Particl For Investors #11 – Particl Marketplace Explained Part 1 – By 15 Cent Joe

Tai Zen: What’s up guys, this is Tai Zen. I’m broadcasting from Time Square, in the beautiful city of New York. And with me today I have 2 special guests.

I got David Fong. And also with us here, the gentleman here we have in the middle, is a very unique and special gentleman. This is Joe, this is what we call 15 Cent Joe.

We call him 15 Cent Joe in the Crypto Community because he actually got into Bitcoin when it was only 15 cents. How did you get into Bitcoin when it was only 15 cents?

15 Cent Joe: It happened for a while actually. Some of those early price points are just a fog memory that I’m trying to forget now. I didn’t hold a single one, because I was trying to pay off the equipment that I used to mine them.

Tai Zen: The reason why we flew up here to New York is to test out some software for different ICOs. But Joe happened to be in New York and we happened to be in New York also. And so I invited Joe to come down.

What is your role in the Particl community? Particl is the Cryptocurrency that got rebranded from Shadowcat and it was released around July 17th. Your community sponsored our channel to do independent third-party research on Privacy Coin. So we want to say thanks to that.

Because without the sponsorship it would’ve taken us probably close to a year to finish all the research. So you guys help sponsored our channel to speed it up, to get the word out.

We’re here to talk about the Particl market place, the private marketplace. Before we get into that, can you share with the audience what your role is in the Particl community?

15 Cent Joe: First off I do want to say The Privacy Coin Video series that you did, I thought it was quite fantastic and I have not seen anything come close to it. When it comes to someone taking the time or group of people taking the time to go through all the minutiae and try to understand. Because it’s a very complicated space, and I’ve been watching things for a long time and I still feel as if I only know or understand a tiny fraction of what’s actually happening.

Tai Zen: We actually take some of that content and speak about the Privacy Coins. This will be exclusive for you guys.

David Fong: So what we’re working on here is an index. You’ve heard of the TaiFuIndex and basically, these are just tools to help investors figure out how to invest. In the traditional market, you got the Dow Jones, the S&P 500 and you also have this tendency for different buckets to move in tandem.

So when Apple and Google and Facebook, they’re all up or they’re all down because of technology announcement then you can see them move in tandem. So investors in the Cryptocurrency market, there isn’t really anything like and we’re looking to develop tools that would really benefit from them.

Tai Zen: We released TaiFu Cryptocurrency market index, and then we released the Altcoin Market Index, and then we also released the TaiFu Bitcoin Aggregate Index that has Bitcoin and Bitcoin Cash. Because we believe that’s the true value of Bitcoin, is the combination of those 2 prices.

And then the next scheduled release, we categorize all the Cryptocurrency into what we call a bucket, in the traditional world on Wall Street, they call it sectors or industries. Because on the streets we always talk about what bucket does that fall in or we’d ask each other. So we just call it the bucket indexes.

And the next one that we going to release is actually the Privacy Coin Index, it’s going to be a content that your community sponsored us to do. So we’re gonna build the index so the community can have a way to measure the pulse of what Privacy Coins are doing as a group. Talk about your role in the Particl community.

15 Cent Joe: So I’ll make it very clear right up. I’m not part of the core development team, I’m not a programmer, I’m fairly a non-technical guy.

However, I’ve been off and on selling goods online for roughly 15 years. For example, my Amazon seller account is around 14 years old.

Tai Zen: So you always the first one in line to do everything in the tech world? You started mining Bitcoins as soon Satoshi released the white paper, as soon as Amazon goes public. Did you get the first store up?

15 Cent Joe: I am not affiliated in a direct way with the development team. However, I consider myself a passionate community member. I’ve made myself available to anyone on the team, pretty much 24/7, they can just blow up my phone or my email and ask me questions because I have bought and sold goods online.

But as a manufacturer, as a private label reseller, even a product inventor who then manufactures and then sells online. My specific angle and what drives the majority of my passion here is that from the seller side I’ve come across dozens or hundreds of hurdle or issues as a seller, that I feel ultimately has hurt my business or my businesses, or made more expensive than necessary, the product and consumer receive from me.

Tai Zen: Can you give the audience 1 or 2 examples of a product and walk them through a scenario?

