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The volatile Bitcoin is on the upswing again.  It’s now 4X as valuable as gold and according to some projections its value over the next few years could reach as high as $40,000.  But it’s not the only peer to peer digital network that’s making waves.  Ethereum is also fast on the rise with Microsoft announcing plans to create an Ethereum based blockchain framework that will allow large corporations to easily do business on these new decentralized networks in the future.

And make no mistake about it, the future is definitely heading towards decentralized networks.  Thanks to the Internet and various open-source movements it’s now easier than ever to share information and work together.  And people, just like atoms, inherently want to work together.  Charlottesville would seem to be evidence to the contrary but that’s the exception not the rule.  Overwhelmingly, people want to work together, want to be together.  It’s why we start families and live in cities.  And the same holds true for everything in the Universe.  It’s why atoms bond together.  Why multi-cellular organisms form.  Why galaxies cluster.

On a planet with billions of people and billions of computers it’s likely that a system will eventually emerge that would combine all of the resources at its disposal.  A global brain is an inevitability at this point, not a theory.  The proof is in the pudding.  Collaboration has literally happened every other time there’s been a similar opportunity so why wouldn’t it happen again?  Every solar system is proof of that.  Cosmic structures working together, the Moon governing tides on Earth, Jupiter acting as an asteroid barrier, the Sun creating the necessary conditions for life.  The Great Barrier Reef is also proof of that.  Millions of organisms working together to create a vibrant ecosystem.  The waste of one organism becoming the food for another as the largest organic structure on the planet forms over thousands of years.

Information wants to be free and it wants to be distributed as efficiently as possible, using the lowest possible energy.  This is the way that the real world works so why should the digital world be any different?  That’s why Ethereum is so exciting.  Central authorities like banks, governments, and corporations, the very entities that the 99 % is weary of, aren’t going to be needed anymore.  Anything we could possibly ever want to do, every type of transaction, every type of validation and verification, we can now do ourselves.  Easily.  Efficiently.  Securely.  Together. The future has arrived and we have the blockchain to thank.

Here’s a quick look at some of the first settlers of this brave new digital world, courtesy of Wired.  These are just some of the many entities laying the groundwork of the future, thanks to Ethereum:

  • “The Golem Project describes itself as ‘AirBnB for computers.’ Users can sell their machine’s unused computing power or buy it from others. Early adopters have already used it to render CGI images on strangers’ computers that would have otherwise been sitting idle. Those adopters did not need to trust that Golem would pay them for their computing time or that the code would run as promised; the transactions were guaranteed by the openness of the network. In the future, Golem could be an alternative or even a challenger to the current cloud computing hegemony.”

 

  • “Gnosis is another market DApp with a lot of buzz. It’s a prediction market, meaning users can bet on the outcome of events (i.e. ‘Will Roger Federer win the Australian Open?’) and question askers can leverage the ‘wisdom of the crowd’ to better predict an event’s outcome. Prediction markets have existed before, but they have always been heavily regulated and dependent on trust in a central source to determine the correct answer and dole out the money. ‘With Gnosis, we are not only using Ethereum to do payments. We are using it to build the core of the prediction market,’ says Gnosis co-founder Martin Köppelmann. ‘Previously, people had to send money to our company, our company would hold the money, and later we sent it back. Now the big difference is that it’s really peer to peer. We don’t touch users’ money.’”

Coindesk details several other Ethereum based apps poised to make a big impact including the Vevue Project, which aims to bring Google street view to life with embedded 30 second long user generated videos, KYC-Chain which verifies users identities, Eth-Tweet, a microblogging platform, and WeiFund, a crowdfunding app.

As you can see, the future is rife with opportunity.  Ethereum is the latest digital Wild West, the latest wide-open real estate in search of settlers.  If you missed out on the web movement and watched on the sidelines as Amazon ate the World now is your chance to get in on the ground floor.  If you missed out on making “a killer app” now is your chance to get in on the action.  If you’re a developer or an entrepreneur creating a new platform on Ethereum is where it’s at.  Aside from creating augmented or virtual reality based businesses there’s no better starting point.  We could very well be looking at a Web 2.0 scenario where every company, every business, every website suddenly becomes obsolete, replaced by an Ethereum based alternative.  What’s the Amazon of Ethereum going to look like?  Who is going to become the Google of Ethereum?  Will you be watching it all happen or will you be one of the ones making it happen?  The future has arrived.  Time to get onboard.

