To me, Steem is more than just a new technology platform; it actually represents the evolution of a multi-decade process in trying to get content creators paid online. My excitement about Steem stems from a past failure of mine and I wanted to share that experience.
The Idea
Back in the fall of 2014, I led the Coinbase tip button launch. The basic idea for the button was to create a like button where every like was worth 300 bits (~10 cents at the time). We looked at a lot of past attempts to do micropayments online (like Beenz and Flooz in the late 90's and Tipjoy in 2009) and our hypothesis was an open-interoperable payment network (Bitcoin) enabled a product that, if built in a way that reduced the friction of paying online, could be the first big breakthrough for micropayments. Below is the first mockup I did for the button before the development process got started:
The Execution
After a brief ideation phase, my friend James Hudon built the button. James is an incredibly productive engineer who shipped the code quickly and after a brief product review process and some marketing work and partner outreach, we launched the button. The launch went well. We got lots of press (see the Techcrunch coverage here), and more importantly we had lots of well-known bloggers as launch partners like Adam Carolla, Maria Popova, and Fred Wilson (see his blog post here).
The Failure
After the initial excitement subsided, the product didn't have nearly the engagement that it needed to be succesful. It had hundreds of passionate users who were using the product every day, but the reality was that there weren't enough bitcoin users to move the needle for publishers (and there still aren't). It also wasn't clear that the majority of bitcoin users that own bitcoin actually wanted to pay directly from their own pockets. Without the userbase of people willing to pay, the publishers simply don't care to adopt no matter how good the idea of micropayments might seem. We ultimately winded the product down after 4 months. The public message was that we were going to allow ChangeTip to own bitcoin tipping. Unfortunately, ChangeTip died about a year later as well.
How is Steem different?
I think Steemit has a higher probability of success than we had with Coinbase tip button for two key reasons:
It's frictionless for anyone to get involved: Anyone can create a Steemit account and start posting content and participating in the community. The success of this platform doesn't require millions of people to already own the token, which is a huge advantage that can't be understated. It's reduced the friction of digital currencies and is attracting thousands of new people a week.
Creators don't depend on users paying from their own pockets: Paying creators directly from the blockchain eliminates the need for users to pay directly from their own pockets. All other micropayment platforms have depended on users paying, which hasn't proven succesful yet. Steem eliminates the mental transaction costs that have proved to be a barrier in getting content creators paid.