This Week in Startups - Citizen App’s bounty blunder, “digital bodyguard” service + Coinbase launches “Fact Check” | E1223

Episode Date: May 28, 2021

Jason breaks down the Citizen App's recent mistake of putting a $30,000 bounty on an incorrect arson suspect (01:39), assesses the merits of an "Uber for private security" (17:15), and covers Coinbase's launch of their self-titled "Fact Check" media arm (37:32).

All right, everybody, happy Friday. We've got a new show for you today. Two big issues we're covering. One, the Citizen app caught in a bit of a brouhaha over creating a bounty for a suspected arsonist. Turns out they were wrong after putting a $30,000 bounty on somebody. And they're launching a new private security service that some people think is dystopian. And maybe some other people think are, it's kind of brilliant. Additionally, Coinbase is creating their own fact-checking blog, where, instead of

fighting with the press, they will just state the facts and try to educate their users, constituents, and perhaps even the press, by being just great at a fact checking. Stick with us. This week in startups is brought to you by Our Crowd helps you invest early in pre-IPO companies alongside professional VCs. If you're interested in investing, you can join Our Crowd for free at O-U-R-C-R-O-D-com slash twist. LinkedIn jobs. A business is only as strong as its people, and every hire matters. Post your first job for free at LinkedIn.com slash twist.

Terms and conditions apply. And Tiny. Want to sell your wonderful internet business? Tiny partners with founders to give them quick, straightforward exits that protect their team and culture. They'll make an offer within a week, close the deal within a month, and keep your business operating for the long term. Get in touch at tinycapital.com slash this week, and they'll let you know within a couple of days. All right. Our first story today, the citizen app made a huge blunder. They put a $30,000 bounty on an arson suspect,

and, as you might predict, they put the bounty on the wrong guy. Also, they're starting a brilliant digital bodyguard subscription called Protect for $20 a month, which is combining these two stories, creating massive drama on the interwebs. Let's get into it and let's have an open mind as to is this a good idea or not. First, some background and context on Citizen. Before we get to the bounty issue and the protect product, for the people who are unfamiliar, Citizen is a public safety app. basically it crowdsources real-time crime data by video streaming and by tracking police dispatches and some other tactics. In other words, when some police scanner says there's a crime in progress on, you know, Brian Street and, you know, fifth in San Francisco, they'll put that in the app. If you have the app, you get an alert if you're in that area.

And if citizens are there, they can take out the app and they can start recording. So we had the founder and CEO Andrew Frame on the podcast, episode 1117, back in September of 2020. So recently, it was originally launched under the name Vigilante. I kid you not. In 2016, it was removed from the App Store because it violated Apple's terms of service, which says you really can't risk physical harm to people. Safety is paramount for all of these app stores and platforms, whether it's Twitter, Facebook, or AppStores. And so they relaunched in 2017 as citizen.

They've raised a bunch of money. And Frames said the original name, distracted from our mission, you think? And people should not take the law into their own hands. Fairly obvious. But if you live in a large city with a lot of crime citizen is kind of a must-have app. I'm sure many of you use it. And it's really become popular.

It's got 840,000 active users in its home city of Los Angeles. And, you know, if crime is occurring and you want to see the patterns, more sunlight on a problem tends to be a good disinfectant. It tends to create a good dialogue. So I'm in favor of sharing that data and in real time, even better. Although you do have when we were, when I worked on an ambulance in Brooklyn back in, I guess the late 90s, or the early 90s, actually, we would have people who would show up at crime scenes or ambulance scenes in like unmarked cars or nondescript looking police cars. And they were just people who had nothing to do and they would listen to police scanners and go to where crimes or ambulances were

going and take pictures and stuff like that. It's a very weird thing, but it is a thing. And so crime has been, you know, going up, it's pretty obvious to everybody. According to Vox, based on primarily FBI data, U.S. murder rate has increased 25% or more in 2020. It's about 20,000 more murders a year for the first time since 1995, which is up from 16,000 murders, in 2019, according to crime analyst Jeff Asher. And according to Asher, crime was up 36%. You can follow him, Crime Alletics on Twitter. Murder up 30.

