BitShares/Graphene sales pitch

[jakub]

User stories

An Online Merchant
Meet Shauna, the owner of an online shop selling hand-made designer clothes.
Currently she has a contract with PayPal and she is used to the fact that when she sells something for $100 she only receives $98. That's just the way things are in this business - she was told.

- Shauna finds out about BitShares and she learns she could sell her stuff for $100 and actually receive the whole amount.
- She decides to give it a go and she adds a BitShares JavaScript plug-in as one extra channel for receiving her payments.
- Whenever her customer chooses this new payment channel, her cost of receiving the payment drops from over 2% to almost zero.
- After a few days, she learns about the BitShares referral program and decides to give it a go: for $100 she upgrades her BitShares account to LTM and adds a referral link on her website inviting her customers to sign up.
- Some of her customers are curious about this new payment method, they find it interesting and sign up (using Shauna as a referrer) and start using it whenever they have a chance.
- Shauna discovers a new source of income as she pockets 60% of the transaction fees paid by her customers, even when they do their online shopping elsewhere.
- And she is even more amazed when she discovers that she can issue her own token on the BitShares platform and reward her loyal customers with it to keep track of them.

An Online consumer
Meet Steve, an IT expert working as a freelancer. Apart from his daytime job, he's a keen economist and he follows closely small Chinese manufactures of mobile games. Also, he considers himself an expert on American basketball and he knows quite a lot about the music business. And he enjoys online shopping and does about 10 purchases a month paying for them with his debit card or a bank transfer. Each time he pays with his debit card he is quite nervous about the security and paying via a bank transfer always means 2-3 days of extra waiting. Sometimes he uses PayPal as it is quite handy but somehow he never liked the idea of being dependent on a financial intermediary.

- Steve finds out about BitShares and he immediately discovers how convenient it is - it works nicely and quickly just as PayPal.
- But what makes him really intrigued is the following fact that he discovers: there is no PayPal-like company behind the system so the money is truly his at all times and yet he can pay with it online. Hey, that's the freedom he always wanted but never considered it possible - to be "financially independent" of any company but still be able to move money around.
- The next day he discovers more advanced features - finally he can leverage his knowledge about those Chinese mobile games companies and become a shareholder in some of them. He can leverage his economic knowledge and enter a long or short position on gold or silver or oil. And he can even bet on a basketball team he is sure to win. And he can try to find the next Justin Bieber on YouTube and make money on it by becoming a co-owner of his music BEFORE he becomes famous. He can even exchange his dollars for euro at the best market rate - all within the same platform.
- And then he discovers he does not need to wait for the rest of the world to catch up with this technology - he's just received a BitShares-based debit card and he can now go to his local coffee shop and pay for a cappuccino without the shop assistant knowing what has just happened: the payment went straight from Steve's digital wallet.

[jakub]

And I'd like to reassure anyone who thinks that we are aiming to position BitShares as an "elitist" product for rich folks.
It's not the case. It's just targeted to those who perceive their "financial independence" to be worth something like $1-$1.5 per month.
So it's the mindset that we are targeting, not level of income.

And this strategy IMO is just needed to jump-start BitShares as a online payment system.
Once it starts rolling we can (and we should) extend our definition of our target customer to accommodate other mindsets.

[jakub]

Financial independence should be the key "phrase", meme and selling point of Bitshares in my opinion. I think financial independence sums up why most people are attracted to Bitshares including most of us.

@luckybit, I need to thank you for this phrase. I took it from one of your posts.
And I agree with you that it's much better than "freedom" (at least for the marketing purposes).

[luckybit]

Thank you very much for posting this sales pitch.  I think that despite what many complain about with pricing, it is our pricing that allows people like you to go market a reasonable business model.

The problem is never about price, it is always about sales and value. You can convince people to over pay for something if they are "buying brand" or "philosophy".  Selling to the "premium" customer is how Tesla is boostraping and is ultimately how all new technology needs to start out. Going after the marginal customer (those not willing to pay you a dime) is not a great way to grow a business.

I pretty much agree with your strategy despite the fact that I really am into the micropayments idea.

