- Web3 is the future. That's what they say.
And I must admit I'm no expert in crypto Blockchain,
coins, tokens, and NFTs.
So I brought in an expert.
In this video, we bring in an expert to talk about
how we can use the Blockchain in startups.
We look at four ways you can use Blockchain in your Startup,
and how you can get started.
This is Raw Startup.
I'm the founder of Vivino, the world's largest wine app
and wine community,
with over 60 million users all over the world.
We don't use Blockchain in our day-to-day business,
but it's a technology that we keep a close eye on.
In this video we have Michael on to guide us
through the Blockchain and crypto.
He's a developer, expert in Blockchain
and also has his own YouTube channel.
We will also cover some crypto basics,
and if you know all those words,
you can skip through that quickly.
Also, this is not about investing in crypto or Bitcoin.
It's all about technology and how you can use that
in your Startup.
With that, let's get started.
Okay. If you know all the buzzwords,
you can skip forward here a little bit.
First, let's find out what a Blockchain is.
Basically, it's a ledger or a list of transactions
that are hosted publicly.
Imagine a database that has all this information,
but once something has been written in the database,
it cannot be changed.
That's how the Blockchain is.
It's also decentral.
- And also all of these transactions are written
not by one machine, not by one company
that is controlling the whole ledger.
Instead, it's written by many, many machines
belong to many many different people.
It's totally written in stone.
Every transaction that has been written into the Blockchain
is there forever and you cannot change it anymore.
What you can do is do another transaction
to maybe send money back or something like this.
But you cannot change what already happened.
- Okay. Basically a database that is public, decentral
and cannot be changed.
Okay, so what about other fancy words like Web3?
What is Web3?
Basically Web3 is the age we're going into now
where crypto and Blockchain are gonna be a big part of that,
along with quite a lot of other things.
Web1 was the early internet with webpages
mostly owned by organizations and companies.
Web2 was the more interactive web
with blogs, social media and so on.
Basically where we are now.
And then we're going into Web3.
Our experts will tell you that asking
what you can do with the Blockchain now is like asking,
"Hey what can you do with the internet in 1996?"
Back then in 1996, we didn't know exactly
what we're gonna do with the internet.
We knew there was a lot of potential.
And it's pretty similar with the Blockchain.
There is something there that could change the world.
We don't know exactly what to do with it just yet.
We're only scratching the surface
with what we can do with the Blockchain.
I think this is a new revolution.
We haven't really explored
how we can use Blockchain and Web3.
There's a lot of potential and the sky is the limit.
I'll only cover four things you can do
with the Blockchain and crypto in this video,
but I'd love to hear more things you can do with it.
So put it in the comments.
Okay, let's keep going with the basics.
So there are two main expressions here
that we have to cover.
They are coins and tokens.
Let's talk about coins first.
- Coins are basically like the currency
that you are used to.
Just euros, dollars,
but instead it's cryptographic coin, right?
It's digital currency.
- Tokens are not coins. They're a little bit different.
Michael, tell us about that.
- You cannot basically rip them apart or half them
or quarter them because then their value would be broken.
So if you have a dollar and you have quarter of a dollar,
then the quarter is exactly quarter worth of $1.
So you can split it into four pieces and you fine.
But if you have a painting and you split it in four pieces,
there is no value anymore.
Each piece is not quarter of the value of the painting.
Instead, there is no value at all.
You destroyed the whole thing.
So NFTs represent digitally the digital representation
of these kind of items that you cannot split
into multiple pieces because if you do so
the value would be zero, right?
- This is the key here.
They cannot be split or they lose all value.
With the basics in place,
let's get the four things going.
Number one, raise funds with crypto.
Well, we're startups.
We always need a little bit of extra money.
But how can we raise money with crypto?
- The way to raise funds with Blockchain or with crypto
is basically you have a business and you have a coin, right?
You have a coin and that coin is a smart contract
and you tell everyone, "Listen, if you buy this coin
at a specific date and you're early adopter
and you have specific voting rights
and you get early access to some things,
and you can also vote for specific proposals
on how the project or the product might evolve."
Because right?
You're like an early kind of an investor type.
That way you can actually raise additional funds
from the crypto sphere, from the crypto universe,
by selling them this coin and of course delivering the value
that you have promised.
- So there's no way just to sell equity,
to sell shares at the company,
that just isn't legal yet.
