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Mint Season 2 episode 3 welcomes Jeff Kauffman Jr., who’s building Parachute, a social token-driven consultancy firm focused on web3 solutions for brands and agencies. Jeff has made it his responsibility to provide entry-level social token exposure to many mainstream marketing and advertising executives via the community’s currency, $JUMP.
In this episode, we talk about the vision behind Parachute and $JUMP, how social tokens will change advertising forever, why he’s building an advertising and marketing network native to Web3, the early days of the internet and mobile adoption, launching creator coins, and so much more.
Thank you to Season 2’s NFT sponsors!
1. Coinvise – https://coinvise.co/
2. POAP – https://poap.xyz/
3. Socialstack – https://socialstack.co/
4. Celo – https://celo.org/
5. PrimeDAO – https://www.prime.xyz/
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Adam Levy: Jeff, welcome to the podcast. Thanks for being on.
Jeff Kauffman, Jr.: Good to be here. Thanks for having me.
Adam Levy: You got it. All right, man. Let’s get right into it down and dirty. Give me a quick brief about yourself, how you got into the crypto space. What were you doing before and kind of like, where are you? Yeah, man.
Jeff Kauffman, Jr.: I’ll so I’ll give you the quick 15 year journey to crypto. So my background is marketing advertising then in the sort of the enterprise agency world for almost 15 years, got my start just actually marketing on MySpace, believe it or not. So I really sort of grew up through the web two movement and saw that from sort of start to what I, I wouldn’t say finish, but to where it is today. And so that was super fun, loved sort of the birth of a new industry, a new models for brands and creators. But ultimately web two started to feel a little stale and a little over a year ago, I came across the concept of social tokens and personal tokens and that those keywords kind of triggered for me that crypto and blockchain and Web were starting to enter a phase that was more relevant to someone like myself, someone who’s not in finance, someone who’s you know, not a coder or a developer by any means, but someone who builds online communities builds brands and builds experiences. So sort of that combination of writing and industry and you know, see riding the ups and downs of all of that to then wanting to be at the start of sort of the next wave of what internet communities could look like.And yeah, here we are today. And yes, it’s getting off to a good start.
Adam Levy: I love it. And you brought up a cool keyword, web two feeling stale. What about web two is feeling stale to you?
Jeff Kauffman, Jr.: So it’s funny because a lot of the sentiment around web was the exact same sentiment that web two had circa 2000 to 2008, which is we’re removing the middleman. The intermediaries are going away. And at the time the intermediaries weren’t Amazon, Google Facebook, the intermediate intermediaries were the large print publications, large TV networks and things of that nature. And so you know, that sentiment was super important for me because as someone who enjoys building brands the number one thing you want to do is connect a brand to a consumer, deliver a great product and a great experience and grow that relationship and web to promised them. Which is the same promises web three is making right now. So I hope we don’t make the same mistakes. But then over the years, what happened? Google, Facebook, Amazon, apple, they all became these huge intermediaries. So we just got centralization and intermediaries all over again. And immediately you start to feel as though you have handcuffs on, so 2010 to 2017 was sort of the heyday. I felt like there was a lot you could do in web two. And then the last three years, the clamps have just started to come down and it just felt like we were in handcuffs and it felt stale.
Adam Levy: So you brought up a point web to aim, to do what web three is doing right now, but people just built quote-unquote data monopolies and these huge islands that were gated and people became the product and very much so what we’re experiencing right now, obviously, what do you think is happening in web three that’s taking change into their own hands, right? Like what are users kind of like experimenting with from a point of view to make sure that web two doesn’t happen over again? What are you seeing?
Jeff Kauffman, Jr.: It seems like social tokens, brand tokens community tokens. They go by a lot of terms, but I like social tokens as sort of the catchall and NFTs again, a little bit adjacent to the world of, of social tokens, but you can still build communities around both. It’s really the ability for the end user to control their access to a community, not decentralized platforms. So right now, if there’s a big community in a Facebook group or an a Reddit group how do you mobilize a million people? If they don’t like how they’re being treated on one platform, how do you mobilize them and migrate them to another platform? There’s really no way to do that. And so that creates data lock-in network effects, lock in, and the innovation sort of stops. And so tokens putting tokens in the hands of the end user and then allowing themselves to organize around the token and not necessarily the UI or the platform or the database for law , at it’s simple, or it’s at its most granular level organizing around the token allows just freedom and mobility across the internet. So as, as we start to see experiences, websites and apps built for tokenized communities. We essentially get this world of online tribes that can just move across the internet together. And that freedom is essentially you know, what, what I think is the polar opposite and counter position to, to web two, which is no ownership and very little freedom.
Adam Levy: Right, and I guess we can both argue that we’re part of that internet tribe that is working in a very much so decentralized manner, me through mint you through jump, which we’ll get to in a minute, but everybody kind of has their own entry into crypto into web three. Right. What was yours? Did you first buy Bitcoin and realize, all right, what is this internet funny money? Was it through a blockchain use case? How did you get your start in this space?
Jeff Kauffman, Jr.: Yeah, it’s funny. My first awareness of Bitcoin was back in 2012, 2013, and being sort of a brand guy, if you will. And not someone who understands deep, deep, deep technology type stuff. The brand of Bitcoin was a bit off putting to me. It just felt really scammy. It didn’t feel right. Just kind of seeing it on the surface. But the general idea of it was like, man, there’s something here and Bitcoin will kind of be the first experiment and then we’ll kind of see what comes after that. So, Definitely put a bookmark in it and kept track of it. And then as we approached 2016 as Coinbase sort of started to gain a lot of momentum and you started to see this really nice brand kind of developed within the space that, you know, brands can often give a lot of legitimacy and credibility started to pique my interest again. So definitely leading up to the 2017 sort of craze and bubble is when I actually started to make some of my first purchases, obviously like super speculative started the devouring every video I could of Vitalik talking about the vision of Ethereum, along with every other sort of conference or video that had been sort of put out there and, you know, got super interested in it. And then obviously the, the ICO boom, and the crash, and there’s a lot of sort of cloudy fuzziness around kind of what was happening. And I wasn’t deep into this space. So at the time I didn’t see really the, like the builders and the real like use cases that were starting to form. So I didn’t pay much attention to it. I was also highly consumed with building a business within the agency that I was working at and sort of scaling a web two solution. So I really just poured all my focus into scaling a social media business. And then in 2020, You know, it just kind of came to a head and it was just like, man, this is this again, that the web two is feeling stale. I’ve scaled this business, but I don’t really see, it doesn’t seem a lot of fun to keep scaling. And then again, kind of come across the term social token and personal token, and then just the, you know, the idea started.
