the business model
The Direct Democracy Experiment is about (1) developing the core software infrastructure to manage our district's unique policy formation processes, (2) decoupling (aka unshackling) the district from the iron fist of a political monopoly's rule over policy decisions impacting our district, and (3) rejuvenating socioeconomic opportunities by removing the burdens of divisive tribalism, blind party loyalties and strict adherence to a political orthodoxy that greatly hinder the free market of ideas and solutions by boxing out political minorities from the debate stage, as well as establishing foundational policy criteria for our roadmap to prosperity.
Beyond these political purposes, there is also a very important business opportunity that becomes readily apparent through the commercialization of the software policy engine and its future licensing to other municipalities throughout the United States and worldwide who are seeking to incubate a direct democracy form of government. Let's look at how this model could operate.
Software Infrastructure: to enhance and to automate, where possible, policy processes and procedures. We present to you the Direct Democracy experiment Software Policy Engine (DDeSPE), a semi-automated software tool that returns the power of community decision-making back to the residents themselves. A proof-of-concept for the basic engine shall be developed at a university of our choosing, whether at UC Santa Cruz or another willing and viable institution with a cross-disciplinary curriculum that includes computer science (information systems, networking, internet security, artificial intelligence), statistics, business (accounting, finance) and political science. In short, the DDESPE is a policy-making efficiency tool that addresses the primary weaknesses of direct democracies (voter assembly, debate, vote casting, and vote validation), thereby removing the barriers that have always stunted its revival. Watch part 6 of our video series, "The Nonpartisan Movement," to learn more about the DDESPE.
vision, Business Models &
10-year product roadmap
An unexpected and potentially high-growth financial opportunity derivable from the DDESPE is its natural conversion to a commercial software product. The DDESPE product roadmap can be segmented into four distinct product categories and timelines: (1) developer model, (2) node model, (3) cluster model and (4) hub (service) model. Given the level of success of each of these models, additional models (the category of other models) can be rolled out (representative democracy model, global model) to allow further expansion and localization of the DDESPE product into stable democratic regions throughout the world. Each of the five models would serve a particular range of new applications that encourages future market expansion for the product. We discuss the monetization paths of each product model at the end of the page.
The software IP (intellectual property) would fall under the domain of a district-owned, for-profit co-op where each district resident shares in the decisions and profits of the company.
Watch: Co-Op Formation Video
(1) DEVELOPER MODEL
Initially, the co-op will continue to advance the DDESPE as a software tool for internal district use through grants, crowdfunding and investors (co-op members). The direct democracy to be established here in Santa Cruz, if I am elected, will be considered as the first DDESPE node put into service. We call it node zer0. Think of a node as a unit of power. Think of a node as one brick removed from the wall of the power structure owned by the political elites, the special interests, and the billionaires, a once-impregnable wall that was built on its betrayal of the people.
(2) node MODEL
The co-op may decide to commercialize the software and license it to individual communities throughout the United States, and eventually world-wide, who may wish to deploy (plug-and-play) their own direct democracy infrastructures. This potentially lucrative business decision would be monetized through the co-op's software licensing agreement, subscription packages, developer tools (API), consulting services and, eventually, advertising programs.
(3) cluster MODEL
Adoption rates will, at least initially, be dependent on pro-direct democracy candidates being elected to local offices. The co-op shall e-market the advantages of the DDESPE as well as early successes in transitioning to its direct democracy infrastructure. The co-op shall steer messaging to the vast network of political organizations and advocacy groups in an effort to encourage certain of its members to enlist as direct democracy candidates in their upcoming elections. These candidates would simply refer their constituents to our co-op's website as a learning and confidence-building platform to drive local interest in a direct democracy form of government and in their candidacies. By the time these candidates take office in early 2025, the DDESPE will be demonstrable as an alpha release. As new direct democracy nodes begin to surface (early adopter community) through DDESPE adoption, then begin to thrive by having the ability to push back against what we call the "compromised" Public Good (dictated by the politicians and special interest groups), the differences between life in small cities operating under representative democracies and those operating under direct democracies will become clearly visible in favor of direct democracies, triggering further interest and rapid growth in the direction of new direct democracy installations (early majority community). Adoption risks will have now been mostly mitigated through a combination of a stable and validated DDESPE, in addition to the "lessons learned" from the early adopters in regards to the decoupling process (see next section) vis-a-vis representative democracy infrastructures. As these isolated islands of direct democracies from the early majority community begin to stablize, a new software release (developed by the district's co-op) could network any combination of nodes together to form (virtual) direct democracy communities (node clusters) that could be configured on the fly and sorted by whatever commonalities they share (e.g. more than 25% senior citizens, urban or rural, high unemployment rate per a given racial segment, reside in a particular state, etc.). Clusters might share virtual meeting spaces and dialogues on similar problems and their solutions, coordinate and advocate at the state and national levels for common causes as a larger and more influential voting block, form permanent mergers when individual nodes share physical resources / services, etc.
