Caden Launches with $3.4M to Empower Data Control

The Rise of User-Controlled Data: Introducing Caden

John Roa, a successful entrepreneur, deeply values individual privacy. Following the sale of his design firm, ÄKTA, to Salesforce in 2015, he intentionally chose to spend several years living privately on a European island.

A New Venture: Caden and the Future of Data Ownership

Roa has now returned to New York City to launch Caden, a novel startup designed to empower consumers. Caden enables individuals to share their data with businesses and receive financial compensation in exchange. The initial business concept was formulated as a thesis concerning the evolving landscape of data privacy during his tenure at Salesforce, prior to commencing his sabbatical, as he revealed to TechCrunch.

Initially, the plan was largely theoretical, according to Roa. He foresaw regulatory hurdles for companies regarding the storage of passively gathered, third-party data. He predicted a transition towards a “privacy-first” paradigm where users maintain ownership of their personal information and exercise complete control and informed consent over its utilization.

Securing Seed Funding and Key Backers

Caden recently emerged from stealth mode, having secured $3.4 million in pre-seed funding. This funding round included participation from prominent figures such as Jerry Yang, co-founder of Yahoo! – TechCrunch’s parent company – Barry Sternlicht of Starwood Capital, and Don Callahan, former CTO of Citigroup, alongside other angel investors, the company reports.

Zero-Party Data and the Encrypted Data Vault

The company positions itself as a “zero-party” data platform, emphasizing that data is shared with brands solely on a voluntary basis. A central component of Caden is an encrypted “on-device vault” where users can securely store their personal data and gain valuable insights from it. Roa draws a parallel to Spotify’s “Year in Review” feature, but notes Caden’s vault encompasses a wider range of user preferences and behaviors.

Furthermore, Caden offers an API, named Link, which facilitates connections to accounts like email or banking platforms. This allows users to extract their data and store it securely within the vault. Once stored, users can grant permission for trusted companies to access the data, with the ability to revoke or modify these permissions at any time, as users retain ultimate ownership of their data within Caden, Roa explained.

Development Timeline and the App as a "Savings Account"

The Caden team has been developing the underlying technology for nine months and anticipates launching a beta version of its mobile application within the next six months. This application will enable users to begin earning rewards for their data, a concept Roa likens to a savings account.

The Regulatory Shift and the Value of Zero-Party Data

A growing number of U.S. states have enacted, or are considering, legislation similar to the California Consumer Privacy Act (CCPA), a 2018 law granting consumers the right to prevent companies from selling their personal information. Roa argues that increasing regulation is transforming third-party data collection into a liability for businesses due to the complexities of auditing and compliance. He contends that zero-party data is more accurate and reliable as it originates directly from the user.

Targeting Consumer Brands for Initial Adoption

Investor Jerry Yang believes Caden will initially appeal most to consumer brands, as they stand to benefit significantly from improved data access, as he communicated to TechCrunch via email.

“Considering the substantial effort and resources required for data collection, storage, insight generation, protection, third-party data acquisition, and ongoing maintenance, Caden provides a platform solution that allows numerous companies to tap into these capabilities without independent development. I am confident that Caden’s reach will extend beyond consumer-facing businesses in the future,” Yang stated.

Lessons from Past Attempts: Datacoup's Experience

Caden is not the first to explore this concept. Datacoup attempted a similar model in 2012, allowing users to sell their data directly to companies, but ultimately ceased operations in 2019 due to users receiving minimal financial returns. Valuing consumer data is challenging, and companies are often motivated to minimize acquisition costs.

Caden's Strategy for Success: User Experience and Streamlined Processes

Roa is confident that Caden will overcome these obstacles by delivering a superior user experience. He acknowledges that while brands are not inherently inclined to readily return data to users, they are legally obligated to do so, but are not necessarily incentivized to make the process easy.

“Caden, along with other innovators, is creating streamlined, user-driven processes, eliminating the need for third-party companies to actively solicit data,” he added.

Beyond Monetary Compensation: Enhancing Brand Experiences

Roa also aims to unlock non-monetary value for consumers through improved brand interactions. He envisions a scenario where using Caden leads to more personalized and enjoyable experiences.

“If utilizing Caden simply enhances your daily life, provides tailored services, and fosters a sense of being understood – these are the value propositions we prioritize. This is an area where many of our competitors have fallen short,” Roa concluded.