Fishbowl (10 page)

‘After that, you have another twelve months before we look at the contract again and I'd expect a guarantee of two million over the following year. And your commission – fifteen per cent, not twenty. We get control over what kind of ads we do and how we do it. If you object, then you can terminate. That's fair. We keep whatever you've paid us, you walk away.'

‘We do need to collaborate on the way we do the ads, Andrei. Like I said, that's something we do know quite a bit about.'

‘Well, we can talk about it. But we have final say. If we have an irreconcilable difference, you can walk away.'

‘And what happens at the end of the eighteen months?'

‘We'll see. If you've done a great job, why wouldn't we stick with you?'

Standish took a deep breath. ‘OK, let me make sure I know what you're saying.' He flipped over his file and began to jot down bullet points on the back. ‘Eighteen-month deal … Exclusive … Guarantee of a million in the first year—'

‘Six months.'

‘Sure, sorry. Guarantee of a million in the first six months, two million in the following twelve months … Fifteen per cent commission … Control of ads …'

‘And the first million – half up front and half after six months,' added Andrei. ‘Don't forget that.'

Standish nodded, making a note. He gazed at the list. Merritt peered at the page and pointed at a couple of things, then looked at him meaningfully. Standish ignored him. ‘I think what you're asking for on the commission is … that may be a little too steep. I'm going to have to go back to my board with this. I need a little something.' He looked up. ‘What if we split the difference? Seventeen and a half?'

Andrei shrugged. ‘Make it eighteen.'

Standish smiled, crossing out fifteen and writing eighteen. ‘OK. I am
pretty
sure I can get this past my board. But I need to know something. If I do that, if I get my board to agree, do we have a deal? What I can guarantee you is that if my board agrees to this, they won't renegotiate it if you come back with something else. And they're not going to let it hang out there. They won't allow 4Site to become part of some kind of negotiation where you're talking to other parties and you're playing us off against someone else. If I get you these terms – and these are great terms for you, Andrei – that's it. That will be 4Site's bottom line, and you'll have twenty-four hours to agree. After that it will be off the table, and if we do offer you anything again, it probably won't even be as good as the terms I started with.' Standish paused, looking to see Andrei's reaction. ‘Now, I can talk to my board first thing tomorrow. I can have a draft letter of agreement with you end of day. That means you'll have until the end of the following day to agree – then it's off. And it's going to be our bottom line. I'm not joking.' Standish put out his hand. ‘On these terms, do we have a deal?'

Andrei gazed at him.

‘Yes or no?'

Andrei nodded.

Standish smiled, shaking his hand.

‘Send me through the draft,' said Andrei and he got up. Ben and Kevin got up as well.

The two 4Site executives watched them leave the restaurant.

‘What an arrogant prick,' muttered Merritt.

Ed Standish laughed. ‘What would you have said if he'd gone for three years? That he was a stupid prick?'

‘He worked you over, Ed. Eighteen per cent? We've still got to sell this to the board.'

‘Easiest sell I've ever done.'

‘They'll kill us. What was wrong with you? He was begging for the money up front. Couldn't you see that?'

‘Of course I could see that.'

‘You could have got him to sign up for anything as long as you were dangling that half million in advance. I would have—'

‘What, Andy?' demanded Standish sharply. ‘What would you have done? Tried to screw every last dime out of him? And how long is he going to stick with us then? Do you understand the potential this website has? Have you thought about it? This is the best fucking deal 4Site has ever done. It would be the best deal at twice the price.'

Merritt snorted.

Standish chose to ignore that. ‘You want to eat? I'm hungry.' He looked around for a waiter. ‘All I'd like to know,' he said, as he waited for Lopez to come over, ‘is what we have to do to invest in this company.'

Outside, on University Avenue, the three founders of Fishbowll walked away.

‘Whoa!' whooped Kevin, fists in the air. ‘Dude! Awesome!'

Andrei stopped. Suddenly he was trembling. His heart was thumping.

‘Where did you learn to do stuff like that?' demanded Kevin. ‘I would have said yes to the first deal.'

‘That was pretty damn impressive, Andrei,' said Ben.

Andrei shrugged. He didn't know where he had got the idea, or the courage, to do what he had done. All he knew was that the first deal was no good because he had to get money up front. A guarantee of money in arrears was no use to him, and if he wasn't going to get that, nothing else mattered. Once he had decided to push back over that, he had just kept going and pushed back on everything. He was just as astonished at himself as the others were. And it had felt easy.