(4) service (hub) MODEL
Once nodes are networked (GEN-II), the DDESPE GEN-III software can funnel any node or cluster into a professional service providers hub specializing in government policy-making and related services. The purpose of the hub is to pool services providers who can essentially replace local government infrastructures that direct democracies must still rely on with third-party service providers. This allows nodes to further decouple from their reliance on policy-making services that were once-performed by their own, local government infrastructures. A second function of the hub is to allow newly installed nodes to bypass this government infrastructure immediately. Members of the hub would offer their services, anything from category-specific (legal, financial, compliance, project management, cost analysis, etc.) to turnkey, on a pay-for-use basis that offers competitive rates. For example, services from different states (e.g. Idaho) may be found to be much cheaper than other states (e.g. New York), and the software could sort service providers by price. Existing government employees with local experience who participate in the policy-making process can join the hub and offer their services to local nodes. Since each node operates under the same DDESPE policy engine software release, each would have a common interface to the outside world. Service providers wishing to join the hub as members would simply set up an account and log in to the service providers website or download the mobile app (also developed by the district's co-op) and do the same, enabling them to network with a single node, a cluster, or the superset of all nodes. Leadership councils (the 4th step in the chain of DDESPE policy-making operations) could leverage the hub in order to bypass any reluctant or hostile, local or regional governments currently operating under representative democracy forms that the nodes formerly relied upon to share government services, but that now either deny services, provide unsatisfactory services or refuse to come to contractual terms with the node.
The Professional Service Providers Hub represents another monetization avenue for our district's co-op via service provider subscriptions which grant them access to the nodes or node clusters of their choice, and whose pricing may be differentiated by whether it is a local, regional, state, national or custom (e.g. all nodes that have agricultural economies) subscription. Advertising revenue from service providers wishing to elevate their game and third-party advertisers seeking to target direct democracy audiences (to be determined) would act as additional revenue sources.
(5) other models
(5.1) Global (localization) model
Once a proven business model, product performance and viable market opportunities have been demonstrated in the United States, the DDESPE can be localized to various languages, cultures and regulations, spreading direct democracy infrastructures into democratic localities throughout the world.
(5.2) Transition model
One interesting and possible use for the DDESPE outside of direct democracy environments is the ability to enhance existing direct democracy tools currently utilized within representative democracy infrastructures. The DDESPE could be extended through a simple extension that blows the dust off of the traditional (and semi-obsolete) direct democracy mechanisms used today (referendums, initiatives, recalls). This would give new birth to these direct vote vehicles by making them more efficient, less costly, faster, and more convenient, enabling them to be more frequently utilized than before and allowing the citizens living under representative democracy forms of government to effect changes more rapidly and flexibly. Such re-empowerment of the people's voices would be a check against extreme forms of collectivism persistently knocking at our doors.
There are some significant and tangible benefits specific to our district (district zero) in pursuing this vision and path. In addition to stimulating new co-op job opportunities (marketing, sales, software, consulting, training, admin, customer service, technical support, etc.) to our district, with resident applicants getting pushed to the top of the resume pile, the profits of the co-op would be carved out into two basic classes, with the particulars established in the co-op's bylaws. They are: (1) profits used to fund new district initiatives to further advance our community (e.g. rehabilitation and mental health programs, at-risk youth counseling, job training, cultural arts, etc.) and (2) member distributions in the form of either equity (shares), dividends (cash), or a combination. Since each district resident shares in co-op profits, this acts as a motivation tool to ensure that the DDESPE is thoroughly exercised to ensure it becomes the best possible product with the best possible user experience (highest utility), as sales and, therefore, profit and profit-sharing would be correlated to that. We predict regular resident feedback on how to improve the DDESPE throughout its lifetime, as it would be in their best financial interests to advance it as such.
Co-Op member equity and Dividend determinations would likely be calculated based on a TIERED Point system. Each member could earn "points" as incentives to participate in the Direct Democracy throughout the year in various ways: engaging with the policy engine (suggestion box, survey, brainstorming, leadership councils), completing training classes, obtaining certifications, assuming leadership roles (e.g. advocacy group lead) or sub-roles (e.g. mediators, scouts), participating in focus groups, or any special achievements (e.g. viral suggestion, high star rating, etc.), and so forth. Direct employees of the co-op earn points based on job function and good standing. Residents who commit financial resources to the co-op may earn "super-points." At the end of the year, points can be converted to either equity, dividends or both (depending on bylaws). The value of the equity-dividend package of members would map to their accumulated points at year-end. The DDESPE would support a special software plug-in to monitor resident activity for point assignments and to gather voting results for new co-op proposals. For additional information about community wealth initiatives such as this as a means to revitalize local economies, please visit here.