Adam Levy: Sure. No, it makes a lot of sense. And, you know, Jeff, you bring such a unique point of view to this entire discussion, mainly because one you saw not only the rise, but the existence of my space. And then you also saw that transition to Facebook and pre IPO. Facebook is very different than post IPO Facebook. And I think newcomers who like gen Zs, right, that are coming into the space, they don’t realize these problems, right. They’re just end users. There’s just a product at this point. Right. And now we’re seeing the rise of these new primitive as these new ideas, these new forms , of one community engagement, community building and community ownership and what it means to be a part owner and something that you use, right. Something that you contribute your time, electricity, resources, whatever. Right. So when you’re seeing the development of my space, right, you’re being an internet community guy, right. An early, early user, you’re seeing the growth of Facebook pre IPO and how it kind of delivered a lot of its organic traffic before when IPO and the second one IPO that kind of like disappeared. Right? Where are we right now in terms of where web three is to where, what to was when you entered? What what’s the energy like right now?
Jeff Kauffman, Jr.: Yeah, I really, I feel like web three, social is 2000 to 2003. So like almost pre my space. Like if you go back before my space, Friendster was really. The, the thing that sort of led up to, to my space. And so I think we’re pre my space. I don’t even think we’ve seen. And it’s tough to say like like I don’t think the next wave of social platforms, I just, it, it, that’s too linear. It’s linear thinking. It’s like to think that there’s going to be another MySpace. I mean, another Facebook that kind of dominates. Like, that’s why I’m not, we can get into big cloud, but I’m not big on just a big cloud feels too linear. It doesn’t feel like this exponential just change. And, and what we’re seeing. So I don’t even think we’re yeah, we’re, we’re like pre to really 2002 to around 2002.
Adam Levy: Yeah. I could echo that. And just, just because you brought up bitclout for a minute. Right. And obviously, and it’s a point of discussion that I wanted to have with you more intimately, but we’ll bring it up. Obviously a bitclout is like that social experiment that hit the market, had all the backing of like the top investors that got a lot of attention, a lot of early capital initially. There’s a lot of hype, right? Tokenizing the top 15,000 influencers on a social media platform. And then adding a twist of decentralization. It’s going to get awareness obviously. And like you said, we’re at a stage right now where. I like that because you’re the first person to kind of tell me we’re in that early 2000, 2003 phase which basically means my space got started in 2003 big cloud is like that early iteration of what it could become, but chances are, or I don’t know, chances are, they might pivot right.
And become something else who knows you can’t really predict. But when it comes to like these creators, right. And now let’s get into the story of jump, starting a social token, just so people understand the difference between the social token that you started versus the ones that are on Bitclout. Why not launch jump on bitclout?
Jeff Kauffman, Jr.: Yeah, absolutely. The main thing that I see with Bitclout , to me, it just felt, so it just felt led to like, just, yes, it had this kind of underlying blockchain component. They tokenized the top 15, I think, thousand sort of influencers on Twitter. But everything about it felt so web two, to me and to me, the social graph is completely built around the individual and not platform. And, you know, unless there’s like a layer of Bitclout that, that, like, I’m not sort of seeing, it still feels like they’re trying to build the social graph around the blockchain itself. And it’s like this, oh, we went from a platform to a blockchain and I dont think that’s where it’s going. I think the social graph is around the user. And right now a theory seems to be the, the best place for an individual person to start to collect tokens and build their own social graph. Right. And, and in that sense, you know, still has all of the high level sort of beliefs and philosophies that , Bitclout is going for. But instead of trying to build around us a very specific blockchain use case you know, Ethereum is really allowing people to kind of create their own social graph. And to me, that, that seems like a a bigger sea change that we’re building social graphs around people, not blockchains and certainly not platform.
Adam Levy: Yeah. And I guess from that point of view, we’re building social graphs around people, but blockchains are the underlying infrastructure that are making it possible. Right. And just because we’re already on this topic, right. I, I think it’s fair point to now even introduce, jump. Right. And I’d love to kind of hear the story because we’ve been kind of seeding at it and teasing it throughout this conversation. So really quick, tell me, tell me about Jump, the social token you launched and parachute how those two kind of work in conjunction.
Jeff Kauffman, Jr.: So, to set the stage, I’ve got to go back to 2005 again, go for it though. How did the advertising, how did I get into community building? I was in college at the time. Wanted to go to the forefront of where I felt like consumer attention and consumer media were going so very similar to the way, a lot of sort of people who are graduating college and just entering web three right now, just kind of doing the same thing in 2005. I was very big into skydiving at the time. was making a lot of jumps at a local drop zone and just decided that I would start a MySpace page for skydive, Dallas. Didn’t ask permission, just got into it. Launched the page, started marketing skydive Dallas on myspace.
Adam Levy: That’s epic.
Jeff Kauffman, Jr.: In about a month, the manager came up to me at the drop zone and I only had about nine skydives at the time. So I was by no means sort of an expert, certainly was probably not qualified to be representing them on the internet, but he came up to me and he said, “Hey, we have these little comment cards. And at the bottom, it’s a sort of ask about your experience and how you liked your skydive. But at the bottom it says, how’d you hear about us?” And it was like, check a box, radio, TV, outdoor, whatever. But there was a little note that you could write. And a lot of people started writing MySpace on there and we were getting a lot of business from MySpace and I found out you’re the one, running it? We should compensate you. And so that was sort of my first client. It was a barter deal traded skydives for essentially social media marketing that allowed me to make 1800 jumps over the course of 11 years, which was just a blast. And so when I started to sort of move into the next phase of my career and I started to sort of think about really what I wanted to do. I wanted to jump into web three that’s, as simple as it was, and I needed to, and I needed a parachute to do that. So parachute and jump were sort of born.