‘My father always says, “Push hard”,' he said. ‘“Push hard and then harder.” Always get up and make them call you back.'

‘Is that more of that oligarch stuff?' asked Kevin.

Andrei nodded.

‘What about giving him that extra half a per cent? We could have got seventeen and a half. You gave him eighteen.'

‘If you can, make people feel like a winner.'

‘That's from your father as well?'

‘Yeah. Make them feel like a winner – or else make sure you have a very big man you can call on.'

Kevin and Ben laughed.

‘He's never applied any of this,' said Andrei in a tone of bewilderment, still wondering at what he had just done. ‘It's talk. When we bought our house in Boston, he paid the exact price they asked.'

‘Dude, who cares? What else did he teach you?'

‘Nothing. That's it.' Suddenly Andrei frowned. ‘That was pretty good, wasn't it?'

‘That was awesome.' Kevin whooped again. ‘You are the negotiator.'

As they headed back to Robinson, Andrei thought about what had just happened. He had learned a lesson. When people came to him with an interest in Fishbowll, he could push them hard. Very hard.

But he had winged it. He had gone into the meeting totally unprepared – hadn't even taken the obvious precaution of talking to another agency. He had only Ed Standish's word that 25 per cent was the standard ad agency commission. He had no idea if a million dollars was a large guarantee or a small one. And now he had reached the end of his father's crude and theoretical teachings about success in business.

By the time the three of them were crossing Sterling Quad back to the dorm, Andrei's sense of wonder at what he had just done had been replaced by a sense of foreboding. They were amateurs. They were three clowns who had turned up for that meeting and somehow come out of it without being recognized for what they were. There was so much, Andrei suspected, that he didn't know, that he didn't even know enough to know that he didn't know it.

13

THE HALF A
million dollars from 4Site arrived a fortnight later. Andrei sat at his screen, checking the bank account every ten minutes until he saw it arrive. He yelled to the others. Kevin let out a whoop.

The first advertisements were on Fishbowll within four weeks, almost six months to the day after the site was launched. When users logged in, they saw a button titled, ‘Sponsored Bait', with a tag underneath: ‘Check it out to see if you get Hooked!' The button gave no idea of what was being advertised. Embracing Ed Standish's idea that advertising, if possible, should complement and even enhance the user experience, Andrei had worked to find a form of advertising that would reinforce Fishbowll's central vision – the taking of a journey into the world of your interests where the destination was unknown. He guessed that if people didn't know what was being advertised, but were certain that it would chime with their interests, they would be more likely to click to find out what it was about.

Andrei had announced the move in a post in the Grotto. He had thought hard about the attitude to strike and had talked it over with Ben, who knew the mood of the Grotto better than anyone. They both knew they were going to face a backlash, especially from the 300. Although Andrei wished he didn't have to do what he was doing, Ben thought the backlash would hit harder and last longer if he was apologetic about it. People would feel that if they shouted loud enough he might relent. He decided therefore to be positive and upfront. He also decided to announce
the move only the day before it was implemented. A prolonged debate before people had the opportunity actually to experience the advertisements for themselves would inevitably be fuelled by misconception and fear, and would play into the hands of people opposed to advertising or to change in general – which, Andrei knew, would be just about everyone.

‘Fellow Fish,' he wrote, ‘tomorrow we are introducing Sponsored Baits on Fishbowll. The reality is that if we are to continue to provide our service, and make the improvements you are telling us you want, this is something we have to do. Our aim is to bring you messages from highly selected and trusted partners about things you are genuinely interested in, many of which will include special deals available to Fishbowll users only. The Sponsored Baits will be clearly identified – you don't have to click on them. If you do click on them, and if you're not interested in what they are offering you, tell us, and we'll tell them! If you are interested, tell us about that as well. Most of all, keep telling us what you think of Fishbowll and how we can improve it. Happy swimming, Andrei.'

