Handshake is a new service in the UK that will make your information available to companies that will pay you for having it. This is the same thing they have been doing but now the consumer keeps the money instead of a middle men company.
They don’t go around shouting about it but most Internet companies make money off user data — either by selling the specifics of individuals’ digital activity to interested companies, or by bundling up multiple users’ data into quasi-anonymised business intelligence and flogging that ‘insight’ on (aka: if the tech service is free you’re the product). Well, here’s a startup that wants to make this money-for-data transfer a little more explicit — by acting as a platform for consumers to sell their own data directly to companies and make some of that filthy lucre themselves.
Handshake says it’s aiming to cut out the market research middle man — and also circumvent the whole ‘free service’ data-grabbing antics of Facebook, Google+ et al — by building a platform where users can sign up to be approached by companies, negotiate a price for their data, and decide who to sell it to (and who not to). The basic idea is to create a marketplace for personal data. “Handshake.uk.com will turn what has previously been stolen into a currency which can be traded,” says co-founder Duncan White in a statement.
It estimates that users of the platform could earn between £1,000 and £5,000 per year for selling their data via the platform — and says it’s basing this estimate on “the traditional cost of market research agencies”. The bracketed range is based on a “variables such as income bracket, occupation, frequency of use, behavioural characteristics” — so presumably you’re going to need to be in a particularly attractive demographic to attract the most interest from brands. Rewards can also be non-cash, so brands could offer discounts or other types of rewards via the platform in exchange for data.
(So really take those earnings figures with a pinch of salt for now. It’s also not clear how many (if any) brands are signed up to Handshake’s service yet. But without a community of users willing to flog data, brands don’t have a lot of reason to turn up yet.) Update: Handshake told TechCrunch it has several potential clients “ready to sign” once beta testing proves functionality — including “a high street bank, a household name telecoms provider and a household name games developer”. For the beta testing phase, it said it will generate its own questions for users.
The startup is currently accepting applications for beta testers, with the aim of launching a beta service within three weeks once 2,000 applications have been received. To get the ball rolling and get testers on board, it’s offering the first 3,000 an equity share in its own business (of up to 10% in total — which it says equates to around £150k shared across the entire beta testing community). Applicants to its beta test process are also being encouraged to refer friends to be in with a higher chance of winning a 2% (£30k-sized chunk) of that equity stake — i.e. the more referrals you make, the more times you’re entered into the draw.
Getting enough users is obviously going to be critical to Handshake building a platform that can attract companies and the money required to pay its users for their data. Why should brands pay people for their data? Well, firstly they’re paying anyway — if they’re buying it off a third party company like Facebook, or from a market research firm. Beyond that, Handshake says its platform will deliver “more detailed and insightful data” to brands, being as its users have a financial incentive to provide detailed data. Brands can also request “more bespoke data” via the platform and use that data to shape product development and marketing strategy.
“Far too often, organisations want information, activity or data from customers without giving something back. Our behavioural analytics experience has proven without a doubt that relationships founded on reciprocity, i.e. where both parties ‘get’ something, are much more profitable. So it simply made sense to create a mechanism for brands and consumers based on reciprocity and fairness,” the startup explains.
Another strand Handshake is hoping to benefit from is the fallout from concerns about privacy and misuse of consumer data by the big data-harvesting tech giants. “There has been increasing unrest from consumers as to how their data is being used by businesses and huge corporations. Handshake brings transparency and control for both parties by turning online data theft into a transaction,” it adds.
What data will Handshake users be able to sell to brands? Brands will apparently be able to request the following:
- Personal information
- Income, gender, occupation etc etc.
- Responses to traditional surveys
- Responses to real time surveys
- Responses to experiences (could be triggered by GPS signals)
- Intent for purchases or activities
- Personality profiles
- First party data
- Quantified self data such as food intake, location, sleeping habits, scanned receipts etc etc
Handshake’s own business model is based on taking a fee from the companies/brands using it, and also taking a “small percentage” of the cash payment member rewards.
The startup was founded in February 2011, with initial development boostrapped by its founders. Last December it also raised £100,000 from private investors under the U.K. government’s SEIS scheme.
Handshake says there are similar startups in the U.S. offering a comparable cash for data service but claims the negotiation element of its platform is novel. It names its closest digital competitors as Enliken and Reputation.com, while offline market competitors are traditional market research companies.
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