If you are into new technology and startups, you’ll probably enjoy listening/viewing This Week in Startups (TWIST). Hosted by Jason Calacanis (AKA @Jason), he does a great job interviewing entrepreneurs and startup investors to provide viewers with an in-depth understanding of how they are building businesses, their successes and failures, and advice for the world. With the exception of Elon Musk, his list of interviewees is a who’s who list from the technology world and includes Mark Cuban, Chris Dixon, Phil Libon, Chris Sacca, Gary Vaynerchuk, Kara Swisher, David Hanson (DHH), and many others.
With that intro, and being a fan of the show (personal favorite Joel Spolsky of Stack Exchange who basically was able to cover every topic thrown at him with perfection), I was a bit surprised to see DogeTipBot’s Founder Josh Mohland show up as the latest guest on the show. Not that TWIST hasn’t talked up virtual currencies or dogecoin in the past, it has. But, DogeTipBot seemed to be less of a startup and more of a hobby (this also comes from someone who proudly goes out jogging with my Dogecoin T-Shirt, so I am admittedly bullish on the alt-coin but failed to see the bigger picture of the product). But, I’ll admit I was wrong.
Posted is the entire interview video to check out. If you don’t have time for the entire podcast you can check out the notes following the video.
7:00 – Demo of the product, integrated with Reddit, so anyone with a Reddit account can automatically be connected to have an account and accept and send dogecoin tips.
9:30 – Inspired by bitcoin tip bot
12:30 – DogeTipBot has cracked the micro-payment niche which until now hasn’t worked as a business model. Works on DogeTipBot because it provides users a product to tip in a way thay want to use. Tipping is for both goofing off and tipping quality content.
17:45 – Discussing why micro-payment startups have failed in the past. Idea isn’t new such as Amazon tip jar or micro payments (a few cents) as paywalls for viewing content. Josh answers that “people just don’t want it”, meaning users don’t want the constraints of having to pay a few pennies for something. In addition, users don’t really feel that they are giving anything of value when they pay a few pennies for something. (Bottom line is too much friction for sending and receiving a micro payment to get people interested in using such a payment model)
20:20 – DogeTipBot is different since they gave users the tools to tip with dogecoin and for users to figure out. It works because people do enjoy tipping. In three months dogecoin tipping surpassed bitcoin tipping for the past year. (Bottom line, DogeTipBot worked because it wasn’t forced on users. No one had to use it to have access to content etc. User got to dictate when and how they wanted to use it)
22:30 – Story of DogeTipBot involved with raising $25,000 to send Jamaican Bobsled Team to the Olympics
26:00 Discussion on how DogeTipBot compares to Patreon. But Patreon is different since users decide to continually back a user’s new content, sending a payment for each new article or video.
32:00 What is ambition for business? Josh answers “Making micro transactions fun”. Product launching on Twitch. Also in discussions with comment products such as Disqus. Different use cases are being found for different networks. Still discovering how it will be used, such as with Twitch they will soon discover whether tips will be focused towards content creators of commenters. Bottom line, still work in process, but demand for tipping is there and will evolve the tipbot for each platform.
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34:30 – DogeTipBot is coin agnostic and could be used for any virtual currency
35:00- Bitcoin is victim of its own success. Technology is still in beta mode, as network discovers how many users it can handle and transactions per minute can be executed. But, no one wants any big changes to the protocol that could make it more efficient since it is currently worth so much.
36:00 – “Will we see professional commenters?” Josh answers “Stranger things have happened” but probably not since people typically don’t follow other commenters
38:00 – Stats time: 90% of people accept tips and 28% will tip other users once accepting another tip. 70,000 users, average $0.02 tip.
39:00 – Reaction from venture capitalists, three groups. 1)Don’t understand it at all 2)Understand idea but don’t understand why it’s not being done with bitcoins 3)Understand DogeTipBot and are funding them
40:00 – Jason clues us in one why he wanted to interview Josh. Views DogeTipBot as one of those potential hidden startups that other angel investors would ignore since it has a 2% chance to be successful. But, but could be a 1000x return if it succeeds, so it has a potentially high reward vs risk rate.
41:00 – What needs to happen to bring DogeTipBot mainstream? Even with bitcoin, the technology is still very early and hard to buy bitcoins. Josh explains that what they are doing is trying to put DogeTipBot on as many platforms as possible and making it easy to use. So you get as many early adopters as possible quickly in who will teach the next wave.
42:45 – Mobile payments is easy to do, and just because you can do it with bitcoins and dogecoins isn’t a big deal. Similar apps exist for PayPal and Square. What they offer is the ability to do micro transactions within a platform like Reddit and allow others to know that they are tipping or donating. This becomes frictionless compared to having to scan a QR code.
45:00 – Josh mentions they would like to make the problem integrated with blogs such as with WordPress which would allow large communities on the blog to tip each other. Added that they are working on tip buttons for websites.
48:00 – Jason asks what needs to occur within 10 years for DogeTipBot to become a big business. Josh answers that tipping for content and comments needs to become the normative. Gave example that sometimes people want to give two upvotes. So tipping provides the ability to do this.
50:00 Some talk about Josh’s past
54:00 – Is bitcoin going to be replaced? “You never know but bitcoin has staying power”