3 Things: American Au Pairs in China, AMA Platform for Athletes, Get Paid for Purchase Data

Happy 4th of July and a very warm welcome to all the new subscribers! I’m thrilled and honored to have you as readers and truly appreciate your thoughts and feedback 🙏. Each edition of 3 Things will contain a dive into 3 rabbit holes I’ve found myself going down recently. Subscribe to get each week’s edition straight to your inbox and if you enjoy it, please share (I suck at self-promotions so can use your help)! This past week I’ve been thinking a lot about:

• American Au Pairs in China

• AMA Platform for Athletes

• Get Paid for Purchase Data

1. American Au Pairs in China

The concept of an au pairs developed in Europe after WWII when a convergence of factors made the opportunity apt. There were fewer domestic servants available to work in middle and upper class homes, increases in wages and taxes which made it difficult for middle class families to afford, the need for more middle class girls to earn their own salary, and a new desire among women to get educated and travel. Since middle class women didn’t want the stigma of being a domestic servant, the concept of au pair was born, which comes from French meaning “at par” or “equal to”. The au pairs are meant to be a temporary member of the family, not just a domestic worker. While they have duties mostly related to childcare, they are provided their own room, an allowance/stipend, and eat meals as well as participate in many activities with the host family. They also often take classes while participating in the au pair program. In the United States, the Au Pair Program was officially enacted in 1989 and 6 organizations were designated by the government as permissible to administer the Au Pair Program (today there are 15).

In the US, most au pairs are young women (18-26) from Europe or Latin/South America who come to study, learn English, and experience American culture. There is also some precedence for Chinese women to come to the US as au pairs, particularly for families who have adopted babies from China. With the recent ending of China’s One Child Policy, which was enforced between 1979-2015, the government is now encouraging couples to have 3 children after their effort at a 2-child policy failed to increase the birth rate over the last few years. Many couples are still wary of having multiple children given the rising costs of raising kids, the need to care for elderly parents, and the lack of childcare. Pair this lack of childcare with the desire among (the rapidly growing) middle and upper class Chinese families to have their children learn English and you have the perfect environment to create an au pair program brining young Americans to China. It also provides the opportunity for US Millennials and GenZ to experience Chinese culture and learn some Mandarin which will be increasingly important as China continues to grow into a more and more dominant world power.

2. AMA Platform for Athletes

It’s been a long time coming, but this week the NCAA finally approved the ability for college athletes to make money off of their name, image, and likeness which until now was prohibited. This is a big deal as college athletics in the US is a huge business with many college coaches earning millions per year, and some football coaches earning close to $10M annually. Overall, the NCAA generated $19B from college athletics in 2019. The athletes, however, never saw a penny as they were banned from monetizing. With the explosion of the creator economy, many are looking at this new crop of potential influencers who now have the opportunity to monetize their fanbase. The challenge with athletes in general is that their core competency is not creating digital content, it’s playing a sport. Creating compelling and quality content, especially video content, takes a lot of time, skill, and knowledge of video editing techniques and software.

Even for professional athletes who have been able to monetize their name, image, and likeness already, few have been able to create and capitalize on a massive digital following. There are platforms like Cameo where celebrities can earn money giving short video shoutouts to people, though these are usually purchased as gifts for someone else, or as a 1-off opportunity to have a short direct connection with their idols (and most celebs on the platform are considered C-list). Other people try selling merch like shirts and hoodies. The biggest names partner with brands for brand licensing deals which is where the big money is, but that is a small subset of athletes. Just like professional athletes, there will immediately be some college athletes who get signed by big brands, but for the vast majority, they’ll need to find their own channels to take advantage of their name, image, or likeness. One opportunity I see that feels like the lowest friction, highest potential frequency, and easiest ability to monetize is an AMA (ask me anything) platform where fans ask athletes questions ranging from funny personal ones to what they eat in a given day, what type of athletic apparel they prefer, how they train, and more. The platform can allow for synchronous or asynchronous interactions with fans and athletes can set different prices for different types of engagements. By creating a “push button, start engaging” experience, it lowers the friction and barrier to entry so any athlete can participate, capturing the middle and longtail. It can also naturally lend itself to easy collaborations between athletes to do live Q&A sessions on various topics. No fancy cameras or video editing necessary.

3. Get Paid for Purchase Data

Data privacy and security has become a hot button topic among the tech world and has started to take shape in the form of government regulation from GDPR (General Data Protection Regulation) in Europe and CCPA (California Consumer Protection Act) which were introduced in 2018 to the upcoming CPRA (California Privacy Rights Act) which will go into effect Jan 1, 2023 and takes the CCPA rules a few steps further. There is a popular phrase that has been around for a decade that “if you’re not paying for the product, you are the product”. This typically takes 2 forms; advertising to you and selling your data. Most apps and sites today track your behavior across other apps and services and use that data to sell to advertisers who can better target their ads and achieve higher conversion rates. Apple recently made big changes in iOS 14.5 where users are prompted to opt in or out of apps tracking you, which will have massive implications for advertising platforms and advertisers. Another of the most common forms of selling your data are banks and credit card companies who sell purchase data to brokers like Yodlee (acquired by Envestnet for $590M in 2015) who does nearly $1B in annual revenue selling the data to enterprises, research companies, and investment firms.

While many consumers say they care about privacy and their data, most care more about price (ie free) and convenience. In addition, consumers are always looking for easy ways to either find great deals or make money. Take Honey, the simple browser extension that was acquired by PayPal for $4B in 2019. Honey finds their 17+ million monthly active consumers deals and applies coupons/promo codes as they shop normally across the internet. Imagine a similarly simple browser extension (and mobile app) that paid you every time you made a purchase. This company would act similar to Yodlee by aggregating massive amounts of consumer purchase data, cleaning it, and selling it to willing buyers. This way, opted-in consumers are active participants in the process and earn money as opposed to secretly being taken advantage of. Like Honey, it is completely passive so extremely easy to sign up and take advantage of without doing any work or changing behavior in any way. With the continued rise in online commerce, there will continue to be more and more opportunities to capture this data and compensate consumers. Since the data is coming directly from the source, there are also opportunities to allow consumers to answer short surveys or provide additional demographic data to receive higher payments which creates proprietary purchase data sets that would be more valuable than the existing ones.

That’s all for today! If you have thoughts, comments, or want to get in touch, reply to this email or find me on Twitter at @ezelby and if you enjoyed this, please subscribe and share with a friend or two!

~ Elaine