In our relatively recently connected economy, platforms have appropriated an outsized proportion of value creation. That is a problem.
Now Braintrust, an IT freelancer platform, has just raised $18 million to support a very interesting approach, issuing blockchain-based tokens to its users to give them effective ownership of the platform.
Braintrust CEO Adam Jackson told Coindesk:
“The typical playbook from eBay, all the way up to the gig economy players we see now is you raise hundreds of millions if not billions of dollars, and use that money to subsidize one or both sides of the marketplace,” said Jackson. “You’re essentially paying people to show up.”
“While five guys in San Francisco became deca-billionaires, a third of all Uber drivers live below the poverty line, some of them even live in the cars they drive,” he said. “So I wanted to figure out how we could create a marketplace that is owned and controlled by its users, instead of investors who just want to tax it.”
“Our business model with Braintrust involves lowering the fees to almost zero. We charge talent zero; we charge clients 10%, that’s just meant to kind of pay our bills and sustain us,” Jackson said. “By lowering fees to zero, you enable a whole new class of big transactions that could never touch a place like Upwork, because the fees are too high.”
Jackson describes Braintrust as a “labor protocol” in the same way that Ethereum is a smart -contract protocol. As such, it’s more like a non-profit, a kind of public good, he said, upon which other businesses and use cases will flourish, rather like the composability, or the Lego-like functionality of building with DeFi.
Jackson told TechCrunch that with many new freelancers on the market as well as an impressive roster of clients they are now profitable, and notes:
“Just imagine if Uber had given all of its drivers some ownership in the company what a different company it would be today,” Jackson said. “Braintrust will be 100% user-owned. Everyone who participates on the platform has skin in the game.”
The system does not give financial participation, but it does allow the users to shape development of the platform, and is built on a belief in treating independent contractors with respect, which will absolutely be at the heart of a positive future of work.
Jackson wrote a very nice piece Tech must radically rethink how it treats independent contractors that lays out how he thinks the market should develop:
What I’m suggesting is a radical rethinking of freelance contracting. I want you to see independent contractors as a different kind of worker, not as a way of skirting getting a full-time employee. A freelancer, by definition, is someone that you don’t monopolize, and someone that you should actively give agency and, indeed, part of the network you’re building. One of the issues of corporate America’s approach to freelance work is an us-versus-them approach to employment — you’re either part of us or you’re simply a thing we pick up and put down. What I’m suggesting is treating your freelancers as an essential part of your strategy, and compensating them as such. Freelancers should own equity and should have skin in the game — they may be working with you on a number of projects and take literal ownership of vast successes throughout your history.
I’m a fan, I really hope this works.