Adam Levy:I love how it’s that simple. It’s like, that’s the inspiration. You’re jumping into web three. Okay, interesting.
Jeff Kauffman, Jr.: Exactly. And so when I think about it, and I kind of am like everybody needs a parachute to jump in, that’s kind of where we are at this stage. It’s hard to do by yourself. You need a little help. I’ve certainly had help through my relationships at sea club. I’m gearing up junk to help others in a similar fashion, but unique to a certain industry. So when I really started kind of preparing myself to actually jump in full time and leave the safety net of a big corporation. One of the things that I did is I just put together sort of a trends and research presentation, and I presented to just a bunch of smart advertising and marketing people. So think like senior digital strategists founders of agencies Founders and CEOs of billion dollar companies. And really the idea was, Hey, this is what I’m seeing. I’m seeing this crazy. And this was before NFTs blew up. This was before anyone was really talking much about web three from a brand perspective. And so sort of middle of last year, 2020. And the response I got from everybody, super senior people, incredibly smart agency people was, man, this is fascinating. It’s definitely the future. I see why we need it. I see the problems with web two. I see the problems that this solves. I have no idea where to start. This is so foreign to me. It’s like, it’s like seeing the internet again for the first time. And so as I started to formulate, okay. That’s the sort of the feedback I did a little market research if you will, light market research, just kind of talking to people. That’s the feedback that’s most needed right now in my industry, which is fortune 1000 brand marketing enterprise agency services. And the question, the answer was super plain obvious. It was, we need a community for the industry to come together, to start to learn, to start to set best practice, best practices, and ultimately build the products and services that this industry that web three would, would sort of need. So, that’s where kind of jumped started to make a lot of sense and being able to work with a bunch of agencies and brands and help them jump into web three.
Adam Levy: You know what this reminds me of when, like I’m a big fan of, of the history of the internet and the stages of the internet from web one to web two and now web three. And quick side tangent, I’m curious at, what’s going to make web three irrelevant and what’s going to eat web three. Right. But, we’ll get into that even later. But, what you’re talking about right now, because we’re so early in the stages of adopting more retail level type of web three tech, it reminds me a lot of like these early internet advertising bureaus, for example, right. Like the IAB, right. The internet advertising bureau when mobile came out, right. The, the, the mobile bureaus that kind of helped an aim to educate agencies and advertisers. And is that, what is that what the vision is?
Jeff Kauffman, Jr.: Yeah, it absolutely is because when you look at the IAB in the nineties you know, if you wanted to learn about the internet, where are you going to write a print article about it? You’re going to talk on the phone? No, you’re going to build a website. You’re going to start a blog. You’re gonna start an email. You’re going to use the native tools of the space. And in doing that, just to build your community, using the native tools by default, you learn the builders learn, the community members learn. And so when it came to like, what does an industry association look like for this age? It was, well, we, we need to vote. Like if we don’t launch a token and we don’t interact with the token, we’re essentially making a huge mistake in terms of how we’re actually actively learning, not just reading articles and you know, tweeting, tweeting ideas, like let’s actually actively learn. So that’s where, you know, the really formalizing a community around a token became important. With that said, introducing a token is a different dynamic than an industry association that is really classified as a nonprofit, right? When you really look at like structure and architecture. And so it’s not really fair, it might even be a bit misleading to call, jump an industry association because of what that might mean, but it is completely fair to call it an industry community. And then I think it levels up the ideas and the ethos of what association wants to do, but I think it actually turbocharges it.
Adam Levy: So with all these bureaus and associations, obviously they would monetize them, quote unquote, through probably membership fees, et cetera, et cetera, education materials. I’m assuming I don’t know too much, I’m thinking out loud here right? But really this is a network effect type of thing. This is a community thing. And to get the resources, to understand, to really get a better hold of what web three is, you’re giving people that first step to buy their first token, if they haven’t already bought in Bitcoin or Ethereum, et cetera, et cetera. And with that, they get access into a community of like-minded people who are also after the same problems, solutions, challenges, et cetera and going through that tunnel together. That’s essentially what it is.
Jeff Kauffman, Jr.: Yeah, absolutely. And the one thing that I’ll add to that is that to me, a token, having a token isn’t an either or, and like a business model, I still think you can have sponsorships around a tokenized community and we can get into what that means, especially when we’re talking big fortune 1000 brands and how they might interact with tokenized communities. I still think you can have online course material that sold USD or some sort of stable coin. You can still have advertising and sponsorships, and I think there’s a right way to do that within a tokenized community. And so , it’s really, we’re talking about the ying and the yang, the Batman and the Robin, the peas, and the carrots, two things that go together like really well, which is community equity in the form of a token and community cash flows in the term of all kinds of products and services that you can imagine.
Adam Levy: Right. So , my next point of discussion is that everybody can launch a token. And these people that are joining your community will soon realize how easy it is and how quick it is and how cost effective it is to just launch an ERC 20 or whatever the token standard is. But the hardest part behind launching a token is building that network effect, creating utility, creating value. How do you think about that? Is there a framework that you use in kind of deriving this value and creating perks, quote, unquote, or talk to me more through that?
Jeff Kauffman, Jr.: So really, you know , you’ve got to figure out a way to create value around the token, like the value for holding the token for using the token. And in that sense, a lot of the fundamentals of building businesses and building brands actually come into play. Granted, you have to translate that knowledge into the new tactical forms of like, what can you do at a very tactical level that’s new and different, but the fundamentals are the, like the high level strategy doesn’t necessarily change. And the example that I’ll give for that, because I think it’s by far, the best example is Bezos, what he claims is Amazon’s strategy. And it hasn’t changed in 25 years. I think Amazon was founded in 94, which is the goal is to deliver products faster and cheaper. That’s it? That’s the strategy. It doesn’t change. That’s the business strategy. That’s the brand strategy, everything ladders up to faster and cheaper. And in that sense, you can introduce all kinds of tactics and components and ways. To execute against that strategy. And so launching a token is not a strategy that is not new, like you haven’t like unlocked some sort of new strategy. You have unlocked a new tactic and that tactic is super powerful and not a lot of people are using it right now. But the strategies are essentially the high level mission is essentially the same. So if you looked at jump’s mission statement versus the IAB mission statement in 1994, they probably look very similar, which is create a space for education and learning, create a space for people to meet and network create creative best practices for building brands using web three and helped start and, and sort of fuel the next generation of marTech, which, you know, the whole new adtech and MarTech stack has to be built for, for sort of web three. And so, that high level strategy is not probably that too different from many associations leading up, but how we do it. And the tactics that we use are very, very different. So I would just encourage everyone who’s considering launching a token to actually spend a lot of time thinking about just the good old fashioned business plan.
Adam Levy: Yeah. So that’s a really good way to submit faster products in the most cost-effective manner. Right. Amazon strategy, share with me more about what, what jumps strategy is, right. And what that like longterm roadmap kind of looks like.
Jeff Kauffman, Jr.: Yeah, absolutely. So, you know, Creating a space to learn creating an ability to network with individuals and then create a best practices and, and sort of build web threes, adtech and MarTech stack. Right? Look at what a token does to that and how it kind of supercharges that, no industry association has ever been aligned with a token. Really it’s a, you pay a membership fee, you’re a part of a community. And really the value you get is somehow extracting that value back towards the company that you’re involved with. So if your goal is to kind of rise through the ranks and be president of the industry association, you actually still care more about your company than you do the association, you would care about the association to the extent that it helps you in your own company. And what a token does is it aligns your company’s success as well as the industry association success, because you essentially have stake in the social capital now, tokens, you know, depending on how you design a social token and the purpose you give it, you know, you can get in the crosshairs of the sec and it can become a currency. But ideally all social tokens that you launched there, they are utility tokens. And you have to build that utility into it. Now, supply and demand takes effect over any good that can be traded and price discovery can happen into sneakers or some sort of collectible and those aren’t necessarily securities. So the same thing can happen with a social token. And so when you think about sort of the future of what this industry community can look like, we can start to imagine a world where in every top agency, enterprise agency. So let’s take just the top 200 several people holding a jump token, and then you look at every marketing team within you know, fortune 1000 brand, someone in there holding a jump token. And then you look at web three adtech and MarTech, you know, people that are deep in the web three space. Imagine them holding a jump token. And now you have these mega resources in the form of capital from fortune 1000. You have incredibly creative minds at all these agencies starving for new ways to do creative things. And then you’ve got all these innovators in the web three space and they happen to all be aligned with a token. So there’s a much stronger dynamic in terms of win-win across the board, because your stake is not just your own personal desire to benefit your own company. You actually want to see the community grow and your tokens actually give you stake in that social capital.
Adam Levy: So there’s two point of views here. How do you prevent this from being an investor’s paradise, right? Where they pump and dump and speculate on the behalf of fortune one hundreds, tens agencies, whatever they may be there, the capital that they put in there, how do you prevent investors from speculating on that? And two how do you communicate that to people? Right. We get it right. We get it. We’ve seen the reality of what it could become, where it is right now, but agencies who are more, I guess, cautionary around crypto, how do you explain this stuff to them in a, in a more, I guess, meaningful way that resonates with their level of understanding of crypto, beyond it being for criminals, beyond it being a stock market for random shit coins.
Jeff Kauffman, Jr.: So the first question, how do you prevent investors from speculating on it? That question first is a premise that that speculation is bad. I think it can cause some people who are new to the space and potentially holding jump to seeing those wild price swings and a tokenized asset could be definitely alarming or concerning. But, I don’t view speculation as bad. I think speculation serves a purpose. And and then also, I don’t think you can even prevent it like once a tokens liquid, like you can’t prevent speculation, so it’s just going to happen. And so really the idea is to not get distracted by your ultimate goal and your ultimate mission, and then the people that are really aligned with that goal and that mission they’re going to do exactly what, what you as a community leader are doing, which is you’re ignoring the price swings that are heavily driven by speculation. And you’re going to focus more on the mission and the purpose. To start, jump is not tradable. And I don’t even know when the jump token will be tradable when, whenever it makes sense. Right now, you have to earn it. And that’s sort of the first step towards you know, putting the token in the, in the right hands of people that want to use it for the purpose and the utility that it is, you have to earn it. And right now to date, we’ve got about 150 beta members. We’ve got 80 agencies represented from across the globe. We’ve got members from Shopify, Netflix, Tik Tok, Prudential, Amazon. And so these people have essentially earned the token by being the first to request access and and, that’s sort of the way I went about building the community as I wasn’t super public about it. You know, I posted on my own social channels and sent out emails to, you know, really close colleagues that I respect and who want to innovate. But as far as like mega PR releases or some like super fancy website, that explains what jump is. I stayed away from all of that. And it was really just, Hey, this is web three. We’re going to learn about it. It’s jump, request an invite. And so those people that were essentially very curious minds and heard just enough of the story and made the effort to request an invite without knowing much. And then I had some zoom calls to sort of onboard people. Essentially their first reward for being curious, people in this field is to receive jump tokens. That’s their first reward. And then moving forward, we’re about to enter season one. And we’ll have two teams. We’ll have an events team and a research team, and essentially to enter the community you’ll have to contribute to the researcher, the events team, and by contributing to the community, you earn tokens, which then give you more access to the community. And at some point, whenever those tokens are tradable it’ll make sense. Obviously, when you start putting tokens into the wild. Anyone can set up a liquidity pool and start trading the token. You know, that’s just the nature of the game. But it’s just like, once you start selling t-shirts, anyone can create a secondary market for your t-shirts. So it’s not like it’s that it’s that different. It just happens at a much quicker pace and probably a much bigger scale, especially coming up throughout the years.
