Tag Archive for: Blockchain

Over the last decade, consumer technology and the sharing economy has revolutionized almost every aspect of our lives. It has changed the way we travel, shop, interact with our friends and even date. Millennials have come to expect immediacy and sharing of experiences, including in their financial investments. As a venture capitalist during this time period, I’ve watched and invested in startups focused on disrupting their analog predecessors and provide the best on-demand service at fractions of the costs. While there have been major innovations in peer-to-peer and mobile payments, particularly in the emerging world, traditional finance has largely avoided total industry disruption — until now. With half of the world’s population under 30 years of age and the number of under 35 millionaires at an all-time high, financial services companies are going to be dealing with a lot of customers who do not understand why their money is ‘locked-up’ in a fund for a decade or why their home can’t be fractionally sold.

Blockchain technology, and the digitization of shares (also referred to as tokenization)  is enabling this type of user experience. By digitizing an asset, and using a smart contract to automatically enforce the rules and regulations of that asset, owners are able to sell shares of private securities on SEC complaint exchanges on-demand In financial terms, we refer to this ease of creating a transaction as ‘liquidity’. In millennial terms, we might describe this feature as swiping left, unsubscribing and utilizing free e-commerce returns.

Disruption in startup investing already began with crowdfunding. The whole point of crowdfunding was to make access to the best deals available to a far wider audience. This it did. However, it fell short in aiming to address the inherent portfolio approach of a fund where you can spread risk across multiple portfolio companies, and it did not address the lack of liquidity. The digitization of funds is the next evolution of that vision, with professional investors at the helm doing deeper due diligence than what users can read on crowdfunding websites. The other advantage of these funds over crowdfunding is that you can get involved with later rounds of funding, since crowdfunding is usually focused only on seed stage.

This is transformative because trillions of dollars worth of the world’s assets do not have a liquidity feature, and as a result, they are bought or sold at a discount because transactions are done ad-hoc without global, highly accessible marketplaces. For instance, private equity and venture capital funds have typical lockup periods of 10 years or more because they wait for their portfolio companies to return and reserve funding for follow on rounds.   If an investor wants to exit a fund interest, they find an intermediary, who then finds a buyer if they can.

The nature of private equity and venture capital requires fund managers to have the ability to operate with a high degree of autonomy from their investors.. The fact that the fund is digitized has nothing to do with the fund investment thesis and the level of risks the fund will assume in its investments. A digitized fund has more freedom to operate than a traditional fund. The fact that your investors have liquidity, allows you to take a much longer term view, if needed, in an investment since the pressure for liquidity of the LP interests is not there anymore. They can exit when they want to and sell their interest on a SEC compliant secondary exchange.  If anything, liquidity can improve returns. First, you can exit the fund after, let’s say, 3–4 years rather than 9–10 greatly increasing your internal rate of return if the net asset value has grown sufficiently by reducing the investment period. Second, liquidity has a premium (the same way that illiquidity has a penalty) in terms of price so a liquid fund should actually be more valuable.

Some traditional VC investors are driving the ball forward in this arena.  Rob Nance and Jon Avidor of CityBlock Capital recently told me about their NYCQ project – a digitized venture fund making equity investments into companies building the infrastructure for digital assets. As meta as this sounds, it struck me as one of the smartest applications of blockchain technology that I’ve seen, and one that also gives retail investors the chance to make a bet on the use of blockchain to tokenize legacy assets.

CityBlock sells shares of the NYCQ fund on their website and allocates the capital it to proven investors with track records of profitable exits. The value of the shares will change as the underlying equity holdings of the fund changes. It’s a diversified portfolio of equity in companies that are upending traditional finance, and it’s liquid. The company thinks of itself as the Airbnb or Uber of venture capital – an investment firm for the digital age focused on removing user friction and creating hyper-efficiency. Managing Partner Rob Nance said “What we learned from Bitcoin and altcoins is that the there is pent up demand for liquid digital assets. Digital tokens shares can be cashed out much faster and more easily than conventional paper shares because there are significantly fewer layers between buyers and sellers.”

Other players in this space include Blockchain Capital, SPiCE VC, and Science Blockchain, who have all successfully issued digital shares in their venture funds and those shares are preparing to trade on regulated exchanges.  In the very near future more funds will provide liquidity as a competitive advantage. Ultimately, we may look back at the days where our financial portfolios were tied up in illiquid investments and consider this as old school as the Blackberry.

