Ex top 50 tournament participant here (circa 2021).
I think Numerai is a great idea and an extremely innovative approach to the market with the potential to be very successful. I’d like to see the team pivot to treating their data scientists as the customers. I think this would really establish the alignment / flywheel they’re looking for.
Better experience for data scientists —>
Higher avg participant stake, more participants and higher avg payout —>
Tougher competition and higher quality Meta Model —>
Better fund performance —>
Bigger AUM / Bigger budget for company.
With a larger budget, Numerai can put more resources toward improving the experience for their data scientists. This completes the flywheel.
More participants and higher participant satisfaction also means more marginal buy pressure on $NMR, which leads to an increase in price and effectively gives the company a larger budget to reward their data scientist with as well.
With that said, these are just some thoughts that I had. I am graduating undergrad soon and was thinking back about the projects I worked on throughout college. That’s when I remembered the Numerai tournament and looked back into this stuff. Anyway, I’d appreciate any thoughts you guys might have on this.
I don’t think they see us as partners but rather disposable data crunchers or coal mine canaries which leads me to believe at one point they will replace us either because they figured out how to, or ran out of data scientists willing to stake.
I believe that what’s good for existing stakers (anything to pare down risk, colaborate or increase earnings ) is good for attracting new users, but as things stand we carry all the risk, get ignored, talked over etc,etc.
This might be the future of finance/quant but these days I am not sure it will be Numerai, not saying its easy, but they seem great at raising money and the tech is sometimes great, but when it comes to product ( Don’t think there’s a role in the organization ) I think there’s no plan there.
Personally I don’t think we are “customers” if anything Numerai is the customer. They’re paying us for predictions after all. I don’t like being referred to as a “user” either. What I am using? Nothing. I’m the one being used. I get that that term comes from VC and the idea that Numerai is a “platform” but it’s really not. Numerai is more “protocol.” i.e. a protocol for managing a large long-short hedge fund. The only term I find appropriate and not demeaning is “competitor.” This is a tournament after all.