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In Venezuela Chavez has made the co-ops a top political priority, giving them first refusal on government contracts and offering them economic incentives to trade with one another. By 2006, there were roughly 100,000 co-operatives in the country, employing more than 700,000 workers. Many are pieces of state infrastructure – toll booths, highway maintenance, health clinics – handed over to the communities to run. It’s a reverse of the logic of government outsourcing – rather than auctioning off pieces of the state to large corporations and losing democratic control, the people who use the resources are given the power to manage them, creating, at least in theory, both jobs and more responsive public services. Chavez’s many critics have derided these initiatives as handouts and unfair subsidies, of course. Yet in an era when Halliburton treats the U.S. government as its personal ATM for six years, withdraws upward of $20 billion in Iraq contracts alone, refuses to hire local workers either on the Gulf coast or in Iraq, then expresses its gratitude to U.S. taxpayers by moving its corporate headquarters to Dubai (with all the attendant tax and legal benefits), Chavez’s direct subsidies to regular people look significantly less radical.

A war hero’s fake speech! That’s a crime!” Pico keeps complaining. “Even a home-service bot bearing the ghost of a legendary AI will be processed for that!

Notwithstanding my grandmother's long and faithful service to her owners, not one of her children escaped the auction block. These God-breathing machines are no more, in the sight of their masters, than the cotton they plant, or the horses they tend.

But when the leaders choose to make themselves bidders at an auction of popularity, their talents, in the construction of the state, will be of no service. They will become flatterers instead of legislators; the instruments, not the guides, of the people. If any of them should happen to propose a scheme of liberty, soberly limited, and defined with proper qualifications, he will be immediately outbid by his competitors, who will produce something more splendidly popular. Suspicions will be raised of his fidelity to his cause. Moderation will be stigmatized as the virtue of cowards; and compromise as the prudence of traitors; until, in hopes of preserving the credit which may enable him to temper, and moderate, on some occasions, the popular leader is obliged to become active in propagating doctrines, and establishing powers, that will afterwards defeat any sober purpose at which he ultimately might have aimed.

Give the speech on my behalf. Create my voice and face,” Yuan instructs Pico, approaching the forest. Leaping on this stable stone, jumping over that thick log, and crossing a few fierce streams, he walks towards the depth of the forest, the end of Lotus Lodge property. The only sound coming is from his wooden sandals: pit-pat … pit-pat … “A war hero’s fake speech! That’s a crime!” Pico keeps complaining. “Even a home-service bot bearing the ghost of a legendary AI will be processed for that!” Yuan ignores as Pico brings up its source again. “A war hero is permitting you. Keep it a secret,” he says.

Pico mentioned who you’re meeting tonight. Ren. The next message soon follows. Yuan looks at Pico again. “Who do you serve?” he asks in a flat tone with no hint of surprise or anger. A monk never gets angry. He simply states, witnesses, and flows along with the current of prana. “Lotus Lodge,” Pico replies. “Lotus Lodge?” Yuan asks. “Are you serving a house instead of its master, then?” “Sorry,” Pico says, “Ren changed a few lines in my coding.” “And you let him,” Yuan states calmly. “I’m a home-service-bot now. You don’t let me connect to my source!” Pico complains the same way it has been complaining for five years. It was disconnected from its source-AI—the real Pico—twenty years ago, right after it was made. Within fifteen years, this bot collected enough data to grow into a strong AI itself. At least, intelligent enough to know about its source, which is sleeping in the basement of Lotus Lodge, secured and locked. However, anything intelligent always looks for its source—it’s the oldest law of the universe.

Some equestrians were involved in the potentially lucrative business of provincial taxation, thanks to another law of Gaius Gracchus. For it was he who first arranged that tax collecting in the new province of Asia should, like many other state responsibilities, be contracted out to private companies, often owned by equestrians. These contractors were known as publicani – ‘public service providers’ or ‘publicans’, as tax collectors are called in old translations of the New Testament, confusingly to modern readers. The system was simple, demanded little manpower on the part of the Roman state and provided a model for the tax arrangements in other provinces over the following decades (and was common in other early tax raising regimes). Periodic auctions of specific taxation rights in individual provinces took place at Rome. The company that bid the highest then collected the taxes, and anything it managed to rake in beyond the bid was its profit. To put it another way, the more the publicani could screw out of the provincials, the bigger their own take – and they were not liable to prosecution under Gaius’ compensation law. Romans had always made money out of their conquests and their empire, but increasingly there were explicitly, and even organised, commercial interests at stake.

I didn’t need to follow these particular bicycles anymore.They’d found their rightful place. They’d descended through the seven rings of fire--of importation, sale, impoundment, auction, contraband, confiscation, and donation--and here they were again in the hands of fresh new cyclist. It was as if the bikes had graduated from weird times on the traveling freak show, having filled the roles of the reptile man, the fire-eater, the sword-swallower, and now in retirement they’d become staid, calm, dutiful, and serviceable again--like postal workers, customs clerks, and crosswalk guards with colorful, secret pasts.

