Our new Disruption by Blockchain series aims to highlight companies that are leveraging the incredible potential of blockchain technology to disrupt and revolutionize their industry. Through one on one interviews, we'll speak directly with industry leaders to cut beyond the hype and get directly to the heart of practical use cases and examples of how it will change the world, one industry at a time.

The following is an interview we recently had with Ugur Yildirim, CFO of Hive Project.

1. What’s the history of Hive Project? How and where did you begin?

UY: Our team has decades of experience in international commerce, and we have all seen first-hand just how much businesses struggle to get the liquidity they need. Unfortunately, small and medium-sized enterprises (SMEs) have been particularly badly served by the forms of finance available to them. And getting the funds they need to run their day-to-day business is often a Herculean task. We knew we had to do something to make life easier for SMEs around the world, but there was always a critical piece of the puzzle missing. Finding a way to provide companies with the liquidity they need has always been difficult because the manual work involved in the factoring process often makes it prohibitively expensive. However, with the advances made with blockchain technology, we can now automatize the processes involved, cutting costs and opening up access to SMEs worldwide.

2. Who are the founders and key team members?

UY: Our team is multidisciplinary, international and absolutely dedicated to bringing Hive Project to the international stage — transforming the way SMEs around the world get the liquidity they need in the process. And with decades of combined experience in finance, business and the blockchain industry at our disposal, I strongly believe our goal can be achieved.

Our co-founder and CEO, Jure Soklic, has been working in international business for over a decade, and Dejan Jovanovic (our other co-founder and CTO) has over 25 years of experience leading various tech teams. Our CMO advised for Iconomi and our CCO is a big name from Sberbank’s compliance department in Vienna. Myself, I have over 15 years of investment management experience to bring to the table, specialising in distressed investment opportunities and turnaround cases. The rest of the team is incredible too, bringing knowledge of the new economy, UX, marketing and AI to the project. You can find all the team’s bios on our website. Working with this highly motivated team has been an incredible experience. And sealing an 8-market deal which includes Russia and Germany, and releasing a DEMO version of our platform, all in the space of just 6 months, shows we are well and truly here to stay!

3. What problem are you solving? Who are you solving it for?

UY: SMEs just cannot get the liquidity they need as easily as they should. For example, 60% of SMEs worldwide are currently experiencing cash flow problems, and over half of small businesses in the UK alone have to wait up to 100 days to get paid. However, despite being the backbone of every economy, SMEs have traditionally been badly served by the forms of finance available to them. While the factoring industry has been growing 14% annually since the 2008–2009 financial crisis, SMEs have been left behind. However, we’re now bringing all the benefits enjoyed by big corporations to small & medium businesses – in an automated, tamper-proof and affordable fashion.

4. What is your solution to this problem?

UY: The risk-mitigating advantages offered by blockchain technology will not only help SMEs get the liquidity they need, it will also help Hive Project bring invoice financing well and truly into the mainstream. One key advantage we have is that we are able to eliminate the risk of invoice duplication, which is a significant problem for small businesses. Since every invoice is unique and will be assessed by our credit scoring algorithms, blockchain technology also helps automate the invoice financing process and increase transparency. In short, we can cut costs, improve data quality, reduce manual work and eliminate errors. By eliminating these issues, we help SMEs get the liquidity they need.

5. Why is your industry ripe for disruption?

UY: The main reason the factoring industry is ripe for disruption by blockchain is because SMEs are very badly served when it comes to their working capital requirements. Recent statistics reveal that British banks reject approximately 30% of working capital loans for SMEs. This rate is even higher for developing countries with less sophisticated banking environments owing to a lack of transparency and SME owners’ inability to provide evidence of the collateral they hold. However, selling receivables creates an alternative way to approach working capital financing, giving SMEs direct access to liquidity, but with less bureaucracy and greater transparency.

6. What’s the future of your industry?

Prediction #1: More peer-to-peer financial transactions.

Prediction #2: Transparency and no hidden costs.

Prediction #3: Better quality data which will cut the cost of borrowing.