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Is Ethereum the Greatest Idea Ever?

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What do you do when you’re on one side of a debate and everyone else is on the other side?  When you know, beyond a shadow of a doubt, that you’re right and they’re wrong?  Certainly, we’ve all been there before.  Empowered by the courage of our convictions, driven by the knowledge that we’re on the right side of history, we dig in our heels, casting aside our doubts, doubling down on our beliefs.  Which is exactly what a splinter group of Bitcoin proponents just did when they spun off Bitcoin Cash, an offshoot of the popular digital currency designed to process transactions at a much quicker rate than Bitcoin can currently handle.

Bitcoin was supposed to make physical money obsolete by decentralizing authority on a network of servers known as a Blockchain, but it’s widespread adaptation has been slow to develop.  It’s been nearly a decade since it was first developed by the mysterious Satoshi Nakamoto, who is either a real person or a group of people depending on who you ask, and despite all the hype and fanfare it’s still subject to wild price fluctuations and is not widely used.  In fact, it may be on the verge of getting displaced all together by another digital currency known as Ethereum.

The main problem with Bitcoin is a simple design flaw: it can only process seven transactions per second.  Seven!  Credit card companies can process thousands of transactions per second.  To be fair, it may be misleading to categorize this fact as a design flaw.  After all, it was designed in such a limited way on purpose, so that all computers could handle the cognitive load associated with mining coins.  Increase the processing power demands and you’d need better hardware to complete the transactions.  And if you need better hardware, you’re basically centralizing power in the hands of those few machines that have it, essentially defeating the entire purposes of starting the decentralized Bitcoin in the first place.

The problem is that if you don’t make a change and scale up from a system that can support seven transactions per second to a system that can support thousands you risk alienating your users.  After all, one of the main selling points of Bitcoin is that it was supposed to be able to route transactions faster than a normal bank could.  If that’s not going to be the case then you’re losing one of the main selling points of Bitcoin.  Damned if you do, damned if you don’t.

So what do you do if you’re one of the people who finds themselves fighting an uphill battle?  What do you do if you’re one of the people who realizes that expansion is necessary but isn’t happening fast enough for your liking?  What recourse do you have?  Well, what you do is take matters into your own hands and start Bitcoin Cash, breaking away from mainline Bitcoin.  In the short run, this may be a bad look.  It’s potentially confusing to investors and regulators alike and will just further slow Bitcoin’s push towards mainstream adaption.  But, in the end, it may prove to be necessary.  Vital even.

As Wired reports, “[Amaury] Séchet [a former Facebook engineer who has worked on Bitcoin] argues he’s fighting for the soul of bitcoin, and Bitcoin Cash will force the cryptocurrency community to take scalability more seriously, even if the project fails. ‘Either bitcoin does not scale and Bitcoin Cash will overtake it over time, or it will scale because of the pressure created by Bitcoin Cash,’ Séchet says. ‘Either is a win for Bitcoin users.’”

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Is Bitcoin Cash the Greatest Idea Ever?

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#1,069 – Ethereum

For years we’ve been hearing about how BitCoin is going to change the world by creating a secure digital currency that wouldn’t be susceptible to fraud or counterfeiting techniques.  While the hype machine was in overdrive smart people began to realize that the idea of BitCoin wasn’t really all that transformative after all.  The real genius lie in the mechanism behind BitCoin: the Blockchain.  Ever since this was realized entrepreneurs and corporations have been racing around the clock to create new Blockchain based businesses that would take advantage of this knowledge and capitalize on BitCoin’s momentum.  Now, just a few short years later, we may have an early winner in this race: Ethereum.

So what exactly is this new crypto currency?  Well, for starters it’s more than just a digital currency.  It’s really a platform for secure transactions and contracts of any kind.  According to their official website:

“Ethereum is a  decentralized platform that runs smart contracts: applications that run exactly as programmed without any possibility of downtime, censorship, fraud or third party interference.  These apps run on a custom built blockchain, an enormously powerful shared global infrastructure that can move value around and represent the ownership of property. This enables developers to create markets, store registries of debts or promises, move funds in accordance with instructions given long in the past (like a will or a futures contract) and many other things that have not been invented yet, all without a middle man or counterparty risk.”