15 Cent Joe: So I use Amazon as a primary example. Amazon publishes something that they call a sales rank, and I might talk about this a lot in these videos because the sales rank is an incredibly powerful tool that I think most customers that are just buying goods and services don’t actually really understand what’s going on.

Amazon publishes the sales rank of any item and there’re people all over the world that track those numbers daily, hourly, weekly. And what they do is people see what the new trending items are, and Amazon does it because Amazon is not the seller themselves. Amazon’s going to collect their fees regardless of who is selling the product.

Amazon is just a middle person, and so Amazon’s going to get their pound of flesh no matter who is buying and who is selling, so all Amazon wants is the most buyers. One of the primary tools Amazon will use is to encourage all sellers to compete for as much as possible. If all sellers were ethical, and indoor of all vendors were manufactures would follow Amazon’s terms of service, the ecosystem would be different.

However as it works now, this has happened to me personally as a seller, the majority of the medium sized Amazon sellers, I will consider myself to have previously been a medium-sized seller, operate somewhere cresting between 15 and maybe $40,000 a month in gross sales. This will be considered a middle-upper tier for Amazon according to last year’s chart.

What’s happening, from my perspective, is that more and more goods are being provided from fewer and fewer sellers, it’s because Amazon publishes the sales rank. Eventually, the manufacturer of the good that you are buying as a reseller will eventually go I’ll just ship those myself. And if people have noticed Amazon is now allowing many goods to be coming in directly from overseas now, and you can just choose to wait a few weeks.

This is a very difficult environment for the existing sellers because the existing sellers are almost guaranteed that the moment that they become successful. Let’s say I’m a small company, I’m a start-up, I develop some new products and I go through a couple of years in your garage designing it, and you go I’m gonna put it on Amazon, this is going to go big. Guess what, that might happen, they might start selling really well.

And you might go well I’m going to recover my costs within 9 months or so, sales continue on this path. What will happen though is that 6 months in, 5 months in, 9 months in, if you become too successful, you’re immediately going to be copied by 10 other copycat products. They effectively have almost every advantage.

David Fong: So it’s the sales statistic that basically points to all the hot items, and then the people who can scale, they’re the ones to go to take that idea that they didn’t develop, effectively copy it and then produce it cheaper with their economies of scale.

15 Cent Joe: This happens every day. Not only that but if you see Amazon-branded items, that’s Amazon entering the market against its sellers because it wants the whole pie.

Tai Zen: Let’s say if the three of us are vendors on Amazon, they’re waiting for us to sell a product and see how it does, and how well it does, what type of buyers are buying that, and they have all the data. And then what they do is that next time they come out with a knock-off product. And then the next time somebody searches for that product, what they do is they just route that to them, instead of to one of us.

15 Cent Joe: I cannot attest to whether or not Amazon has somehow or another subtly controlled the buying bot from all the listing. I don’t want to go into the weeds too far but it does appear from a layperson perspective that some products that are branded Amazon or Ship and Sold by Amazon, seems to have a difficult time acquiring 1, 2 and 3-star reviews.

So it is a very complicated, multi-faceted topic but Amazon has no problem entering the market whenever the profits are great enough for them to care. And so that’s amazon basics, that’s Ship and Sold by Amazon, that’s Amazon deciding to cut out all the sellers. So what’s happening here is that on the face of it, I used to believe that pure competition was ultimately beneficial for the end consumers.

After seeing from behind-the-scenes how the seller struggle and how small companies, an especially domestic company that is domestically designing, sourcing, manufacturing products, this is a very toxic climate for them to operate in. What happens is that at the end of the day, one would expect the product will be of barely acceptable quality for the price, and the price will be the lowest possible, that’s what you would expect.

However I don’t see this playing out, I see the cost of commonly used consumer goods constantly edging up with few exceptions, despite the fact that more and more end-users and more and more middle people and handlers are getting cut out. So where is this profit going? And so my opinion is that on Amazon, for example, most buyers and most people out there may not actually know just how much Amazon actually charges to sell things on their platform, it’s item-specific, it’s category-specific.