Adam Levy: Yeah. I love how controlled and how focused it is on trying to achieve like not a validation, but kind of getting the initial energy built up within that community before scaling it and getting it much larger. Right. Cause obviously. There is a problem that needs to be solved here, right? And the social token solve that through community coordination, right. And validating equity, right. And validating proof of participation, et cetera, et cetera. Right. And the beauty behind what I like that you’re doing is you’re keeping it controlled, but also you’re aware that there could be quote unquote, a bad actor within that, that wants to take his experimentation to just another notch and create a unit swap pool or a sushi swap cool and create an ETH pair or whatever it may be, whatever the token pair may be. Right. And just put it out there wild and allow more members that you necessarily wouldn’t have won to join, to get into the community. And I think when creators are kind of thinking about how do they build their social token community, whether you’re a Lil NAS X, and you’re you have a fan base of millions, or you’re an individual like yourself that wants to create more awareness for a topic. I think there’s two models, either releasing it out in the wild, right. And letting people ape in quote unquote and buy it, or having a core individual sort of meant this on their own, in their own wallet. Not really create a multisig quote, unquote, that’s managed by multiple people, but you as individuals, Jeff Kauffman Jr. You determine who comes in and who doesn’t. And I think there’s something unique about that with creating that intimacy behind a community. And just to add on to that, you know, I think one of the biggest misconceptions people have is they’re aiming for masses, right? They’re aiming for millions of people in the community, but what you’re proving it’s use case dependent.
Jeff Kauffman, Jr.: Yep. Yep. Absolutely. And I definitely don’t think it’s wrong to just sort of release a token and let people ape in and kind of do all that jazz. I think that’s more sort of natural for where the blockchain and crypto community has been up to this point. But I do think that like every industry there’s evolutions and there are different use cases and you know, jump is certainly very you know, it’s very centralized in, in a sense right now. Now the goal is to get it to a very decentralized place, but that does not happen overnight. And I think a lot of people forget how long certain projects took to actually get to true decentralization and aligning with that ethos. Now at the same time, I think we all need to sort of sit back and understand that there are plenty of reasons to have a very centralized and creative sort of actor in a sense. And so, like some examples that I’ll give is that a musician. While they , or a band might have a token and a decentralized community, the community is not necessarily dictating what that musician is thinking about and creating about and that exact song and that like that algorithm that’s in that musician or that creator’s head and how they wake up and how they feel and how they get to that next hit song or that next hit album. Now there’s certainly like that interaction with the community, but that actual song that’s being created is not necessarily created by the community. It’s certainly created in some sense in tandem. But yeah, I think there’s a lot of room for a very centralized sort of actor who partners with their community but isn’t necessarily giving out just full control and ownership and just being like, okay, and now you create every single song and album ever released under my name and that sort of like that’s Bitcoin .
And, you know, that’s, that’s the, just the full Satoshi goes into the back and there’s now , all these actors that keep that platform up, you know, there are ways to bring the metaverse characters to life and this community-driven like avatar, that’s controlled by the community. And like, and that’s kind of, that’s, that’ll be a fun space to play in, but for the time being, while we still have people that want to be extremely creative allow them to be creative. But these tokens allow them to partner with their fan base in any way.
Adam Levy: What I love aboutthe jump story is, and I touched upon this earlier is the, you can be centralized and still utilize decentralized technologies. You don’t have to go from zero to 100 instantly, right? There’s a process to it. Right? And for future creators who are looking to experiment on this, whether again, your little NAS X or Jeff Kauffman Jr. There are stages to, to releasing and becoming more quote unquote decentralized. Right? And you’re seeing a lot of these fair launch models kind of go into the ecosystem. The biggest one comes to mind is Andre Conje . I feel like I’m butchering his last name, but from yearn finance. Right. And he’s very big on this ethos of fair launch, no premine, no VCs, none of that stuff. Here’s a project. Here’s a problem I’m trying to solve you guys do what you will with it. Right. All still developed, but. It’s two different models. And I think it’s a misconception that people have with like, okay man, how do I go decentralized? Right . Initially, like, I don’t even know the first thing about decentralization. I grew up in a society where all I’ve known is centralization. I have to rework my framework and the way I’ve kind of approached it, like people don’t realize that there is no CEO, necessarily. There is no CMO. There are no executives that kind of manage. There might be not nonprofits that help fuel and fund these ecosystems. But the majority of the traction, the network effects happen many times beyond someone’s control.
Jeff Kauffman, Jr.: Yeah. And you kind of touched on, we grew up with centralization, whether even though we’ve got a whole new generation of bright minds that are coming into this space, they still grew up with centralized school, centralized government, centralized healthcare, centralization, centralized family. Right. And there’s not necessarily a bad. That’s not all bad, but that is a behavior that is so hard to sort of unlearn, but we do need to get there. I’m a huge fan of de-centralization. and we need as much of it as, as we can, but you can do it in a very progressive manner. And so one of the things that I challenge people to do in launching a sort of a tokenized social tokens and community tokens is to think first about what is one single behavior that you can decentralize. One single thing and get really good at decentralizing, that single behavior. And then, you know, you’ll start to lay the foundation and the sort of the culture to sort of spread that. And then maybe one day you can become fully decentralized. You can actually become a DAO. Cause right now, most DAOS are, they’re DOs. They’re a digital organization. It’s not decentralized and it’s not autonomous, but that’s okay. It doesn’t have to start there. And so if, as long as you’re up front with your community, even if you’re calling yourself a DAO, no big deal. Just say, Hey, we’re not fully decentralized yet. It might take us a year or two. I think two years is quick. It might take us some time, especially when we’re talking about culture and human capital, because that is much different than just software.