But again, how do we promote financial independence through Bitshares, and then market the concept? So many people I talk to don't even know what financial independence is and believe that people should work just to not sink. Financial independence would mean true freedom because a person would have a safety net of dividend paying assets.

Instead people seem to prefer to live day to day, debt to debt, off credit and money printed by banks out of thin air, backed by absolutely nothing. It seems people prefer to depend on large centralized institutions, centralized exchanges, central government, which ultimately means their fate in life depends on the decisions of an ever decreasing amount of people all who are subject to corruption or influence.

Depending on the market for employment is fine but if people save or invest in dividend paying assets then they only have to depend on the growth of capitalism itself. GDP is likely to continue to grow, and stocks are likely to continue to grow up, even if the jobs people currently are doing become obsolete. Unfortunately half of Americans don't own stock, and some don't even believe in capitalism, but even if people don't believe in capitalism the capability exists to build gift economies or to barter over Bitshares and these capabilities should be marketed to people who don't like traditional forms of exchange.

In the end people want self sufficiency or they want dependency. The people who want self sufficiency represent the demographic who can understand Bitshares. How do we reach them? I think we have to identify the core psychology behind the self sufficiency and financial independence movement. I don't think it's a political ideology, I think it's a psychological outlook which most of us share.

Almost 100,000 people:
https://www.reddit.com/r/FinancialIndependence
http://www.nytimes.com/2015/11/12/your-money/supersavers-focus-on-the-goal.html

[luckybit]

The important thing here is that we can charge this fee (even though our competition does not) because we offer added value.

We don't need to be everything to everybody.  That way leads to the Unprofitable Side.
We just need to be valuable to those willing to pay a premium for that value.

“Decide you must, how to serve them best. If you [cut rates] now, help some you could; but you would destroy all for which we have fought, and suffered.”  -- Yoda

What is your opinion on the best way to market the features of Bitshares which can help participants achieve financial independence?

I think it's one phrase which we should see more often, substituting any of the politically divisive language. Similar to how the American dream as a concept is what attracts immigrants, the concept of financial independence will attract people to Bitcoin (people think the Bitcoin price could be $100,000 per coin someday), or to Bitshares if similar opportunities for investors exist in Bitshares.

At some point there could be some success stories but for now how do we promote the dream of financial independence in a less than political way?

[luckybit]

Financial independence should be the key "phrase", meme and selling point of Bitshares in my opinion. I think financial independence sums up why most people are attracted to Bitshares including most of us.

So I would put a lot of attention to explain exactly what financial independence is. Financial independence defined by Wikipedia is:

Financial independence is generally used to describe the state of having sufficient personal wealth to live, without having to work actively for basic necessities.[1] For financially independent people, their assets generate income that is greater than their expenses. For example, a person's quarterly expenses may total $4000. They receive dividends from stocks they have previously purchased totaling $5,000 quarterly, while also having more money in other assets. Under these circumstances, a person is financially independent. A person's assets and liabilities are an important factor in determining if they have achieved financial independence.

Financial independence is the NEW AMERICAN DREAM. It should be promoted because in my opinion I think that is what brings us all together. Bytemaster might have some crypto-anarchist tendencies, another person might be a socialist, but both want to be self sufficient, financially independent, one way or another.

If Bitshares offers opportunties to achieve the NEW AMERICAN DREAM of financial independence then it will be very easy to market the features which promote that. At the same time there probably are going to be forces, entities, groups, who do not want us to have financial independence, and who will promote dependency either on the state, or on employment to them, but Bitshares offers an ability to be employed by a DAC, and to free yourself from dependency on oligarchs or states.

[Stan]

The important thing here is that we can charge this fee (even though our competition does not) because we offer added value.

We don't need to be everything to everybody.  That way leads to the Unprofitable Side.
We just need to be valuable to those willing to pay a premium for that value.

“Decide you must, how to serve them best. If you [cut rates] now, help some you could; but you would destroy all for which we have fought, and suffered.”  -- Yoda

[bytemaster]

Thank you very much for posting this sales pitch.  I think that despite what many complain about with pricing, it is our pricing that allows people like you to go market a reasonable business model.

