Blockchain Revolution – Part 3 of 3 “How To”

1.    Opportunities for “How To”

In the first two of our three part articles we analyzed and shared the discovered landscape of “What Is” in today’s blockchain technology development and what the landscape “Should Be”. To understand what is taking place in blockchain technology today, we looked at over 1,900 blockchain companies that are developing or plan to develop blockchain technology solutions. We examined the landscape of blockchain companies, their projects, investors, and the direction these companies were taking.

In this article, we share our suggestions on “How To” create mass adoption of blockchain based solutions in the market.

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2.   Avoid repeating known mistakes

To solve any business problem it’s critical to understand the root cause/s of the problem and not just react to symptoms. There is a famous saying that history repeats itself and if we don’t learn from it, we will repeat it. We need to understand why so many startup companies fail. We want to avoid making the same mistakes they did. Yes it’s also critical to learn from companies that succeeded.

Recently CBInsights  compiled a list of 269 post-mortem essays from startup founders (non blockchain) to pinpoint the reasons they believed their company has failed. Their results clearly show that 42% of startups were working on solutions for which there was no market need. In the chart below, other key reasons stand out also. For example, 29% of startups ran out of cash and 17% of products had no business model. If the company is chasing a market that has no need for its solution, the company will burn cash at a high rate, not earn revenue and will quickly ran out of cash.

Drawing a parallel to today’s blockchain startups where in our analysis we found that 57% of startups are developing another blockchain platform and 25% of are developing specific applications without a clear target market, these startups are following the failed model. How do blockchain startups join the “How To” succeed strategy?

Top Reason why fail

3.   Adopting the “How To” succeed strategy

Today blockchain startups are repeating the same mistakes that failed nine out of ten startups of non blockchain businesses. In our analysis we found that blockchain startups are developing technology and applications without validating the market need. Almost all of the blockchain projects are pure technology and not business focused. Continuing with this strategy will certainly be a kiss of death for the startups.

So how does a startup shift its strategy towards success? Here are some proven tips used by successful companies on how to ensure that there is a market need for what your business is developing and plans to sell.

Validate the market need

  • Get out of the lab!
  • Don’t outsource … do it yourself
  • Talk to at least 50 people to gain insight into customer needs and if your solution meets their needs
  • Talk to people you don’t know
  • Don’t sell your idea, seek to understand the problem(s)
  • Ask why … a lot

Create Minimum Viable Product (MVP)

  • Create the smallest feature set that enables you
    • To learn and receive feedback
    • Follow incremental and iterative interactions and not with a final product version
  • Don’t build a prototype
    • This is not a deployable version with the fewest features
    • It should enable testing a hypothesis
  • This may be a drawing, a slide, a wireframe, clickable workflow, etc.

 

Gather direct market knowledge

To create business success, knowledge is everything. Here are some proven guidelines from successful companies on how to gather knowledge.

  • You must know more than others know
    • Knowledge about customer needs will be your competitive advantage
    • If everyone already has this knowledge, than it’s likely too late because someone has already solved the problem you are solving or they will solve it soon
    • Knowledge must be firsthand knowledge and direct from target customers. There is no better substitute
    • Reading the internet should only influence your direction and it should not be the base for your decision

If you are a blockchain startup and you are developing or plan to develop your blockchain solution, examine how your company gets firsthand knowledge from your target customers? It’s never too late to shift your business strategy to put your company onto a path for success. If you don’t have firsthand knowledge from your target customers, you likely don’t understand the real market needs

Create a go-to-market plan

Before you build you final product, create a business road-map that explains these four critical segments of every successful business.

  • Who your target customers are and be able to name specific businesses and geographic locations
  • State your value proposition that your target customers will understand and which will motivate them to invite you to their business
  • Define how you will sell and support your solution
  • Define your revenue plan clearly stating how you will earn revenue and how much

Don’t wait to complete your product, act now. If you need help, we will be happy to have a conversation with you. We want you to be the one in ten companies that succeeds. Why not become the company that helps create mass adoption of blockchain technology in the market and start the business transformation revolution.

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Blockcgain Revolution – Part 2 of 3 “Should Be”

1.   Opportunities for “Should Be”

In the first of our three part articles we analyzed and shared the discovered landscape of “What Is” in today’s blockchain technology development. To understand what is taking place in blockchain today, we looked at over 1,900 blockchain companies that are developing or plan to develop blockchain technology solutions. We examined the landscape of blockchain companies, their projects, investors, and the direction these companies were taking.

2 of 3

Our findings were not very encouraging. We found that; 57% of the companies are building new and better blockchain platform, 25% of companies are building specific applications and 15% of companies are introducing another unique crypto coin for their own solution use. We also discovered that all projects have a pure technology focus and place little to no emphasis on how the company will monetize their solution.

This lack of strong business focus coupled with the high percentage of companies building new blockchain platforms indicates that today’s blockchain technology is still at a very early experimental state. For blockchain to become the new mainstream technology that would revolutionize how we do business in the next decade, significant changes are needed.

In this article, we explore the opportunities for blockchain solutions and what needs to happen for blockchain to achieve the “Should Be” state of revolution.

2.   Creating mass adoptions

There are many future thinkers who see great opportunities for blockchain and even digital currencies. In today’s blockchain concept, cryptocurrency is an integral part of the blockchain technology. In most cases they are designed to be inseparable. There are many opinions on the future of blockchain and cryptocurrency as one entity and as separate entities.

On July 2, 2018, Reason and The Soho Forum hosted a debate between Erik Voorhees, the CEO of ShapeShift, and Peter Schiff, CEO and chief global strategist of Euro Pacific Capital. Both featured guests presented strong views on the potential future of bitcoin, other cryptocurrencies and fiat. Although the audience voted in favor of cryptocurrency, this debate does not end here. The future of digital currency is tied to blcokchain technologies that are still experimenting. A quick acceptance of cryptocurrency without solid adoption of blockchain technology is probably an unlikely scenario today.

Future thinkers like Don Tapscott share their exciting and optimistic visions of the future with blockchain technology as the mainstream enabler that will revolutionize how we do business in the next 5 to 10 years.

Research companies like Gartner share a more cautionary perspective on the present landscape of blockchain technology.

“Blockchain is developing quickly, but significant business challenges and technology gaps remain before widespread use cases and ways to generate value emerge. CIOs are under pressure to guide decisions on if and how they should implement blockchain but struggle with how to apply this technology to meet new business challenges.”

What is encouraging is that there are debates and opinions on both sides (pro and con) of blockchain technology. These often opposing views are the catalysts that drive innovation. In the last three decades revolutionary technologies such as PC’s (Personal Computers), internet and cellular technologies all shared similar beginnings which faced skepticism and optimism. They all evolved from being completely discretionary to indispensable every day tools. Today, we can’t imagine how we could operate a business without these tools let alone doing without them in our personal life.

Crossing the chasm – Geoffrey Moore of Chasm Institute has been advocating for decades that for every new technology that is introduced it has to cross the chasm.

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Before new technology reaches the mainstream market, it follows the same process. According to Geoffrey Moore, the early market is made up of “Early adopters who are a rare breed of visionaries who have the insight to match an emerging technology to a strategic opportunity driven by a dream”. Their core dream is a business goal and not a technology goal. Driven by these goals they will take a quantum leap forward to eventually revolutionize how they conduct business. Securing early adopters and proving the solution value helps businesses cross the chasm to engage the mainstream markets. There are no shortcuts to skip this chasm. Succeeding with visionary early adopters is the right start but the real revenue is with the prudent buyers, the pragmatists.

Today (2018) blockchain technology holds a promise to become the everyday business and personal tools that we will simply not be able to live without one day. The road to this future is no different than the path previous revolutionary technologies took. We need to learn from their experiences and apply the lessons to blockchain evolution as well.

3.   Past mass adoptions models

In the late 1980’s when the first PC was introduced, it simply had no practical use in our business and personal life. These behemoth objects consumed large office desk space, took two people to lift, and had a very unattractive green characters displayed on a small but heavy screen. And yet they were intriguing when you turned them on. Personally I recall installing our first PC in our office, everyone asked, what can it do?  The most common answer was it can do many things. Actually, the potential was that it could do many things but it wasn’t until 3d party companies developed business and personal applications that the true potential of the first PC’s begun to emerge.

Similarly, if we look back at the internet and the cellular technologies, the same patterns emerged. The first internet connection had very few if any practical uses. It was slow and not very useful. The first cellular phones were large and could only make phone calls. It was difficult to get excited about these technologies when they first entered the market. Consumers and businesses resisted accepting them as mainstream technologies.

This is what a cell phone looked like in 1984 and how it looks 44 years later in 2018. We all witnessed the evolution but likely forgot how it started.

Snap14                                   Modern Phone                                    Cellphone in 1984                                                    Now in 2018

Today blockchain is in a similar state of early stage of evolution. It holds a promise of delivering great things but today it still delivers little to no practical value for business and personal use. Today blockchain faces the same skepticism and optimism that challenged the previous major technologies. The encouraging part is that there are critical lessons we should learn from past revolutionary technology introductions, lessons that should be applied to blockchain today.

4.   Key lessons learned

The most important lesson learned from all new technology introductions is that pure technology focus alone leads to few successes. Every new technology solution must have a business focus. It must be delivering value to potential users who will eventually by the solution. It’s as simple as that.

Blockchain technology innovators need to add significant business focus to their projects. Our analysis clearly shows that almost all blockchain projects have pure technology focus only. It’s as if their solution is looking for a problem. This has to change if blockchain companies wish to transform their companies into revenue earning businesses.

History is full of examples of failed singularly technology focused companies. In fact today there are already over 900 blockchain companies whose token price is at zero. If this model continues, more blockchain companies will be added to this list. Fortunately, this does not have to be so.

5.    Strategic targeting to “Should Be”

The most prudent strategy for all blockchain companies is to add a strong business focus to their plans. There are essentially two options blockchain startups can consider. One is to build a standalone business around the product they are developing and the second is to build a solution that buyers will buy to transform their businesses. In both options, engaging early adopters is critical.

In the standalone business and depending on the solution, the blockchain companies could consider creating a service type business SaaS (Software as a Service) whereby target customers buy services from the company. In the 2nd the product based model, the company would be selling their products to target customers for their internal deployment and use.

In both models, engaging early adopters (target customers) is critical. No successful company has ever built a successful solution without engaging early adopters during their development process. Working closely with a target customer enables the company to learn about the target customers business needs and helps fine tune the solution for best business fit. Regardless how exciting the new blockchain solution might sound to technology enthusiasts, it is the target customer who determines the value the new technology adds to their business.

Companies that don’t engage early adopter visionaries are at risk of failing. To cross the chasm, engage visionary customers early. If your solution promises to deliver high value, you should have no problem finding interested customers. And if they show little interest, revisit your business focus. This may be a sign that you need to adjust your solution vision. If your solution is not attracting early adopters, dedicate some effort to understand your target customers. Focus on understanding their business, their customers, and their business needs. Readjust your solution to help your target customers improve and grow their business. This is not rocket science and yet nearly all of today’s blockchain companies are skipping this step.

To create a “Should Be” state of technology revolution, blockchain companies must cross the chasm. There is no short cut to transitioning blockchain to mainstream markets.

If your company is interested in building strong revenue based business one that will help revolutionize how business is conducted in the next 5 to 10 years, and you need help, contact us. We will be happy to have a conversation with you.

 

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Blockchain Revolution Landscape Assessment – “What Is” Part 1 of 3

Today blockchain promises to become the 21 st century technology that will revolutionize how we do business in the future. Future thinkers like Dan Tapscott of Blockchain Research Institute share a very exciting vision on how blockchain will revolutionize our businesses landscape and even how organizations are structured in the future.  BenchMrkPro business experts also agree that blockchain technology holds great potential to change the way business commerce is conducted in the next few decades.

