 Live from San Juan, Puerto Rico, it's The Cube. Covering Coin Agenda, brought to you by SiliconANGLE. Hello everyone, welcome to our specials, Cube Exclusive Coverage in Puerto Rico. Been here on the island all week, talking to the most important people, entrepreneurs, citizens of Puerto Rico, the entrepreneur, the students, connecting with blockchain, investors, thought leaders and the pioneers. I'm John Furrier, the co-host of The Cube, co-founder of SiliconANGLE Media Inc. We're here with Crystal Rose, who's the CEO and co-founder of Sensei, doing something really cutting edge, really relevant, and kind of ahead of his time, but I think it's time to get it out there and get that token program. Crystal Rose, thanks for joining me, spending the time with me. Thank you for having me. So, one of the things I think that you're doing, and I want you to explain this, because it's nuanced, a lot of the super geeks get it, and alpha geeks will get it, but the mainstream people are used to dealing in their silos. I use Facebook, I use LinkedIn, I use Twitter, I use Telegram, I use these apps. The world's kind of horizontally being disrupted because of the network effect that blockchain and crypto is now the underpinnings of, and there's ICOs out there and other things happening, but it's a disruption at the technology stack with software. You guys are doing something with Sensei in the sense token that is changing the equation of how people come together, how people grow and learn, whether it's a non-linear path of some proficiency or connecting with folks or just learning, whatever it is, it's a new discovery mechanism. Take a minute to explain what you guys are doing and why it's so important. We built Sensei to connect everyone together without any borders or intermediaries, and so really it's as simple as every phone has the capability to have a messenger. We have five billion phones that have SMS on them, and so we wanted to take the most basic messaging system, which is the most important thing that people do, and connect it to any other messenger. So Facebook, Messenger, Telegram, Slack, anywhere where people are chatting, we wanted to create a system that is interoperable and can decentralize your contact list, essentially. Yeah, so this is important. So like most people when they go to social networks, you got to find a friend, you get connected. In some cases, I don't want to have to friend someone just to have a chat. I mean, I might not want to friend them, or I might want to, or it's a hassle. I don't know who to friend. Is that kind of where you guys come in? Yeah, that's one really great use case because things like Facebook max you at 5,000 friends. So if you friended everybody that you had a conversation with, if you needed to know something, let's say that every Google search that you did was actually a conversation, you would cap the number of potential contacts. We have a circle of people around us that extends out with different tiers, but I think some of the most important people in our lives are actually strangers. So instead of building this social graph, we wanted to build the stranger graph. Since it cares more about what you know than who you know. Because if we can connect people together around similar interests and like-mindedness, we're connecting tribes. And that's really the innate human connection that we're all looking for. And it's also when you extend yourself outside of your social graph, you're most likely to educate yourself or to uplift yourself more. So the way to level up is to get somebody who's a eight or a 10 if you're a five or a two, and find someone outside of your current circle. And that also eliminates all this group think we've seen on the, some of these hate threads that have been on, whether it's Facebook or some IRC back channel or Slack channel. You see the hate just comes in because everyone's just talking to themselves. This is the new way, right? Connecting out through the metadata of the chat. Exactly. We want people to seek out good connections, helpful connections. And so if you can both contribute what you know, you get rewarded. And if you can ask people on the network, you also get rewarded. So by asking something, you're receiving a reward. It's a two way system. So it's not just the person who is helping. So we don't really encourage an economy of experts. We think that everyone is a sensei. A sensei literally means a person who's been there before. So we think of that as somebody who has had that life experience. And I think if we look at the internet, the internet democratized expertise. It gave us the ability for every single person to write what they were thinking or contribute some kind of content in some way. But for 20 years, the internet has been free. We, it's a really beautiful thing for consumption open source is the absolute right methodology for software. When it comes to your own content, a reward makes sense. And so we wanted to create sense on top of the platform as a value exchange. It was a point system. So kind of like Reddit karma. And we wanted to let people exchange it out for some value that they could transact in the world. So basically you're going to reward folks with a system that says, okay, first ante up some content. That's your sense token. And then based on how you want to work with people in the network, there's a token transaction that could come out of it. Is that, they get that right? Exactly. So you're the person who contributes on the network gets rewarded for that data. And it can be anything that you've done in the past too. So if you have a lot of historical data