approached us about this and they said, hey, you know, Kotu, for anyone who hasn't heard, Kotu is a big fund that has invested in dozens of maybe more of Web2 companies. And they came to us and said, look, we've been watching Braintrust for a long time. You know, this whole Web3 thing where, you know, it's tokens that represent ownership and control. And that allows you to bring this rake way down. And a lower rake means a faster growing and more robust marketplace, right? Stronger network effects. And they said, hey, you know, we'd love to participate. And we said, you know, we don't really need the capital at this point, but if you want to like lean in and help us build, essentially join the community, you know, we can consider it.

Starting point is 00:09:33 And so they said, yeah, we're in like we understand talent. They actually acquired some recruiting firms, some some tech recruiters. And they're like, hey, we know we know recruiting. Why don't we lean in and help you guys build out brain trust for recruiters and help you grow even faster? And so the round came together, 100 million of a bunch of firms participating, True Ventures, Tiger, Blockchain, Hashkey. And that money basically just goes into community grant program. So, you know, it's not like a traditional fundraise would be like a corporation takes that money and sits on the balance sheet and you go hire more people. Right. And the management team decides what happens in a decentralized network.

Starting point is 00:10:14 It goes into essentially the community treasury and then folks can submit proposals like, hey, brain trust should translate for APAC and localize in different regions. Here's a proposal for that community votes. Money goes out and funds it. So that's kind of why it's a unique fundraise. Got it. And when you talk about this being decentralized, is this like an open source thing that other people can come in and they can basically build on top of the network and kind of use this as a building block? Or how do you think about like the relationship with other people, maybe potential like business

Starting point is 00:10:48 development type deals versus people who are building other types of applications that would love the data or the marketplace infrastructure or anything like that? Exactly right. It's all open source. The data is, you know, most companies like keep their data close and it's behind pay walls and all this stuff. We put everything up on our dashboard. All the users own their own data, their work history, their reputation. All the smart contracts are open source. Right now, brain trust is just in IT. You can imagine people have been talking about

Starting point is 00:11:17 expanding brain trust into accountants, lawyers, compliance professionals. Basically, anyone who makes their living in front of a computer, this model could work, right? We call it kind of unbundling of of the corporate firm got it um and then in terms of uh the downsides like there's obvious uh advantages to doing it the way that you're doing it what are the downsides or what are the trade-offs that you're making uh where you're like ah you know what actually like a centralized hierarchical structure is better in you know a or b scenario well i i would say initially control right like i i come from the web 2 world i've been building and investing in web 2 marketplaces pretty much my whole career and you know when you're ceo one of those you

Starting point is 00:12:00 say, okay, we're going to do this next and we're going to do that next. And everyone sort of falls in line. With a decentralized network, you know, it's community run, right? And so like, if you could look at our, our brain trust snapshot where people propose things and vote on them and vote out on how to change the network. And, you know, I'm like the last to know on half of those. And it's, so it's like, I, it's, I don't know if it's a chair, like it's something you got to get used to, you know, like I think good things and bad things can come out of it, but we, we just think that decentralized networks, you know, just have more people with skin in the game and they tend to grow faster. Yeah. Joe and John, what questions do you guys have? So my question would be around

Starting point is 00:12:36 the Academy. Just talk through kind of how the Brain Trust Academy works with the courses and stuff. Yeah, this is a good example of something that, you know, it's like totally out of my purview, but so it was one of the nodes on the network built this. And the idea, there's lots of iterations of it, but the idea is have an Academy where you can upskill, right? So if you're a junior developer, you can become a senior developer. And you basically will use brain trust tokens to pay for those courses. And then conversely, you can actually earn tokens by taking brain trust classes on like how to be a better contributor to the brain trust ecosystem. Like an example, that would be, you know, we have just like tens of thousands of talent joining the

Starting point is 00:13:18 network all the time. And to, you know, allow them to propose on like these enterprise jobs, they need to be screened, right? You can't just let anyone do it. And so the community screens itself, screens all these new applicants. And so you can take a Brain Trust Academy course to learn how to be a screener and earn tokens. So you're kind of in the ecosystem that way. John, what questions you got? Yeah. Thanks, Adam, for doing this. I'm curious about after this, you guys just raised some money after this, what are you guys going to try to do? Are you guys going to try to just scale up the business? Are you going to try to pivot into different avenues and grow that way? What are your thoughts around that?

