Linking up blockchain businesses
Blockchain organises data from different computers into blocks which are ‘chained’ together without the need for an intermediary or coordinator. It can make operations more efficient, resilient and reliable. Typical use cases for this technology involve large companies, such as financial institutions or conglomerates, automating processes in complex supply chains. However, the EU-funded BlockStart project has shown that blockchain may also benefit smaller companies, by connecting start-ups that are developing blockchain technologies with small to medium-sized enterprises (SMEs). “BlockStart is an accelerator that helps boost the progress of start-ups, not only by supporting them with services and funding to help them further develop their blockchain products, but mostly by facilitating the testing of their solutions by potential clients,” explains BlockStart project coordinator João Fernandes, investment analyst at Bright Pixel Capital, a venture capital firm based in Portugal.
Blockchain can benefit the ‘real economy’
“A common perception is that blockchain technologies are solely useful for large organisations and networks with a huge number of users,” Fernandes adds. “So initially, finding SMEs willing to test blockchain solutions was identified as the main challenge.” “Blockchain is heavily associated with cryptocurrencies, financial speculation and easy profits. Not much is known about blockchain’s potential to positively impact the ‘real economy’,” he says. Besides matchmaking, specialisation was central to BlockStart, Fernandes notes. “Our focus on blockchain provided a network of seasoned experts – company founders, investors, chief technology officers, business developers – acting as hands-on mentors. They contributed to the technical validation and business growth of the mentees.”
Bringing SMEs on board
BlockStart provided almost EUR 800 000 to start-ups without taking any equity. It received 490 applications, with participants coming from 26 European countries. Pilots were implemented in 55 companies, and over 200 mentoring sessions were held. The diverse profiles of the 60 participating start-ups highlight the variety of blockchain applications. They include fraud detection for insurance, industrial emissions monitoring, digital identity for motorcycles, document certification and even a social metaverse.
Contributing to early success of start-ups
In addition to the support services, the BlockStart consortium, consisting of the Bright Pixel venture capital fund, CIVITTA innovation consultancy and the F6S community of tech founders, organised dozens of events, demystifying buzzwords associated with blockchain, such as non-fungible tokens or NFTs. Furthermore, participation in wider industry events, like the European Blockchain Convention and Web Summit, helped the start-ups to connect with potential customers and investors. Some ended up with commercial deals and even joint ventures, says Fernandes, who was also a mentor. He adds: “We believe start-ups saved plenty of time and money and that they brought more fitting solutions to the market, as we got them to connect with potential customers early on.” Since the start of the programme, supported start-ups attracted more than 120 clients, hired over 60 employees, received EUR 5 million in public grants and raised EUR 13 million in private investment, he notes. “We are happy that we were able to contribute to the early success of these start-ups, while providing new possibilities for SMEs eager to test blockchain. We also contributed to the development of the blockchain ecosystem – by including those that were already experts in the field, and also educating policymakers, associations and people who were not yet immersed in the blockchain revolution.”
Keywords
BlockStart, blockchain, NFTs, start-ups, SMEs, accelerator, cryptocurrencies