on Facebook or on, you know, GitHub, for instance, let's say your developer and you have a bunch of repos out there that could be analyzed to see what kind of developer you are. Or if you've contributed a lot to Reddit, all of that data is out there. And it's been something that defines you and your personality and your skills and who you are. So you can leverage that and you can get a reward for it just by letting Sensei understand more about you. So the AI runs through it. You get more rewards though if you have real conversations. So it's almost like a bounty program on conversation. So we have the same mission. We love what you're doing. I'm really so glad you're doing it. I want to get to an example in Puerto Rico where you've reached out with Trance. I know you have. But I want to get to that in a minute but I want to continue on the Sensei for a second. The Sensei token. As you guys do this, what is the token going to be looking like to the user? Because you have a user who's contributing content and data. And then you have people who are going to transact with the token. It could be a bounty. It could be someone trying to connect. How is the token economics? We're just so I can get that out there. How does that work? Right now in Sensei, the transaction is peer to peer. So both users who are chatting have the ability to tip each other essentially. They can give each other some coins within the chat. We have the concept that when you're having a conversation it's always a buyer and a seller. It's always a merchant and a consumer. And sometimes those roles flip too. I'll be selling you something and eventually you're selling me something. But it's a natural way that we chat to transact. So that was the first way that the token could be used. We then realized that the powerful part of the platform is actually everything underlying the application. So the layer underneath really was the most powerful thing. And so Sensei network evolved as a way for developers who are creating apps or bots to be able to build on top of the network and leverage the access to the humans or to their data. And so now the token can be used to access the network. You get paid if you contribute data or users and vice versa you can pay to access them. What that's doing is it's taking away the advertising model from being the only entity that's earning a profit on the data. So you, the user, when you're giving your data to Facebook Facebook earns a lot of money on it, selling it over and over repeatedly to advertisers. And while it's technically yours in the terms you own it you don't actually have any upside of that profit. And so what we're doing is saying well why don't we just let a potential business talk to you directly on your consent and give you the money directly for that. So that two or five dollars for one connection will go straight to you. This is the new business model. I mean this is something that I think, I mean first of all don't get me started on my ad tech rant because advertising creates a bad behavior. You're chasing a business model that's failing attention and page views. So the content's not optimized the proper way. And you mentioned the Facebook example. Facebook's not optimizing their data for a user experience. They're optimized for their monetization which is countering to what users want to do. So I think you kind of are taking it in another direction which we love because that's what we do. We are open source content. But the role of the data is critical. So I got to ask you the hard question. I'm a user. It's my data. How do the developers get access to it? Do they pay me coins or? Because you want developers because that's going to be a nice piece of the growth. So what's the relationship between the developer who's trying to add value but also respecting the user's data? Exactly. So the developer pays the network and as a user you're a token holder you own the network essentially. So there is really no middle layer since the token will take a small amount out for continuing to power the network but a nominal amount. It's right now the most expensive thing that happens is the gas that's on top of Ethereum because we're an ERC-20 token. So we're looking to be poly chain. We want to move on to other types of blockchains that have better faster transactions with no fees and be able to pass that through as well. So we really want to just do a peer-to-peer connection. There's no interest in owning that connection or owning the repository of data. We want the data to be, that's why the blockchain is important. We want the data to be distributed. We want it to be owned by the user and we want it to be accessible by anyone that they want to give access to. So if it's a developer they're building a bot maybe or if it's a brand, they're using a developer on their behalf, they have to pay the user for that data. So the developers and centers are completely aligned with the peer-to-peer architecture that you have, user's interest, and the technical underpinnings of the plumbing. Is that right? Exactly. Okay, good, so check. Now I got that. All right, now let's talk about my favorite topic since we're on this kind of data topic. Who's influential? I mean, what is an influencer mean to you? Is it the most followers? Is it the most, it's kind of actually a canned question, you can hear it coming. Oh, I'll just say it. I don't like the influencer model right now because it's all about followers. It's the wrong signal because you can have a zillion followers and not be influential. And we know people are buying followers. So there's kind of been that gamification. What