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Blockchain is not the first revolutionary technology that changed how we communicate and conduct business. Over the past three decades, PC’s (Personal Computers), internet, and cellular technologies are among the many disrupting technologies that have already changed our way of life and how we do business.

If we reflect on the past 30 years, history thought us critical lessons. When personal computers, internet, and cellular technologies were introduced at conceptual levels, they were met with skepticism and they were also embraced as a potential. Change did not happen overnight. It took time for the new paradigm of thinking about these technologies to set in. It wasn’t until useful value based applications were added to these technologies that we saw their mass adoptions take off. Today, no one needs to be convinced of the value internet, PC’s or mobile devices deliver to our personal life and business.

Blockchain technology today also faces similar skepticism and positive embraces. The potential that blockchain holds at its current level of maturity, still needs to evolve and be distilled to help create mass adoption. This will take time. History is full of examples of how to successfully introduce value and how to avoid mistakes. We should not dismiss skeptics and instead, we should strive to demonstrate true value of blockchain to them. As we experienced with previous revolutionary technologies, skepticism drove innovators to examine the grass roots of their innovation to help create balance thinking about practical uses of new technologies and value delivery.

Today, blockchain is still surrounded by considerable hype mainly fueled by the ICO (Initial Coin Offering) financial gains opportunities. There are many promises that may or may not be realistic, and many examples of new startups that are repeating mistakes of the failed past. During this phase of blockchain innovation, there are many investors who gain financnially and many who lose their investments. We are repeating mistakes of the past.

For blockchain to become the 21 st century technology that will revolutionize our commerce, blockchain startups need to be driven by business vision on how they will deliver value on blockchain. It’s more than just setting up a company and completing an ICO to raise capital. Blockchain companies have an opportunity to lead this innovation to help create the next revolution.

To understand the current landscape of blockchain technology developments, BenchMrkPro looked at over 1,900 existing blockchain companies.  In this 3 part article, we examine the rapidly growing landscape of blockchain companies, their projects, investors, business adoption opportunities and challenges.

In our 1st article, we wanted to understand how blockchain technology is evolving today. We wanted to understand the “What Is” state about the current blockchain landscape in terms of; the companies’ business vision, company structure, their products and the direction their projects are heading to.

In the 2nd part, we examine the opportunities for blockchain solutions and what needs to happen for blockchain to achieve the “Should Be” state of revolution.

Finally in our 3d part of this article, we share our suggestions on how to create mass adoption of blockchain based solutions in the market.

1.   “What Is” landscape

To understand the true potential that blockchain technology represents to businesses and consumers, BenchMrkPro looked at over 1,900 active blockchain projects that have completed their ICO (Initial Coin Offering) and those that are pre-ICO. In total we found 1,683 blockchain companies that had a market cap of more than a dollar. The balance of companies is facing potential demise and closure.

In our analysis we made several key discoveries. Over 900 or 57% of blockchain companies are building new and better blockchain platform. For a new technology that is still in very early stages of maturity, this signals that the core blockchain platform is not ready for mainstream mass production of blockchain based applications. There are too many opposing views on; what is efficient and what needs to improve, implementation of proper security measures, system scalability challenges, use of utility tokens, protection of privacy, and even use of specific protocols.  Understandably, every new core technology goes through a shakeout period before it finds its mainstream strength and stability.

1.1. Blockchain solutions developed

In the total of 1,974 companies that we examined, we found a mix of initiatives. As illustrated in the chart below, the largest group of projects is focused on developing new blockchain platform.  Over 900 companies are solving blockchain technology problems that include, slow transaction processing, poor scalability, questionable privacy, inefficient platforms, security improvements and the use of utility tokens.

Projects

Over 400 companies are developing specific applications. Some of these include applications to manage physical assets like automobiles, information management, real estate sales, sports specific use, gaming, casinos, adult content and more.

Nearly 250 companies are introducing unique new coins for specific uses. Some are even entertaining as shown below.