Inc. does an even better job of summing up this new technology:

“If you aren’t familiar, what Bitcoin does for payments, Ethereum does for anything involving programming and computing. While it utilizes its own version of a blockchain, it is functionally different from Bitcoin. For example, on the Ethereum platform you could host a crowdfunding campaign or any type of ‘smart contract.’  Ethereum’s goal is to make a decentralized internet. And it has a very good shot at becoming ‘the new internet,’ literally. It could one day replace a lot of technology and ways that we host and execute code online.”

A new internet?!?! Sounds to me like the plot of this season’s Silicon Valley! But more than that, it also sounds like something that is inevitable.  So if you’re looking for a smart investment to make forget about BitCoin.  Ethereum is now where it’s at!

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Is Ethereum the Greatest Idea Ever?

 

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#896 -TradeHero

The idea of a fantasy stock market game isn’t new.  But TradeHero finally gets it right.  Because with this app you’re not just buying and selling fake stocks to build a phony portfolio in order to beat your friends.  That is part of it.  With real prizes on the line too.  But, the real heart and soul of the game is the educational aspect.  By following the success of other “heroes” you can actually learn useful advice to help you master the real stock market.  And best of all those “heroes” are able to profit from their success.

As Tech In Asia explains:

“On TradeHero, users who are less familiar with how stock markets work can learn how to trade. On top of that, more experienced users can earn money by monetizing their reputation as a talented and well-informed stock trader. This means that one user can subscribe to another user’s feed to know whenever they make a trade or post a comment. This information is valuable because it can then be applied to the real stock market.”

This is the fantasy football equivalent of having access to hundreds of Matthew Berrys.  Unofficial experts who you can use to help make valuable decisions once they’ve established themselves with a long track record of success.  Which is more than we can say for Berry.

Having access to this much crowd sourced unbiased information is a real game changer for middle class investors who may not be able to afford a financial advisor and who may not have sufficient knowledge about how the stock market works on their own.  Instead of blindly playing their hunches they now at least have a fighting chance of getting it right.  At least as much of a chance as one can have when it comes to the stock market.

Is TradeHero the Greatest Idea Ever?

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You probably didn’t notice but yesterday was a monumental day as Title III of the JOBS Act went into effect.  Why is that significant?  Well, it means that anyone can now directly invest in a new company via a process known as equity crowdfunding!

This is huge.  Previously, if you wanted to invest in a company you needed to be an accredited investor.  Meaning that you needed to have a net worth of at least $1,000,000 or a yearly income of at least $200,000.  But now any Joe Schmo with a dollar and a dream can follow his heart and invest in an idea that they feel passionately about it.  Albeit up to a certain limit.  As Fast Company explains, “Investors who make less than $100,000 a year can now invest up to either 5% of their annual income, or $2,000, whichever is greater. Investors who make more than $100,000 a year can invest up to 10% of their annual income, but they cannot invest more than $100,000 in one year.”

The key difference with equity crowdfunding when compared to ordinary crowdfunding is that instead of contributing money to a cause that you believe in for a one time reward i.e. early access to the finished product or some other small scale perk like a t-shirt, with equity crowd funding you’re a real investor in a future company getting in at the ground level before the company goes public.  That’s a huge difference.

A few years ago when Alibaba filed for their IPO I was livid that I couldn’t get in on the action ahead of time at the pre-IPO price of $68 per share.  When I finally did have an opportunity to buy after the IPO the share price was jacked up into the high 80’s.  It has subsequently gone down into the low 80’s.  Meaning that if I had gotten in on the ground floor I would have turned a profit and if I would have purchased when all of the other common folk were eligible I would have lost money.  Another classic example of the rich getting richer while the poor get left out in the cold.  Well, now with equity crowdfunding legalized that’s no longer an issue.  A savvy forward thinking investor who can spot trends ahead of time, such as yours truly, now has as good a chance as anyone else at finding the next big thing and capitalizing on it exponentially.

There is a caveat, however, as there often is with news this good.  And that’s the sad truth that nobody knows how this is going to play out yet.  How will it work?  Will Kickstarter and Indiegogo offer equity crowdfunding options?  Will other platforms emerge?  Are there even going to be worthwhile ideas worth investing in or will all the best ideas follow traditional paths to funding.  And most importantly, will investors get taken advantage of with Ponzi schemes and the like?  Will corruption run rampant?