should influence really be like in this network? Because sometimes you can be really influential and then discover and go outside your comfort zone into a new area for some reason, whether it's a discovery or progression to some proficiency or connection, you're not an influencer, you're a newbie. So context is very important. How do you guys look at, how do you look at influencers and how influencers measure? I think of the bare bones, an influencer is someone who drives action. So it's a person who can elicit an action in another person. And if you can do that at scale, so one to many, then you have more power as an influencer. So that's sort of the traditional thinking. But I think we're missing something there, which is good action. So an influencer to me, a good influencer is somebody who can encourage positive action. And so if it's one to one and you get one person to do one positive thing versus one to a thousand and you get a thousand people to do something not so great, like buy a product that's crap because it was advertised to them for the purpose of that influencer making profit, that metric doesn't add up. So I think we live in a world of vanity metrics where we have tons of numbers all over the place. We have hearts and likes and stars and followers and all of these things that keep adding up, but they have no real value. And so I think it's a really, like you said before, the behavior is being trained in the wrong way. We're encouraged to just get numbers rather than quality. And so what I think a really good influencer is, somebody who has a small group of people who will always take action. It can be any number of people, but let's say a group of followers who will take action based on that person's movements and will follow them in a positive direction. And guess what? It's a network graph so you can actually measure it. That's interesting. I can see where you're going with this. Okay, so I got to talk about your role here in Puerto Rico. You mentioned earlier about reaching out to strangers, the stranger graph, which is a way people's outside their comfort zone sometimes reaching out to strangers. You came here in the analog sense, you're in person, but on the digital side as well kind of blends together. Give an example where you reached out to strangers and how that's impacted your life and their life because this is the heart of your system if I can get that right. You're connecting people and creating value. Maybe sometimes it might not be value, but you're creating connections which have the potential for more value. What have you done here in Puerto Rico that's been a stranger outreach that turned into a wow moment? Our outreach has been so far an invitation. So we bought a space here that's turned into a community center and even at the very beginning we had no power as most of the places around that have been sitting for a year or two or since the hurricane. And so we put a call out and said we'd like to get to know the community. We're doing something called let there be light which is turn the power on. And we put it out to a public group and saw who would show up. So basically it's a community central building. It's a historical building so a lot of people know it. There's a lot of curiosity. So it was just a call, it was a call for help. It was really, I think the biggest thing people love is when you're asking them for help. And then you give gratitude and return for that help and you create a connection around it. So that's why we built Sensei the way that we did. And I think there's a lot of possibilities for how it could be used. But having that encouragement of the community to come and share, we've done that now this whole week. So this is restart week. And one of the other things that we've done is help all of the conferences come together, collaborate rather than compete. So go into the same week and put all of these satellite groups around it. And then we blanketed a week around it so that we had one place for people to go and look for all of the events and also for them to understand a movement. So we since then have done a dinner every single night and it's been an open invitation. It's basically whoever comes in first and we've had drinks every night as well, open. So it's really been an invitation. It's been an open invitation. Well, congratulations. I really love what you're doing. You guys are doing great work down here. The event this week has been great. We've got great content. That's amazing people and it's working. So congratulations on that. As you guys look forward, one of the things I've observed in my old, many years of history is that there's a lot of waves. I've seen all the waves. This wave is the biggest. But what jumps out at me is the mission-driven aspect of it. So I mean, I can geek out on what's the decentralized and the stacks and all the tech stuff happening, but what's most impressive is the mission-oriented, the impact kind of thinking. This is now, society is now software-driven. This is a new major thinking. Used to be philanthropy was a waterfall model. Yeah, it's donate, it either goes or doesn't go. Go to the next one, go to the next one. Now you have this integrated model where it's not just philanthropy, it's action, there's money behind it, there's coding, there's community. This is now a new era of societal entrepreneurship, societal missions. So talk about your vision on this mission and impact culture that's part of this ethos. I think impact is the important word there. So we think about bringing capital. Like you said with normal philanthropy, you can bring capital and you can continuously