And you can see this if you're watching the YouTube. We'll pull up the data here. Murder up 36.7% in 57 agencies with data through at least September. And so this is obviously happening according to NPR. 750 homicides in Chicago at the end of 2020, up 50% from 2019. 322 homicides in L.A. by mid-December of 2020, up 30% from 2019. And 437 homicides in New York by mid-December 2020, up 40% from 2019. According to NBCLA, shootings in L.A.

Increased 73% during just the first four months of 2021. Now, the surge is coming from a relatively low baseline, according to Vox. This is sort of the counterpoint. And it comes after decades of drops in murders and crimes more broadly in the U.S. We're still living through a very safe area in your history, says Patrick Sharkey, a sociologist at Princeton. He told that to Vox. When you start from a low base, a percentage increase can be a little misleading, but there was a huge surge in violence without a doubt. So I guess, you know, people are trying to put this all in context.

At the end of the day, you know, crime should go down, not up. And we should have ways of addressing that head on, specifically violent crime, which I don't think anybody here. puts violent crime in the same era as like drug crime or other places we might want to see reform happening. Filing crime is violent crime. Period. End of story. It's unacceptable.

And Citizen is currently the number six overall news app in the app store ahead of Fox, Quora, Medium, the New York Times app, Wall Street Journal app. So citizens obviously love Citizen. I'm not an investor. But back in September of 2020, we did have the founder. And his name is Andrew Frame. and I asked him about their business model. Here's a 90-second clip, and I'll comment on the other side.

Andrew, what's the business model assistant? How do you make money? So the first thing I'll tell you is what it's not. It's not an advertising network. It's not a platform where we scrape data and sell ads against it. We could probably make a lot of revenue if we did that. A lot of the people at Citizen came from those types of businesses and have zero interest in ever building that again.

So we are in the process of testing and soon to be launching a subscription service, which is, I'm so excited about this. This is the most powerful personal safety service ever created. Citizen free is amazing. People are getting tremendous value out of it, but there's only so much we can do in a free product. But Citizen, I can't even give the name yet. But when this comes out, I think it is going to be a. absolutely essential safety service, both for your individual level as well as for families. So citizen pro will be a paid service. I'll be able to pay 10 bucks a month for or five bucks a

month for. And that's how you monetize. It will be subscription monetization. Yes. Perfect. And that would I guess allow me to, if I'm in trouble, I could hit a button and the citizen community could be activated to know I was having a problem. So if I was being attacked or if somebody was banging on my I could say there's somebody trying to break into my home and report it on citizen and then have that immediately go to 911 as well. Let's put it this way. This is like the complete do-over of the 911 public safety response system. All right.

Got to give myself credit. I called it. Nailed it again. I didn't have any inside information, but it just seemed obvious to me that if the people who have citizen app were concerned about their personal safety, I immediately thought of life alert. You remember that? I've fallen and I can't get up.

Why isn't there a life alert for not old people, just people walking down the street? So in Q1 of 2021, CitizenSoft launched a subscription service, which he almost gave me right there during the interview. He said, citizen and protect. That's the word he left out. It's priced at $20 a month, double what I suspected. But I do think for good reason. It's like I said, life alert for people who are not in retirement homes. Essentially, it's available.

They haven't announced what cities it's available in, but there have been user reports and job postings in Philly, L.A., New York, indicating maybe protect is available. If you've used it, go ahead and tweet it at me, attach Jason. And according to Fast Company, citizen plans on a publicly launching their subscription in June. It's only available in certain cities.

So it is being pitched to users as a digital bodyguard that when enabled sends their location to a citizen employee, then users can stream video to, a protect agent, which is activated by using a safe word. Protect also advertises instant emergency response to your exact location and says, live monitoring means you never have to walk alone. It's time for another R Crowd deal of the week. Right now you can join R Crowd's investment in CITOR Reason.