The users did tell them. The traffic in the Grotto reached record highs and the 300 erupted in a storm of verbiage. The Morrowmeter was off the scale: ‘Sponsored Baits?' ran one typical message. ‘Why not call it what it is? Fishbowll sells out like all the others.' ‘How are they targeting those ads?' said another. ‘What about privacy? I'm outta here.' ‘Shame on you, Andrei Koss. You're no better than the others.' And so it went on. The Dillerman valiantly fought Andrei's corner: ‘Guys, what do you expect? If the site we love is going to survive, it's gotta have a revenue stream. Andrei's doing it in the least bad way. Let's help him out. Click on these Sponsored Baits to make sure he gets the cash to keep going!' A shitload of abuse was poured over the Dillerman's head but he and a small number of supporters kept writing similar things. Some messages even turned up that were actually positive: ‘I love Sponsored Baits! I found something I didn't even realize I need. I'm totally Hooked!' Those messages were met with the suspicion that the people posting them secretly
worked for Fishbowll. Andrei denied that in a second post he issued a few days after the Sponsored Baits appeared. He also reassured users that although their data was used for targeting purposes, as was standard practice on all networking sites and in keeping with the privacy policy that Ben had drafted – largely by copying the policies on those other sites – no actual person at Fishbowll had access to that data, which was analysed by a totally automated set of algorithms.

Naturally, a School soon formed of people whose interest was in stopping Fishbowll sending Sponsored Baits. Its membership surged to over 100,000 but there were never more than a couple of hundred active members, and the frequency of their protests soon fell away. For a brief period there was a larger than usual number of deregistrations, then growth of the site returned to normal. Apart from a few lunatic free-netters, as Kevin described them, who left the site to find the next outpost of cyberspace where they hoped the realities of the world would never impinge on their dream of getting something for free for ever, the rest of Fishbowll's membership seemed to accept reality, albeit not always with the best humour. The heat gradually went out of the battle, and sponsored Baits became an accepted feature of the Fishbowll seascape.

When it was over, Andrei was amazed at how easy it had actually been and how transient and negligible was the response to what he had done, despite the volume of noise that it had generated. Just as the experience of Mike Sweetman's attempt to crush Fishbowll, which he connected with the
Stanford Daily
article, made Andrei forever wary of the press, his experience of introducing advertising to Fishbowll – the first major risk he had taken in the site's functionality – left a lasting mark. It made him sceptical of the significance and sustainability of user opposition, no matter how loud it sounded at the start. It didn't exactly make him feel that he could do whatever he liked, but it definitely inclined him to be willing to do more than he might have thought was possible before that experience.

In the meantime, it rapidly became clear that revenues generated by advertising would exceed the minimum $1 million guaranteed by 4Site for the next six months. Recognizing the degree of targeting they could obtain, and seeing the first results come in, the companies 4Site approached were soon prepared to pay rates per click that were five or even ten times the fee on other networks, a trend amplified by the scarcity of advertising opportunities on Fishbowll and the auction mechanism Andrei devised to award them. Initially, each user or School page received only one Sponsored Bait per day from companies offering a product in the relevant area of interest. The limit was Ben's idea, which he saw as a means of protecting the user experience. Ed Standish at 4Site resisted the concept at first, but soon came to see its value, not only in protecting the Fishbowll user experience but stoking demand and achieving premium pricing for the ads. An automated winner-takes-all auction at midnight each night determined whose advertisements would take the slots the following day.

Over time, the approach was refined. Some users clicked on the Sponsored Bait button more than once in a twenty-four-hour period, obviously seeking more ads. But in the course of any one day they saw the same ad each time, and if the same advertiser won the auction for the next day, they would see the same ads again. Standish, who was spending just about all his time on Fishbowll, thought this would frustrate the users as well as being a wasted opportunity to involve more advertisers. Andrei therefore developed a functionality that meant that if a given user clicked on the Sponsored Bait link for a second time in the twenty-four-hour period, a different Bait would appear. If they clicked a third time, a third Bait would appear, and so on down to the ninth slot. The auction process now offered not only the prime slot but the eight additional slots as well. Revenues tripled.

The statistics were relentlessly analysed. Some users consistently worked their way through all nine Baits for the day; others rarely clicked and if they did, they clicked once or at most twice.
Geography mattered as well, with users from developing countries consistently clicking on more Baits than users in the US and Europe. It seemed they were using the Baits as entertainment or information in their own right, while US and European users saw them more as advertisements. Andrei developed a further improvement in the functionality that allowed advertisers to bid at different rates for users by country, age group and gender.

All of this required a huge amount of work. Andrei, Kevin and the team of programmers, which now consisted of three additional Stanford undergraduates, worked through gruelling sequences of wheelspins to get the advertising functionality launched and then to keep improving it. Under Andrei's direction, they focused tirelessly on maximizing its efficiency and integrating it seamlessly into the user experience. Ed Standish sent through a weekly financial report detailing Fishbowll's earnings, but those were the numbers Andrei was least interested in. Now that he had a million dollars guaranteed for the next six months, he didn't think about the money from advertising at all. It was the user metrics that fascinated him, the problems they raised, the opportunities for improvement that they signposted, and the elegance of the solutions he could devise. It was an area rich with programming possibilities, and the technical discussions he had with Kevin and the other programmers were some of the most stimulating since he had started Fishbowll. Andrei spent hours at the screen, taking the most technically demanding parts of the coding for himself, headphones on, Coke can to hand, coding alongside Kevin and the other programmers crammed into the common room in Robinson House.