pump capital into something, but if the model is wrong, it's just going to drain. And it's going to go to inefficient systems and in the end, maybe do some help, but a very small percentage of the capacity of what it could do. So what we have the concept of is bringing funds here. We have a fund that was just launched called Restart Ventures. And the idea is instead of compounding interest, we want to make compounding impact. And so it's a social good focused fund, but at the same time, all of the proceeds generated from the fund recycle back into other things that are making more impact. So we're measuring based on how much impact can be created with different projects. It could be a charity or it could be an entrepreneur. And if we're getting a multiple, most of that money is going back. So very small percentage goes to the actual fund and to the fund managers and the lion's share of the fund is going back into Puerto Rico. So I think that if we look at how we can help in a way that is constantly regenerative, sustainable is good, regenerative is better. We want to at least elevate ourselves to get to the point of sustainability, but we're not improving at that point. We're still just fixing problems. We want regenerative. So if we can keep planting things that regrow themselves, if we can make it so that we're setting up the ecosystem to constantly mend itself, it's like a self healing system of software. This is the right way to do it. So I think that's the new model. You built in some nurturing into the algorithm. I like that. Cause you're not going to do the classic, you know, venture capital carry, you're going to rotate in, but still pay some operators to run it. So they got to get paid. So this, I noticed in the announcement there was some money for, you know, managing directors to do it. So they get paid and the rest goes into the compounding impact. Right. Okay. So I got to ask you what your view is these days on something that's really been important in open source software, which was, again, when I started as a tier two citizen at best, now it's running the world tier one, open source ethos are sprinkled throughout these, these new awesome opportunities, but community made it happen. What is your current view on the role of the community, communities in general, to make this new compounding impacts, whether it's software development, innovation, impact giving, regenerative growth, what's your view on community? If community operates with a mentality of giving or contribution over consumption, we do a lot better. So when you have an open source network, if a community comes and they contribute to it more, that's something that regenerates. It keeps adding value. But if a community comes and they just keep consuming, then you have to continue to have more and more people giving. I think a really good example of this is Wikipedia. Wikipedia has hundreds of thousands of people who constantly contribute. And the only reward that they've ever gotten for that is a banner ad that says, please donate because we don't do ads. So it's a broken model because you want it to be free and you want it to continue to have the same ethos and you want it to have no advertising. Yet the people who contribute most of the time also contribute most of the funding to keep it alive because they love it and care about it so much. So how could we change that model so that the community could give contributions while also receiving a way to make sure that they're able to keep doing that? And a reward system works and maybe that's not the only solution. But we have to think about how we can keep creating more and more. Well, I think transparency is one thing I've always loved. The thing that I always hear, especially with women in tech and these new important areas like underserved minorities, and also the bad behavior that goes on in other groups, is to shine the light on things. Having the data being open changes everything. That is a huge thing. So community and open data. Your thoughts, I'm sure you agree, open data and the importance of having the data exposed. 100%. So our platform also has a layer of anonymity on the user by default. And part of the idea of being able to understand whether or not data is good, because think of human data, we have to figure out quality. In the past, there would be a validation system that is actually other humans telling you whether or not you're good and giving you some accreditation, some verification. This is our concept of experts on things. Now we would rather take consensus. So let's just crowdsource this validation and use a consensus mechanism that would see whether or not other humans think the data is good. If we're using a system like that, we have to have open data. It has to be transparent and it has to be able to be viewed in order to be voted on. So on our platform, on just the first application on Sensei, we exposed this consensus mechanism in a feature called peak. So peak basically lets you peek inside of conversations happening on the network. You can watch all the conversations that happen. The AI pulls out the good ones. And then you vote on them. It's kind of like when you walk into a nightclub, do I want to kind of hang out here? Yeah, you're kind of a voyeur, but you get rewarded for doing it. It's a way for us to help classify. It's a way for us to help train the AI. And also it's a way for people to have passive ability to interact without having to have a conversation with an actual human. Well, you're exposing the conversation to folks, but also you get signaling data who jumps in, who kind of walks away. I