Meet Karma, ex-rugby star Clyde Rathbone’s controversial people-rating startup

Clyde Rathbone made his name in rugby; first as part of Jake White’s 2002 Junior World Cup winning team and then, following a highly publicised move to Australia, as a pivotal member of the Brumbies Super Rugby team. Now though, he’s looking to make a mark on the online startup space with a new play called Karma.

Founded by Rathbone, his brother Dayne, and Monish Parajuli, Karma can be thought of as a kind of Yelp, or TripAdvisor, for humans. On its website, Karma describes itself as “a wiki of open letters and reviews about people” and “a social network where the world creates your profile”.

The startup is Rathbone’s first foray into the technology space, having previously founded a health business in Canberra.

Launched in early 2015, Karma has attracted criticism from psychiatrists in Australia, with one professor calling it “very threatening” and another calling it “a huge invasion of privacy and disturbing”.

That criticism is hardly surprising. Peeple, a Silicon Valley-based startup labeling itself as “Yelp for people”, caused so much outrage when it launched in early October that its founders quickly pulled the app and all of its marketing material.

But Rathbone, no stranger to controversy himself, is adamant that the aim of Karma is to create a more transparent world for ultimate good of humanity.

“We’re motivated to build Karma so that good people can benefit from their good deeds,” Rathbone told Ventureburn in an email interview, adding that the aim of the service is “to incentivize people to act with compassion for those whose lives they affect, and to democratise information so that vulnerable individuals are empowered to protect themselves from those with ill-intentions”.

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According to Rathbone, who’s working full-time on the startup, it was the three founders’ experiences own experiences moving to Australia that inspired them to form Karma.

“Monish, Dayne and I are immigrants,” Rathbone said in the interview. “We moved to Australia as adults, leaving behind reputations we’d built over decades, and a network of trusted friends and family. We arrived in cities surrounded by strangers who had no reason to trust us”.

These experiences, he said, “brought into sharp focus the importance of being able to learn about people, and take your reputation with you wherever you are in the world”.

As Rathbone points out though, it’s also about being able to find out about people before you meet them. We constantly make decisions around where to eat and what movies to watch based on online ratings, he told Ventureburn, so why shouldn’t we be able to do so with people?

“I typically won’t watch a movie that doesn’t have at least 80% on Rotten Tomatoes,” the ex Wallaby said. “And yet the decisions we make regarding other people are unquestionably the most important of all. When we pick a teacher for our kids, go on a date or hire someone, we often do so without really knowing the person’s true character or competence”.

“The internet, and more specifically platforms like Wikipedia,” he added, “have shown the value of making true information publicly available. Karma is an attempt to democratise information about people”.

Karma aims to make the world a more transparent place.

Right now, Rathbone told Ventureburn, Karma isn’t making money and is instead focused on “creating genuine value for Karma users and continuing to grow”.

“We’ve got ideas around recruiter access, premium accounts and advertising but we not concerned with figuring out all the specifics of our monetisation strategy at this stage”.

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With the company having taken on its first round of seed funding from a group of Sydney-based angel investors in June, it’ll be interesting to see how long it’ll be allowed to carry on operating with that mentality. If it manages rapid user growth however, its investors are a lot less likely to put pressure on it to find a viable revenue model.

According to Rathbone, Karma isn’t worried about targeting a particular market either.

“At this stage we’re focussed on people who already produce quality content online,” he said. The rugby-star-turned-entrepreneur does however believe the company will take off, arguing that “the value of being able to learn more accurate information about other people extends into every domain imaginable”.

While Rathbone acknowledges that there are a number of other startups working toward the same vision, he reckons Karma has an edge on them.

“What our potential competitors have in common,” he said, “is that they are working first and foremost to consolidate and aggregate reputation data from other sources (AirBnB, eBay, Uber, etc). Karma is the only platform primarily focused on creating reputation data”

Speaking about Karma’s most obvious (before the internet drove it into hiding) competitor Peeple, Rathbone said the while he respects the problem the company’s trying to solve, he’d “fear them more if their founders were engineers”, and if they hadn’t launched “one of the worst publicity campaigns of all time.”

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The former Brumbies star told Ventureburn it’s also possible that a larger incumbent like LinkedIn or Facebook could add functionality similar to Karma’s. He thinks that’s unlikely though “as they have much to lose entering into such a controversial space”.

Another factor which might stop them from taking on Karma is that operating an open platform while also mitigating abuse and defamation is difficult. “It needs to be core to the product and the company’s DNA, and can’t easily be tacked on,” Rathbone told us.

While the competition may be a big challenge, a far bigger one may be convincing people to allow themselves to be rated at all. If Karma manages that however, it could turn into a seriously powerful networking tool.