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Let's get back to this amazing episode. What this is, and now, of course, this is going to be polarizing. People are going to start thinking about robocop and outsourced policing. Outsourced policing, obviously, just like outsourcing and making a for-profit police force, a for-profit criminal, a prison system,

that creates incentives for essentially putting more people in jail and even for more crime. And so it does seem like a bit of madness. But let's pause for a second. If an app existed and it was launched by your local police department and the police department said when you press this button, it turns on your video. We know who you are because you've opted in. It's going to give us your location. You've opted in. And we're going to send somebody to your location if you feel unsafe or we'll watch the

stream. Seems like a really good idea. It is such a good idea that there's a company called Deep Sentinel that I use at my office and in other locations where it has an alarm on it. It's a camera like a drop cam or a Ness cam. And when you stand in front of it, a live operator working from home sees the person. It does facial recognition. If it's me, it says, okay, this is you. If it's not you, it says, why are you here? And you have a safe word and all those kind of stuff. And so it utilizes computer vision and AI. It has a safe word, all that stuff. And so this system is the live version of that. So imagine they have security guards in cars, not vigilantes like the original name of their company, but just citizen protect. You feel unsafe.

You're walking home. Somebody's following. You do this. And all of a sudden, the car pulls up next to you and says everything okay. And we've called the police and then you walk up to the car just like an Uber. So Uber for a personal security doesn't sound like a crazy idea. Of course it's not, but it does trigger two people. Okay, now only the rich will have police. Well, this is $20 a month. So that sounds like something only for the rich. So I think it's very important when ever you see a new innovation like this to pause for a second,

take out all of your biases and just think from base principles. Is this service good for society? Or is it good for you as an individual? Would you want to use it? Yeah, you'd want to use it. I'd want to use it. I want my kids to use it. I want my wife to have it. I want my mom or dad to have it. No brainer for 20 bucks a month, especially if we lived in a city, that's dangerous. Now, you can think about the second and third order effects or philosophically what this means, of course. But let's just start with a basic product. And if the product was offered by your, I don't know, if you lived in a building, you know, or you lived in one of those new mall slash little cities, would you feel bad about having that service? I wouldn't. And in terms of who can afford? it. Well, it's basically $20, which is, you know, essentially what people make in one hour. So if you really wanted this, I think almost everybody could afford it. And so I like the idea that they're trying it. But obviously, this comes and is dovetailed with other things the company has done,

which then make them an easy target for criticism, such as their insane $30,000 bounty they put on the arson suspect. So we'll talk about that in a second. But just objectively, good idea for a service. Any reasonable person would want to use it. I think it'll be incredibly popular. I'm not sure it can be profitable. Sure, there could be instances where the security person shows up and what if there's an attack in progress?

That's the question I have. If you're actually call for help, this citizen car shows up, they're not armed. Are they like bouncers? Are they really like diesel folks who can mix it up? Are they instructed to engage? What if they see somebody and the person who was following decides to jump you while the citizen protect car pulls up? Are they going to intervene? What if they get stabbed and killed?

What if you get stabbed and killed? The liability becomes insane. But people have had neighborhood patrols before. So I put this into the category more of a neighborhood patrol. And for that reason, I kind of like it. But, you know, devil's in the details, as always. Earlier this month's residents of L.A. begin posting photos of citizen brand of patrol cards,

including this Bro Bibles Brandon, we nerd. A few things make you feel like you live in a bleak dystopian reality like a citizen app patrol car that looks like a cop car. And so sure, I guess. I guess that's like a clever tweet. I wouldn't put it in the ish posting category.

But yeah, you could have that dystopian. This is privatized security like Robocop. Or you could say, this is like a neighborhood patrol. and Neighborhood Patrol has always existed or gated communities have always had this, so I'm not super shocked by it or whatever.

So this was first reported by Vices Tech Publication motherboard. So part of VICE's motherboard, I guess they bought it. These patrol cars are being driven by members of LAPS, Los Angeles Professional Security, a private security service run by James Gaspari, whose current business model is charging, subscription security for private property for $200 a month, based on LAPS promotional materials.

They are primarily used for making evictions and arrests on private property. According to the article, Citizen is partnering with LAPS to test a personal rapid response service. Citizen said this could be used for things like requesting an escort home. Late at night,

the service is currently being tested internally among citizen employees. Great. It's not clear if private security would be tied to the Protect subscription or another service. According to Citizen emails leaked to motherboard, the LAPD has been overrun

with property crime and the agency has effectively thrown its hands up because they don't have enough officers on the streets to respond to these sort of calls. That sounds familiar like San Francisco. And I tweeted this last week, Uber for Law Enforcement. How do we not see this coming? And I did see it coming, actually. Uber cops has been discussed for a long time.