However, if you were going to let Amazon ship the product for you, if it’s a lower value item, Amazon could be taking over half the sale right off the to. So the $10 item, they’re getting $3.50 to $5 right off the top. And what that means is that in that $5 they’re giving you, you have to buy the inventory months ahead of time, process inventory, repackage it, rebranded, package how they want you to send it to them, and then ship it to Amazon and wait to get paid for a year or 30 days however long it takes for you to sell that batch of product.

And so what happened here is that if you say I can’t afford to have 50% of the sale be taken as a fee from Amazon shipping and handling “customer service”, I’m just going to list it on Amazon myself. Depending upon the category and the type of item, if you ship it on your own dime, from your own shipping center, your home or your garage or whatever, Amazon could take between 15% and 30% off the top of that sale. Amazon prices, after 18 months, they kind of raise them a little bit.

And Amazon seems to be, in my opinion, continuing to raise their fees about in step with how the economies of scale should be making these products cheaper for customers. So after seeing how all this works and seeing what’s happening inside of the blockchain space, I’m a new exciting project like Particl or even any other potentially decentralized marketplaces or even this trading post, whatever you want to have. I’m excited to see what’s going to happen when these profitless decentralized algorithms enter the space.

Because on the Particl marketplace, I cannot attest to what the final alpha or beta fee structures will be in things like that. However, it’s going to be many orders of magnitude, less cost to buy and sell list items on the Particl marketplace. Ultimately I like to think that this is going to enable sellers to sell their products at lower and lower prices, keeping more and more of the margin for themselves.

Tai Zen: Particl is considered a Privacy Coin, they’re building a privacy-centric marketplace. When you use the term marketplace in the world of Cryptocurrencies, people always the first thing that comes to mind is like the Dark net. So can you talk about what’s the difference between your Darknet, like Alpha bay or Silk Road that’s no longer in existence versus a privacy-centric marketplace that helps business owners? I want to make the audience’s clear that the marketplace is for a legal product and business owners.

15 Cent Joe: I don’t want to interject but it’s my understanding that the majority of your viewers are interested in your tips. In the spirit of this thing is an investing channel, I’m not after small money, I’m after real money and I define real money coming from challenging the multiple billion-dollar existing industries or institutional power structures that surround comers, and the buying and selling of goods and services.

I don’t want to accuse people of being short-sighted or being ignorant of some of the potential out there. However when you really take a step back, and you imagine the benefits that can arise from a marketplace that has more privacy protection, specifically for the sellers, that’s primarily my specialties understanding how could that can be beneficial, and my sales rank example is one of the biggest examples I can think of.

Because if you’re able to see how popular and how well my products are selling, then that gives you an advantage of moving into my market share. And as I explained earlier, generally speaking, you would assume that competition ultimately will be the best thing for the consumers.

But I’m continuing to see nothing but centralization, fewer and fewer larger sellers, and at the end of the day, your HDMI cable which costs pennies to produce is sold at Walmart for $25, that used to be way cheaper than that. Why is it the case?

Tai Zen: Because there are less and fewer vendors selling it, less competition.

15 Cent Joe: Exactly. One way to look at it would be predatory abuse of having the secret sauce. And I think that Amazon entering into the market with their own goods and services based upon the hundreds of people they have on payroll, figuring out what sellers that are building a name for themselves, they can eyes out in order to make a little bit more margin.

That to me seems like a really predatory practice and ultimately will probably wind up hurting them, and people flee the platform.

Tai Zen: So the key to the Particl marketplace, when it comes out, is that it eliminates the analytics. The analytics, the sale statistics that the marketplace is doing, so that one business owner cannot clone or a knockoff or have an advantage, the intel, the data from another business.

15 Cent Joe: In simplest terms of my understanding is that the majority of the sales, metric which many providers in goods and services consider a portion of a sales metric to even be potential that trade secret, they want to secure their bases so they can continue developing and innovating. And if every single time they have a breakout product, they make some news as-seen-on-TV thing, they just get kneecapped over and over again.

David Fong: In this privacy marketplace, as a seller, what would you want to see? You’re going to want to see that your product is selling. Would you want to even see a ranking?

Tai Zen: If you’re selling these microphones on the Particl marketplace, and you actually have the best microphones, and you got a lot of buyers. Don’t you want people to see that the majority of buyers buy your product, your microphone because it’s the best one?

