Although companies see the value of using the blockchain, they often do not want to take up the challenge of working with their business partners to create a new blockchain solution. Last year, 74% of the companies surveyed as part of a global blockchain survey said they felt compelled to use a blockchain network to improve the business. inter-company efficiency. Yet only 34% have taken steps to deploy one.
Most companies prefer to avoid risk, even if it means paying for the privilege of using a blockchain network created by another company. The blockchain company then created a huge opportunity for tech startups to do the work, summon the right parts, and create blockchain networks improving inter-enterprise efficiencies.
The value of a network ready for use
Over the past decade, lean startup methods, cloud platforms, and DevOps practices have transformed the way startups move from concept to minimum viable product, and evolve. These innovations have also enabled startups to create solutions that companies can easily implement and use more quickly.
Startups that offer blockchain solutions benefit from all this knowledge, but also face several new challenges. To create a network that reaches critical mass and generates significant returns, a start-up must convince other companies that its blockchain can provide the expected security, scalability, and resiliency.
This means that businesses need to understand clearly how the integration of the blockchain network will benefit them, while addressing the concerns that have hitherto prevented them from doing so. If you find yourself in this position, here's how to approach this conversation:
1. Approach decentralization head-on.
When startups create a blockchain network, they must benefit from their investment and risk without retaining control of the blockchain solution they have designed. This is because controlling the solution makes it another software product as a service, as opposed to an exact decentralized blockchain solution.
The first thing startups need to do is separate ownership from control. Ownership and control can be difficult at the beginning of the activity, when fewer parties are involved. However, it is possible to start with centralized control and to clearly define when this control will be transferred to a governing body composed of a set of users with different interests.
2. Prioritize rules for data and logic.
A well-designed decision-making body is encouraged to improve the network, develop it and generate a fair return for all users. However, a fair return is only possible if the network has rules for data management, code management and node control as soon as possible. It can only grow if everyone understands who has and can analyze what data and who can authorize changes to business rules and data logic.
Once the data is provided, it is difficult to change the rules on their use. Startups should therefore carefully review the basic data strategies as soon as possible. While governance is primarily more centralized, all network users should be able to participate in the design of initial policies to meet their needs and expectations.
3. Grow faster with trusted third parties.
The fundamental value of the blockchain lies in its ability to identify high-value problems and solve them by bringing together the right parts. In the same vein, blockchain startups should not hesitate to determine which areas of their business can be managed by new types of service providers that can assist in many aspects of the business. governance, chain network operations, the creation of smart contracts and auditing.
By enabling experienced third parties to manage these tasks, start-ups have more freedom to focus on users. This means more time to implement the improvements and develop the network to benefit everyone. Start-up companies can prove that, unlike previous solutions, a well-governed blockchain network actually works in the interest of its users.
4. Concentrate on improving efficiency.
Blockchain technology dramatically increases productivity. Today's companies primarily use software purchased from large vendors such as SAP, Oracle or Microsoft. When working with partners with different systems, these systems do not always agree on details such as the status of order fulfillment and special pricing rules. When the details do not match, the result is a waste of time for the resolution of exceptions.
Blockchain technology allows companies to radically simplify the way they work together. The use of logic and data shared over the entire network eliminates the risk of variations and conflicts. This feature alone makes transactions more efficient and generates significant cost savings for each company involved.
5. Move the value by eliminating middlemen.
Although their reservations about blockchain sometimes bother businesses, they may also be prevented from adopting specific work methods due to a lack of transparency or trust. In these cases, they can use a third party – a market provider, for example – to solve some of these problems.
Bold startups are adopting this status quo and are proposing new blockchain-based solutions using a decentralized approach, eliminating the need for middlemen. The unparalleled transparency and confidence offered by Blockchain creates new flexibility in the operation of the company. Transactions lead to a transfer of value from intermediaries to companies – and to customers who buy their products and services.
While blockchain start-ups have more challenges to overcome than more traditional companies, those who can navigate this new field and allow companies to adopt this emerging technology early will have an interest in positioning themselves in some of the networks. The most valuable and sustainable companies established.