So it's all about advantages and benefits.
Maybe it could be the first to buy something,
special price, special access,
maybe even a special limited edition of the product,
even influence on what the product's gonna look like
in the future.
There are many ways, but you have to be creative.
So right now you cannot make them shareholders,
you cannot make them proper investors.
But sometime in the future, that's probably gonna happen.
This technology is incredibly good
for this particular purpose,
but we have to wait till it gets legal.
Here is one interesting example.
LimeWire raised $10 million for the company like this.
Let's have a look at what they did.
- Yeah, I mean they went to traditional investors
but they also launched their own coin.
It's like what we discussed before.
So they have sold their coin
and I think they made over $10 million
in this coin offering.
Whereas these early adopters that have bought
this LimeWire coin have early access
and also they have cheaper fees or no fees at all.
I don't exactly know what the benefits are,
but they made 10 million selling this coin.
Now it's amazing. Of course it's all legit, obviously.
And of course they're not saying that...
LimeWire is not saying if you have the Limecoin
that you are a shareholder, right?
'Cause that's, we said it's not gonna work, right?
Instead you get benefits and benefits and benefits,
but you're not a shareholder.
That's important.
- [Heini] So how do you get started?
So first you'll need to find out the benefits
you wanna give people that are holding this token or NFT.
This part does get a little bit technical,
so you might need some help for that.
But like we said earlier,
be creative on what kind of benefits you can give people.
If you wanna build it yourself,
there's quite a bit of education online.
- So the way I got started is by going to a website
called Crypto Zombies,
and Crypto Zombies is made in a great way.
It shows you how to program a smart contract
with a mega gamified experience.
It's very simple, okay?
Basically on the left side you have code that you have to,
you know, adapt, and the right side you have
a lot of graphics and explaining your stuff.
And it is cool because really, even if you're not coder,
it doesn't matter, but you just see how it works, right?
So you're maybe not gonna deploy the code yourself,
if you're tech guy, of course you will do all this,
the whole program that Crypto Zombies offers, right?
But just if you do one or two or three lessons
on that website and it's totally free,
at least you see how it works, right? In principle.
And you get ideas, you get creative
and you are knowledgeable about these things
instead of, you know, ignoring the technology.
So that's how I would get started because I am a tech guy.
- [Heini] So that's obviously
if you want to build it yourself.
It could also be a way for you to understand it better.
Even if you have someone else build it for you.
It usually is a pretty good idea to know how it works.
Number two, extra services to your fans or customers.
This is basically the same as the one above.
Rather than raising money, you're giving extra benefits
to your customers or fans.
Basically, whatever ideas you had before
could also be used here.
So find some benefits that you can give or sell
to your customers.
And again, be creative.
Find something you can add onto your existing product.
How to get started? Same as above.
Number three, receive payments and spend in crypto.
There are quite a lot of advantages with this
and one of them is speed.
- And you don't have to wait for any kind of two days
or one day or whatever to pass in order for that to happen,
which makes the whole economy much faster.
If you make the economy one day or two days faster than now,
well, economy growth is, we love it, right?
We need to get out of recession anyway.
- Another advantage area is that in some countries
crypto isn't taxed until you take them out
in euros, dollars or whatever currency you're in.
But make sure you know your local rules.
This means there is some kind of bunch of money out there
which is only accessible if you accept crypto.
- But you can be the Startup that gives them
the (indistinct) so they come up to you, right?
So you will make money because you are the only
or the second or the third option there is,
and there is no other option, right?
They will come to you, right?
Of course in the future, if everyone is using it,
there is not a distinguishing factor anymore.
But I think that, for example, paying for servers
or for domains or these kind of things,
if you can pay with crypto and you earn in crypto also,
let's say you are a crypto business, well, it's perfect.
You don't have to go through the banking system at all.
You just basically, you just pay everyone in crypto
and it's much faster and it's also cheaper
depending if you do business all around the world.
If you know what I'm talking about,
if you're paying developers to live
in a very different country than US or Europe or so,
you pay tons of transaction fees.
With crypto, it's very cheap if you use the right chain.
So that, again, saves you money and time.
- Again, you have to check your local rules,
but it's clear there is some money out there
that can only be accessed if you accept crypto.
Finally, there's another advantage. That's flexibility.
You can do all kinds of strange business models
with cryptocurrency.
