Can John Roa’s Caden Solve the Internet Advertising Privacy Problem?
Internet advertising was born from the idea that a variety of services and information would be available for free in exchange for the ability to collect data from consumers to serve them better advertising or search results. However, that ideal “contract” with consumers has in many cases turned into a “Faustian bargain” at the cost of personal privacy.
At the root of the staggering growth of Internet advertising is the data most often provided by consumers without their informed consent. Digital advertising spending worldwide was $521.02 billion in 2021 and is forecast to reach $876 billion by 2026, according to Statista, with marketers spending more on digital platforms than any other media format.
Privacy legislation such as Europe’s General Data Protection Regulation (GDPR) and the California Consumer Privacy Act (CCPA) have attempted to even the playing field to give consumers more control over their personal information. Both have yet to significantly change market dynamics, with billions in market cap at stake in companies such as Amazon, Netflix, Alphabet, Meta and The Trade Desk.
One startup is hoping to change that dynamic Caden. Founded in 2021 by John Roa, the New York-based company provides an open data platform that empowers users to control and monetize their personal data. Caden allows users to securely access data from different brands and add it to their own secure Vault that they own and control. Users who agree to share their data for advertising purposes may earn a portion of the revenue generated by the app.
The idea isn’t exactly new, but Caden’s concept has been championed by internet stars, including Jerry Young of Yahoo! of founding fame and Wenda Harris Millard of MediaLink, as well as business leaders such as Barry Sternlicht of Starwood Capital. Its founder is serial entrepreneur John Roa, who broke his vow to never go through the pain and stress of a startup again, but did it to build Cayden. This Founder’s Journey is based on my interview with Roa.
“I actually wrote a very rough business plan for Caden back in 2015 [When Roa was at salesforce.com]. And so I thought about that idea for a very long time. And so in 2021, I was talking to a friend who comes from the martech, ad tech world, and I showed him this business plan. He was the first to tell me that this was a really good idea and that I should pursue it and see if it was worth doing. And my first reaction was like this. “No way, not doing that again!” I’m not starting from scratch,” says Roa.
Roa’s reticence was based on burnout and depression from building and selling his Chicago-based digital agency AKTA to Salesforce in 2015. and substance abuse with suicidal thoughts. A friend encouraged her to write about her experience, which then became a memoir that turned into a book A practical way to get rich and die trying Published by Penguin, Roa to “promote honesty and transparency instead of the toxic superhero complex in which we exist as entrepreneurs,” says Roa.
But Caden’s idea began to take on a life of its own when Roa’s plans to spend time in New York to promote his book were put on hold due to the Covid-19 pandemic. His adtech friend then gathered together a number of influencers, such as Bill Gray, former Ogilvy CEO, Jerry Young, Wenda Millard, and Barry Sternlicht, to discuss the business plan. “And suddenly, standing in front of me a large group of people and somewhat against my will, I said: “I don’t want to do this, I don’t want to talk about this.” I thought they would just tell me why it could never work and this is not a good idea. And it was the complete opposite. And people like Jerry Young, who helped create the industry, said there’s been a privacy problem in Internet advertising for 30 years, and he wants to be part of the solution now. And I kind of said. And all these very influential people said: “Not only do you have to do it, but if you do it, we will support it and we will invest in it and we will put our weight behind this success.” says Roa.
From then until now, Roa and his team of about 25 employees have been working quickly to get their app up and running. A beta version is now available. With the Caden app, users can choose to have their personal data from online services like Amazon, Netflix or Uber Eats automatically collected into their Caden account, where they can selectively choose to share it and get cash back. According to Roa, users can expect to earn between $5 and $50 per month by sharing their data.
“So now all that really valuable first-party data, I can now take, which is my legal right, and pull it into a secure Caden vault, basically digital wallets that we provide to the user. And that wallet is encrypted and owned by the user. We just give them a chance to pull it all together. Once it’s there, we convert it into a knowledge graph, which is the most technically challenging thing we do,” says Roa.
With $9.4 million in funding to date, Caden is just getting started on his journey. Its most recent Seed round of $6 million was led by Streamlined Ventures in early January 2023.
Roa grew up in Grosse Pointe, a suburb of Detroit, Michigan. Her father came to Michigan from Venezuela to go to school in the US before Roa was born. “I grew up in an immigrant, low-income household on the Detroit border. And it’s funny because I think people who hear my story must assume that my parents are like computer scientists, and I was exposed to computers at an early age,” says Roa. His father only brought home a computer when he was 11 years old, because it was given to him as a leftover they were going to trash from the Chrysler assembly plant where his father worked.
‘I just fell in love with it. The funny thing is, my parents thought I was crazy. They thought I had a problem. I was just obsessed. But before that, there was no technology in my family. There was no entrepreneurship. There was none of that. So whatever reason I went down this path is a bit of an unknown,” says Roa.
His obsession will lead him on the path to building a technology business and creating wealth. He describes himself as a typical outcast techie who builds websites for the school and hacks school systems for fun. He started his first business at the age of 14. At age 18, he started a video game business, moved to Los Angeles, and later sold the business to William Morris. That exit was followed by Roa founding SocialCrunch, a sentiment analytics company that was then acquired by Tastebud. He then moved to Chicago and founded a digital agency called AKTA, which he sold to Salesforce in 2015 before founding Caden in 2021. “I’ve had three very classic failures and three exits,” Roa says of his extraordinary entrepreneurial journey.
What about the future? Whether or not Caden will succeed in shifting the balance of data ownership to consumers remains to be seen. “We’re building something that’s extremely complex, very difficult, has all the makings of the hardest way to build a tech company, but if it works, it will fundamentally change the future of the Internet. And that’s an exciting proposition,” Roa concludes.