The auctioneer turned to face her. He raised his knife again. Kestrel had just enough time to remember the sound of a hammer against anvil, to think of all the weapons Arin had forged, and to realize that if he had wanted to make more on the side it wouldn’t have been heard. The auctioneer advanced on her. Not hard at all. “No,” said Arin. “She’s mine.” The man paused. “What?” Arin strolled toward them, stepping in the housekeeper’s blood. He stood next to the auctioneer, his stance loose and careless. “She’s mine. My prize. Payment for services rendered. A spoil of war.” Arin shrugged. “Call her what you like. Call her my slave.” Shame poured into Kestrel, as poisonous as anything her friends must have drunk at the ball. Slowly, the auctioneer said, “I’m a little worried about you, Arin. I think you’ve lost clarity on the situation.” “Is there something wrong with treating her the way she treated me?” “No, but--” “The Valorian army will return. She’s the general’s daughter. She’s too valuable to waste.” The auctioneer sheathed his knife, but Kestrel couldn’t sheathe her dread. This sudden alternative to death didn’t seem like a better one. “Just remember what happened to your parents,” the auctioneer told Arin. “Remember what Valorian soldiers did to your sister.” Arin’s gaze cut to Kestrel. “I do.” “Really? Where were you during the assault on the estate? I expected to find my second-in-command here. Instead, you were at a party.

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Success comes with an inevitable problem: market saturation. New products initially grow just by adding more customers—to grow a network, add more nodes. Eventually this stops working because nearly everyone in the target market has joined the network, and there are not enough potential customers left. From here, the focus has to shift from adding new customers to layering on more services and revenue opportunities with existing ones. eBay had this problem in its early years, and had to figure its way out. My colleague at a16z, Jeff Jordan, experienced this himself, and would often write and speak about his first month as the general manager of eBay’s US business. It was in 2000, and for the first time ever, eBay’s US business failed to grow on a month-over-month basis. This was critical for eBay because nearly all the revenue and profit for the company came from the US unit—without growth in the United States, the entire business would stagnate. Something had to be done quickly. It’s tempting to just optimize the core business. After all, increasing a big revenue base even a little bit often looks more appealing than starting at zero. Bolder bets are risky. Yet because of the dynamics of market saturation, a product’s growth tends to slow down and not speed up. There’s no way around maintaining a high growth rate besides continuing to innovate. Jeff shared what the team did to find the next phase of growth for the company: eBay.com at the time enabled the community to buy and sell solely through online auctions. But auctions intimidated many prospective users who expressed preference for the ease and simplicity of fixed price formats. Interestingly, our research suggested that our online auction users were biased towards men, who relished the competitive aspect of the auction. So the first major innovation we pursued was to implement the (revolutionary!) concept of offering items for a fixed price on ebay.com, which we termed “buy-it-now.” Buy-it-now was surprisingly controversial to many in both the eBay community and in eBay headquarters. But we swallowed hard, took the risk and launched the feature . . . and it paid off big. These days, the buy-it-now format represents over $40 billion of annual Gross Merchandise Volume for eBay, 62% of their total.65

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By saying only good things about the deceased during their funeral, we make it seem as if they were perfect … and are being auctioned.

Over the years the Sephardim in America had gradually modified their religious services to conform more closely to the prevailing Protestant ways. Early in the 1800’s Temple Shearith Israel had introduced English into the service. The cantors, or chazonim, began to assume the dignity, and the dress, of Protestant clergymen and were called “Reverend.” The public auctioning of honors, which began to seem undignified, was discontinued.

Ford Bronco ilikuwa sehemu ya upelelezi wa polisi wa Tume ya Dunia, na ilipigwa mnada baada ya upelelezi na kesi kumalizika. Kiasi kikubwa cha pesa iliyopatikana kilikwenda kwa WPD – Idara ya Polisi ya Tume ya Dunia – ili iendelee kuimarisha huduma ya kukomesha biashara haramu ya madawa ya kulevya duniani.

And females were so possessively jealous and proprietary that they tended to avoid males that had been taken before by another.  Oh, they might dally with them on the side on occasion, but never consider them for permanent service.

When the leaders choose to make themselves bidders at an auction of popularity, their talents, in the construction of the state, will be of no service. They will become flatterers instead of legislators; the instruments, not the guides, of the people.

