The Facebook vampire squid and why non-normies don't have a right to be surprised

From 2010 to 2011 I co-founded and ran a data marketing company called Qwerly, which appended metadata to email addresses and social media usernames. You'd ping our REST API with an email or a username, we'd do a bit of magic and serve back some JSON that listed social media profiles, location, photos, associated URIs. It wasn't so dissimilar to what a Rapportive or a Rapleaf did and it piggybacked off the available APIs, e.g. for finding friends by email addresses, as well as the rel="me" microformat to discover new websites and social media profiles.

The core bet that didn't really pan out was that the social web was getting more diverse and interesting and meta-profiles would have value. We figured this could be a cool consumer play, like a decentralized Friendfeed. But as we rolled this out, we saw the opposite was happening: 80% of our results were from Facebook. 

And so we opened an API to see what people wanted to do with our results. And found that people really valued social data: to populate CRM systems, email lists, to make call center agents' conversations better, to target marketing. And so we pivoted to B2B. 

Qwerly the B2B business was almost instantly profitable. Our biggest customer was Mailchimp, who used us to populate email lists with social profiles. But we also had political customers (an NDA prevents me from saying which campaigns). The volumes were impressive. For example, when we sold the company, the database had hundreds of millions of profiles. We never had to raise money. But we did get some inbound investor interest - from In-Q-Tel. Not surprising.

To their credit Facebook, while allowing us to do what we did, was keen to preserve privacy controls throughout the chain. So if a marketing manager somewhere had been blocked by his ex-wife, he shouldn't be able to see her information. 

We prided ourselves on only serving "public" data, i.e. what you'd see searching Google or if you weren't logged into any one service. So that wasn't really a problem for us (though the constant re-OAuthing sucked). But of course the way we appended data relied on using private or frequently hidden APIs. We quickly realized this privacy stuff was harder than expected.

We ended up selling/merging Qwerly into Fliptop, which was acquired by LinkedIn in 2015. A primary reason was that we were scared that Facebook would end up killing the whole social data industry.

Well, they didn't. And I think most people in tech knew that. At least anyone that was in the "app" business knew that data was being traded quite openly. One way was via "acquisitions" of Facebook apps. 

Today there are big vested interests in keeping Facebook the way it is. Businesses love the Facebook marketing machine and there seems to be very little demand elasticity to price increases in its advertising. Government, now posturing about the awfulness of it all, has always had a big interest in a more transparent populace and the means to control it. Heck, most people I know only know they kind of dislike Facebook, but they can't imagine their lives without it. 

The fact that a WhatsApp co-founder is tweeting #deletefacebook is too little too late. WhatsApp was a company that said: we're never going to serve ads, we're going to show you that we can build a large social messaging app on subscriptions, we're going to do right by users. Well, that promise was worth less than $20 billion in case of these guys, so I have little sympathy here. 

I am not sure where we should go from here. I loved the internet without Facebook. I hate the monopoly on advertising and attention and M&A for social that is the Facebook vampire squid. But we seem to have done a poor job creating alternatives to Facebook. The application layer of the decentralized web seems years away. Mobile vertical communities can work but by definition they're more niche. The implicit messaging infrastructure of iMessage is cool, but Apple isn't good at building social. From Snapchat, Musically and Path to Meerkat and Periscope, Houseparty, and many others, long-term retention and engagement isn't very good on most social properties. And the ones where it's good or has potential to be good are acquired by Facebook. 

Perhaps it's time to turn East to learn how to build new consumer platforms in the US and Europe. Anyway, here's some old slides from a presentation we did at a Techcrunch event. Knowing what you know now, it does sound more ominous than it did at the time...: