Business

Could NZ be an early champion of blockchain?

How ready is New Zealand to invest in blockchain-based technologies? Reporter Vanita Prasad went along to an investor night to see big ideas meet big wallets as businesses betting on blockchain pitched their wares.

“Unf*ck the world! Unf*ck the world!”

A stage-full of excited tech entrepreneurs chanted as they posed for a photo at Centrality.ai’s Demo Day, an event to showcase the latest businesses to come out of the Kiwi blockchain studio’s first accelerator programme.

The chant, an old Centrality slogan, sums up the belief that many proponents of the technology have in its ability to change the world, and New Zealand’s economy, for the better.

The studio, which both invests in and creates decentralised apps, has a portfolio with more than 20 applications. The goal is to be at the forefront of a global transition to a blockchain-enabled future.

In a nutshell, blockchain is a type of decentralised distributed ledger (a way of replicating and sharing data between networked computers) which records the transaction of data, communication, tokens, and money.

Its fans herald it as one of the key revolutionary infrastructures that will disrupt traditional social institutions, such as banks, through the decentralising of data.

Blockchain and other distributed ledger systems are immutable, which means data cannot be removed or changed once it is published, and data can be traced with ease.

Still don’t understand it? You’re not alone. Minister for Statistics James Shaw, who was a guest speaker on the night, says it took him a while too.

“[Blockchain] completely erases the tyranny of distance that has made New Zealand such a difficult place to do business because we're at the very long end of a very long supply chain. Here you can start companies that are digital and global from day one.” - Minister for Statistics James Shaw

“I consider myself a reasonably tech-savvy guy and I’ve had to have people explain it to me at least 17 different times.

“But I started to understand blockchain through its application rather than the complicated back-end to it.”

Shaw believes digital services will be New Zealand’s single greatest opportunity for growth in the coming decades.

“It completely erases the tyranny of distance that has made New Zealand such a difficult place to do business because we're at the very long end of a very long supply chain.

“Here you can start companies that are digital and global from day one.”

Tech is New Zealand’s third-biggest export sector, bringing in more than $16 billion a year in overall revenue.

A Callaghan Innovation report published in December – Distributed Ledgers and Blockchain, Opportunities for Aotearoa New Zealand – suggests New Zealand has significant potential to be a world leader in tech through early mass adoption of blockchain.

Investors invited to the Dragon’s Den-styled pitch event were encouraged to approach the evening with an open mind and open wallets as the businesses pitched their blockchain-based or block-ready enterprises.

Each of the businesses in the four-month long course (powered by accelerator programme Lightning Lab) were given access to mentorship from business leaders and $100,000 of seed money from Centrality.

The diverse range of businesses pitched for amounts between $300,000 to $3 million to take their businesses to the next level. While most were still starting out, Yabble, an existing business, attracted much attention with its ambitious plans to give users control over their data and get paid when large companies use it.

Here’s a look at the six businesses and their pitches:

Āhau

With the tagline “saving culture in the modern age”, Āhau is a digital interface for tribal trusts to develop their communities and manage their assets. Targeted at the 61 post-settlement iwi around New Zealand, which spend a total of $7.9m annually on shareholder management platforms, Āhau uses blockchain to assist groups to digitally manage tribal data, organisation development and voting. Āhau co-founders Ben Tairea, Sam Kaw and Kaye-Maree Dunn plan to extend this product to indigenous communities globally.

CarbonClick

There is a growing desire for businesses to offset their carbon emissions, however many businesses don’t have the resource or expertise to set up and manage these programmes. Enter CarbonClick. Co-founded by Jan Czaplicki (ex-Air NZ) and Paul Brady, CarbonClick presents consumers with the option to offset carbon credits as they buy. Using blockchain’s data-recording abilities, the platform is said to be able to provide full transparency right down to the very trees that get planted.

CentraPass

CentraPass is an identity verification platform designed to cut down check-in time for travellers. Co-founded by Sam Brodie, Rob Brough and Andy Higgs, CentraPass’s blockchain-based business is aimed at tourism providers to allow fast check-in and provide them with insights on their customer journey data.

Cinema Logic

With more than 20 years of experience working in the theatrical film distribution industry, co-founders Neil Lambert and Ahmed Almuktar want to solve its inefficiencies in the distribution supply chain through their blockchain-based business, Cinema Logic. The platform is based on the ‘smart contracts’ technology of blockchain which would allow studios to automate, track and optimise film distribution at scale. The duo aims to have a major studio on board by the end of the year.

Pocketful

Pocketful is a platform designed to eliminate awkward conversations with flatmates about household expenses. More precisely, it’s a platform which manages payments through a social account (rather than an existing bank account – a concept developed by Kiwi start-up Glassjar) and ensures transparency within households about who has paid for what and when. The app has further use for landlords and property managers with the ability to manage tenant requests, book maintenance contractors and schedule inspections – all of which would be tracked and recorded through blockchain.

Yabble

In 2019 you can ‘gig out’ your home and driveway for money through Airbnb and Parkable, but what about your data? Yabble is billed as a dataplace where consumers and brands can ethically exchange data and earn rewards. Co-founded by Kathryn Topp and Rachel O’Shea, Yabble aims to disrupt the insights industry with its pioneering consumer-to-brand marketplace which has already turned over more than $1m in its first year with the first stage of its business already in market.

Sought: $3 million

James Shaw says he was impressed by the diversity of the companies and their pitches.

“What these companies have shown ... is that they’ve got something of value to customers out there in the world and that they’re able to deliver that.”

So what happens next? Any investors who were keen on what they saw last night now have the opportunity to privately contact the start-ups with their offers before embarking upon due diligence and contract negotiations.

While that happens, similar incubators and accelerators worldwide press on looking to be at the apex of the new frontier as the Government seeks to prepare the nation for a unpredicatable future.

Just yesterday, the Government released the terms of reference for the Productivity Commission’s inquiry into the future of work, with Finance Minister Grant Robertson asking the inquiry to look into “how New Zealand can maximise the opportunities and manage the risks of disruptive technological change and its impact on the future of work and the workforce”.

When it will the blockchain digital revolution hit? Depends who you ask.