I've been pitched the idea many times for personal security, like Uber for personal security. And I had Smart Things founder Andrew Hawkinson back on episode 371 in July of 2013. I think this was at the De-Conference. And he brought up the idea of Uber. for off-duty cops when talking about an open-source development platform for his connected smart home startup here's a 45-second clip i'll see you on the other side uh there's connected services people can build so imagine not just the not just the uh the app but imagine a emergency plumber repair service on that moisture sensor where you pay not just a sort of

notified but guaranteed that a plumber will show up within two hours if it gets right so now you're making like bottom-up ADTs exactly there's an interesting uber of off-duty cops is one of my favorite examples where a local cop with a gun and a badge that's off time knows your neighborhood. When you're away on vacation, you don't even have to install it on a contract. You just say this service should run for the two weeks I'm away from my house. And I'll just pay 10 bucks a day for you to be on call to hop a test. Right. Exactly. Let the marketplace unfold. And so we're trying to create that mechanism and we'll take a slice of that revenue. That's so brilliant. So here's how I predict this is all going to go down.

13 months later, by the way, after that interview, smart things got acquired by Samsung for 200 million. So taking off-duty cops and putting them in this role, people have often off-duty cops were bouncers at clubs. Why? Well, because they could still carry a gun with them. And if something happened and the police showed up, they would be showing up and there would be an off-duty cop,

where they might know. And for the person who owns the club or bar, speaking from personal experience, you know, if there was an issue, the cops might be able to work it out without anybody being arrested or, you know, I don't want to say covering up, but it could be, it could smooth things over and make whatever happened. If somebody got in a fight, maybe, you know, people don't wind up, you know, the place doesn't wind up losing its liquor license or getting shut down. That's the reality of this. And so here, if off-duty cops are making a lot of money doing this, now they're double dipping, they're servicing the community two different ways. Maybe that could lead to the them giving favorable treatment to subscribers of citizen. There's going to be a whole brouhaha in the media over this. But this has been going on for a long time. A lot of affluent people who have security will specifically use off-duty cops because

they can carry a piece. That's the bottom line. Really innovative service that I think is pretty genius, if not obvious, you know, is going to come under massive, massive criticism and scrutiny, as it should. You know, we should scrutinize everything. And the reason is because citizen originally called themselves vigilante. That is just going to cause complete chaos in the media. So I encourage you to make your own decisions and think for yourself.

That's part of this program's mission is for you to think from first principles or just think independently critical thinking. Sure, this company has a history, but you could separate out this idea. This might be a great idea that many different companies could pursue. Imagine if Apple had this as a product where you have. had a panic button and Apple had security that would come and drive to you and just have cameras on the top. I mean, just alone, having spotlights and cameras on a car come to a scene and turn on the spotlights and get there possibly 10 minutes before that could actually cause a situation to be resolved. So we've always talked about what if people who weren't police officers

could engage with, I don't know, a homeless person or a person having a mental health issue before the people with guns showed up, this could be in that vein in some situations. But Citizen has an effervescent, iconoclastic, I guess founder, who is really excited about the mission of the company. And this Pacific Palisades situation, I'll explain to you now, is pretty gnarly. So this was first reported by the Verge on May 21st. Saturday, May 15th, the wildfow broke out in Pacific Palisades, which is a neighborhood in LA just west of Bretwood and south of Malibu.

The fire was suspected to be a case of arson. LA-based citizen users received a series of push alerts over the next few hours. The notifications urged them to hunt down an alleged suspect. As a reward, there was a bounty that started at 10K and rose to 30K to catch the subject. That bounty was paid for by citizen. Now, bounties have always been put out there. The FBI does it. You know, it's why you get those famous most wanted posters.

And so there's nothing wrong with putting a bounty. And private citizens put a bounty. If somebody was, you know, murdered and a private citizen said, I'm putting up $50,000 for a reward, I don't think any of us think that's a bad thing. But because this became real time and because of the vigilante name that this company originally had, it obviously triggers a lot more scrutiny. And scrutiny has arrived. And it also gets a lot of clicks, obviously. So, you know, places like The Verge or Vox are going to be on this story in a major way. And again, you know, if you're going to start something new in the world, be prepared for criticism.