Coins

We also found that nearly all projects shared similar if not the same thinking patterns. This is probably not surprising as all of these companies were created using the same white paper template and followed the same ICO process. Their model is almost a carbon copy of each other and they all share these same patterns:

  • Projects have pure technology focus to develop something
  • Real and validated business needs are not the main drivers for their development
  • ICO’s provide easy access to capital and are the main motivators and project drivers
  • Projects position themselves as radical change agents and share these key attributes
    • Eliminate the middleman like banks and other financial institutions
    • Not targeting strategic businesses to validate their solutions in the market
    • Seem to follow the “build it and they will come” concept without engaging target customers early
    • No transition plans to help customers adopt their solutions
    • Operate as technology islands with no consideration of broader technology mix
    • Large number of new and better blockchain platforms built

In each of the projects we looked at, we focused on the structure of each project to better understand the probability of each project reaching full potential.  Again we found a repeating pattern that raised concerns about the likelihood of success for these projects. We discovered that projects shared the same structure which includes:

  • Promise to revolutionize how business commerce is conducted in the future but fall short on details on how their solution will accomplish this and when
  • No project activities planned to help target customers transition onto their solutions. It almost seemed like they will simply switch over when and if their solutions are ready
  • Many projects promise to deliver two way transactions between fiat based banks and users digital wallets and don’t have integration tasks with banks planned in their roadmap
  • Companies with market cap of more than $ 1.0 million identify many potential uses for their solutions and don’t show a plan to engage target customers in their projects.
  • Potential applications identified in these projects, include key categories of solutions;
    • Global payment processing
    • Global financial services e.g. loans, investments
    • P2P Trading e.g. stocks, crypto currency, and other assets
    • P2P e-commerce ( goods and services sales and purchases)
    • New cryptocurrencies for specific use
    • New social media channels
    • More secure communication networks

These patterns are similar to how the dot.com companies and their projects were structured. The pattern of build it and they will come is clearly present in today’s blockchain startups projects. If history teaches us anything, it should be to avoid repeating the same mistakes that failed majority of the dot.com companies in the early 2000.

1.2. Company core leadership team

For any startup to build a successful business, the company needs a well balanced and experienced core leadership team. In the companies we examined, we looked for a good balance of business, technology, operations and sales skills in the company leadership team. What we discovered was again a repeating pattern in the core team structure. The core leadership teams shared these attributes:

  • Highly technically focused and skilled managers
  • Mostly junior management business experience present
  • Missing stated plans for building revenue based business
  • Not engaging with target customers early in their business

With companies that we spoke with, we also found a repeating pattern. The CEO’s of companies that have already completed their ICO’s and raised their capital; they displayed overconfidence that their technology will simply attract customers once completed and are less open to discussions on how they will monetize their solutions in the market.

In the pre ICO companies, CEO’s were more open to discussing their project as a business. They were more open to discussing and learning about developing their business plan and open to suggestions on how to monetize their solution. They were keen to  attract investors to their upcoming ICO’s and were interested in developing business strategy that would bring their projects to a successful ICO and sustainable business.

1.3. Investor’s temperament and impacts on token prices

The ICO process definitely creates excitement and considerable hype around blockchain. To understand the full landscape, we needed to understand the impact cryptocurrency investors have on today’s blockchain companies and their projects.

To understand investor’s behavior, we looked at many social media channels and chats where crypto investors shared their views. This is an excerpt from the Youtube channel that shows the investors reactions to recent major price changes in Bitcoin and other popular coins. This example illustrates the depth of many conversations between crypto investors.

What we found is that most investors rely on speculative hype that fuels volatility in trading and price manipulations. Here is a typical chat discussion chat about the crypto market:

  • Youtube discussions
    • Youtube quotes https://www.youtube.com/watch?v=vggOsb_LUm4
    • Mr_Kristof“WE ARE IN A BULL MARKET. The issue is majority of the action is happening OTC where exchanges are not registering them. It’s like the ultimate David Copperfield magic trick”
    • K Boslice – “My belief at this point in time is, the lower Bitcoin goes, the longer it will take to recover, however the plus side to that, is the price going lower and taking longer to recover, means the reward will be even greater in the long run.”
    • Carlos Banos -“Yeap soon or later I knew this is gonna happens , too much money to make from that side , just don’t get on trouble , you have too much to lose with your Bitcoin farm that is not worth it , I’d appreciate for all info you gave us basically for free , I just can’t pay $3000 dollars I rather invest it in crypto , Just my opinion .”
    • blintor zabat –“Yeah, I think it depends on your time frame. Long term until Btc stabilizes at a much higher level, we are in a bull market. Short term, frame < 3 years, bear. Just my opinion. Thanks for the great vids, as usual!”

