Applying Our Lead VC's Conviction Framework to codify and refine our POV

Our seed co-lead investor, BBG Ventures, published this pre-seed/seed investment evaluation framework a few days ago (on September 9):

This was the first concrete actionable framework I’d seen from any of our investors so I decided to leverage it. I found it very useful. I’ll be doing it monthly.

Date: September 9, 2025 @ ~9p ET

Note: Yellow highlighted text = working hypothesis, currently under validation. Included here to document learning-in-progress.

Latest inputs (August 2025 learnings):

• Research: 7-week undercover, stepped-wedge field study with 302 participants.
  

• Data: See our flagship study published on OSF (still editing, aim to polish it off by EOD today then kick off our next study on 9/22)
  

• Gap spotting:

  • The #1 culprit: TikTok Shop has opened a “backdoor” into influencer marketing. ~Anyone can post affiliate content on behalf of a brand, with little to no vetting, training, or accountability.

  • Brands bypass the work of selecting and supervising endorsers, leaving consumers exposed.

• Precedent: Anchored in the FDA’s Nutrition Facts label and decades of behavioral research, including studies across low-literacy and low-IQ populations.
  

• Application: We tested the three dominant disclosure methods (#ad hashtags, platform tags, and ad hoc disclaimers) against a new Nutrition Facts–style label. All current methods failed to restore consumer clarity. The standardized label restored recognition in under 5 seconds, across participant archetypes.

Why Now

Two forces are colliding:

1. TikTok Shop: Massified the role of influencer, turning everyday users into unvetted product promoters without guardrails. Result: impaired judgment, especially in teens shaped by disguised ads.
   

2. Litigation and regulation: Class actions against Alo, Shein, and Fashion Nova, plus FTC fines of up to $43,792 per misleading post, show the financial cost of inaction. (source)

Old disclosure formats cannot withstand this collision. They weren’t built for this scale, this speed, or this vulnerability.

And critically: consumers don’t want platforms, brands, or creators policing themselves. Just as food buyers trusted FDA-backed Nutrition Facts over brand claims, consumers want an independent standard above the platforms.

Why Us: Lived experience (also core to BBGV’s investment thesis)

• Spent three years in the trenches with Swaypay, democratizing influencer marketing and living the pain points daily.

• Personally absorbed the costs of a system with no guardrails, as unsupervised creators and undisclosed promotions created confusion and liability.

• Survived $4M+ in legal threats by building a timestamped, good-faith, public accountability infrastructure, cutting exposure from overwhelming to negligible.

• Held a dual vantage point: inside the creator–brand ecosystem with Swaypay, and inside the legal survival system that Disclosure Facts grew out of.

• Proven ability to impose clarity on chaotic, unregulated environments, now hardening into Disclosure Facts.

Why Our Product

Old methods (#ad hashtags, platform tags, disclaimers) provably fail.

The standardized Nutrition Facts–style label provably restores consumer clarity in under 5 seconds across demographics.

And it works in every room:

• Regulators: Modeled after FDA precedent, aligned with FTC standards.

• Advertisers: Halts disputes at the root by removing ambiguity.

• Creators: Independent, fast, protective.

• Consumers: Instantly legible for higher comprehension, fewer dispute triggers, stronger reliance in purchasing decisions.

• Lawyers: Provides structured proof that prevents disputes from escalating.

Conviction

Commercial food has Nutrition Facts.
Commercial posts need Disclosure Facts.

DisclosureFacts.com

Note: Conviction isn’t static; it strengthens or weakens over time based on evolving inputs and outputs.

Sources and notes

Notes on “~Every quarter of a second, undisclosed commercial post disguised as organic goes live (working estimate*)

• The cadence is an extrapolation from existing data on high volumes of creator-commerce content (video uploads, affiliate posts) divided over time.

• Non-disclosure rates draw on recent audits/studies below, which consistently show very high under-disclosure; we use the higher end to reflect current platform realities.

• We will refine both figures as we gather direct post-volume data and harden our own audit slices.

Sources on under-/non-disclosure

• How Much Influencer Marketing is Undisclosed? (EU Commission, SSRN) — ~20% systematically disclose. Link

• Majority of Influencer Advertising is Undisclosed (CEPR / VoxEU, 2021) — ~94% non-disclosure. Link

• Endorsements on Social Media: Empirical Study of Affiliate Marketing Disclosures (YouTube + Pinterest, 2018) — ~10% of affiliate posts included disclosures. Link

• Across Platforms & Languages: Dutch Influencers Legal Disclosures (TikTok, Instagram, YouTube, 2024) — under-disclosure persists across platforms. Link

*Working hypothesis markers indicate areas under active validation; included to document learning-in-progress.

Calculation notes:

Step 1. Sponsored post baseline

• Influencer Marketing Hub reported ~83.3M sponsored posts globally in 2024.

• Divide by 365 → ≈ 228,000 posts/day.

• Divide by 24 hours → ≈ 9,500 posts/hour.

• Divide by 3,600 seconds → ≈ 2.6 posts/second.
  Global total of sponsored posts (~83.3M) is assumed / estimated based on US share and global market, not confirmed in a single source.

Step 2. TikTok video uploads (potential affiliate content)

• Global TikTok uploads estimated at 23–34M/day (Techjury, Influencer Marketing Hub, Thunderbit).

• That’s ≈ 270–400 videos/second.

• Internal calculation: 0.2–1% of these are TikTok Shop/affiliate, inherently unsupervised, that equals ≈ 0.5–2.7 affiliate commerce posts/second.

Step 3. Combine

• Sponsored posts ≈ 2.6/sec

• TikTok Shop affiliate ≈ 0.5–2.7/sec

• Total ≈ 3.1–5.3 creator commerce posts/sec

• Total “undisclosed + disguised as organic” = 4/sec

Step 4. Disclosure failure rate

• Multiple audits (EU Commission, CEPR/VoxEU, YouTube/Pinterest studies) show ~80–95%+ non-disclosure rates, depending on platform/region.

• Aligning with the high end (~90%) reflects TikTok affiliate’s lack of structured compliance.

Result:

• Volume: 3–5 posts per second.

• Failure rate: ~90%+ non-disclosure.

• Interpretation: Effectively quarter of a second, an undisclosed commercial post disguised as an organic product endorsement is flooding our social feeds.

Thank you,
Kaeya