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Tech Workshop

Building a business on blockchain technology

Provenance is a business built on blockchain technology – but it doesn’t sell itself that way.

24 Apr 2017

Unlike many founders, Jessi Baker didn’t set out to start a business. Instead, while working on a computer science PhD looking at non-financial applications for bitcoin, she realised that blockchain technology could be used to track supply chains. From the route a t-shirt takes to get from the cotton tree to the high-street hanger, to the origins  of the minerals used to make a mobile phone, companies of all sizes find it difficult to track where exactly their products have come from, the levels of outsourcing, and whose hands they’ve passed through. It comes at a time when an increasing number of consumers are demanding to know the back story of the stuff they buy. ‘Uber geekery’ Baker saw that her technology could offer a way to verify some of the many claims companies make about their products – safety, authenticity, working conditions and sustainability – by logging how they move through the chain. Working out a business case – going from ‘uber geekery to real life application’ – was trickier, she says. Blockchain was new, abstract and missing an obvious commercial use.

Targeting business

‘We tried to look at where Provenance could add most value in the shortest period of time,’ says Baker. Consumers wanted transparency around things they bought but wouldn’t pay for this information. Provenance would have to target businesses instead. She considered launching a wikileaks style site. Instead, after speaking to a raft of companies to see where there was most motivation for change, including African mines, Apple and Patagonia, she decided to hone in on the food and drinks industry. ‘Consumers are interested in this sector,’ she says. ‘So businesses have more incentive to do something about the problems.’

Selling the story

When it came to selling Provenance to those businesses, Baker highlighted the company’s ability to tell the ‘story’ behind its clients’ products, rather than the technical aspects of technology and supply chains. ‘We focused on giving businesses a tool to understand where a product has come from, and present that to consumers.’ Since launching in 2014, Provenance has signed up a few small food, drink, fashion and cosmetics companies and, as of July 2016, the Co-op supermarket.

What is blockchain?

In a nutshell, it’s a sophisticated record book that stores digital information. Think of it as a giant Google spreadsheet which can be added to and accessed by many users simultaneously. The blockchain database is not stored in one central location or controlled by any one company or individual. Instead, it’s shared across its network, meaning all data on it is public and cannot be destroyed or corrupted. This is one reason why it’s popular with digital currencies, like Bitcoin.

This story is taken from Courier Apr/May 2017.