Starting point is 00:13:53 Yeah, look, I think the opportunity here for a decentralized talent network is to actually start consolidating the space. I think about what Airbnb did for vacation rentals. Like pre-Airbnb, it was a mess, right? Like there's scammers on Craigslist, there's like travel agents, like you're using the phone and like, it was just a mess, right? There was no way to know if anything's quality, if who's scamming you. Airbnb came in, had a better model, better UI, and started consolidating a previously completely fragmented space. I think the branchless network has a similar potential to start consolidating knowledge workers, folks who don't want to be in their cubicle job, who don't want to commute, who don't want to work at a consulting firm or their corporate job. They would rather freelance because you can work from wherever for whatever amount you want. You can work six months on, six months off. But the problem with freelancing traditionally has been, who are you going to freelance for? You've got to start an agency and go out there and sell and pitch. Most people don't like pitching clients all day. And what Braintrust, I think, is solving is because the fees are basically zero, you have unlimited demand. I can actually attest to this. Today, Braintrust has almost unlimited demand from clients. The network is very much talent shortage. And so now folks who don't want corporate jobs anymore can come freelance. And so I think this network has this potential to be the go-to place where knowledge workers who just are fed up with the corporate world can come find gigs. What's been the biggest surprise as you've built this, Adam?

Starting point is 00:15:34 The biggest surprise is it's such a counterintuitive story. I feel like it makes sense to me, but people are like, yeah, but how does Braintrust make money? Why is there no company? You have to explain, no, it's like a co-op. It's a network. People make money on that network, but the network itself doesn't have to be for profit. That's so counterintuitive. right there's there's no bitcoin ink there's no ethereum inc but people make money on those networks right so it was i was i was surprised at um you know and and you know a lot of investors i i give you know kotu and these new investors all the credit in the world for figuring this out we didn't pitch them on it they came to us but like a lot of folks on sandhill were like this is a stupid idea i mean like two years ago when we started and still today are like this is kind and stupid and like now it's growing big right so that was surprising to me got it and then in terms of uh when you think of a kind of like this decentralized thing how much of the when you use

Starting point is 00:16:36 the word decentralized is about the technology tech stack and like if somebody came and tried to shut it down they couldn't shut it down versus it's decentralized in terms of um kind of the user control and uh the ability to uh source talent and source the customers and kind of more of like a distributed way? Like unpack that a little bit. Yeah, for sure. So both are critical. So brain trust is built on Ethereum. We inherit all of the security from the Ethereum network. So Ethereum has tens of thousands of miners. You can't shut it off. Right. And so that's critical. I don't think, you know, brain trust could exist without Ethereum. Maybe Solana would work as well. But But and then so technical decentralization is really important.

Starting point is 00:17:23 And then but I think more importantly, Pomp, is what you just said is sort of like business operations decentralization. Like, you know, I run one of the six core teams that built the network. And if we went away, the thing would would move on without us. Right. There's lots of different people contributing, thousands and thousands of people referring new clients. And to me, that's absolutely critical. If a network is business-wise centrally controlled, it might as well be a corporation. And corporations can change the rules anytime they want. If someone wants to change the rules on brain trust, how many fees should the talent pay? The token holder's got to vote because it's all on a smart contract. So it's it's to me, it's like it's about fairness. Right. In the gig economy, companies have done a lot of unfair things to their workers. And that stuff's just not possible on a decentralized network. Yeah. And now talk to me about obviously a lot of people watching this will say a couple of things. So like one is why not build on Bitcoin? Why not build on Solana, Binance Smart Chain, any of these other smart contract platforms? Explain kind of the analysis that you all have done in terms of the various places where you could build something like this. And then what the kind of conviction that you had to build on Ethereum was versus something else. And then maybe what the pros and cons of that decision have been so far. Yeah, this is a great topic. And I've been in this space a long time. So we thought carefully

Starting point is 00:18:48 about it. We had to sort of pick a chain about 18, 20 months ago or so. And we wanted, you know, it had to be Turing complete. You had to run smart contracts Turing complete. It wasn't possible on Bitcoin. I love Bitcoin, you know, been there forever. Absolutely, you know, no question on Bitcoin's integrity. The Turing complete piece was important. And then why not other layer ones? We wanted the ecosystem. We wanted developers that could easily build with solidity, institutional custody partners like Anchorage and Coinbase. We have folks that I think don't want to own their own keys. They want them in an insured custodian. And two years ago, Ethereum was the only gaming town. Now, fast forward to now, I think Solana especially and

Starting point is 00:19:37 a lot of these other projects are super interesting. And I think Braintrust should probably at some time be portable you know across these other chains right just as a layer three right it shouldn't shouldn't be dogmatic about a layer one got it and then in terms of uh how you think about um recruiting for your own business talk to me about where you're seeing talent flow in are you seeing people leave legacy finance leave legacy uh technology companies uh to come and work for you or are you seeing folks that are younger that maybe this is like their first job and they're kind of more, you know, crypto native, if you will, like, just talk to me about where you're finding talent to help you build this. Yeah, in droves, folks leaving like legacy tech