15 Cent Joe: I cannot speak to exactly how some type of reputation system or something may be incorporated into the system because it’s my laypersons understanding, that one that is still outside the scope of what I perceive the developers are working on, they’re working on the MVP, they’re working on trying to stick with the roadmap that they’ve laid out, which I’m happy with as a holder and as someone whose passion about the space.

I’m quite happy actually with what I would consider being a pretty fast movement, pretty fast development. It’s nearly entirely new, built on the Bitcoin .15 codebase.

Tai Zen: Talk about the delay. Because you told me offline they had originally built the Particl marketplace on a previous version of Bitcoin that did not have Segway and all that.

15 Cent Joe: I don’t want to speak for the developers but they’re private and they work very hard and I try not to bother them as much as possible. However, from my voyeuristically outside perspective, it would appear as if a lot of advances that were made in the codebase made a lot of things that they wanted to do or are already previously worked on.

More streamlined, more efficient, secure better. And so it sounds as if there’s been a lot of new development that may not have been anticipated, but I don’t want to speak at all, I would wait for some kind of development update. That’s my personal opinion.

But you did ask what as a seller I would like to see. I’d like to see a lot of things, but having personally found myself pinched numerous times. I would call these kinds of predatory, competitive practices.

Tai Zen: So when you said a pinch, you mean that your business was hurt.

15 Cent Joe: Not only my businesses or businesses that I have been part of or co-owned but also businesses from colleagues or people that I have followed. And what I mean by pinch, is that a small company or a development company or an inventor or even just a private label reseller, and to the people out there that don’t really know what that is, a wide variety of the goods and services that we all buy are made in a very few manufacturers.

However they’re sold with a different look or feel under 50 different brand names, and so each one of those name brands is a private label reseller. What that means is that they’re ordering at a manufacturer or a bulk near manufacturer level, and they are having a product shipped directly to them or to a third party to be changed, modified, rebranded, repackaged and then they sell them under the new name.

If you just go hypothetically on Amazon and look up Bluetooth Speaker, you’ll see 500 different brands and the speakers all kind of look the same, each one of those individual companies is a private label, reseller.

Tai Zen: I did not realize that until my coaching client, he actually imports, he brings in the majority of headphones into America. He and his team bring the majority to headphones into America.

15 Cent Joe: So going back to what pinch means, I’ve been on all sides of this as a seller with a product that was co-developed or partially produced in-house that used inside of a product assembly with other product that you buy. There’re a lot of different ways to look at it but what I’ve seen is I’ve seen Amazon enter some of the same spaces as an Amazon basic item.

And that instantly almost like a kiss of death, because how are you going to compete with whatever price they’re going to sell that product for. And if you are actually using gold plated connectors, gold foil connectors on your RCA cable hypothetically, Amazons version might look confusingly similar as brass.

You know your product is superior but there’s no way to get that through because ultimately if you create a product listing on Amazon, you don’t own the listing, you created this database item in their system, and so you don’t have rights over the listing.

David Fong: They have the branding, they’re got the enormous well-respected brand that regardless of all the searches and all, they’ve already invested all in this brand. As a consumer, you’re gonna go with the safer one.

15 Cent Joe: So going back to my one example of something that hurt my business. So if you want to do a private label resale, let’s say you fly overseas, you fly to stay India and you’re looking at some products, and you go to multiple manufacturers and you make some tweaks to some existing products, you kind of tailor it to the market you want to target.

And you make tooling deposit to these factories, you got skin in the game, you’re at $50,000 invested and you’re going to order 500kg of this item, be a partial container load. And you think the way that you’ve taken this product and made this modification, you believe you’re going to get into a new market.

So you get it, you repackaged it, rebranded it, you ship to Amazon or you list it on Amazon, it starts to sell, it takes a little while, you get good reviews to pick up, it starts to sell quite well. What happened is that the better it begins to sell, the more things will start to happen to you that will hurt your sales.

Tai Zen: Before you talk about the things that will happen to hurt your sell, the camera is gonna cut off right here, we will start a second part. I’m gonna end this video here guys, join us in part 2. So thanks for watching, we’ll continue in the next one.

Learn more at www.Particl.io

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