It was around this time that Andrei began to think more deeply about Fishbowll. By now, user numbers were heading towards 10 million, covering just about every country on earth. To be a part of the lives of 10 million people was not something trivial. Fishbowll meant something to them, and those meanings had all kinds of shades. The feeling Andrei had had when Mike Sweetman
had offered him $100 million and when John Dimmer had handed him their first National Security Letter – there had been fifty by now – was still fresh. Fishbowll had a place in the world, and that place was not simple; neither was it entirely under his control.

From the beginning, and especially from the time that he had taken off to fly home to Boston and forced himself to step back and look at what he was doing, Andrei had thought about what Fishbowll was for. But now he found himself pondering it more searchingly, recognising that it was something he needed to understand explicitly. What did Fishbowll mean? What was it trying to achieve?

He began to write down his thoughts in a series of black notebooks in which – ironically for someone who had founded a tech website – he scribbled his ideas longhand. It was in this period of extraordinary activity and mental ferment, around the time that advertising was introduced, in these notebooks written in his neat, dense script, that the fundamentals of Andrei's philosophy of Fishbowll developed.

In its essence, Andrei saw Fishbowll as a tool with which to slice through the superficial barrier of place so as to enable anyone to engage with anyone else, anywhere, about the handful of things that most mattered to them. He began to conceive of the world and its population not as a set of physical agglomerations but as a set of clusters – of ideas, views, values, aspirations – spanning the planet, and Fishbowll as a means of bringing them together in a way that had never been possible before. Andrei began to envisage these clusters exerting an effect on the real world, dissolving misapprehensions by groups of people about others and creating a series of shared, global identities based on values and interests rather than on nationality, ethnicity or other artificial constructs of affiliation over which an individual is able to exercise little if any choice. He began to conceive of overcoming these artificial constructs as the great challenge for humanity, and of Fishbowll as playing a central role in beating the challenge. In short, he began to see Fishbowll not
only as a way for people to connect but as a radical, revolutionary form of connection that would change the way people understood themselves and thus the way in which they understood others around them.

At some point in this period he began to use the term that would be associated more than any other with Andrei Koss: Deep Connectedness. To Andrei, this was the thing above all others that Fishbowll offered: the act and reality of connection; depth in both extent and meaningfulness.

Andrei saw Deep Connectedness, as he began to conceptualize it, as an important and fundamentally good thing. He carried in him a sense that Fishbowll had been born in a kind of original sin – that secret deceit, long since discarded and not admitted to anyone, that he had had to employ in order to ensure that in Fishbowll's first weeks and months, when registration numbers were low, people thought they were being sought by others. Andrei was by no means a mystical person, but he felt that there was a strange symmetry in this, that somehow such a fundamentally good thing as Fishbowll could only come about through something that had an inkling of evil in it. And if there was such an inkling in it, then only by ensuring that Fishbowll remained fundamentally good could that founding evil be counterbalanced.

But that didn't mean that he saw Fishbowll as a vehicle to challenge law or authority. He was confirmed in the view that he had developed after the first meeting with John Dimmer: Fishbowll was a medium, not a message. The radical good at the heart of Fishbowll was Deep Connectedness and all that it made possible, not any kind of ideological objective espoused by Fishbowll itself. It was for others, facilitated by Deep Connectedness, to espouse their ideologies and test them in the crucible that Fishbowll helped provide.

Similarly, money in its own right was no objective. As Fishbowll took shape, Andrei saw the money that it could generate as purely instrumental, not an end in itself. Raising
revenue would be necessary in order to run the service efficiently and to provide the opportunity to continuously improve and develop its functionality. Deep Connectedness was the goal – money earned by the website was nothing but the means.

The black notebooks scribbled in his small, impatient handwriting covered the same ideas over and over again, refining, clarifying, extending. Andrei came out of this period with a much more elaborate and sophisticated theory than he had had before, tying together his understanding of human history, the possibilities opened up by the internet, mankind's future, and a vision for the role in all of this that Fishbowll could play.