You can do all kinds of strange things
and you're not limited by whatever business model
your payment processor has, like Stripe or something else.
I know this is a little bit abstract,
but let's listen to what Michael has to say here.
- Now, if you think about it,
if you use Stripe or any other payment provider,
then the business model that you can run
with your Startup is what they allow you.
So for example, if you wanna do transactions
every one minute or every five seconds or every whatever,
then you cannot do that
because they don't have this feature, right?
So they are the gatekeeper of what you can and cannot do
with your business model.
Now with cryptocurrencies,
you can run whatever business model you want.
For example, let's say I enter a car
and I borrow the car, right?
And so I pay every minute.
Every minute I pay for the fraction that I've used.
I'm driving this car around 'cause it's just rented.
And when I close the car up and I leave,
then this this flow of money stops.
Now again, the economy is much faster
because the one that rented the car through the service,
it got the money immediately.
It's already on his or her bank account or wallet,
and that one it can already be spent again
for whatever stuff, which makes much, much more sense
than having to wait the whole month
or sometimes two weeks until four weeks to get money paid
from Stripe into your business bank account.
- [Heini] How to get started.
Basically you implement one of these payment gateways
that can do crypto transactions.
Here are some examples that are many out there.
Coin Gate, Bit Pay, Rocket Fuel,
and there's plenty more out there.
Number four, keep a public ledger.
Now this is interesting because it's basically
what the Blockchain is, a public ledger.
Let's have a look at how you can use that.
One of my favorite use cases here is ownership of art.
Imagine if all physical art had an NFT connected to it
that proved the ownership of that piece of art.
That solves a lot of problems.
First, there's providence.
meaning where did the art piece come from?
Did the artist actually paint this?
And who has owned it over the past many years?
Having NFT connected to the piece of art
will kill all fake art.
I bet that 50 years from now
every single piece of physical art
has an NFT connected to it
and we'll actually have very little fake art.
With the Blockchain and smart contract
you'll know how to do some incredibly cool things,
and I will use art as an example again.
One of the problems that the art business has
is if an artist paints something and sells it $100,
the artist will only see that $100.
Now 10 years later,
somebody sells it for $100,000.
If you did that as NFTs, you could build a smart contract
that said, "Every time this piece of art is sold,
the artist must get 10%."
I mean, I think that would be kind of fair.
Just an example
but something that could help a lot of artists.
Another use case here is the supply chain
and creating transparency in the supply chain.
- But what if you could actually track down
the whole supply chain of, you know,
producing these parts for the airplane
and storing the every single move that it made
onto the Blockchain.
Then you construct the airplane, again,
storing onto the Blockchain the ideas or the parts
that were used and all, and then all the flights.
All the flights of this particular airplane
and the airplane has an ID, right?
Gets a number on the chain.
And then even the destruction of the airplane
when you disassemble it and what did it,
how much CO2 did this whole thing cost you right?
And generate?
- [Heini] Another one is traceability.
Building products is complicated
and very often when you have a finished product,
hundreds of producers from all over the world
have been part of building that product.
Tracing that can be very challenging
and a public ledger can be very useful for that.
This is big, or as Michael puts it-
- You can also think about
if you just wanna collaborate better
with every party that is involved
in transferring goods around the planet,
then you can simply see what happened with this good.
Where does it come from?
Does it come from the right place
that I thought it comes from, right?
Maybe I just been financing, you know, terrorism
or who knows.
Or you can basically collaborate,
the one at the beginning of the chain
knows what the one at the end of the chain did, right?
Which other than that is almost impossible
to see what happened to the thing that you sold.
Where is it now, right? How did it move around?
So the Blockchain is great for the supply chain.
- [Heini] How do we get started?
Well, we sort of rely on your creativity here.
- The ledger can be used for anything you come up with
where the ledger makes sense.
So it's basically, if you ask me how to use the internet
in 2000, I don't know, right?
People are creative, all right.
So, but here's the technology
and here are a few use cases and what you can do with it.
Now be creative with your business
and come up with use cases to use it,
because I think there's no way around it anymore.
- The technology is there. Now find a way to use it.
Again, this is not meant to be a full list.
Just some ideas on how you can use Blockchain
in your Startup.
If you have great ideas, put them into comments.
I love to see some more of them.
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Thank you very much for watching Raw Startup.
Now stop watching and go build something.
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