And if we're going to be customers of new things in the world, we should be prepared to independently, critically think about those products or services. And do we want them in our lives? The suspects, picture and name were posted multiple time on citizens' new live streaming service called On Air. So they will, like CNN, have, you know, an on-air feed when something like this is happening. and in the early morning hours of Sunday, May 16th, LAPD did in fact make an arrest, but it was not the suspect citizen had doxed and put a bounty on. Now, I don't know if citizen doxed them, but they put a bounty on them, and then I think the person was subsequently doxed, doxing meaning they put out his home address.

Citizen realized that they had put a bounty on an innocent, a homeless man. We're not going to say the name here, but obviously that person is going to get a nice settlement. Once we realized this era, we immediately retracted the photo and were, ward officer citizen said, we are actively working to improve internal processes to ensure it doesn't occur again. This was a mistake and we're taking it seriously. Lieutenant Jim Braden of the LA County Sheriff's Department told a spectrum news reporter that the actions of the citizen app were potentially disastrous, according to the New York Times. Growing your business takes more than offering a popular product or service. It's essential to have the right people

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That's my favorite thing to do to ask people what do they read, what news sources do they like? And you want to get in front of the people with the skills experience and motivation you need. They've got great filtering and management tools. That's all just done inside of LinkedIn. Easy peasy, lemon, squeezy. When your business is ready to make that next hire, find the right person with LinkedIn jobs. And now you can post your job for free. Just visit LinkedIn.com slash twist. Again, that's LinkedIn.com slash twist to post a job for free. Terms and conditions, of course, apply because they're giving you a free job posting. Okay, let's get back to this amazing episode. Of course, Slack messages have been leaked, as is the case. You know, as a CEO like Andrew,

you shouldn't be having these discussions on digital. You should be having a phone call with your management team or a Zoom call and discussing it. But, Weiss's motherboard published another article with a bunch of allegedly leaked Slack messages. And they spoke to eight sources for the story, obviously all anonymous, as is the case. Five-form employees, two sources with knowledge of the industry operations and one person close to the founders. And I think they were all anonymous. Painted an awful picture of Frame, Andrew Frame, the CEO. He was allegedly leading the crowdsourced manhunt via Slack messages in email.

He put the initial reward at $10,000. And he said, first name, what is it? publish all info find this f you ck let's get this guy before midnight he's going down all caps breaking news all caps this guy is the devil get him we hate this guy get him all caps if these are in fact true we don't know that exactly but i would say more likely than not if they actually have the screenshots it's probably what he said the more courage we have the more signups we will have that's really damaging i mean it may be true but it's kind of damaging that you know using the bounty to go after this guy gets more signups.

It feels pretty cynical, to be honest. And go after bad guy, signups will skyrocket, period. We should catch a new bad guy every day cap. So this is, yeah, it's kind of gnarly, obviously. But candidly, you know, if you believe in the mission of the company, you want more people to download it to make them safer. So I can get where he's coming from, if that is where he's coming from, as opposed to a place of,

I want the shares in my company to go up again. I'm not an investor in the company. I do think the company has great potential. The alert copy said, Citizen is on air, arsonist pursuit continues. We are now offering $30,000 reward for any information directly leading to his arrest tonight. Tap to Join the Live Search. So this tap to join the Live Search is a little bit crazy.

You do not want to create a vigilante-like situation. Because what if one of the citizen folks then goes, and obviously they're passionate about Law & Order because they have the Citizen app, they spot the person, they tackle them, a fight ensues and somebody gets injured or worse. That's the downside to this. You don't want to say something like join the live search. It should be a little more innocuous, the language. And language really does matter here.

They should have said, if you have information, please call your local authorities or put it into the citizen app and we will send it to the live authorities. That would have been a much easier way. You do not want to say, you know, like join the live search. that seems like, you know, a mob. And wow, according to the article frames, so the crime is the perfect opportunity. I mean, perfect opportunity to catch an arsonist would be the virtuous part of it. Perfect opportunity to get downloads would be the nefarious part of it. If they could catch a criminal live stream more, the user caught them and get huge engagement, downloads and publicity, I guess that's the most negative spin on it. And I can understand that. At 1.40,000 people were watching the live feed according to Slack messages. And it's sure a sharp spot. you can signups as the live stream spread and frame said in a later all-hands meeting that 1.4 million people engaged with the content according to other Slack messages. And so a quote from a former employee, again, I really hate reading like these non-attributed

