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In the past, I touched on how I think that most of the ways that original creators make money is broken. This can be anything from the authors of academic journal papers, to YouTubers, to painters, to bloggers. For the purpose of this post, I will call these creators producers and the people who consume their art (I use the word art in the most general sense) consumers. After my previous post, I spoke to some friends about Google's new Bard (the inevitable assistant-in-search) and had some additional thoughts that I wanted to share.
On the internet, making money as a producer of "free" art is often connected to advertising in some way. I think it's uncontroversial that it's a "hack" to make money off of advertising. The logic goes that as a creator, you've captured attention, and now you can sell that attention to other creators that require it. I feel like this pollutes the original creation and that art should exist on its own. I don't want some pages in my novel to have ads, or the walk in a gallery to have ads, or indeed to be pulled out of the immersion of a TV show to see ads. Consumers and producers of content would generally agree that ads within their work is undesirable.
We get to the crux of the issue: how else can producers make money? I think there are 3 general ways:
Twilio used to be a cool and trustworthy company. I remember when I was in uni, some CS students (I was not a CS student) built little SMS conversation trees like it was nothing, and suddenly SMS become something you could build things with as a hobby.
Over the past month, my view of Twilio has completely changed.
Ten days ago (Jan 19th) at around 7am UTC, I woke up to large charges to our business account from Twilio, as well as a series of auto-recharge emails and finally an account suspension email. These charges happened in the span of 3 minutes just before 5am UTC. My reaction at this point was confusion. We were part of Twilio's startup programme and I didn't expect any of our usage to surpass our startup credits at this stage.
I checked the Twilio dashboard and saw that there was a large influx of OTP verification requests from Myanmar numbers that were clearly automated. I could tell that they're automated because they came basically all at once, and mostly from the same IP address (in Palestine). At this point, I realised it was an attack. I could also see that this was some kind of app automation (rather than spamming the underlying API endpoint) as we were also getting app navigation events.
After we were suspended, the verifications failed, so the attack stopped. The attacker seemed to have manually tried a California IP after that some hours later, probably to check if they've been IP blocked, and it probably wasn't a physical phone (Android 7). Then they stopped.
I also saw that our account balance was more than £1.5k in the red (in addition to the charges to our bank account) and our account was suspended until we zero that balance. The timing could not have been worse as we were scheduled to have an important pitch to partners at a tier 1 VC firm. They could be trying the app out already and unable to get in as phone verification was confirmed broken.
We're on the lowest tier (as a startup) which means our support is limited to email. I immediately opened a ticket to inform Twilio that we were victims of a clear attack, and to ask Twilio for help in blocking these area codes, as we needed our account to be un-suspended ASAP. They took quite a long time to respond, so after some hours I went ahead and paid off the £1.5k balance in order for our account to be un-suspended, with the hope that they can refund us later.
I was scratching my head at what the possible motive of such an attack could be. I thought it must be denial of service, but couldn't think of a motive. We're not big enough for competitors to want to sabotage us, so I was expecting an email at any point from someone asking for bitcoin to stop attacking us, or a dodgy security company coming in and asking for money to prevent it. But Twilio sent an email saying that this is a case of toll fraud.
I recommend reading that article, but in essence, those numbers are premium numbers owned by the attacker, and every time Twilio sends them a verification SMS, they make money, and we foot the bill.
Twilio seemed to follow a set playbook that they use for these situations. Their documentation names a set of countries as the one where toll fraud numbers most likely come from and recommend are blocked (I suppose it's easy to get premium numbers there): Bangladesh, Sri-Lanka, Myanmar, Pakistan, Uzbekistan, Azerbaijan, Kyrgyzstan, and Nigeria.
I immediately went and blocked those area codes from our side, though Twilio also automatically blocked all countries except the US and the UK anyway, so it didn't really make a difference. Also, the attacker tried again using Indonesian numbers after that, so clearly a blocklist like that is not enough. Later I went and one by one selectively allowed only countries we actually serve.
Beyond this, Twilio's response was to try and do everything to blame this on us. They wash their hands of the responsibility to secure their own APIs, and instead the onus is on us to implement our own unreasonable security measures.
I told a friend about this, and through that friend found out that this is actually a very common problem that people have been having with Twilio, because Twilio dropped the ball. Apparently, out of all of those cases, we got pretty lucky (some people lost 6 figures). For me, the main issues are:
Their email was incredibly patronising, like others have reported, and they acted like they're doing us a huge favour by blessing us with a partial refund in account credits (not even real money). But we need to explain to them first how we promise to be better and not do a silly mistake like this again!
Twilio tries to push you into agreeing not to dispute the bank charges (see the link above for why they do this). I refused to agree to this, and first wanted to know exactly how much they would refund us, and if they would refund us in real money, not account credits (they agreed to "prioritize" this).
They told us that their finance team is who decides the refund amount, based on the information we provide on how we'll do better and a breakdown of the charges. I told them exactly what we did to combat this, and what the charges were. We had lost a few hundred in startup credits, then just over £2k in real money.
Instead of telling me how much they would refund (remember, I still haven't agreed not to dispute the charges, which they "required" in order to issue a refund), they went ahead and refunded us £847 and some change immediately.
I believe this to be a ploy to try and prevent us from disputing the original charges, because if we dispute now, we would have more back than what they charged.
I sought some advice, with mixed opinions, but it seems quite clear that if we dispute these charges, at the very least it would mean that we can no longer use Twilio for SMS anymore (which I don't want to anyway). But, this means switching to a different provider before disputing.
It would be relatively easy to switch, as they all tend to work the same way anyway, but would still require:
This is not difficult, but time and effort that I don't have right now, as well as a distraction from our actual core product. I don't know if £1.1k is worth that "labour", or any extra stress that may come if Twilio decides to make a stink about this and pass us on to collections etc.
All I know is: Twilio, never again. I will advise people to not use Twilio for the rest of my life and longer depending on how that advice may spread and how long this article survives.
Yesterday evening I had a call with three founders looking for some advice on specific things. Something that came up was how to make a proper pitch deck. My advice is usually to go to Slidebean and check out the pitch decks of some well-known companies. There's a clear pattern to how these are structured, depending on who the target of the deck is.
But recently, a different founder sent me a pitch deck asking for feedback and he used a platform called Tome, and his slides were pretty cool, and when viewed on that platform could even have little video bubbles where he explains the slide. At first I though this was a GPT-3-based slide generator (similar to ChatBA (formerly ChatBCG)) but it seems to be more than that and looks like it could be a great tool for putting together a pitch deck on a whim!
Referral link, not sponsored ↩︎
I'm letting day-nft.com expire. This was an experiment with 3 other people where we minted simple NFTs that each correspond to a different date going back something like 10 years. The technical part was relatively straightforward, but we realised that the whole thing is just one big hype game, and in order for it to succeed we would need to do things that we weren't comfortable with morally, so we abandoned the project. At that point I had already done some research and analysis on NFT marketplaces (which I intent to publish at some point) that helped me cement the current views I hold about this space.
I wrote an article on Y Combinator and the drama with DreamWorld: https://yousefamar.com/memo/articles/entrepreneurship/y-combinator/