Adam Levy: Yeah. I think like that quote right there, one behavior at a time, right. And starting small one baby step at a time, one stair at a time. Right. And building from there. When people enter the space, it can get very overwhelming, very fast. Right. And that whole point of view is like, okay. And I want to pick your brain on this a little bit more designing one behavior at a time. How do you approach that? What does that look like? So let’s talk about it from jumps point of view for a minute. Okay. You’re trying to build a network of like-minded ad agencies ad tech, marketing tech, et cetera, et cetera, people to educate them on the future of web three and what it can become. That’s the vision, that’s the mission. That’s the goal? What does that first behavior look like in your ecosystem? How does that look like from your point of view?
Jeff Kauffman, Jr.: So the goal is to decentralize research and events. So kind of going back to the two teams that were there. And so the way we’ll do it, we’ll do it in classic agency style, which is, there’s always a briefing and you start with a briefing and then you move into a brainstorm. And then those ideas that kind of the community rallies around will then formulate into the working groups and the projects within research and events. And so in that sense, the ideation of what projects fall within research and events was very decentralized. It was the community kind of came up with it. Now, you know, I had to kick off the process, which was very centralized, sort of planning and structure. You know, then I have to do the work within discord to set that up. So that’s very centralized. And so there’s centralized components of, of bringing that together. But that first, like that would be a huge success for our community just to brainstorm on what the working groups would, would be, and then come to consensus on those working groups and then to start working in those groups. And then if we sort of map that out several months and maybe a year or two, the I, the ideal scenario would that an event idea would happen or would come to someone, they would start organizing the community around that idea. And then that event would happen. Done and that’s the vision that’s decentralized and that came to life without any centralized actor within the jump community. So how do, how do I empower that? And then in turn, create others in the community to sort of empower that. And so one of the things that we’ll have within jump, as soon as the community reaches a little bit larger, still as we’ll have a, what we’re calling city nodes. So ways for agencies and people that are in the same cities to connect. So if jump can sort of put out the resources in the form of tokens to hold the local event, and then that of that bounty and that event just happens and it’s grabbed, and it just goes with very little oversight. Or no oversight from, you know, the centralized team and the, the Genesis team, if you will then we’ll start to see like that actual behavior kind of come into life, hopefully pretty soon.
Adam Levy: And the reality of what you’re saying on paper, it sounds fantastic. But the reality of these organizations is that as you build towards decentralization, you’re really banking on the fact that you’re going to have a lot of self-motivated and self disciplined individuals, more leaders, less followers, right. To an extent, right. And in a world where society has only so many leaders and more followers, right? How do you avoid the bureaucracy that will come and streamline efficiency? I think it’s a problem that a lot of DAOs true DAOs, haven’t figured out just yet. One example comes to mind and I’ll let you answer it for this one example is friends with benefits. They introduced season three and they basically have leads managing events, projects, this and that. Right. And with those, you have core individuals that get, I guess, I don’t know what the pay is, whatever it may be, but they basically get compensated from the Dow and become essentially like decentralized employees, contractors, from what I understand. Right. And they, they are like the leaders that coordinate and manage specific departments. How do you kind of view that when one, all these people, they already have full-time jobs, right. And they’re working at Amazon, it’s already consuming a lot of their time. They’re working on these ad agencies, et cetera, et cetera. How do you build a system that motivates and incentivizes leadership versus being a follower.
Jeff Kauffman, Jr.: Yeah man, that is a billion dollar question. See whatever unlocks that is going to start really do it. Cause what we’re talking about. Talking about coordinating human capital, natural capital. And that’s, what’s so fascinating about this space. And so in the absence of being able to perfectly program everything into software, then you have to start relying on the human brains form of software. And you have to sort of have these centralized actors. And so that’s where, you know, you need even stronger leadership. And I think that when we start to talk about the bureaucracy of organizations, I actually, I feel like that’s when leadership is breaking down and you’re having weak leadership. And so you’ve actually got to somehow cultivate even stronger forms of human leadership when you’re really relying on a decentralized team to self-motivate self act and do it without a lot of oversight. So really, you know, the future is the stronger the leader. I think the more likely they’re going to gravitate towards this sort of environment, because really strong leaders, they don’t want to micromanage they want to empower people and these systems give them a lot better opportunity to do that. And so I think we’re going to naturally see our strongest leaders and businesses and society start to gravitate towards this sort of model. And when you have strong leaders, I think that’s what gets us through the bureaucracy component until we can start to code the coordination of human capital into software.
Adam Levy: Yeah, I it’s, it’s a great point. Let’s pivot for a minute and talk about the future of digital marketing, the future of advertising from the first point of view of decency, centralized social networks. Okay. Now the platforms right now, their business model is ad revenue, right? Probably other miscellaneous like fields, whatever, but majority ad revenue. I, as a Facebook marketer, I can go and set up a campaign, target a specific audience based off the interest, demographic, whatever people become the product, but on platforms like Bitclout, it’s no longer that scenario. Right? How should digital advertising agencies. And I guess also brands and it’s probably two different answers. How should they be viewing decentralized social networks when it comes to engaging with their core communities and their customer base?