quotes because who knows, maybe that was an employee who was fired or didn't get a raise, you know, who knows what their axe to grind is. But here's the quote from the former employee, if it's in fact true. which we don't know. I would assume maybe a third of the time this stuff is true, and two thirds of the time it's coming from a point of view and not super objective. So just in terms of your own media savviness, if it's an unidentified source, you really got to maybe assume there's an axe to grind here and maybe take half of it as the truth. That's kind of what I do. Like maybe there's 50% truth to the quote.

Here's the quote, the whole idea behind protect is that you could convince people to pay for the product. Once you've gotten them to the highest point of anxiety, you can possibly get them to, one former employee said, referring to Citizens' subscription service. Citizen can't make money unless it makes its users believe there are constant ugly threats around them at all times. So I don't believe that. I think any reasonable person without getting alerts,

just hearing about Citizen for the first time, would buy it. I don't think that they're going and trying to make people more anxious. That feels to me like kind of silly. I think people would want that $1.00 service because it's a great idea. and it's a good service, despite absolutely the horrendous job they did with this bounty. That was really boneheaded and poorly executed to their own admission. A citizen's broken person denied this in a statement. It's actually the opposite.

With user feedback in mind, we have designed the citizen home screen. So users only see relevant real-time information within their immediate surroundings. And that was my criticism of the app. I had to turn the app off because our offices were in the Soma area of San Francisco, which is crime-ridden. I was just getting a never-ending stream of alerts. Some hot takes from our friend Casey Newton. Citizen is truly a depraved company.

I think they kind of set themselves up for that one. I don't agree that they're depraved. I agree, I would say that with the genius of making, like, innovative things, and I've seen this firsthand, people can take it too far. And that's what I see here more is just get it going a little bit too far in terms of pursuit of the mission of the, the company. And that's where the founder really needs to have great lieutenants around them and a

great board who can say pump the brakes. And this is why governance is so important in companies. You need to have somebody who can say, listen, great idea with protect, bad idea putting a bounty. And if we're going to put bounties on people, let's make it crowdfunded and let's let the police execute on that. And we give the money to the police for their bounty. This way it's organized and nobody does anything like start a mob. Twitter user Josh Edd gets in on the dunking in a reply to Casey Newton. Good God, what's their motto? Innocent until proven monetizable.

Again, that would be the least charitable interpretation. Twitter user Church Chi replying to the original post said, man, forget playing with fire. This 100% black mirror twilight zone end of the world, sky net ish. And they criticize crypto for being payouts for hitmen. insane. Yeah. I mean, referring to the bounty, poorly executed, could have enabled mob-like behavior

on the margins it did. Thank God, nobody got hurt. I mean, if they found this person, the homeless person who was misidentified and he was beaten up or beaten to death, God forbid, you know, this would have been really crazy. Data Journal, Daniel J. Willis, who's Bay Area Data on Twitter, God, citizen just keeps getting more dystopian the more I learn about it. How is that not illegal? There have to be laws against inciting a vigilante mob to hunt down some random dude with ever-increasing cash rewards, right?

That's a great question. There is not a law against putting up a bounty, but for sure inciting violence and a mob, yeah, that would be bad. And I think that's why they owned it. So in summary, I think there's a great idea here in Citizen Protect. That is a just great idea. In fact, if Uber or Lyft released in their pro version, the ability to do an emergency and have a driver come pick you up in an emergency situation and it just sent the closest driver to you as a priority, that could be interesting. I like the idea of a car that can record video being sent to a location. So imagine a 360 degree camera on top of a car.

Something's happening. Your car is being broken into. Your home's being broken into. You hit that panic button. It shows up. and the person doesn't even need to get out of the car. They just put the floodlights on and it's recording. That's pretty awesome for a crime situation, of course, could be abused.

