We’re well beyond the tipping point: blockchain startups are now everywhere, and ICOs are the new way to get funding for your product or service. We’re not going to talk you out of launching, then, but we will try, with this blog post, to give you at least a little tough love. We’re not going to discuss the price of bitcoin today, and we’re not going to dive in on which cryptocurrencies have the potential to go 10x. What we are going to do is this:
We’ll tell you how to give your blockchain startup a chance.
Before we start, a quick primer: “blockchain” refers to digital ledger technology that keeps a record of cryptocurrency transactions. Think of a network of computers that all have the same notebook, and when that notebook gets updated on one computer, and that update is verified as actually having happened by a couple more computers, the notebook’s contents are broadcast to a whole bunch of computers at once.
“Blocks” of transaction code is kept together in a “chain,” and that chain can’t be changed once it is verified. Thus, the blockchain.
Here at Metacoin, we’ve been blogging about bitcoin, cryptocurrencies, and the blockchain for more than a year (!!!), and we recently started to consult with companies that are in this space on how best to communicate their message and market their product. So we decided it was time, maybe, to offer a little bit of advice – not just from the year-plus in this space, but from Dave’s 20-plus years in marketing and communications.
But…Why Today’s Post?
Being up front and honest with you, one thing “triggered” today’s post: the launch of a blockchain-enabled interface by Whenhub, the startup founded by the ubiquitous persuasion guru Scott Adams. Since his correct prediction of the election of Donald Trump in 2016, much more attention has been paid to Scott’s work as a prognosticator.
But it seems as if he’s been talking about Whenhub for a LONG time now – they’ve been solving problems for a while. Is this a case of “put it on the blockchain” – or a modern version of “we need a web strategy,” or “we need a cloud strategy”?
Digging around more than a little on the site this morning – it appears that the blockchain interface thingamajig is brand new – tells me that…NO, this is not just a blatant attempt to borrow the latest corporate buzzword and leverage crypto mania to get rich. This – and a couple others we’ll talk about – use the blockchain in ways for which it was designed, thus giving this particular blockchain startup a chance at success. Here’s our three-part sniff test:
1. Does It Solve An Actual Problem?
This is really almost stupid-simple: someone needs an expert to answer a problem, provide advice or counsel, of strategize with. As opposed to posting a project and looking for someone and wading through proposals, you just go to the site, find someone whose rates match your budget and whose experience matches what you’re after, and you transact business.
Whenhub answers the question that one of my business mentors used to ask all the time: “what business problem are you trying to solve?”
We’ve met others as we talk about helping them with their marketing and communications issues, and we can tell you that the above is likely the biggest question they should ask.
For instance, one group solving an actual problem is Medcredits – access to doctors and nurses globally can be tough; vetting those service providers and verifying their licensure is also pretty important. They’re solving an actual problem (or two or three, in fact), so their success – while not assured – is a lot more likely than a lot of others in this space.
2. Does It Use the Blockchain – And Use It Effectively?
One of the hurdles for bitcoin is that people are slow to actually use it. Go ask friends: “own any bitcoin?” Then ask them what they use it for. You’ll either get the “it’s an investment” answer, or you’ll get something like “it’s digital gold!” Few people will tell you that they pay their service providers with it.
But bitcoin is blockchain-enabled – more accurately, bitcoin invented the blockchain – so there’s where your focus should be with your ICO or blockchain startup. Blockchain(s) – there are many of them, but we’ll use the singular term to talk about the technology – are supposed to make life easier, and make transactions more secure, with the lack of a single point of failure.
Another term that’s an offshoot of this technology: Ethereum’s “smart contract” concept. It is just like it sounds: certain actions happen, certain conditions are met, a smart contract is executed, and a transaction takes place. (If A takes place then B takes place, C amount of money gets sent to account D.)
Whenhub uses smart contracts – and those smart contracts, coupled with what appear to be the “A” above (service provider is available) and the “B” (consumer purchases time with service provider discussing the issue or problem), ensure that the transaction takes place.
This is an effective use of blockchain technology – increasing this startup’s chances.
3. Does the Use of the Blockchain Decrease Friction?
Friction is a pain, and this is why people loved the Starbucks app when it launched, and love the pre-order and pickup functions just as much, if not more. Humans, sadly, cause friction just by being humans. (Tim Ferriss, author of The Four-hour Workweek, champions anything in business that “takes humans out of the equation.” There are issues with this long-term, but those issues can possibly be solved by a new batch of young, eager, humans developing frictionless computer programs and blockchain systems.)
The thought of a drive to a strip mall to sit down with an expert might give some hives; a frictionless meeting over the phone with a one-on-one conversation removes a good chunk of that friction.
Think of the other ways that the blockchain can potentially reduce friction: billing and payments are automatic and smart contract-enabled. Licensure or certifications can be verified in moments and the computer won’t go down (because there’s not one computer but potentially thousands, or tens of thousands, that verify the license and keep a record of it).
The possibilities are endless.
Don’t ignore whether or not your name and your own lingo help a lot or are barriers to your success.
Here’s where Whenhub’s use of alliteration and naming score some serious persuasion points, thus increasing their chance of success. Credits are called “WHEN” and the network – “Whenhub Interface Network” – is called “WIN.” When do you need it? Is it a win? You could go on and on and on, but just saying those words out loud either answer the question of how real-time effective it could be: “WHEN? RIGHT NOW!!!” or they tell you that the site is a “Win!”
Rivetz is another one we met somewhat recently – you may not care to know all the details behind how they do what they do, but if you imagine a rivet being tightened to secure something in place…hey, I wonder if they are involved in cybersecurity at all? (Do you have a mental image of rivets tightening something? Even better if it’s Rosie the Riveter in your head.)
One of the coins we work with at Metacoin is POW (that’s a REFERRAL LINK and you should get some, claim some free if you haven’t claimed some yet); cryptocurrency enthusiasts will note that POW stands for “proof of work” and will argue that POW isn’t really a proof of work coin. The masses – the real target for the business – will only say “hey, let me send you 5000 POW for yesterday’s coffee.” (And yes, the founders of POW are hoping that someday they’ll be talked about like the “Bitcoin Pizza” is talked about.) Alliteration does not hurt, easy to remember helps quite a bit – and you’ll find that a lot of consumers just want to know if your coin or token is worth something.
Can We Help?
Yes, we’re here to help. If you need help answering the above questions with your blockchain startup, let us know. If you have answered those questions but are currently stuck, let us know that, too.
Thanks for reading.