 

Article first appeared August 16, 2018 on Forbes.com.

https://www.forbes.com/sites/nisaamoils/2018/08/16/millennials-are-driving-the-digitization-of-finance/#2ad2da4359d5

 

After many stops and starts it finally appears that we are on the verge of a true convergence explosion between Internet of Things (IOT), AI, and blockchain. Or in other words, the production of data, the consumption of data and the distribution of data.

To review:

IoT, pertains to the interconnectivity of the world around us—basically how all of our personal and home devices work together to optimize daily human life.

Artificial Intelligence (AI) has previously been described as the ability of computer systems to perform tasks that previously had required human interaction, but today it pertains more to algorithms that assemble and analyze personal data which is then used to facilitate and streamline human existence.

Blockchain is a digital ledger in which transactions are recorded chronologically and publicly. The technology often involves bitcoin or other similarly cryptocurrencies. The main benefit of blockchain is that it catalogues data into a permanent record along a chain that is transparent and linear.

The convergence of these technologies come with both enormous benefits and also significant risks. Industries have been looking at blockchain as a way to streamline their processes and make tracking and data collection simpler and more transparent. In the past, there have been those who worried about the susceptibility of IoT and AI to the hacking of encryption services. Those security concerns are one of the main reasons why we haven’t yet seen a true explosion of the convergence of IoT, blockchain and AI but the tide has begun to turn as blockchain advances have now made the aforementioned hacking more difficult.

What are the key convergence highlights? One of the main ideas at the interaction of AI and Blockchain is the data marketplace. If everyone owns their own data and can make it available as they choose in a private manner, we could have more data in aggregate.  To truly achieve its potential, each of the three building blocks of AI must be made available in a centralized, private, and secured manner.

Outlier Ventures explains the need for the Convergence Ecosystem by saying, “The Internet of Things is creating an unmanageable data environment, and artificial intelligence is giving those who control the most data more power than any company in history.”  Outlier adds, “The integration of these technologies will see markets become increasingly open-sourced, distributed, decentralized, automated, and tokenized.”

Observers are closely watching which sectors and companies will emerge atop the convergence industry bracket. Interestingly, this convergence war echoes what occurred several years ago with cloud/mobile convergence. The companies who emerged victorious from that battle were not initial sweetheart companies like Lycos and Yahoo but rather Microsoft, Amazon and surprisingly, IBM, a company once associated with hardware who has made significant inroads into this space, especially as of late.

Several budding convergence sectors will undoubtedly determine the winners and losers. The Government Accountability Office recently identified eight industries where convergence has the greatest upside. They include the health care industry, transportation (both personal and commercial), smart homes and buildings, manufacturing, supply chains, wearables, agriculture and energy. Other industries that appear primed to take full advantage of the technology include farming, marketing, retail and the financial services arena.

So if you’re making your convergence picks who should be in your Final Four? Not surprisingly the smart money is on the companies that are already leaders in the digital economy like Google, Amazon, Microsoft, Apple and, despite their recent Cambridge Analytica issues, Facebook. These behemoths have access to a wealth of data and already have established footholds in the IoT landscape. Google, for example, has cornered the market on geographic mapping. But the companies who could become major convergence players aren’t simply limited to the GAFA Four. Metromile, for example, is a San Francisco based company which provides per-mile auto insurance along with an app called The Pulse, which collects data about trips and car health. Ecobee is a Canadian home automation company that makes thermostats and smart light switches for both residential and commercial use and a company like Ring is already a major player in the home security field.

In the health care field, Chrono Therapeutics is focusing on improving clinical outcomes for patients battling addiction and living with neurological disorders via their Integrated Dosing Solution. The company integrates timed drug delivery with personalized, mobile-based digital support and data analytics which seeks to maximize compliance and improve overall patient health. Several smaller start-ups have a real shot at establishing and solidifying a hold on a market that escapes the view of one of the aforementioned tech giants.

 

Article first appeared on Forbes.com

https://www.forbes.com/sites/nisaamoils/2018/07/18/convergence-of-brains-and-chains/#499cc61d6495

 

 

Despite the fact that the way motion pictures are made and seen hasn’t changed dramatically in the last century, there have been notable examples in the last twenty years of technological advances which have revolutionized the film industry.

Streaming services have reshaped the way audiences watch movies or other content at home or on the go, creating a new wave of innovative entertainment options. The ability to actually make films has become easier, as director Steven Soderbergh proved with his latest film, Unseen. IMAX made the “big screen” experience even bigger with movie screens that are nearly 100 feet tall. Movie theaters made the change from heavy, analog 35 mm film to digital in the early 2000s, and one of the biggest technological advances came in the world of animation as Pixar revolutionized animation by expertly combining engaging storytelling with breathtaking visuals. Check out Coco for further proof!