Starting point is 00:20:22 company or like legacy finance, bank, stuff like that. But also, I don't know what a legacy tech company would be. But like, people who just don't want to, you know, work at Netflix or Google or Apple anymore, right? They're just they just wanted more freedom. I think those are great places to work. But this like freelancing is all about freedom and autonomy, setting your own rate, setting your own schedule and not going to an office. Right. And so we're seeing people flood in from all sectors. As far as like categories that are popular on brain trust, I mean, Solana labs is actually a client on brain trust. So they're, you know, they've got rust people building there. We have tons of solidity work on brain trust. So like lots of cutting edge

Starting point is 00:20:59 stuff, but also like, you know, we have Nike and Goldman Sachs and like, you know, traditional tech stack stuff happening as well. Got it. And then in terms of how you see the overall industry in general, what are you most excited about outside of what you're building? Look, I'm excited about Web3. So like Braintrust is just a little sliver of that. I'm like emphatic about Web3. I really think that user-owned networks will grow faster and be more valuable than investor-owned networks. That doesn't mean there's no place for investors, obviously, right? Like Braintrust has some amazing investors and they've leaned in and become part of the community. That's the new angle, I think, right? I think these Silicon Valley VCs and New

Starting point is 00:21:40 York firms or whatever have to like lean in and not just write a check and take off, but actually help build. And that was our lens for the folks we're working with. So look, I think all corporate owned for-profit networks that are extracting more value than they provide to their users eventually will be disrupted by a Web3 counterpart, right? Think about Uber surge pricing, A lot of that money just goes back to Uber Inc. DoorDash, famously in 2019, they rolled out a tipping feature and then decided, yeah, we're keeping all the tips. Fuck it. And they booked it as revenue. And it's like, dude, you can't treat your users like that. And so those networks that are extracting disproportionate value, they're going to tokenize. They're eventually going to be owned by their drivers, their riders, the dashers, the knowledge workers, you name it. Yeah. And then I guess the other piece of this is that as that continues, really what a lot of times people are doing is rather than go spend their customer acquisition costs or marketing money on Amazon or Google or wherever, Facebook, et cetera, instead of what they're trying to do is they're basically just trying to give it to their users, right? But in some weird way, it's almost like the economics are very similar because there's still got to be an economic incentive, whether you're paying Facebook to get you in front of potential users to then come and join your, you know, whether it's mobile app, a product, whatever. Now, instead, you basically just say, hey, can we cut out that middleman and can we just give it directly to the people?

Starting point is 00:23:09 If that works, we'll see. But but it seems to be at least theoretically much more attractive to the folks who are looking to join because they're getting paid rather than just seeing an ad somewhere. So let me, I'll give you an exact quote of one of the investors in this round. And I'm not going to name them because I haven't asked his permission to say this, but they approached us and they're like, okay, look, we're not, we don't do blockchain. A lot of these firms actually, this was their first token purchase, which is, I think, also interesting, right? There's no equity in Braintrust. There's no Braintrust Inc.

Starting point is 00:23:41 So these folks are buying tokens. But this guy goes, okay, look, I'm a marketplace investor. I get it. I've been doing it for a decade. I get CAC. I get LTV. uh i get you know um acv average you know average contract value and i showed him all the brain trust stats right it's average contract value is like you know i got in front of me it's like

Starting point is 00:24:01 seventy five thousand dollars or something and it's you know these are big jobs right not five hundred dollar logo jobs and and our cac is is nothing and he goes look man i don't give a shit about blockchain but like how do you put up those numbers and i was like well you give tokens to folks for building the network, referring, screening, bringing clients in. You pay them in tokens. The software does it for you. So you don't have to hire like 50,000 people. And he goes, he sat back and he's like, oh, so you invented your own fake internet money to lower CAC to zero. Is that right? I'm like, well, I'm not sure I would have said it that way, but essentially yes. And that, look, dude, that is exactly what you said, right? You can,

Starting point is 00:24:39 why like spend a bunch of money on expensive ads when you just, you know, give the value to your users. Yeah. It's, uh, it's definitely interesting in terms of how, uh, how more and more people are trying to, uh, to do this. Um, where can we send people to, uh, learn more about this or to follow you on the internet? Yeah, sure. Uh, go to brain trust.com. That's the, uh, the website where you can sign up either as a client or talent. And then, um, uh, Twitter, um, at Adam Jackson, SF or at use brain trust. Awesome. Joe, John, you guys got any more questions? yeah appreciate you coming on thank you adam great to see you guys awesome buddy thank you so much i appreciate you coming on later buddy

The Pomp Podcast - #750 The First Decentralized Talent Network w/ Adam Jackson

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