COMMENTARY

Peter Burgess

Capitalism Can't Build Community Web Services

A new breed of web site seeks to reconnect us to our neighbours - through the Internet! Using up-front capital a polished web service can be built to mediate and encourage relationships between neighbours. But what happens when these sites are competing for territory?

I could sign up to Hey Neighbor! and tragically not know that the rest of the neighbourhood was on Nextdoor. In fact there are many such local groups already using Facebook. More silos means more advertising, more competition, and worse, more separation from our neighbours.

When a project takes on venture capital or sells shares, it becomes obliged to maximise the returns on investment, which means a national, or city by city marketing campaign, in hope of establishing monopoly. The progressive intentions of the founders of Nextdoor to build community are utterly incidental to the imperatives imposed by capital. Until a monopoly emerges, the usual venture capital model of building a technology - trying to build the biggest silo, is actually counter to the stated aims of these community building sites. And once the monopoly is established and the alternatives diminished, the users can do little to prevent abuses.

When Ning cut loose all their communities that couldn't pay, when Yahoo! handed over users to the Chinese justice system, and when Facebook investors are connected to the CIA, the users, the netizens have no voice in these 'communities'. This is where the American Dream leads in the 21st Century. We should offer up a prayer for Couchsurfing, which recently took on several million in capital, allegedly because it couldn't compete. There's truth in it, compared to communities who are seduced into subjugating themselves to extractive models of finance, the grass roots efforts can appear almost backward.

But I digress. The capitalist model imposes values and architecture entirely incompatible with the communities we need to build. If the intentions of the monied were really to build community, they would be engaging more with existing projects. The largest community (software) network I know of, CES, is a mutual credit network with over 300 installations and has been built over ten years as a labour of love by one person, partially supported by foundation money.

So how can we allow competition between community softwares without making silos and building monopolies beholden only to the self aggrandising logic of money? There is a well understood open source answer to this and it doesn't often attract investment. Defining APIs (Application programming interfaces) creates spaces for equivalent software components to work with the larger system, just as the open, published format of email allows innovators to build equivalent email reading/sending software.

This year Shareable magazine published an API for sharing, which I want to expand upon here. We need local portals which manage identity and strictly local issues, but which connect with open APIs to global web services, such as a 'stuff for sharing' service. We also need local portals which manage identity and strictly local issues, but which connect with open APIs to global web services.

The next generation of social networks, distributed social networks may have an answer. The most well known, Diaspora, won't be ready for some time, but it has a model of 'pods' which store user data and enforce privacy settings across the rest of the network.

I would like to see local social networks owned, managed and hosted by local government or nonpolitical groups representing the community. They would be private to the outside, and would mainly be in place for local governance, local accounting, local exchange, and informal interactions. I would expect this to happen on an open, extensible platform that can move with the times and be adapted to local needs. The software for this could be supplied by vendors or volunteers.

But not all our needs can be met locally. There need to be services at the global level, accessed via the local sites though open APIs. The global services would need to be carefully managed by the community to prevent abuse.

There needs to be a globalised marketplace where all the non-local businesses can be found. So I could find every hardwood floor specialist within 50 miles. It would not be all commercial, including baby sitters and stamp collectors alike. Real identities would be hidden at this level. It would be especially useful for people that live near borders or in cities where communities might be densely packed.

Another essential non-local service would be ride-sharing. This sector has been totally shattered by too many projects.

Accounting in non-local currencies.

Events and activities should be available globally

What other global services might be needed?

I'm not just painting a pretty picture. The recent Community Forge / Community Tools partnership intends to take our software in exactly this direction. We are committed to open source, open standards, and pushing the governance to the edges, and we look to partner with other efforts who value that.

There is a solution to this conundrum.

We can for invest for Product instead of Profit.

But only Users can accept Product as ROI, so the Users would crowd-fund the operation by pre-paying for the service with the Product being their return.

This way, we don't even *sell* the Product at all, because instead of buying the Product back from their collectives 'self', they *already* own it - as a result of their co-owning the Sources of that Product.