Now, the latest tech trend that appears ready for its close-up in the movie business is blockchain and that technology is poised to take the film industry, in the words of Toy Story’s Buzz Lightyear, “to infinity and beyond.”

The following is a sampling of sectors within the movie business which are using blockchain, and the women at the helm that are creating lasting change in the industry.

Independent Production

One area of the movie business that is already incorporating blockchain is in the production, marketing, and distribution of independent films. The first blockchain film is set for release in early July and is called, No Postage Necessary. The film, starring George Blagden (Versailles) and Charleen Closshey (An Evergreen Christmas), is a romantic comedy about a man who poses as a postal worker to steal people’s mail in order to make ends meet.

What makes this film different from traditional movie production is that it is being distributed through a P2P incentivized video network which utilizes the blockchain app Qtum. The clear benefit of this technology is that, in addition to being released in theatres, it will also be made available to purchase and view online using bitcoin. This groundbreaking change will immediately eliminate a litany of movie industry middle men who are waiting to get their hands on a portion of box office revenues.

Anti-Piracy

Blockchain significantly reduces the possibility of piracy by providing top-to-bottom transparency whereby all individuals involved in each stage of the process, from production to content viewing, are identified. Piracy is a problem across the movie industry, but it hits independent films especially hard. These films already are at a disadvantage in trying to gain moviegoers eyeballs against the big studio tentpoles. For example, the music industry is already using blockchain by utilizing unique IDs and time stamps in a way that will all but eliminate piracy. Watch for the movie industry to follow suit.

Consumer Interaction

The social media interaction app TaTaTu is the first video-on-demand and social platform to reward consumers for watching movies, music videos, sports, gaming, and celebrity content. The app also rewards consumers for sharing and posting content in addition to when their friends watch and post, as well.

The platform is the brainchild of AMBI Media Media Group Co-Founders Monika Bacardi and Andrea Iervolino. The company is in negotiations for additional content partnerships and, on June 27th, announced it would produce and finance the directorial debut of actor David Henrie (How I Met Your Mother) entitled This is the Year.

The company’s new beta test is scheduled for July 1st.

Distribution and Marketing

Led by company CEO Amorette Jones, Treeti is designed to harness the disruptive power of blockchain in order to create a new way for filmmakers to distribute and monetize their creative projects. Jones is no novice to the film industry. Over the past two decades, she has revolutionized marketing from

creating the first dedicated movie website for Stargate to being first to leverage the power of the internet for The Blair Witch Project, widely praised as the first and most successful socially interactive marketing campaign ever.

Jones also paved the way for digital distribution with the launch of Standing in the Shadows of Motown, which enabled studios to increase revenue by eliminating the cost of striking prints. The Treeti program will eliminate the need for third party services for studios and allow content owners and distributors to directly bring their content, promotional events, and PR directly to audiences.

In-Theater

Hong Kong based ANX Blockchain Services has developed a blockchain platform that will eliminate a theater circuit’s dependence on time consuming, credit card transactional cash flow by working in, what they call, Movicoin. Starting with incorporating the ABS into a chain’s loyalty club service, moviegoers purchase Movicoins either at the theater’s online platform, POS system, or right at the box office. Then, consumers store their Moviecoins in their digital wallets and can use Moviecoins to purchase either movie tickets or theater concessions. Due to the technology’s simplicity and convenience, Moviecoins will significantly cut down on long lines at the box office and concession stand through their innovative technology. The company recently announced the addition of former Focus and Sony Pictures executive Peter Schlessel to its Advisory Board.

Subscription Services

What will be interesting to watch is which of the subscription moviegoing apps will be the first to incorporate a blockchain component. The majority of bitcoin users are between the ages of 20-35, the prime age demographic of subscription moviegoing apps such as MoviePass, Sinemia, and exhibitor subscription programs that are in place from circuits such as AMC and Cinemark. Fan favorite Alamo Drafthouse announced a subscription based beta test that will begin in mid July.

If its financial standing (or lack thereof) is to be believed, MoviePass, which set the moviegoing industry on its ear in early 2017 by bringing a $9.99 subscription plan to market, won’t be the service to do so, as financial and industry experts don’t expect the service to last much longer after consistently hemorrhaging money. Alternatively, look out for the individual circuits to revel in the benefits of blockchain. From the standpoint of lower transactional fees, increased concession sales, and greater customer loyalty, MoviePass showcase’s a version of ANX’s Movicoins as part of their programs.