Main investments decisions are made on here say information with not facts to justify investment decisions.  What we found was:

  • Investors don’t educate themselves about the companies they invest in
  • Token purchases and prices are completely disconnected from the company assets and value
    • All companies distance themselves from their token price volatility and investors by publishing disclaimers in their white papers
    • It’s not clear if token purchases are investments or contributions to the company’s ICO

1.4.  Summary of “What Is” Landscape

For blockchain technology to create the next revolution vision shared by Don Tapscott and other future thinkers, the present landscape of the 1,900 blockchain companies’ initiatives has to change. The present landscape is not as encouraging as the visions when over 57% of the companies are still focusing on improving the fundamental building block of blockchain. This signals that the blockchain innovators believe that the blockchain platform needs to improve first.

Specific blockchain applications represent 25% of all projects worked on today. In these projects we see little emphasis on engaging potential target customers early in their project. This of course increases the risk that many of these projects may actually be out of synch with real business needs. Experience teaches us that successful technology companies engage their target customers early in their projects to learn about their needs and to validate their solution value.

Close to 15% of companies are introducing unique crypto currency tokens. These are planned for specific applications. Market acceptance of digital currency is already being challenged by the fact that there are over 1,900 different and unique crypto currencies. Introducing more unique crypto coins is not helping businesses to accept digital currency.

In summary, blockchain technology does represent a great potential to revolutionize how we conduct business commerce in the 21st century. However, today’s landscape of blockchain companies and their projects clearly demonstrate that blockchain companies need to create a more strategic roadmap that delivers on the promised potential. Blockchain companies need to start demonstrating value and create the needed pull from businesses to start the blockchain technology adoption and revolution. We will write more on this topic in our 2nd part of this article.

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Blockchain Misguided Adoption

 

 

 Blockchain - Fundamental Mistakes

 

The old saying that the chain is as strong as its weakest link applies to blockchain technology projects today. After analyzing over 2,700 blockchain projects, we found their weakest link. Majority of projects we looked at have no practical business focus and have made no contacts with target users.  They are simply engaged in another experimental blockchain project.

Blockchain vertical analysis – Many blockchain experts promote blockchain as the disruptive technology that will revolutionize how commerce is conducted in the future. Financial systems are targeted as the first to be impacted by blockchain solutions. With this in mind, BenchMrkPro chose to focus on finding blockchain projects that are actually developing a solution that will revolutionize the financial sector. We selected payment systems technology vertical as our target.

In our analysis we looked at 2,790 blockcain companies made up of a mix of companies that have completed their ICO’s (Initial Coin Offering), companies that had an active ICO and companies that had an upcoming ICO. This mix represented today’s blockchain technology landscape.

For our selected vertical, our objective was to find which and how many  blockchain projects were developing blockchain based payment solutions that promised to modernize or replace today’s fiat based payment systems.

Critical weaknesses – Out of 2,790 active blockchain projects, we found 50 projects that were developing something or promised to deliver a blockchain solution that will enable merchants and consumers to make payments using digital currency.  Of the 50 projects that came close to doing something in this business vertical, only few (Bitcoinus and Stellar) shared a vision and plan to engage today’s fiat based companies and systems to create an adoption path for blockchain technology solutions by classic businesses.

The balance of blockchain projects operate in a silo mode. Most lack clear business focus, have no engagements or contacts with classic businesses and lack a go to market plan for introducing their solutions to today’s classic businesses. It almost felt like they were following an old and filed strategy, “build it and they will come”. This is a major weakness that will likely derail many of the blockchain companies and their projects. Unless these projects embrace the fundamental need to engage target customers and users early in their projects, blockchain adoption will be long and difficult.

