The pros and cons of building a privacy focused startup


Like all the articles we publish on this blog, this content is being written to begin discussions. These discussions may take place in public forums like Twitter, semi-public forums like LinkedIn or more focused and ‘private’ (i.e. not indexed for now) forums like Greater Than Learning.

This specific content is targeted at early stage startup founders grappling with the complex, nuanced and ambiguous challenges of building a new venture in the modern information age.

Let’s dive in.

Defining terms

Privacy has been studied and debated for a long time. There’s still no broadly agreeable definition. In fact, we regularly see requests for commentary on both LinkedIn and Twitter on this particular topic.

For the purpose of this post, we will not explicitly define what privacy is and what it isn’t. Those semantic discussions matter, but they won’t help us today.

Today we will assume that privacy is proxy for power. Specifically, the power that an indvidual has to influence the outcomes related to the information they disclose and how its used.

When we refer to a privacy focused startup, we refer to an organisation that explicitly prioritises, funds and implements the principles, practices and associated metrics of Privacy by Design.

What this means for Greater Than Learning

We’ve worked at the forefront of the personal information economy for a number of years. We’ve grappled with the complexity, nuance and ambiguity of privacy, data protection and data ethics head on. We’ve make incredible progress in certain contexts.

Because of this, it’s important to note that we are in a different position to most founders. We have working knowledge of how to operationalise Privacy by Design, Data Protection by Design, Data Ethics Frameworks and Data Trust by Design. 

Where our position doesn’t differ, however, is in our constraints. We’re self funded. We’re a full time team of two (as of the time of this post). We are trying to do something that is – in our words – beautifully ambitious

As my co-founder Mat puts it, we eventually decided to spend our only upfront innovation token on platform ecosystem design and the quality of the learning experience. This has resulted in what is effectively a fully featured social learning network from day 1. Aspects of this decision making process are effectively captured in this key decision about our MVP Tech Stack.

We could have spent our innovation token on a privacy enhancing, decentralised architecture. But we didn’t. We believe that what we’ve done enables us to communicate openly, align our approach to the ways in which many organisations are constrained today, and support our entire community and key stakeholders in making progress towards better models. Much more on that in another post.

With all that very basic context out of the way, let’s talk about the pros and cons.

The pros

  1. Strong Privacy by Design practices decrease certain organisational risks
  2. Strong Privacy by Design practices actually enhance innovation opportunities
  3. Strong Privacy by Design practices are, as a result of point 1 and 2 (+ some other stuff we’ll cover in the future), very likely to enhance the qualities of trustworthiness that the startup exhibits
  4. If point 3 is the case, the qualities of trustworthiness will enhance stakeholder trust and benefit both relationship and bottom line business outcomes  

This is the short and perhaps grossly oversimplified version.

The cons

  1. Most startups will have to learn new things in order to implement strong Privacy by Design approaches effectively
  2. If strong Privacy by Design practices are prioritised, it’s very likely other stuff that is really important will be deprioritised (there’s always an opportunity cost consideration here)
  3. Given that so many ‘growth hacking’ and related practices rely on privacy eroding approaches, you have to find new ways to attract, nurture, retain and grow your key stakeholder base
  4. You may actually end up moving slower in some ways. 

However, we think most of these cons can pretty quickly be turned around. If you wanna talk about how, leave a comment and we’ll answer this specific questions.

What can you do as a startup founder right now?

We can’t cover all the possible actions in this short paragraph. However, we can suggest something that we trust will benefit you, and in turn, benefit us (the entire community). Join Greater Than Learning as an early beta member. Doing this will get you hands on with the practices that make privacy a competitive advantage.

If you’d like to talk to the founders directly, connect with Nate or Mat on LinkedIn.