4. The Anonymous Economy

The buying and selling of unidentifiable business and accounts. And the cost of keeping your identity a secret.

The Anonymous Economy

Part of my job is to be around people who make a partial living, or are trying to, being online. This comes from an urge to acquire the new online commodities. So in my book, being online has had a mostly positive connotation. It wasn’t until I started focusing on investing as learning emerging demographics that I realized that once online - it is almost impossible to get off.

I’m an older cousin to 20~ cousins (it’s 2023) who are under 21 and, as someone who recently has been around 21-years-old, I know how incredibly turbulent it can be. Being in the creator ecosystem, it’s safe to say I have exposure with individuals going through shifting personal times online and share them. My largest personal concern has always been the feeling I had gone through as a fun-loving, emotional college drop out getting over a breakup and enjoying the 2020-2021 VC-bull-market: that isn’t fully reflective of who I am and the changes I am actively going through in my life. I’m writing this three (update: also four) years later. It’s safe to say, I’m almost nothing like that person individuals started following me as. Getting off of the internet, or getting any individual thing off of the internet is hard. It’s always been hard, but it’s become increasingly harder. I’ve gone back and forth on addressing “The Dark Web” and my teenage years that teetered close to it, but I’m only going to acknowledge that space as the highway to which information goes through. In that highway, it leaves track marks. Those track marks are probably not going to get kicked up, but they’re also not going to purposefully destroyed with any detail.

So back to emerging demographics - one day, I was focused on the process of being a trans American individual and the operational, financial, consumer walkways each person is going through. It wasn’t until that moment I realized exactly what identity ownership, or identity management really felt like until I heard the companies building in that space. I had a small taste focusing on consumer cybersecurity for a quick minute. You already know I’ve spent time working with women celebrities and women creators, specifically. The danger of the “nude leak” or the eventual “deepfake P*” happening is always looming. For that purpose, and for the purpose of being the wallet-holders of most households in the U.S., they are the majority of consumers in consumer cybersecurity. But, the just as pressing matter of changing elements about yourself - such as in changing your identity in the U.S. is nothing short of a generally bad experience. For example, in some states, in order to get a legal name change as a trans American, you have to post your new name in the local paper to prove you aren’t changing it to run from committing fraud. That’s the state’s KYC proof, so to speak. Just posting your personal business on a paper and see who legally comes for you. Classy. It’s a perfect example of how government and business haven’t found a solution of how to manage identity change and manipulation as a whole.

There are three parts here: identity transfer, anonymous transactions (scary sounding) and the price of maintaining online anonymity. As you could imagine, this is a space (especially in the pursuit of targeted ads and social-pressure from social media or a preventer of crime and fraud) that most trusted businesses and IRL institutions stay away from.

PSA: Twitter, Instagram, whatever - don’t cancel me this is an observation of a consumer habit.

There is no “passport” online. No proof that you’ve been there or that, if it’s really you, you even exist. This is, in my eyes, the benefit of being an online individual. This is reflective of the two ways of verification processes in most online places.

1) Local identity verification. Local meaning local to the internet. Examples are articles written about you, awards given and documented online… lists, etc. 2) The most transactional area - and potentially most investible one - is in one of the identity IP.

What’s legal, what isn’t:

Selling accounts or username transfer is not allowed on most platforms. Accounts that amass a certain following - traditionally - have a face associated with the company, which makes everyone happy, because if something happens, they’re to blame.

The profits from distribution (ads services, merch, services, etc.) of private accounts are accounted within taxes. They aren’t liable - making anonymous account transfer prime real estate for fraud and unfriendly business markets.

How do you make this legal?

Take the name - if unique - and wrap it up as an LLC. You’re basically arguing that this distribution channel has now become a media company - making it acquirable by a certain buyer.

How these sell:

Basically like the SMB industry.

Partial Purchase:

Most similar to an agency model (without an income take). Ability to keep the original owner of the account running it. This doesn’t mean you own the IP.

So, the creator can continue making content separately from the username on a specific platform.

Complete purchase:

The most appealing to a regular consumer. It’s the opposite of the 2011 “buying followers”, where you buy a whole account in a demographic of your choice and either do a:

1) cold reboot: change the name, bio, content, delete previous media, etc.

2) Content-focused reboot: brand the account and gradually shift the public-perception of ownership on the account as a media company.

The best application of a complete repurchase is if you have a similar account and just want a cleaner username.

How these price:

I originally had an interest in a company that does underwriting for creators: taking previous earnings and predict future. That’s under the assumption that the owner wants to purchase accounts for a “creator” purpose - where they want to make money off of it, which is a REALLY SMALL segment of people today.

Here’s how they will segment:

  1. Creator
    1. Does it make money already?
      1. Ads
      2. Merch
      3. Shoutouts
      4. Paid collabs
  2. Dutch Auction
    1. Cold demand until the seller feels it’s right.
    2. Even though we’re used to website auctions through 3d parties, there are still websites that sell by shutting down the page and leaving plain text that says “up for bit - min is 20M. enter your paypal” with an empty box and no leaderboard.
  3. Industry assumption
    1. Brokers that are further into SEO and content focus within markets can best predict what can sell for how much - not systemic at all. I asked.