What needs to change – If blockchain technology is to revolutionize how commerce is conducted, today’s classic businesses will need to adopt blockchain through mass adoption. However, this is not going to happen if blockchain companies work in silos. Blockchain companies must engage their target customers early in their projects. No successful company has ever developed a practical solution without first understanding their customers business and their needs. To understand target customers needs, it has to start with a conversation that follows with active engaments. Threatening the classic businesses like banks and others that blockchain will somehow replace them is not the answer.

In our analysis we find that majority of the core leadership teams of the blockchain startups hold strong experience and passion in developing new technology. These young technology developers are driven to develop the next generation platform or system. What is missing in most of the core teams is strong business experience. This is like having a great soccer team without strong forwards or football team without a strong quarterback. It’s this critical balance that must be present to drive these companies to create a mass adoption of blockchain technologies in today’s classic business. It won’t happen by just developing new blockchain technology. You can build but they won’t come.

Recommendations – For blockchain companies to become successful businesses, they will need to sell and earn revenue. To sell blockchain solutions to classis businesses, these solutions must enable target customers to transition from where they are today to blockchain. And they will need help.

With over 2,700 blockchain projects in the works today, finding practical business solutions is impossible. Almost all of the published white papers focus on two main areas. They describe in often great detail the technology being built and the justification for the company’s ICO. Very little to no mention is made about target customers, businesses, users and how the company will generate revenue. What this means is that each of these companies have no plan on what to do when they complete their project.  Even in live conversations with many CEO’s the idea of addressing this critical segment is brushed off as insignificant. We will leave this point here for your own conclusion. To help classic businesses mass adopt blockchain technology, blockchain companies must expand their focus to include:

  • Engage customers now – We strongly recommend that every blockchain startup that has no clear go to market plan start working on it now and not when their projects complete. Engage your target customers now and start learning how to transition businesses onto blockchain.
  • Become unique – Building another and better blockchain platform is not unique. In fact it’s confusing to potential customers. Think about how your solution will differentiate from the other 2,700 solutions being developed. Describe how your solution will help your target customers and why they should consider it
  • Create a revenue plan – To be successful, every company needs to be delivering value to its customers, value they will pay for and help your company generate revenue. It’s not sufficient to state that your company will charge lower transaction, have a distributed ledger, and eliminate banks, middleman and so on. Be specific who your solution is for and explain in a language that your target customers can understand and are keen to have a conversation with you.
  • Create a sales strategy – No even when you do build it, they won’t come. This old failed strategy hasn’t worked during the dot-com and it won’t work now. Your company will need to sell your solution for you to generate revenue. Hiring marketing and sales people alone is not a sales strategy. They will need to understand; your value proposition, how to sell, who to sell it to and where to market your solutions.
  • Build believable roadmap – A dead end solution won’t sell. All of the roadmaps we analyzed state high level milestones that have no clear deliverables or strategy behind it. Customers buying new solutions want to ensure that the vendors will be around in the next several years and that the solution will evolve. No one wants to buy a dead end solution. Create a thought through solution roadmap that is backed by the company’s business strategy.
  • Create strategic marketing – Every new company faces the same two key challenges in sales, they are not known in the market and they don’t have customers. Select your target customers and market to them. Advertising on typical blockchain media channels is not enough to reach your target customers. Yes you will reach other blockchain companies and enthusiasts but not necessarily your customers. Learn about your target customers and understand where in they look for information and communicate your marketing strategy there. Know Your Customer (KYC) is more than knowing your ICO investors, it’s knowing customers who will pay for your solution.

Does it sound overwhelming, it doesn’t have? If it does, this means you have not completed your company’s plan to create a successful and sustainable business. You need to take action now to position your company and your business for success. If you need help, let’s have a conversation.

Published by:

Jerry Witkowicz

jerry@bmpro.io

 

 

 

 

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Over 800 crypto coins are worthless now

Dead coins

Today there are over 1,600 post ICO (Initial Coin Offering) blockchain startups with over 300 more either live or planned. Not all blockchain startups are poised to succeed.

