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To me, the striking part of the story is the valuation of spam. > Javice lied about having data on 4 million clients, including making up fake client informati

To me, the striking part of the story is the valuation of spam. > Javice lied about having data on 4 million clients, including making up fake client information, in order to entice JPMorgan Chase to buy her company in 2021 for $175 milliion > According to the SEC's complaint, JPMorgan was eager to buy Frank because the company claimed to have contact information — including names, emails and phone numbers — for over 4 million students, a pool of potential new customers the bank wanted to reach. JPM paid ~$42 per student so it could spam them. I don't know what their conversion funnel looks like, but that's surprisingly high to me. College students make lucrative targets, apparently. It's also depressing to think about as an individual in this economy - having our personal info harvested, bundled up, traded, and exploited for hundreds of millions of dollars, all without our consent.

lotsofpulp 4y ago
I am surprised, presumably, that Discover/Navient/etc would not directly sell their borrower’s contact info for much less than $42 per person, and it would be the highest quality real time data.
- JPws_Prntr_Fngr 4y ago
  Good point, the market rate for contact info must be way below $42. I suspect JPM really wanted the juicier demographic/segmentation data that this little startup app convinced the students to provide. But they're not going to put that in their lawsuit or PR releases: "We thought we were buying 4.2M unsuspecting students' race, sexual orientation, family history, mental health status, blood types, and genetic code, but it was fake! We want a refund."
function_seven 4y ago
> College students make lucrative targets, apparently. I have in my wallet two credit cards that I signed up for back in college. In the 90s. For one of them, I also got a 3 lb. bag of M&Ms. The other one came with a free T-shirt I think? In both cases, them setting up tables on my campus netted multi-decade account holders. I should've bargained harder that day, though. I didn't realize what my CLTV was to them.
timr 4y ago
No, they paid $4M to have an existing business relationship with a demographic that is incredibly valuable to a bank (and hard to reach). Email marketing is only one part of that. Regardless, marketing works, and yes, it's valuable. It's a business thing that I wish I could snap my fingers and make engineers understand. Even a 1% monthly response rate on a 4M member list is 40k leads a month. If your conversion rate is 1% (low), that's 400 sales a month. If your EV is $1000 (not at all unreasonable for a financial product), that's $400,000 a month.
- JPws_Prntr_Fngr 4y ago
  Thanks for the downvote and the explanation, oh wise one. Marketing works, goddamn, I wish I'd thought of that.
- soulbadguy 4y ago
  > It's a business thing that I wish I could snap my fingers and make engineers understand. I find interesting that "engineers" (what ever that means) do not understand the concept of marketing... The question here is not whether not "marketing works", but to which extent it does and also the privacy and ethical concern around buy peoples contact (with out their conscent) and basically spaming them.
  - timr 4y ago
    I realizing I'm stereotyping, but it's with love (since I, myself, am an engineer, and I also carried this misconception around for a long time). But to explain: in my experience, engineers are quick to complain about all forms of marketing, and dismiss email marketing in particular as "spam". OP was a specific example of an attitude I've encountered many times before -- taking this so far as to suggest acquiring the users was "just for spamming". In addition to "all marketing email is spam", other non-truths that engineers believe about marketing: * if you send more than one email about something, it's intrusive and a violation * most people unsubscribe from marketing emails * nobody sees ads * people hate ads, and would opt-out of all advertising if they could
ed_elliott_asc 4y ago
So who is creating a startup aimed at getting college students to sign up and supply their data? We know the valuation for each student is $42 - if we can get acquisition below that then we have a profitable business!

lotsofpulp 4y ago

I am surprised, presumably, that Discover/Navient/etc would not directly sell their borrower’s contact info for much less than $42 per person, and it would be the highest quality real time data.

JPws_Prntr_Fngr 4y ago
Good point, the market rate for contact info must be way below $42. I suspect JPM really wanted the juicier demographic/segmentation data that this little startup app convinced the students to provide. But they're not going to put that in their lawsuit or PR releases: "We thought we were buying 4.2M unsuspecting students' race, sexual orientation, family history, mental health status, blood types, and genetic code, but it was fake! We want a refund."

function_seven 4y ago

> College students make lucrative targets, apparently. I have in my wallet two credit cards that I signed up for back in college. In the 90s. For one of them, I also got a 3 lb. bag of M&Ms. The other one came with a free T-shirt I think? In both cases, them setting up tables on my campus netted multi-decade account holders. I should've bargained harder that day, though. I didn't realize what my CLTV was to them.

timr 4y ago

No, they paid $4M to have an existing business relationship with a demographic that is incredibly valuable to a bank (and hard to reach). Email marketing is only one part of that. Regardless, marketing works, and yes, it's valuable. It's a business thing that I wish I could snap my fingers and make engineers understand. Even a 1% monthly response rate on a 4M member list is 40k leads a month. If your conversion rate is 1% (low), that's 400 sales a month. If your EV is $1000 (not at all unreasonable for a financial product), that's $400,000 a month.

JPws_Prntr_Fngr 4y ago
Thanks for the downvote and the explanation, oh wise one. Marketing works, goddamn, I wish I'd thought of that.
soulbadguy 4y ago
> It's a business thing that I wish I could snap my fingers and make engineers understand. I find interesting that "engineers" (what ever that means) do not understand the concept of marketing... The question here is not whether not "marketing works", but to which extent it does and also the privacy and ethical concern around buy peoples contact (with out their conscent) and basically spaming them.
- timr 4y ago
  I realizing I'm stereotyping, but it's with love (since I, myself, am an engineer, and I also carried this misconception around for a long time). But to explain: in my experience, engineers are quick to complain about all forms of marketing, and dismiss email marketing in particular as "spam". OP was a specific example of an attitude I've encountered many times before -- taking this so far as to suggest acquiring the users was "just for spamming". In addition to "all marketing email is spam", other non-truths that engineers believe about marketing: * if you send more than one email about something, it's intrusive and a violation * most people unsubscribe from marketing emails * nobody sees ads * people hate ads, and would opt-out of all advertising if they could

ed_elliott_asc 4y ago

So who is creating a startup aimed at getting college students to sign up and supply their data? We know the valuation for each student is $42 - if we can get acquisition below that then we have a profitable business!