The problem is never about price, it is always about sales and value. You can convince people to over pay for something if they are "buying brand" or "philosophy".  Selling to the "premium" customer is how Tesla is boostraping and is ultimately how all new technology needs to start out. Going after the marginal customer (those not willing to pay you a dime) is not a great way to grow a business.

[jakub]

When the investor asks the big question (which is always asked in such circumstances):
"How are you going to solve this chicken-and-egg problem that every new payment system has? What's the plan?"

This is my answer:

(1) With our digital cash technology we are able to create added value for an online consumer - it's called "financial independence". Not everybody will see value in it but we just need 1%-3% of all online consumers who do. And if they do, they will be willing to pay for it. Probably not much, but $1-$1.5 per month is fine for us. And they will pay it in the form of $0.20 transfer fees. Which is nice as everybody will pay according to their usage. The important thing here is that we can charge this fee (even though our competition does not) because we offer added value.

(2) Now we pass this income earned on online consumers to our online merchants, the other group of our customers. Actually we don't pass anything to them, we will just let them receive their online payments for free. They will be happy because up till now they needed to pay a 2% burden to a third-party intermediary (PayPal or Visa or MasterCard). And now they can do the same almost for free (not entirely free as there needs to be a fiat gateway involved). And if they are happy, they will start selling stuff for SmartCoins (which will make online consumers happy).

(3) Also, our online merchants will see the financial benefits of the referral program and start recruiting their own customers to join the system. And here the avalanche starts. Chicken and egg is solved. The virtue of "financial independence" is still there but as time goes by we are less and less dependent on it to be able to attract new users. And if things go well we can even revert to a more standard pricing policy.

**********************************************************************************************************************
And that's why I suggest to keep the pricing policy unchanged. It's non-standard but there is a very valid reason for it being non-standard.
It's absolutely crucial for our business model (at least at the initial stage).

Any thoughts?

[jakub]

My point boils down to this: currently we have a very nice balance between our offering for online merchants and our offering for online consumers.
Online merchants have their reasons to try us out and online consumers have their own reasons to be attracted.

So please let us not damage this. Let us not to try to "improve" the pricing policy based on our personal feelings and experiences like "talking to a guy on a plane".
Even if our pricing policy is non-standard. Let us have the guts to be different in this respect and see how it plays out.

At least not until we have a clear indication from the sales people that things need to be changed.

And one more thing: we are aiming for mass adoption but if we achieve just 3% of the online payments market - it will be a tremendous success. Even 1% will make us huge. So we are not aiming to satisfy everybody. We just need to clearly define our customers and it's never gonna be 100% of the population.

Which features do you like about the current and proposed pricing policies?

Generally I like the concept that it's the sender (i.e. online consumer) who pays for the transfer. It's not a big deal for the online consumer (even if you do 10 online payments per month) but it is a big deal for the merchant. And it plays nicely because:
- the merchant is a business entity so it is naturally concerned about the financial aspects
- the consumer can have lifestyle motivations ("I feel cool because I'm my own bank") and if he sees value in this he will gladly pay for this feeling of being cool - especially when it is such a small amount per month
- the merchant has a clear incentive to become a referral business himself

And I like the current opportunity for the referral businesses to shape their own pricing policy. If I (the referral business) can't sell because my potential users are turned off by steep pricing I can always offer to prefund those users from my referral profits. So it's all very flexible.

To sum up, regrading the pricing policies for transfers, I just like everything the way we have now.
The only thing that prevents me from selling is the fact that there is no product to sell - our SmartCoins do not work due to low liquidity and lack of gateways.

[carpet ride]

My point boils down to this: currently we have a very nice balance between our offering for online merchants and our offering for online consumers.
Online merchants have their reasons to try us out and online consumers have their own reasons to be attracted.

So please let us not damage this. Let us not to try to "improve" the pricing policy based on our personal feelings and experiences like "talking to a guy on a plane".
Even if our pricing policy is non-standard. Let us have the guts to be different in this respect and see how it plays out.