There's a bigger issue here, which we should talk about, which is in cities where they take a no-policing approach to crime, especially for property crimes like San Francisco and L.A. and other places are taking, like Chesa Boudin is taken here in San Francisco, what rights do the citizens? have. Do they have the right to have a community watch? Of course they do. In fact, police organize and encourage community watch and auxiliary police in some neighborhoods. So, then the next step is, can you have private security? Well, the rich have private security. Newsflash, you know, you can be sure that rich billionaires have private security. You see them walking around. When you see Bill Gates walking down the street with six, you know, security guards

around them, it's for a reason. And you can be sure that those six security guards, if they're walking around him, they're going to be with him at the office and, you know, and personal residences, et cetera. So what we're actually talking about here is lowering the price and giving that to everyone. So if you framed it as private security exists, neighborhood watches exist, why shouldn't you be able to hire somebody as a citizen? Why can't you have private security if you're willing to pay for it? What if they said, we can give you private security for $150 an hour or $75 an hour, we'll have somebody park outside your house. Or for $300, we'll have somebody park outside your house.

Let's say you broke up with a particularly violent or potentially violent spouse or something like that. Sometimes people do hire security when those kind of things happen. It'll get restraining orders. So, you know, depending on how you frame this, it's either dystopian or you're providing something that the rich have already to the average person through a company. this company has not helped themselves because of the two things. One, this ridiculous bounty, the horrible execution on the bounty idea and ridiculously

calling your app vigilante. So sometimes it's who creates the product that determines how it is interpreted. I think that there should be 10 different versions of this. I would back a company that's doing something like this. If they executed it in a very clean way with the support of local authorities, etc., Because it already exists for the rich. Anybody who's, have you ever been to a private community? I've never lived in one, but they tend to have like their own little cop cars that drive around.

And they don't have guns or anything. They just will ask people, hey, are you lost? Can we help you somewhere? Or, hey, where are you headed? Don't see you here. Don't recognize you. You're not from the neighborhood. So should somebody who lives in, you know, a dangerous area of San Francisco be able to call security

if they're feeling unsafe? Well, if a rich person can, I think a person who's not yet. rich should be able to do that. So Citizen hasn't made themselves very likeable, but they do have a great idea here that I think is a fine idea. In the past, selling your business was a miserable task, months of negotiation, legal fees, and sometimes you'd have to watch the new owners trash the business that you spent so much time and money building. I have been through this before. Oh my God, I sold Weblogs Inc to AOL and it was wonderful. And then, oh, years later, they shut down half the blogs, then another 30% of them, and all that's left is Engadget and Autoblog.

This is really heartbreaking for me. They did a great job in the beginning. They totally screwed the whole thing up. I don't want to even talk about it. But now there's a better way, Tiny. And I had Tiny's co-founder, Andrew Wilkinson on episode 1174 back in February because he's a baller. He's this incredible entrepreneur. And he described his new Warren Buffett-like approach to acquisitions. Andrew and his team started Tiny to become the buyer they wish they could have sold to fair, fast, and founder-friendly. If you're looking for a new home for your internet business, they'll respond in a day or two, make an offer within seven days, and close a straightforward deal in about 30 days, which is

unbelievable. So here's a call to action, Tiny Partners with Founders, to give them quick, straightforward exits that protect their team and their culture. Get in touch with tinycapital.com slash this week, and they'll let you know within a couple of days. That's tiny capital, t-in-y-y-capital.com slash this week. All right, thanks, Tiny Capital. Let's get back to this amazing episode. Okay, up next, Coinbase just launched an internal fact-checking blog. It's been an eventful eight months for Coinbase. Remember, in September 2020, Brian Armstrong made waves by being one of the first CEOs to publicly state no politics at

work in a blog post. Coinbase offered a generous severance to those who decided to leave and wanted to work at a company that had politics at work, which some companies do allow. In November of 2020, Coinbase Front ran a hit piece by the New York Times about previous, or what they perceived as a hit piece, previous black employees having a bad experience while employed there. April of 2021 Coinbase IPO, making Armstrong a billionaire, obviously on paper, but, you know, he may have sold some secondary shares. It's a $50 billion market cap company, even after the recent 40% Bitcoin drop.