While the movie industry is currently lagging behind other sectors with the incorporation of blockchain in its day-to-day business, it’s important to note that it is an industry that historically takes a while to incorporate new technologies. When it does, however, that technology usually takes off like a

500 HP Dodge Charger in The Fast and the Furious, and women are more than happy to take the wheel.

 

Image: Shutterstock

This article was first published on Forbes.com

If ever there was a question as to whether New York City is the capital of fintech or blockchain, it was answered this week. Through a series of events from May 11 – 17, “Blockchain Week New York City,” surprised everyone in attendance with diverse panels. Conference organizers were particularly careful to put women on panels and get female attendance up.  “Satoshi is female” they declared and wore T-shirts to match, referring to the still unknown identity of Satoshi Nakamoto who is credited with founding crypto and blockchain. “We think cryptocurrencies should be built with  different values than Silicon Valley,” said Nyla Rodgers, the creator of the Satoshi is Female group.

The headliner and most talked about event of Blockchain Week is the 4th annual and 3 days long Consensus however, I found the most inspiring talks at the Women on the Block Diversity event on Mother’s Day. Their concept of having all women speakers was designed to highlight and recognize the contributions and innovations of woman across the blockchain industry globally. The event had over 400 registrants from all over the world, including 50 speakers from US, Canada, Japan, China, Canada, Belgium, Germany, Switzerland, Turkey, Australia, Lithuania, South Korea, Norway and the Cayman Islands.

The day of learning and thought leadership at Women on the Block had a goal to educate and empower women to become involved in the emerging and disruptive industry.  Topics included smart contracts, raising capital, creating startups, legal and regulatory issues and use cases and the room was a sea of diversity.

The event’s sponsor Microsoft gave out a series of awards, one woman particularly deserving is Amber Baldet, Clovyr Co-Founder and CEO, the recipient of the Corporate Innovation award.  Her company brings the flexibility and ease of use of modern application development to the blockchain domain. With Clovyr, people and businesses can experiment and even implement blockchain-based applications. Clovyr could also in the future easily enable merchants to accept cryptocurrencies as a form of payment as seamlessly as they accept a credit card. It’s these types of developments that will cement cryptocurrencies place in the larger scheme of the consumer based economy. Previously, Amber led the team at J.P. Morgan Chase that developed the blockchain project, Quorum.

Another woman highlighted was Ashwini Anburajan, Founding Partner of the 22X Fund. 22X is one of the firms which represent the future of the cryptocurrency market, tokenizing real world assets to spread investor returns and give entrepreneurs greater access to capital. With her fund, Ashwini is democratizing access to capital by allowing investors to buy tokens representing equity across a diverse portfolio of startups. She’s bridging the gap between ICO and venture capital and revolutionizing the way start-ups look to raise capital. Investors into the 22x Fund are offered the opportunity to support the growth of 30 participating early-stage ventures, all of which have already raised capital from VCs or other traditional modes. Ashwini’s innovative take on funding is just one of the reasons she was awarded the Innovation in Venture Fundraising award from Microsoft.

Microsoft’s Entrepreneur In Residence, Tereza Nemessanyi, was the award grantor who said “People often tell me they don’t know any women in Blockchain, which is surprising because I know so many and more getting involved every day.  This week was pivotal in cementing key communities of diverse movers and shakers. It is still early enough in Blockchain to enter and shape what it will be.”

Blockchain Week was a far cry from the origin of the creation of crypto now known as the Silk Road and the Red Pill, a blockchain based crypto kicked off social media for extreme misogynistic views. What I did see were the merging of industries and the heralding of what could be the end of the era of the “blockchain bro”.  The origins of blockchain and cryptocurrency are part of the reason why the industry lacks diversity. The early days of blockchain and crypto consisted mainly of hacktivists and cypherpunks. Fast forward 10 or so years, and look at the contemporary origins of blockchain and cryptocurrency: tech and finance—areas which are still struggling to become more representative of the population as a whole.

The industry of blockchain is still relatively new so we have the chance to make this segment of the tech industry better than the rest for women and people of color. With blockchain we’re building an ‘automated trust society.’ Automated trust means equality and fairness, blockchain really should be the perfect space for inclusiveness and diversity to thrive. The underlying spirit of the technology lies in opposition to rigid or standard systems put in place by conventional finance companies or the internet’s data monopolies by requiring people of any kind to collaboratively use a shared ledger. To me, what blockchain week could represent is the redemptive moment for tech and diversity outlined at the end of Emily Chang’s book Breaking Up Brotopia.

 

First published in Forbes, May 20, 2018

https://www.forbes.com/sites/nisaamoils/2018/05/20/breaking-the-bank-or-the-myth-of-blockchain-brotopia-or-both/2/#1e5b1a444701