I recall back in 2008 talking to a colleague about Mint and Wesabe, the first two social “Web 2.0” financial aggregation services. My friend’s insight into why these two services were interesting was terrific: the quality signal in the system costs real money to exercise. On Facebook, a “like” costs a user only a click. In Mint or Wesabe, you had to spend real money with a merchant to get the data into the system, so any aggregated social data exhaust was ungamable.
Neither Mint nor Wesabe ever executed on building a great quality signal out of their data exhaust. But, I recently realized that Kickstarter has built ungamable social signals using the same mechanism. The primary way I find out about interesting new Kickstarter projects today is when one of my friends backs a project. When that happens, an email hits my inbox with the project and my friend’s name in the subject: which almost always gets a click from me.
The minimum amount someone can contribute to a project is $1, so unlike a “like” in Facebook, there is a real monetary cost to the gesture of announcing to your network “Hey, this project is interesting.”
This means that the signal-to-noise ratio in this data exhaust that Kickstarter exposes to other users is very high. It fulfills the ungamable vision that Wesabe and Mint never realized. Other web services would be well-adviced to borrow this dynamic if there’s already real dollars flowing through their service (ie any ecommerce startup).