But on Wednesday, May 26, Coinbase CEO, Brian Armstrong, published a blog post announcing Coinbase fact check, decentralized truth in the age of misinformation. Armstrong presented three choices for companies to deal with misinformation. One, turn the other cheek, ignore misinformation, slander entirely, or fight it privacy behind closed doors, the classic PR approach. Two, fight. Anytime someone posts false information about your company, it's war, come out swinging,

never back down. Armstrong referenced, of course, Amazon's recent aggressive Twitter presence where they went after Elizabeth Warren. people were giving Amazon a hard time about minimum wage. And Amazon's like, but we pay minimum, we pay double minimum wage. And your job, Senator Warren, is to convince, you know, our government to raise the minimum wage. And you haven't gotten that done, but we've gotten it done in Amazon. So stop complaining.

Say what you will. I think it's a very effective technique to be, you know, engaging with the critics because these are important issues. And if you don't engage, well, you know, they can run roughshot over you and spread misinformation. option three, publish the truth. I believe there is a reasonable middle ground between these first two options, which is to simply publish the truth in a thoughtful and respectful way and build a direct relationship with your audience. Duh, that's what I've been doing forever with this podcast.

That's what everybody on the All In podcast doing. That's what Indreason Horowitz is doing, which back Coinbase. This fact check approach is not about antagonizing or embarrassing others, but simply sharing what happened through your own channels. And so they launched with four articles, a response to misinformation about the effect Bitcoin is having on the environment. some social media, misinformation that spread on our executive share sales, post we did rebutting misinformation on traditional media, on employee matter,

and a more recent post we did correcting false statements by folks in government industry about illicit activity in crypto. Every tech company should go direct to their audience and become a media company. Sound familiar. We've heard it before, Bologi, you know, tweeted that in July 2020. Every citizen is a citizen journalist. Every company is a media company. And, you know, listen, that's something I've been doing here going direct.

And, you know, I very rarely even participate. I'm participating with one journalist now in a story. They were doing a profile. And like, they're obsessing over tiny little things that happened in my life that really don't represent who I am. So I'm just like, oh, God, I can see it happening already. Why don't I even participate? It's just going to be like all this negativity because they want to try to sell subscriptions.

Margaret, when mockers published a blog title, doubling down on the future in January 25th, announcing that A16 would be creating their own media company. And obviously, A16Z has really, you know, besides their own blog and videos and newsletters, they've been, they've weaponized substack and Clubhouse. And now Coinbase, I think their influence is pretty clear. They gave a lot of money to those companies, specifically substack and Clubhouse, to then go raid mainstream media and try to shake free voices there. And essentially, I think they're going full court press and Jason Horowitz is fed up with the media.

and that's always top down. So that's coming from Ben and Mark 100%. They're spreading this ideology to take on the media directly. Of course, Margett denies that. We were in a clubhouse at one point. And she's like, no, no, no. And I was just like, yes, yes, yes.

Just judge people by their actions. Again, if they're getting substack and they're giving them tons of money and same thing with Clubhouse and they're shaking free journalists and kind of creating this other media outlet, I just judge them by their actions. and their actions are to really take on the media head-on.

Some hot takes, Benedict Evans, who've previously worked at Andreessen Horowitz and is a smart cat. I generally do not understand how anyone can believe the news is purely about facts, rather than choosing which facts and which interpretation, nor that coverage you disagree with is purely a problem of getting facts wrong. Morning Bruce, Jacob, Donnelly, it's interesting that Coinbase is going to try to fact-check itself. It is an endearing idea, but it won't work. businesses are incentivized to maximize returns.

They're not incentivized to talk truth. When said truth interferes with profitability, yeah, I think that is also applicable to publications. Publications are making decisions to do link baiting articles, to make money. That's why there is this whole reaction from, I think, a lot of subjects is subjects are tired of being misrepresented and horrible headlines. So, you know, my philosophy on this is to just have your own media channel like I do. and talk directly to your audience.

I think there's very few publications that have the reach I have after 10 years of this podcast and doing All In and my Twitter following. The same thing is true for Bezos or Coinbase or Elon or any number of high-profile people on Twitter. And in fact, Trump could route around the press completely when he had his Twitter account. So I think it's a fine move by Coinbase. I think it's actually kind of an olive branch from Coinbase of saying, I don't want to be in a big fight with y'all.

Let's just, we're going to state the facts, and if those facts are wrong, we could just talk about facts. So I think they're taking a less aggressive approach than Amazon or maybe Bellagie or other folks. All right, it's been a great episode, and we'll talk to you next time. Bye-bye.