Notice, since there is no sale, Price and Cost are the same, and so Profit is UNDEFINED.

This is obvious for single-ownership. For example, you only pay the real costs for operating a network in your own home.

But we, as groups of Users, can do this on a larger scale to avoid the unpleasant side-effects of seeking to perpetuate Profit.

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Neal Gorenflo wrote on 11.01.11, 7:57am:

Well, venture backed firms are building and have built community sites, so they can do it. But I think it your piece raises good questions - should users trust venture-back or for profit sharing sites? And what could go wrong?

Another perspective - profit and social good seem aligned in collaborative consumption. The more collaborative consumption companies help people share, the more they profit. They have a huge incentive to help people share. I think this is a big improvement over the legacy model of consumption where corporations are motivated to get people to consume as much as possible.

That said, perhaps we can do even better. I'd love to see a collaborative consumption business that's a coop where users or workers own and manage the business. Anyone seen such a business?

In addition, I don't see this as a binary question, nonprofit versus for profit. I think there's room for all kinds of enterprises. People can chose the form of organization that best serves the purpose at hand. And they can innovate new forms as needed, like the folks at B-corp have done. It seems that just like there's some purposes that only a nonprofit should take on, there's others where a for profit is the best choice (like when a lot of capital is required).

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Hey Matthew,

A good post with many excellent points.

I definitely agree on that there are problems with companies building community sites. But then again, it does consume a great deal of resources to build these communities: to make the technology good enough for millions of users, to make the user experience good enough and, most importantly, to get the message through to enough people to build the critical mass. Those coders, designers and marketers need to get food and shelter somehow, and in the current society it means that they need money.

Just like Neal said, I don't think we shouldn't be all 'capitalism is EVIL'. Instead I believe that even venture-backed companies could and should have a soul, and that their ultimate motive could also be something other than simply turning profit. After all, it's all about the people. B-corporations have shown exactly this. I do hope and believe that when the folks behind CouchSurfing took the venture money, they didn't do it because they were jealous of AirBnB guys getting rich, but instead because they see that they could do so much more good with all that money.

We founded a company (a 'social enterprise', which is an European equivalent of a B-corp) because we believe that with an enterprise model we can get our message through more effectively, and can help more people than we could if we were a non-profit. Because we have a company and make some money, we can put all our effort into helping people share, instead of having a 'day job' in some other industry and working on Kassi on our spare time. We aim for a 'win-win' scenario, where our success is also good for people and not away from anybody else.

I admit that venture funding seems like a double-edged sword to us. We don't currently have venture funding, and it means that we retain the total control of the company and can run it exactly by our own values. But it also means that we only have a handful of people and everything takes so much time!

I myself am first to admit that things related to the Sharing API haven't unfortunately been progressing much lately, and instead of pushing it forward our Kassi team has been more focused on stuff that immediately puts butter on our bread. But we believe on it and all the other collaborative efforts you mention more than ever. And I do think that breaking those walled gardens could actually be beneficial to all those big companies too. I simply can't believe that they would all say 'no' to collaboration just in the hope of increasing their short-term profit. What's best for the people must ultimately be also for the best of the companies working on the field of the sharing economy. We just have to find ways of collaboration that make sense for everybody.

That said, please let me know if you have concrete ideas on how we could work with you guys, if you don't mind working with an enterprise. :) As you know, all our stuff is also completely open source too, so all of that can be freely used by anyone (code is here https://github.com/sizzlelab/kassi). Same goes for Dan Gooden's Sharedearth project http://sharedearthplatform.org/ There are lots of open source projects too that are aiming for these same goals, and best parts should probably be picked from each to achieve the best results.

We'll also be happy to spread word about what you guys are doing to all the communities we work with. Cooperation with communication is just as important as cooperation on a code level.

Hmm, quite a random list of thoughts, hopefully some of those made some sense to you. :)

Juho is a co-founder of Kassi, a service that helps members of local communities to share goods, favors and rides.

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