I don’t know.  All I know is that I like having the ability to invest in an idea that I’m passionate about and be able to profit from down the road.  Some may even say that watching a company grow from startup to fortune 500 juggernaut is as exciting as the actual profit that you’ll receive.  I don’t know if that’s true but that’s beside the point.  The point is that now we’ll get to find out.  The era of equity crowdfunding has arrived!

Is Equity Crowdfunding the Greatest Idea Ever?

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I wish that it was easier to get in touch with people.  Not people that you went to high school with.  There’s Facebook for that.  Not people that you want to hook up with.  There’s dating apps for that.  Rather, people in the know.  Decision makers.  Power brokers.  Movers and shakers.  The kind of people who could tell me whether or not my world changing idea actually has merit.  The kind of people capable of turning my dreams into reality. 

To date no such way existed.  Now it does.  And we have the venture capital firm Kleiner Perkins to thank.  That’s because they’ve created a new messaging app that enables anyone to reach out to them during virtual “office hours”. 

Business Insider explains how it will work:

“Called the “KPCB Edge Office Hours,” the app is basically a communication app where users can ask and get instant feedback from one of the three partners of the Edge Fund, the firm’s early stage fund focused on emerging technologies like drones, digital currency, and virtual reality. The three partners — [Anjney] Midha, Roneil Rumburg, and Ruby Lee — spend at least two hours a week answering questions in real-time, while they respond to non-office hour messages throughout the week.”

If you think about it this is really unprecedented and potentially as game changing as any of the ideas that Kleiner Perkins invests in.  For the first time anyone from a barista in San Francisco to a farmer in Des Moines will have the ability to quickly and easily connect with a partner at a major venture capital firm.  The insights that could be gleamed from these conversations could help thousands of young or aspiring entrepreneurs get their ideas off the ground, shaping a myriad of industries along the way.   Better yet, it might even transform the way that venture capital funding works making it much more efficient and accessible to the smartphone generation. 

I would say more and extoll the virtues of this initiative even more but I have more important things to do.  Like actually using this app!

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Is the Kleiner Perkins office hours app the Greatest Idea Ever?

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#455 – Tongal

This morning I was riding the subway in New York City along with a bunch of other mindless drones, like I do everyday, when I saw an advertisement that snapped me back into reality.  It was for a company called Tongal and it mentioned something about coming up with ideas.  Intrigued, I decided to check it out.  What I found can only be described as Heaven on Earth.  For here we had a website offering to pay people, regular, ordinary people, just like me and you, cold, hard, cash to come up with ideas!  What the what!!!!

The basic concept is simple.  A brand, say a beer company, or a fast food restaurant chain, or a toy manufacturer will pose a question to the general public.  This may be a suggestion for how they can reach more people or how they can promote a new product.  The general public then has a set period of time, generally a few weeks, to submit suggestions.  The sponsor will then select the best ideas and look to turn them into a usable video that they can use for the advertising campaign.  Winners then get paid.

As TechCrunch explains, “Anyone with a good idea can submit it to their web site, like Twitter, in 140 characters or less. The sponsor selects ideas and from there people with video skills do the creative work. People whose ideas get selected can make $250 to $1,000. If the video gets selected, the person who submitted the idea gets a 5 percent bonus/residual payment. People who make the videos can earn $1,000 to $25,000.”

Check out this video to find out more about how Tongal works:

In addition to what was described on the video there is also a section on the website called Tongal’s left field where the objective is to come up with “out-there-in-left-field ideas”.  My specialty!! In this section users have 500 characters to come up with an idea for how to solve a problem that a company is struggling with.  After the best ideas are selected everyone will have a second chance to use their creativity this time to suggest ways to actually apply the idea.  The top five suggestions for either the initial concept or for how to implement it will receive monetary prizes.

But, wait.  It gets better!  As a way to encourage people to keep coming back for more the site has been gamified!  This means that in addition to earning prize money participants also earn points.  A leader board tracks points and earnings for all participants and then at the end of each “season” the top 20 production and ideation leaders split an additional prize pool with the top five finishers splitting 50% of the pot!  It doesn’t get any better than that!

All in all, I really love the crowd sourced concept at the heart of Tongal.  This is a great way for people from all walks of life to put their creativity to good use and to get paid for it in the process.  But be forewarned.  None of you stand a chance against me!!!

Is getting paid for coming up with ideas the Greatest Idea Ever?

 

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