Manifold Markets Founder - Predictions Markets & Revolutionizing Governance

Now, here is a question I've had for a while. Why- why don't companies who have direct incentive to get the best possible information on themselves, on the factors affecting their business, why aren't they using internal prediction markets if this is the best way to aggregate information?

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All right, this is gonna be fun. Uh, today I have the pleasure of speaking with- with my friend, Steven Grugutt. He's the founder of Manifold Markets, which has received a grant from Scott Alexander. Um, Scott has written thousands of word about these- thousands of words about these guys, and they've raised a two million dollar seed round. And, um, you know, i- i- it's an incredibly exciting project. So, um, Steven, why don't you tell us a little bit about Manifold Markets?

Great. Uh, thanks so much for having me on this podcast, Omkesh. It's great to be on here after seeing other people like Tyler Cowen and David Deutsch. I guess first thing, I'm- I'm one of three co-founders of Manifold Markets. Um, but what we're- what we're doing is building a platform for user-created prediction markets. So the idea is that anyone can come onto our site and create a question about anything that they care about, and then they can, um, have their friends and other people on our site come bet on that, and that- the betting process, through the magic of our, like, market mechanism, will help, uh, you know, get the best and most calibrated probabilities, um, that you could find.

So, um, l- let's talk about the mechanism here. So the, uh... Uh, correct me if I'm wrong, but the idea is you use real money to m- buy Manifold dollars. Uh, w- what is your reason for expecting that people will care a lot about how many Manifold dollars they have? Um, so w- what is your hypothesis about human nature and reputation that makes you think this is something people are gonna invest a lot of effort and time into calibrating?

Mm-hmm. Yeah. Uh, so I guess- I guess to- to take a step back for people listening to this, uh, Manifold uses a- a play money currency. Um, if you sign up right now, we'll give you a thousand Manifold dollars, which is our in-platform currency, uh, to- uh, for you- for you to use and bet as you see fit. Um, but the- the reason why we think that, uh, play money can work is that peop- uh, people are driven more by, uh, status and competitiveness, um, than greed. You know, we- we kind of see ourselves as a social game where, uh, people can come on to hone their skills at predicting, and then demonstrate to others that they really do know more about what they- what they're talking about, and they can prove it with an ob- um, an objective track record, uh, from their betting history.

Yeah. That- that- that's a- that's a very interesting point, which makes me wonder, do you expect that in the future Wall Street firms will be enticed to get the top people on the leader boards on Manifold Markets to come work for them? One of the objections that Tyler Cowen has to, um, prediction markets is, you know, I- I... He- he's kind of tongue-in-cheek about this, but I- I remember at one point hearing him, uh, saying, "You know, if you guys are so good at predicting stuff, you would expect all these hedge funds to be trying to constantly hire you guys. The fact that they're not makes me think that, you know, this is kind of just a hobby. This is not, uh..." So I- I... Curious about your reaction. Do you- do you expect, uh, people to be coveting these, uh, these top predictors for their, uh, you know, for- for their prowess at, uh, predicting the future?