The anatomy of a pivot

in entrepreneurship •  last month

This is the story of my changing priorities within the Steem ecosystem, and in some sense the blockchain ecosystem as a whole. In the time around HF20 last fall I resolved to make some significant changes in my approach, and I've been implementing them, but I'm just now getting to the point of being able to put them together into a coherent post.

About a year ago I signed up to Steem after hearing about it on Facebook. It then took six weeks for my account to be created, so my actual Steemiversary isn't until March. But as I took in the Steem ecosystem and began to make connections here, my primary interest was in the areas of user acquisition and retention for the blogging focus of Steem.

I've loved long-form blogging for decades, now. I started doing it in the early years of this century, and kept up through Livejournal long after everyone else left for short-form sites like Twitter and Facebook. My first reaction to Steem was as a potential revival of that form, and I resolved to do what i could to encourage it. User retention wasn't something that was being very actively pursued, and I saw a place for myself there. That's why I built @themesopotamians over the summer and early fall, and attracted a substantial group of current and future community leaders to be a part of it. That's why I was working in the background on a thing called @steemdailyquest, looking to launch it if HF20 went well.

Then HF20 didn't go well, and I was forced to re-evaluate. There were four factors that led to me making the decision to change my approach away from user retention.

Adverse conditions

First, and probably most important, I had become disillusioned with the idea that use of Steem in the community has any relation to the health or price of the Steem currency. Part of the idea I bought into with user acquisition and retention was that bringing in users, encouraging them to grow their stake, and building a "middle class" of content creators and consumers would be essential for the long-term health of the Steem coin. This was a popular idea over the summer, but I no longer believe it to be true.

Such a middle class would still be useful to the blogging community in specific, but I don't believe that evidence supports the idea that blogging, as it currently exists, is a core feature of Steem's future. This has been reflected particularly in Ned's recent reflections that the purpose of Steem is to encourage the ownership of cryptocurrency, and blogging has been a mechanism for that rather than a goal in and of itself.

One consequence of this change in position is that I no longer have a lot of patience with the judgement of users based on their staking behavior that is ubiquitous within the community. If individuals staking or not staking is irrelevant to the price of the coin, which I think is empirically evident, and irrelevant to the future of the blockchain itself, which I now believe, then the idea of rewarding powering up and punishing powering down stops being cooperative community behavior and becomes merely cultish exploitation of in- and out-groups. I was not interested in continuing to participate in that.

In addition, projects whose economic success depends on the synergy of acquiring Steem while supporting its adoption and therefore its price obviously become impractical when those assumptions are dispelled.

Second, the discussions that came about as a result of the post-HF20 price drop, and its resulting price panic, caused me to feel considerably less secure about the future of any project that depends on the characteristics of Steem's economics. Quite a few people who has previously been interested in the process of slowly building a quality product instead latched on to various bad ideas which promised the quick acquisition of new "investors" to stake, without any substance behind them. One proposal to make drastic, wholesale changes to Steem's economics, which I had thought dead in the summer, came roaring back like a hydra, though thankfully it seems to have died off in Steemit Inc.'s current level of chaos.

As above, I'm convinced that any plan with that basis is a bad idea upon conception, because stake does not drive either price or product quality. But its popularity made me reconsider how much of my time and my financial resources I was willing to put into any project that could be destroyed by thoughtless changes to Steem's basic infrastructure.

Third, I've become unconvinced of the future of social media as a whole. People seem to be recognizing, on the most popular networks, that they're giving up their personal information in return for the right to engage in irresolvable conflict with people acting in bad faith. That's an exceptionally bad deal, and it seems to be one that is fundamental to social media in the Twitter and Facebook era.

This ties in with my disappointment that long-form blogging does not see more support here, as it seemed to when I joined; I think if there is a solution to that problem it's returning to higher content densities and more thoughtful discussions. But that has reduced drastically on Steem with the price.

Fourth, my engagement level over the summer was physically unsustainable. It was driven in large part by caffeine, sugar, and convenience foods, and I paid for that with weight gain, high blood pressure, and a pretty awful autumn on a chronic pain level. This demanded change.

Interlude

I spent a fair amount of time depressed by this. Most of the specific potential I had seen in Steem in the summer didn't survive HF20 and what followed. I brooded, I spent a month in a particularly bad mood about the whole thing, and I gave serious consideration to simply packing up and leaving. However, my coping mechanism for such things is generally to spend far too much time playing games, and Steem Monsters had just started up, so I dove headfirst into that for a while and let my brain percolate on my options. That ended up being an important factor in my solutions to the above issues.

New philosophies

I still like the core math behind the Steem system quite a lot, and see potential within it. I still think the community here has value, even if its value as a blogging society isn't reflected in the health of the coin; perhaps more so, as your value is even less tied to the idea that you're someone who could be powering up. I still think this is the best place to learn and build my blockchain skills for a future when the distributed cryptographic open ledger is a core data structure for both economic and logistical industries.

To take advantage of that in spite of the above issues required the insight that building with Steem does not require building dependent on Steem. Too much of the rhetoric here is "build only on Steem or get out." We see criticism of witnessing on multiple platforms, and suggestions that apps ought to tie themselves to the Steem blockchain in ways that do neither system any good in order to make Steem stakeholders more comfortable with their presence.

I see this as counterproductive. I think the future of dApps is in multi-chain usage, and Steem is uniquely positioned to be a leader in that area as the code-parent and most-highly-adopted token in a group of Graphene-based content blockchains which can all be interfaced with using essentially the same methods. So I've determined that my efforts should also be in areas that can extend to multiple chains, to maximize opportunity while limiting the risk of drastic changes made to any particular chain.

