Periscope Depth

I don’t understand the language of people with short money

The “Internet of Things” promised us a new way of making money, and that way is apparently:

  1. Find something that people typically do for free.
  2. Add Internet.
  3. Profit!
This isn’t to say Step 2 is spurious, as it expands the potential audience from “one’s friends” to the whole world. Thus, bumming a ride from a neighbor becomes UberX, crashing on a friend-of-a-friend’s couch becomes AirBnB, and so forth. Really, you can describe the whole history of commerce this way: instead of weaving baskets for my neighbor and his three wives, I’m now weaving them for any stranger who has a slice of gold with the king’s face on it.

And the idea’s not without value. One of capitalism’s biggest drains is the noisy gear-shifting between supply and demand. We envision the grainless curves of our Econ 101 textbooks, but, as Deirdre McCloskey reminds us, these are, like all metaphors, limited. Figuring out the right quantity of gadgets to bring to market and the right price to charge takes trial and error, and frequently results in surplus or dearth. Anything that takes excess inventory – the car rusting in the driveway, the guest room gathering dust – and brings it to a desiring consumer has some merit.

But you’d think that, in a growing, stable enterprise, someone would pay attention to the bricks being laid. Both Uber and AirBnB have run afoul of local legislators, as their technology makes an end run around existing regulations. I’m all in favor of bypassing these regulations, as they largely exist to create rent-seeking opportunities for entrenched monopolies and thereby generate revenue for the people with stamps and ink pads, but this isn’t to imply that the entrepreneurs are heroes either. Confronted with a level of resistance that should not have been a shock to them, the executive response has either been “we’ll cut you a check” or “you’re on your own, suckers!

So, since you can start a profitable firm on the Internet of Things and leave the regulatory hurdles for the Series B investors to resolve, I’m pitching my idea right now. Hell, I’m not even pitching it: I’m throwing it into the wind. If some developer wants to take this and make it into an app tomorrow, have at it. You owe me nothing. I quit all claim to this product and its revenues.

The pitch: MakeARun is a social errands app powered by reputation systems and escrow payments. Here’s how it works:

  1. While you’re out and about in the city, you log onto MakeARun. You punch in your destination – maybe you’re heading home for the day – and a number of small errands pop up. You tap on one that looks promising: “Pick up diapers.”
  2. Tapping on the errand gives you details: who’s requesting the item, where they are, the window of time in which they’d like delivery, how much money they’ve set aside, and the bounty they’re offering for delivery (some notional premium like $5 or $10).
  3. You claim the errand with a few more taps – and confirmation by the job-poster – swing by Rite Aid, and get a case of diapers. You pay for these yourself.
  4. You send the job-poster a picture of the diapers, receipt in hand. The poster acknowledges the picture and releases money from escrow to reimburse you.
  5. You drive, bike, or take the train home. On the way, you drop off the diapers at the requested location. The job-poster thanks you and uses MakeARun to release the bounty to your account.
  6. Hooray! You’ve made a bit of cash and done someone a favor. And MakeARun claims their percentage, of course.
Are there problems? Is there potential for abuse? Obviously! But that hasn’t stopped AirBnB from being valued at $10 billion, or Uber from expanding to over 60 cities in the U.S. alone. Problems are for management to solve. You’re the founder. Your job is just to have vision, and I’ve already done that job for you.

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