mean, it's a gesture data, but it's a data point. Right, and it's completely private. So there's the beauty of the transparency is there's actually privacy baked in. And that's what I love about blockchain is it has all of the good things. Crystal, I got to ask you a final question. I know you're very busy. And thank you for taking the time to share your thoughts with me today here on theCUBE, here in Puerto Rico. This week you've been super busy. You look great. I'm sure you've been up burning the midnight oil as they say. What is the, I won't say craziest things. I've seen a lot of cool, crazy things going on here. It's been fun. What is some highlights for you? Conversations, meeting new people. Can you just share a couple of anecdotal highlights from restart week that have moved you or surprised you or just in general might be worth noting? I've been overall extremely surprised by this sheer number of people who showed up. I feel like a few months ago there was a small group of us sitting around wondering what it would be like if we could encourage our friends to come here and share the space. So just to see the thousands of people who have come here to support these several conferences has been amazing. My most surprising thing though is the amount of people that have told me that they bought a one-way ticket and have no intention of going home. So to make Puerto Rico your home I think is a really amazing first step. And we, I just did a panel earlier today with the person in government who had instituted Act 20 and 22. And that was the initial incentive. Take an interest in explaining what that is for the folks who don't know what it is. Sure, so Act 20 and 22 are for the company and the individual respectively. They are a way for you to get a tax incentive for moving here as a resident or domiciling your company here. So you get 0% taxes. I think companies range up to 4% or something like that. And that incentive was created to bring more brilliant minds and entrepreneurs and different types of people with different vocations to the island. So basically give them a tax incentive and encourage the stimulation of economy. So that has brought this wave of people in who have an idea that no taxes are great. At the same time, they fall in love with the island. So it's amazing because to me, Puerto Rico is a combination of LA's, whether San Francisco's Open-Mindedness and Barcelona's, you know, European history. It's just a really beautiful place. And it's US territory, so it's a short hop in and jump to the states if you need to or Europe. Yeah, exactly. And no customs. And you have your driver's license to get here. Also, it's a US dollar. So I think, you know, and I say that because most people in America, Mainland, don't realize that Puerto Rico is an American territory. And so they sort of think they're going to a foreign country because it's treated that way by our government. But what I've been really shocked about though is the sheer amount of innovation already here. The forward-thinking ways of people and the embracing of things like open source and blockchain technology, because their minds are already in a mode of community, a mode of sharing, a mode of giving. We interviewed Michael Angelo from edublock.ido, edublock. They're connecting all the universities with blockchain. We also interviewed Daria Rivera, Puerto Rico Advantage. They'll move you down here. You can press a button. It's instant move. So folks in Silicon Valley who are watching who know us and around the world know theCUBE, there's a group of like-minded people here that have tech chops. There's capital flowing. There's capital people I know who've moved here, setting up shop, as well as Cayman's and everyone else. But it's nice. So it's kind of like LA. There is a lot of capital. I have just witnessed a couple hundred million dollars of funds that were established in the last couple of months. And this is around all different types of technology sectors. You don't have to be a blockchain company. You can be innovating in any way possible. One of my favorite projects is a machine that turns plastic bottles into diesel fuel. So one of the problems here is the generators on the island. When we were here last time, we met a guy that was working at a bar in a restaurant and he was like, hey, I saw you guys in New York Times and I think you're like the crypto people. And he had a conversation and he said, I was wondering if you could help my grandmother who is stuck with no power and it's been months and she's in her 90s and she needs a generator to run a machine that keeps her life supported. And so a couple of people went out to bring more fuel, bring a generator to donate. They started understanding that there are so many areas that still need this level of help that there's a lot that we can do. So when I see projects like that, that's something I want to back. Entrepreneurial action taking impact. Crystal, thanks so much for coming on. Crystal Rose, CEO of Cal Founder of Sensei, real innovative company, pioneer here in the Puerto Rico movement. It's a movement, a lot of tech entrepreneurs, capital investors and the pioneers in the blockchain. Decentralized internet are all here. This is like the Silicon Valley of crypto, right? I think they're calling it Crypto Island. Crypto Island, yes. It sounds like a TV show, we should be honest. Like it's not lost, it's Crypto Island. Exactly. Thanks so much for spending the time. Thanks, John. I appreciate it so much. Thanks for making sense of me. I'm John Furrier here in theCUBE. Here in Puerto Rico, our coverage continues after this short break.