While I'm still interested in long-form blogging, and you may see a related project out of me in the future, for my first project I decided to go in a different direction. While content creation and publishing is one of my key areas of expertise, another one is gaming. I've been involved in blockchain-based gaming, in the gambling sense, since late in 2013, being involved in a lot of startup projects in that area both as a player and a beta tester.

My first project under the new philosophy is Crypto Game Strategy, which brings a well-tested business model to the blockchain: the kickback affiliate. I'll talk more about that in a different post, but kickback affiliates are well-established in the online poker industry, and more than a decade of doing business with them has given me a reasonable understanding of how they operate.

A kickback affiliate isn't tied to a single game, and thus a single blockchain. For the moment @cryptogamestrat is focused on Steem Monsters, but that's as a first offering, not an only offering. While I'm using the Steem voting structure as a benefit, the business model does not rely on that specific structure persisting; if y'all decide to make a mess of it, my business will survive. It has a direct profit mechanism, and is in the gaming industry, which has a much more robust appeal than social media right now. And it allows me to spend less time on social interaction, which takes the most effort for me, and more on things that I can work on by myself.

As CGS gets built out you can probably expect to see other things from me, both in and out of the gaming space, but that's my priority for the rest of the winter season, which around here lasts until late April. When summer comes, and higher energy levels with it, I'll re-evaluate again.


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then the idea of rewarding powering up and punishing powering down stops being cooperative community behavior and becomes merely cultish exploitation of in- and out-groups. I was not interested in continuing to participate in that.

I found that totally bizarre...'You can be in our gang' , moral strings attached..

Very good post, sir!

That was a lot to take in.

I agree that posting probably won't be the future of STEEM. Not everything relies on it, and especially now with apps like steemmonsters and magicdice(that is a ref link, let me get in on this affiliation game for a short amount of time), they've shown us that it can be done without requiring the rewards pool to generate rewards.

Heading into steemd to check out what was in the last block, I see 7 steemmonsters transactions and one from magic dice. Isn't that wonderful. EOS has had developers do things like this for a while and crosschain features were praised there. The bancor token(crosschain with ETH, I'm not expert on it so don't ask me anything about it), the new EUSD, EBTC, and EETH that was added in by people as tethers shows that people on EOS support the idea of being multicoined. I remember when EOS was just getting started and a few STEEM witnesses were getting set up there and considered becoming BPs and the hate they got because of it.

Even I'm posting less. I haven't posted in a week(though that has something to do with what I've got planned for upcoming soon) and have been interacting a lot more with people through comments. And I've sunk a lot of hours into making stuff for STEEM. Some have crashed and need reworking due to HF20. Others work great. I don't want the code I write to go to waste because STEEMIT INC. decides one day that they wanna change everything. (Remember pitchforking the chain and starting over?) Blogs aren't the best thing for everyone, but STEEM can provide more than that. I liked this statement the most from your post building with Steem does not require building dependent on Steem. With the chain freezes we saw multiple apps being rendered useless. No matter how much hate we give to dlive, they were up(or so I heard, I RARELY used them). We need our apps to be connected to steem, but be separate enough that stuff like that won't happen.

And honestly, with the way STEEMIT INC. has been acting recently, I've had multiple thoughts of just leaving STEEM. But something keeps me here.

I'm sorry for this. I didn't check it for grammar or anything. Just tried to get as much of my facts right as possible. There might still be mistakes. Please do your own research as I'm no expert.

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I warned you that I like long-form blogging at the beginning.

It was interesting, as I was working on transfer commands, to look at a lot of raw transaction streams and see just how much of it was Magic Dice. And how many people have mathematically-suspect betting strategies.

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Everyone isn't using martingale? That's the only way to win(Provided you have infinite money and theres no max bet). I assume the raw data is from STEEMSQL? I need to learn how to use SQL because I've gathered witness data in multiple days that someone with access to it and the knowledge was able to gather in seconds.

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Everyone isn't using martingale? That's the only way to win(Provided you have infinite money and theres no max bet)

Literal LOL.

I assume the raw data is from STEEMSQL?

No, coming straight from the node api. I have no idea how to access any of the SQL solutions.

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Any patterns on who's winning/losing the most?

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I suppose I could pull that and report it, but making that public seems like such a bad idea that I don't even think I want to know.

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Haha, this is the type of data I like to see. I'm sure someone out there will put in time to make it public sometime soon. Let's just wait and see.

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I thought of writing a series of posts analyzing Steemit, the first part would've explained how you come to it for money, or for a social network.

The second part would've explained how it fails as a social network.

The third would've explained how it doesn't actually work as a money-earning endeavour.

The conclusion is then obvious.

Anyway, social networks come in all shapes and sizes, and I think you're wrong about them. Reddit is a social network of the sort Steemit professes to want to be like, and it's still working. It has semi-anonymity, and people actually come there for conversations, and it works.

As for Steemit's success having a relation to the success of Steem the coin, I kept saying so, though mostly on chats (voice and written) over last year - Steemit is a PR move to have gotten Steem going. That's the only real reason it's there, at least originally.

Now, Steemit could "fail", and it won't really affect the Steem coin that much. It also goes in the other direction though, yes. The success of Steemit isn't really going to help the coin.

The real purpose of Steemit now is to be a place and way for the whales to make money easily.

You can still make a community on Steemit. But the realization has to be it isn't because of what Steemit offers, but in spite of all of its detriments.

You do make some money, essentially "for free," if you just republish here stuff you're going to write anyway, which has been my plan. But then the question remains if it is worth the "cost."

Because it isn't actually free - it costs you mental energy of dealing with and thinking of the bad actors. The open loops that cryptocurrency and inequal rewards generate, and the loss of control over your content.

This post has been included in the latest edition of SOS Daily News - a digest of all you need to know about the State of Steem.