At least not until we have a clear indication from the sales people that things need to be changed.

And one more thing: we are aiming for mass adoption but if we achieve just 3% of the online payments market - it will be a tremendous success. Even 1% will make us huge. So we are not aiming to satisfy everybody. We just need to clearly define our customers and it's never gonna be 100% of the population.

Which features do you like about the current and proposed pricing policies?

[jakub]

My point boils down to this: currently we have a very nice balance between our offering for online merchants and our offering for online consumers.
Online merchants have their reasons to try us out and online consumers have their own reasons to be attracted.

So please let us not damage this. Let us not to try to "improve" the pricing policy based on our personal feelings and experiences like "talking to a guy on a plane".
Even if our pricing policy is non-standard. Let us have the guts to be different in this respect and see how it plays out.

At least not until we have a clear indication from the sales people that things need to be changed.

And one more thing: we are aiming for mass adoption but if we achieve just 3% of the online payments market - it will be a tremendous success. Even 1% will make us huge. So we are not aiming to satisfy everybody. We just need to clearly define our customers and it's never gonna be 100% of the population.

[jakub]

Looks good. What will your company do?

We intend to become a BitShares/Identabit gateway in Poland & Eastern Europe. And maybe a hosted wallet provider.
We will start by participating in the referral program for OpenLedger and we'll see how it goes.

[carpet ride]

Looks good. What will your company do?

[jakub]

Below is a draft of a sales pitch I intend to use to present BitShares/Graphene to a potential investor in order to raise money for my company.
I'd like to share it with you for two reasons:
(1) to get feedback about the quality of the argumentation
(2) to emphasize how careful we need to be about changing anything in the pricing policy

And actually (2) is much more important to me. The current balance between the benefits we can offer to online merchants and online consumers is very delicate because there are areas where those two groups have opposite interests.
If we please one group too much we might ruin the incentive structure for the other group.  So this is a very delicate matter. That's why I got very worried when in the last Mumble hang-out BM started talking about creating a worker proposal to turn our pricing policy upside-down without first consulting the sales people and businesses based on the referral program. It might sound very tempting to hide or lower the fees or make the merchants pay the fees (to make us look similar to our competition) but we need to take into account this: it will hurt the referral program and it will hurt the delicate balance between opportunities we can offer to merchants and consumers.

****************************************************************************************************************************

BitShares/Graphene makes money mobile​ while preserving the core features of cash:

• it's stable in value (pegged to fiat currencies e.g. USD, EUR, CNY)
• it's cheap to receive
• you are the ultimate owner of your money

...and adding some extra features:​

• real-time speed
• fully integrated with the existing financial systems, including debit cards & ATMs
• accessible in a web browser and on mobile devices​

Imagine mobile money that you own & control in the same way you own & control paper banknotes.
Graphene creates a new standard where money can preserve the core features of cash and yet be mobile. Digital peer-to-peer cash has become a reality.

New opportunities for online merchants: ​lower costs & rich functionality​

• Transaction fees significantly lower when compared to major legacy systems (debit/credit cards or proprietary payment processors like PayPal)​
• Reversed business model: acquiring online payments can be profitable, instead of being a cost​
• Possibility to issue your own tokens for marketing purposes (customer loyalty, sales promotions etc.)​
• No charge-backs, no volatility and no dependence on a third-party intermediary​
• Clear rules that never change (they are hard-coded in the blockchain)​
• Full compatibility with legal requirements (both KYC & AML)​

New opportunities for online consumers:​ financial independence​

• Be the ultimate owner of your money while being able to make payments both online and at traditional POS​
• Anonymity by default plus optional stealth mode (in stealth mode nobody can trace your payments)​
• Direct access to other decentralized financial services (e.g. an online currency exchange & prediction markets)​
• Opportunity for extra profits (via participation in the referral program)​
• Debit card connected directly to your own digital wallet (i.e. debit card without a bank behind it - your digital wallet is your bank)​
• No compromise: UX on par with the best standards offered by legacy systems