Jeff Kauffman, Jr.: Yep. I love this topic because I think the natural place for a lot of people who are not deep in the world of advertising and marketing and actually care about doing it in a really in a way that’s has a lot of quality and adds value to the person that’s being spoken to and the brand itself. You know, I like to use a couple of old school examples, but I also like to start with a quote from Peter Thiel’s book zero to one, which was you have product and you have marketing and unless your product is at least 10 X better than the user switching costs, well people wont try your new product. And you’re like, well, why not? It’s a, it’s five X better, but the end user, whether it’s a business customer or, you know, B2C sort of play, the switching costs are too high, especially when demographics start to get older and you’re having families and you’re buying houses and you’re working, your parents, you know, are getting older and whatnot. When you start to hit, you know, the later twenties and your thirties and your forties switching costs become really, really difficult. And so I love sort of how Peter Thiel sets that up. And he’s like, well, if your product’s not at least 10 X better than you’re going to have to win with marketing and you’re going to have to build a brand. And so what is marketing? And that’s where a lot of people just kind of go to, oh, marketing. If they’re not in this sort of field, they go straight towards, oh, it’s okay. And that’s just one tiny, tiny, tiny, tiny little sliver of marketing and what marketing is. But it’s really important for us to think about, like, as we move into web three, there will not be a less need for marketing and advertising, there will be a greater need. And the reason is there will be more decentralization and a greater importance on building your brand, whether it’s a community brand or a protocol brand or whatever the mission is, there will be a big need to build that brand and do it in the right way. So I see marketing’s evolution is actually coming into a bit of a golden age and, and I think a better place than where we’ve been. And what I hope is that when we look at marketing budgets and where marketing budgets go. You know, we’re talking about, you know, the analogy is the fortune $1,000 marketing budgets and ad budgets are almost, you know, it’s certainly not at the level of the institutional sort of hedge funds that are now considering buying Bitcoin and Ethereum, right. But it’s the institutional equivalent of branding and communities and, and all of that. And so unlocking those budgets in a new way and bringing those budgets into web three is going to just fuel the growth of the ecosystem. And what I hope is that we, that what I hope gets removed out of the advertising and marketing ecosystem is rent seeking marketing dollars where it doesn’t add value to the experience or the end user or necessarily the brand. And essentially that’s what Facebook certainly has become. You’re renting your audience and your ad presence. Doesn’t add value to the experience. And that second part is so important. And I’ll go back and I’ll use a skydiving example real quick. One of my favorite magazines when I was jumping was parachutist. And in that magazine, there were a lot of ads and I love every single ad. Why? Because it was the builders and the creators and the event organizers and all the people that made up the community were essentially advertising in that magazine. And in that sense, those products and those services and those events. Added to the community and those ad dollars fueled the magazine, which supported the community. And so I actually think there’s a huge opportunity for ecosystems and brands to actually advertise within their communities. And it’s actually a value add even more so than the magazine example that I gave, because I was just a membership of the United States parachute association. Well, what if that was tokenized? And so instead of buying an annual membership, I actually bought tokens. And those tokens traded a value based off of the value of the community and the desire of people to be part of that community. And so that’s where I think that there’s actually sort of this opportunity for advertising to, again, start to become a value add and the problem with the print industry and the television industry.
And a lot of those advertising sorts of channels is that we’re talking about atoms and paper is actually really expensive and it’s hard to scale. And so it’s hard to create real strong business models around really tight and small communities that can support themselves. And so I think that we can start to reimagine the world of advertising because essentially the cost of the media has come down hopefully the creators that are creating that are, are being compensated fairly unlike they are now. And then those ads actually add value. Unlike Facebook, it doesn’t add value to my experience, but when I’m looking at my skydiving magazine, every ad added value to my experience.
Adam Levy: I love that example. That’s such a clear example, but what about from the point of view of let’s talk about influencer marketing for a second , and let’s, let’s kind of transition into the five, 10 year point of view where you’re going to have hundreds of thousands, if not millions of creators, tokenizing themselves and their communities and giving their fans and audiences a ride for their quote unquote money and experience, right. And brands like Nike, like Patagonia, Adidas, the food network, et cetera, et cetera. Right. How are they going to be thinking about influencer marketing? And I have a hunch from buying into their networks where I’m buying their social tokens, but I’d love to hear your point of view on that. What you kind of see formulating down the line.
Jeff Kauffman, Jr.: Well, first to start with fortune 1000 brands, the idea of them launching a token anytime soon is especially an ERC 20, like social token, sort of like that, that is a, that is actually a long way off. I think it’s the legal component of a publicly traded company launching a token like that, the learning curve, but also just the regulatory, uncertainty and risk is going to take a long time. That doesn’t mean that the industry isn’t going to move forward. What I feel like we’re going to see is we’re going to see just the explosion of tokenized communities forming in a bit of this mass Exodus of attention from web two social networks. And so wherever that attention goes, then brands sort of need to go there too. And so what I hope that happens, what I believe will happen and what I hope the Jump community sets the best practices and standards for. Is that, when I work with a brand we want to develop, we want to essentially build that brand. And so what is a brand is a brand, a logo. Nope. Is it a product? Nope. We like to define a brand as a promise, and it’s the promise that you’re going to live up to X, Y, and Z as best you can every single day. And that’s where you have to like really work hard to outline your brand values and then how that translates into goals. And so if you’re Patagonia, which is a great example, they’ve been doing this for a long time. You know, they’re famous for saying we don’t spend dollars on advertising. We spend a lot on marketing, which is marketing is not just placing a single ad, but what you can start to see sort of formulate is brands that really understand their values and their goals and their promise that they want to live up to every day. Hopefully those brands are making the world better through whatever product or service they’re providing. Hopefully we will be able to, as an industry, match them with tokenized communities and influencers that just share the same values and goals. And so when you start to think of like, what are the goals and what are the values of this community and what brand can actually come in and play a sponsorship role to help them achieve that. So imagine sort of, you know, what would Jordan be without Nike, where would jump man as a brand be without Nike and that sort of combination? How is that going to play out? When we start to see the upstarts of these brands start to align with these creators and or communities, and essentially the brand comes in and rather than spending Facebook generates $25 billion a year on ads, 80% of which comes from 100 advertisers. So 100 advertisers are footing the bill for the entire ecosystem. Most people don’t know that. What if those brands start to redirect their dollars to communities that align with their goals and values and start to support those communities? That’s where I hope we see things going. And the reason we couldn’t unlock that before, is this just really hard for a community to capture the value and unlock their own social capital. Tokens give them a way to do that now.
