To provide our customers with a high-quality, software platform that brings revolutionary real-time market efficiencies to the economics of Internet bandwidth for both buyers and sellers.
In late 1995, Internet traffic had just shifted gears and was entering its fastest growth period ever. However, as usage grew, performance and service quality did not get better on what came to be known as the "World Wide Wait". One school of thought was that the key to improving service quality was in rethinking Internet economics (pricing and incentives) to make allocation more efficient, and enable different types of services to co-exist.
One of our founders, Nemo Semret, was pursuing a Ph.D. in Electrical Engineering at Columbia University's Center for Telecommunications Research, where his research was on using game theory and other economic methodologies to design and analyze networks, focusing in particular on auctions and other market-based algorithms for decentralized network control and management. By mid-1997, just as he was getting exciting theoretical results, it became clear that this topic had greater implications beyond academic interest. In fact, it promised a practical way forward for Internet Service Providers, facing both an enormous problem, and an exciting opportunity.
Bandwidth should be bought and sold dynamically, and delivery should be in real-time. Additionally, software agents, combined with well thought-out rules, should create an efficient spot and futures markets for bandwidth. Nemo and Columbia computer science graduate and co-founder Giovanna Giammarino came to the realization that by developing a solution for real-time market pricing of Internet bandwidth, they could solve a major business problem, create an opportunity for ISPs, and make the Internet better for the end user.
After several months of brainstorming, research, and prototyping the technology, they concluded their vision could come true. In March 1998, they founded InvisibleHand Networks, Inc. and started developing Merkato.
The name "Invisible Hand Networks" is derived from Adam Smith's famous metaphor wherein free market forces lead society to the best use of its resources, as if participants, though motivated by self-benefit, were guided to the common good by a benevolent hand.
Indeed, to the vast majority of end-users, our technology is "invisible", embedded in the Internet infrastructure, transparent to the end user, but making things better on the large scale of things, using the same fundamental market principles seen by Smith in the late 18th century.
"Networks" has a double meaning, of data transport networks (the Internet), but also of the network of hundreds of distributed market places that we will enable, which together are even more efficient than in isolation.
Our values are based on the common interests of both buyers and sellers of bandwidth and other networked resources.
Improving the efficiency of these markets is a win-win proposition not only for our wholesale buyers and sellers, but also, ultimately, for the end user, who will benefit from cheaper, and better quality services.
As a natural mathematical consequence of the goal of market efficiency, truth and fairness are present in the very fabric of our technology, in the market rules and algorithms, and we strive to make them the basis of our relationships, whether its within the company, or with partners and customers.