According to this website, https://deadcoins.com/?pagenum=1 , as of the date this article was written, 864 blockchain startups had already failed and the three key reasons cited are; Scam, Parody and Deceased. In the screen shot sample below are examples of these dead coins and the startup companies that were behind them.

Dead coin list

Today in the 1,600 startups along with the 300 new companies that are about to enter the market, over 90% of these blockchain startups are not positioned for success. BenchMrkPro analyzed 100’s of blockchain startups that are in post and pre ICO stages and we discovered that at least 93% of the startups have no business plan on how they will earn revenue. What this means is that when and if their technology projects complete, they will need to find buyers who will see value in their solutions and who are willing to pay for it.

This has to change or the list of dead coins will continue to grow. Just imagine how many investors who purchased tokens that are on the list of dead coins have lost their total investments? This is said but it is avoidable. Investors need to do a greater due diligence to learn about the blockchain startups before making an investment decision. Here are some tips to follow.

Common sense – There is a lot of truth in the saying that if it doesn’t make sense it’s probably wrong. As an investor, you don’t have to be a blockchain expert to understand the company and their solution. The onus is on the startup company to clearly describe their business and solution so that non technical investors will understand. If you find the company whitepaper confusing and not making sense, this suggests that the company has not communicated their value proposition clearly. And if the investor cannot understand, neither will their potential paying customers.

The core team – No sports coach ever won a game singlehandedly without a strong core team. In business it’s no different. When analyzing the ICO whitepaper, look at the core team. You should expect to see strong and experienced business leaders who have managed successful business and have a good track record. Check them out in Linkedin and the companies they worked before. If you find that the core team is primarily technical people and particularly in blockchain technology, that’s a red flag. Remember, blockchain technology is still in its infancy and very few blockchain solutions have been adopted widely in the industry. The experience level in this industry is still very young. Selling blockchin solutions is difficult and the new startups will need a strong and experienced business team to execute on their plan.  Above all, make sure that the team is truly a team that is associated with the ICO startup. Here is an example of an ICO that just completed and whose team has not been verified and in fact, the team members shown on the company website are different than the ones shown on https://icoholder.com. Several team members shown on the company website denied any association with the company and one even filed police case in his location against the company for using his Linkedin profile without consent. Would you invest in a company whose team is falsified? Many have and they are now at risk of losing their investment.

Unverified team

 

Unverified team 2

Business model – For any business regardless of technology to become profitable, it must have a believable business model. Building a piece of technology regardless of how innovative the technology is not be enough. There has to be a business model that clearly answers in the whitepaper; What business problems are being solved, Who needs this solution and will eventually pay for it, How will the company sell and deliver their solution and Where are the users and where the company plans to promote and sell their solution. These 4 elements MUST be present in the whitepaper or the company has no business model and is simply building a piece of technology

Stay informed – Even after you analyzed the startup and their whitepaper, stay informed about the company. Blockchain technology is an extremely fluid vertical. Many startups are simply unprepared for real successful business. Many are caught up in the blockchain hype and promise more than they can deliver. Often significant changes in the company direction, team structure and even the company sustainability are forced upon the company. Just look at the list of the 864 dead coins and the companies behind the coins. Don’t ever rush into investing. Remember, it takes a lot of effort and hard work to earn your money and it should also take time and effort to part with it when investing.

Decide wisely – When you do reach a decision point, summarize the key reasons why you believe that the startup will be a good investment. Don’t ever rely on free and unverified advice such as the one below. Always ask for clarification.

Advice

In the above example, this promoter did not respond to our question. We are not surprised. This is someone who is likely being compensated for luring uninformed investors to buy into the new ICO. Always do your own verification before investing. If its sounds too good to be true, guaranteed that it is. Decide based on your facts and you will decide wisely.

To avoid being part of the dead coin graveyard, follow these simple tips. If you are unsure about how to analyze a potential company, send us a note. We don’t offer investment advice but will be happy to answer questions about the company you may be looking at.

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