Adam Levy: Wow. That introduces a whole new rabbit hole to fall down like brands re-imagining companies reimagining how they’re investing every single penny. Rather than spending it on these paid ads, which all these drop shipping models, right. That kind of came into existence and all these new friggin brand to end consumer companies that drop ship products from China, from local us, whatever may be right. You’re telling me right now that they’re going to have to reimagine and actually plug and play into these individual ecosystems, which one on one makes me think it’s a very daunting task. How do you find and source all these individual communities that align with what you’re looking to promote and get out there? And two, and I guess this is more of like a question that we can talk more about later, but I think it ties into it. It’s like when these tokens fluctuate in value, how does a brand really determine what they associate themselves with or not? Does a token price determine that as well?
Jeff Kauffman, Jr.: Oh man, that’s a big question. I think if we’re being, if we’re really focused on our goals and our mission, then we’re not concerned with the price, whether we’re or a community we’re looking at. Like, it kinda goes back. If you look at early early 2000s videos of Bezos talking about Amazon and he’s just like, I don’t care what the stock price is like. Did we deliver more products? Did we, did we improve our shipping speed? Did we bring price down? Did we give people more selection? And are those the metrics that we’re focusing on and holding ourselves accountable to? And I think if you’re doing that, then the token price just kind of becomes a thing that, you know, it’s obviously going to grab some attention, but ultimately, you know, if that’s the focus, I think any community is going to fail.
Adam Levy: So just to touch up on that one point, the first point. So how do brands find these communities now? Obviously they, right now, they live in discord. A lot of them do. Okay. But how many discord servers can you jump into this court also limits you with how many discord servers you could join. Right. So how do you, how do you do that, right? How do you find these communities?
Jeff Kauffman, Jr.: Absolutely. So we’re super early stage. One of the event teams that I hope will gain traction within the jump community is what we’re hoping to host the first ever web three adtech and MarTech hackathon to start to build the tools that will help brands do this. So, okay. We’ve got. Let’s fast forward two years from now, we’ve got a thousand tokenized communities that have members of 50,000 people, or more soon as we got 50,000 people, that’s a decent size audience to sort of like communicate and work with. And certainly if we’re talking about tokenized communities in the millions. Those are really important communities to get into. And if there’s a lot of them, it becomes tough. Okay. So how do you do that? You start to look at some form of user interface that will allow you to sort of survey the landscape look at what this community is about. And there’s all sorts of data points that you can sort of pull. So if we use just a web two example, very common to leverage social listening tools put in a couple of keywords and then you start to build this cloud of emojis. In other words, and other similar accounts that sort of LinkedIn, you kind of start to understand what that social graph looks like. And you can start to understand if that’s the influencer that you want to engage. And so what I anticipate happening is as the tokenized communities form and scale, we’re going to start to need to have these tools that are so essentially a form of next generation of social listening and community management. And so yeah, those, those are the tools that we’ve got to start building, and that’s part of what we hope jump’s role will be. And when you imagine that world of brands and agencies and entrepreneurs aligned around a token, you start to see that we’ve as a community, we’ve actually created the supply and the demand. And we’re aligned with the token around the creation of those tools.
Adam Levy: I love it. It’s super powerful. When do you think all this is going to come to fruition? Like right now, obviously Facebook Tik, TOK, Instagram, Snapchat, Twitter, et cetera, et cetera. These are things that we use and we rely on. When do we start kind of like how many years what’s that roadmap you think predict, throw a number out there. What do you think is going to be that point where we feel comfortable with web three tools and strategies the way we do with web two tools and strategies.
Jeff Kauffman, Jr.: So, one thing I feel like we’re going to live in is web two’s not going to just disappear overnight. I think web two strategies are going to support web three strategy long time. So we’re not throwing sort of the baby out of the scene, but so, but what about the scale of web three? And then maybe when does the flip happen right? With like mobile took over desktop. When does web three marketing and community building takeover sort of web two. And so I think on the, on the conservative end, and I don’t think a lot of people who are building in the space want to hear this, but 10 years. On the conservative end. On the aggressive end, I think we start to see incredible use cases that set the stage within the next two to three years, we’re going to see a big brand partner with a huge community that has global reach, and they’re going to do something together that every brand and tokenized community is going to be chasing after and starting to build around. And so I’m really excited about what that first use case is going to be. I hope it comes from the jump community. I hope we find the brand that wants to align with the community and do something super special. Like clean up the ocean. I don’t know. Well, you know, we’ll, we’ll see what happens. So yeah, that’s, that’s sort of the timeline on it. One of the things that you have to realize about some of these transitions and one of the reasons why I wanted to build jump is I want to speed that up. I don’t want it to take 10 years and jump as a way to speed that up. And so what do I mean by that? So when you look at these marketing budgets and a lot of these decision-making you have mostly people in their thirties and forties and sort of the mid-level to senior director type positions in VP positions , and then you have like CMOs and things of that nature. So kind of starting in your fifties and sixties. And so we’re talking about educating and reaching retraining, a generation of people and how they operate. And seeing that change in web two, seeing dollars transition from TV to Facebook and seeing the mental leaps that the old CMOs and the senior marketing directors were having to leap through in order to say, Hey, I’m going to shift just 10% of my TV budget into social. And then now, you know, they’re going to start to have to make those decisions of how do I shift 5% or 10% of my budget into these web three strategies, especially when on the surface to most people, it still feels like a scam. And so how do we do that? Build a community around it. Hopefully people learn by doing, hopefully the jump experience spreads super fast to these brands and agencies. And at the same time, web three communities are rising up and we can start to create those sort of case studies as soon as possible.
Adam Levy: I love it, Jeff. You’re a wealth of knowledge. Thank you for sharing this with us. Thank you for being on. Really quick before I let you go. Where can we find you and learn more about jump and parachute? Give us, give us the rundown.
Jeff Kauffman, Jr.: Yeah, absolutely. So you can find me on Twitter at @jeffkauffmanjr. You can find, jump on Twitter at @jumperstweeting , and then you can sign up for jump and participate in jump at www.joinjump.community.
Adam Levy: Amazing. Thank you so much.
Jeff Kauffman, Jr.: Absolutely glad to be here.