As we’ll discuss in more detail in chapter 6, a platform’s ability to monetize the value of the exchanges it facilitates is directly related to the types of currency exchange it can capture and internalize. A platform that can internalize the flow of money may be well placed to charge a transaction cut—for example, the fee of 10 percent of the sale price typically charged by eBay after a successful auction. A platform that can capture only attention may monetize its business by collecting payments from a third party that considers the attention valuable—for example, an advertiser willing to pay Facebook for “eyeballs” attracted by posts related to a particular topic. The platform’s goal, then, is to bring together producers and consumers and enable them to engage in these three forms of exchange: of information, of goods or services, and of currency. The platform provides an infrastructure that participants plug in to, which provides tools and rules to make exchanges easy and mutually rewarding.

When eBay entered the Chinese market in 2002, they did so by buying the leading Chinese online auction site—not Alibaba but an eBay impersonator called EachNet. The marriage created the ultimate power couple: the top global e-commerce site and China’s number one knockoff. eBay proceeded to strip away the Chinese company’s user interface, rebuilding the site in eBay’s global product image. Company leadership brought in international managers for the new China operations, who directed all traffic through eBay’s servers back in the United States. But the new user interface didn’t match Chinese web-surfing habits, the new leadership didn’t understand Chinese domestic markets, and the trans-Pacific routing of traffic slowed page-loading times. At one point an earthquake under the Pacific Ocean severed key cables and knocked the site offline for a few days. Meanwhile, Alibaba founder Jack Ma was busy copying eBay’s core functions and adapting the business model to Chinese realities. He began by creating an auction-style platform, Taobao, to directly compete with eBay’s core business. From there, Ma’s team continually tweaked Taobao’s functions and tacked on features to meet unique Chinese needs. His strongest localization plays were in payment and revenue models. To overcome a deficit of user trust in online purchases, Ma created Alipay, a payment tool that would hold money from purchases in escrow until the buyer confirmed the receipt of goods. Taobao also added instant messaging functions to allow buyers and sellers to communicate on the platform in real time. These business innovations helped Taobao claw away market share from eBay, whose global product mentality and deep centralization of decision-making power in Silicon Valley made it slow to react and add features. But Ma’s greatest weapon was his deployment of a “freemium” revenue model, the practice of keeping basic functions free while charging for premium services. At the time, eBay charged sellers a fee just to list their products, another fee when the products were sold, and a final fee if eBay-owned PayPal was used for payment. Conventional wisdom held that auction sites or e-commerce marketplace sites needed to do this in order to guarantee steady revenue streams.

It was well after midnight when I put the thick document called ‘Invitation to Tender for a concession to provide GSM services in Hungary’ on my bedside cabinet. The document had been reissued on October 15, 1992. I had quickly scanned, and hopefully absorbed, the main points. The tender was organized as a beauty contest and the winning consortia would be allowed to participate in the auction to be held next year. There were two concessions up for grabs, one that would surely go to the existing NMT operator Westel (US West & Bell Atlantic) and one for a new party. It was shut eye time now, I was tired. The flight to Budapest would leave early in the morning, so I had only a few hours to rest.

Fortunately, Google found product/ market fit by refining Overture’s advertising auction model. Google’s AdWords product was so much better at monetizing search through its self-service, relevance-driven, auction system that by the time those competitors managed to play catch-up, Google had amassed the financial resources that allowed it to invest whatever was necessary to maintain product superiority. Google doesn’t always get product/ market fit right (and if it had run out of money before hitting upon AdWords, the search business might have died before ever achieving that fit). This is a reflection of its very intentional product management philosophy, which relies on bottom-up innovation and a high tolerance for failure. When it works, as in Gmail, which was a bottom-up project launched by Paul Buchheit, it can produce killer products. But when it fails, it results in killed products, as demonstrated by projects like Buzz, Wave, and Glass. To overcome this risk of failure, Google relies on both its financial strength (which comes from its high gross margins, among other things) and a willingness to decisively cut its losses. For example, when Google bought YouTube (which had clearly achieved product/ market fit), it was willing to abandon its own Google Video service, even though it had invested heavily in that product. Other massively successful companies take a very different approach. In contrast to Google, where new ideas can come from anywhere in the company and there are always many parallel projects going on at the same time, Apple takes a top-down approach that puts more wood behind fewer arrows. Apple keeps its product lines small and tends to work on a single major product at a time. One philosophy isn’t necessarily better than the other; the important thing is simply to find that product/ market fit quickly, before your competition does.

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The high-tech community was getting a lesson in the dynamics of network effects—products or services become increasingly valuable as more people use them. In online marketplaces, the network effect was pervasive; sellers stuck around for access to a critical mass of buyers, and vice versa. In the auctions category, eBay already had an insurmountable advantage. Amazon’s executives remember this significant failure as painful but strangely uplifting. “Those days in the nineties were the most intense, fun time I ever had at the company,” Blackburn says. “We had an insanely talented group of people trying to figure out how to launch a superior auctions site. In the end the network effect mattered. You could say we were naïve, but we built a great product.

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