Institute For The Future

Swapthing

Recently the Institute hosted a talk by Jessica Hardwick, the co-founder of Swapthing. As she describes it, Swapthing is "eBay for barter, and a system for providing social networking around things." Pretty simple concept, really.

Two things struck me during the talk. First, it's another version of what I first noticed with del.icio.us and ThinkLink: a relatively small outfit that's able to grow thanks to the abundance of IT.

Second, Swapthing is spending infinitely more energy on the social networking and community stuff than on the economics. This might seem counterintuitive, but I suspect it's a smart gamble. One model they're not following is that of barter trading markets, where participants get credit for things they donate, then "spend" that credit on other things. (I also suspect that eBay may have lowered the barrier for auctions enough to challenge systems that rely on proxies for currency; I don't know how you'd test that hypothesis, thought.)

There are some tax reasons for staying away from all this-- once you start to handle money, you become an entirely different kind entity as far as the IRS is concerned-- but mainly Swapthing assumes that participants can figure out the value of items on their own, but could really benefit from networking tools. More value can be created by concentrating on the social side, most notably by building the reputation system (which is obviously essential), and giving participants the opportunity to build swap circles and groups (e.g., new moms in Portland, the First Methodist Church of Springfield, Peninsula School families).

There might be a parallel here to a real estate developer who tries to create a vibrant new downtown area. They aren't trying to create new economies; they're trying to create a space that supports economic activity.

Jessica is also interviewed on the wonderfully transparently-titled A Hot Web 2.0 blog from Silicon Valley.