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The Art Of Selling Blockchain To Financial Services

The Art Of Selling Blockchain To Financial Services

The focus needs to be on trying to find value internally for the organisation

The key is to focus on creating a live system that is better compared to the peers

The best path is to start with a limited number of participants and establish reasonable goals

When describing the autocorrect feature on our smartphone to someone who has never experienced it before, how much of our focus is on the machine learning behind it?

The answer is probably fairly little – we simply describe what it does than how the technology behind it has built the product.

Why do businesses then try to teach so much about a technology rather than focus on the problem it solves?

When trying to sell a blockchain solution, it is important to highlight what it actually does, rather than glorifying the technology. Customers pick up a solution when they understand the value of it, not because of the technology behind it. But it’s not always so simple.

The reality is that Blockchain can be a double-edged sword. In the early days, we probably wouldn’t have gotten the initial meetings with global banks and regulators if we worked in any other space.

At the time it was somewhat mystical to them and they needed help understanding the technology. Being knowledgeable about blockchain enabled us to get in the door. However, that door didn’t always lead where we wanted.

While meeting with the IT teams, Innovation Groups, or R&D departments is great, the focus needs to be on trying to find value internally for the organisation.

Pull Or Push 

Our clients don’t buy database or servers just because they’re Oracle or IBM – they buy them for specific projects, customer needs, or business units. At the top level, they look for use cases, business processes, or transactional flows that can benefit them internally or their customers.

When the logic is built into the network to enforce rules and regulations, ultimately it equates to lower costs, lower overheads, and overall a lower maintenance.

The real power of applying this technology generally emerges when you look at workflows and related applications. Once you start moving away from the pure technology discussions and getting to the business unit needs, that’s when real value starts to become clear – and that’s when you start to look at the pathway ahead and cost of implementation.

The innovation and research teams that are looking at new tech don’t necessarily know right away what fits within their stack. While those departments usually want to see more in terms of possibilities, they may not have the pull to push for deployments within the company.

On the other hand, when asking someone taking care of products in the Receivables Financing space if they want to reduce their rate of fraud across their whole portfolio for a minimal transaction based cost, they’re instantly eager. They can translate that fairly easily into dollars and cents to their internal finance team.

While they may seek back up from an Innovation or IT person, by that point we already have a sponsor on the business side. They understand the cost-benefit and can sell it internally.

Money Is Clear

Another factor to consider is that with the number of proofs-of-concepts and claims by so many organisations looking to benefit from public interest in the space, clients are often confused due to the lack of availability of real solutions.

In fact, when selling a product as a solution, references to blockchain can complicate things. In many instances, the discussion should be limited to the solutions and value they provide.

As individuals in the blockchain space, it is our responsibility to accurately inform potential clients regarding the differences between the myriad of far-fetched proofs-of-concepts that are nowhere near production as compared to the few which are actually being used today to solve real-world problems.

Clients sit up and take notice when we demonstrate an actual solution that can improve their business. But you have to start with improving their business, not with blockchain.

In MonetaGo’s case with the Fraud Mitigation Network – where it is a completely new capability that prevents double financing – the sale cycle can be a little more straightforward. On the other hand, when you are augmenting systems or business processes or looking to introduce similar capabilities, you are more in line with standard enterprise sale side of things. These need larger investments in terms of money and time before going ahead.

The key is to focus on creating a live system that is better compared to the peers. As long as the business messaging takes centre stage and people can understand the costs and the benefits, it will be easier to convince clients to incorporate blockchain based products into their businesses.

In fact, at some point, they probably won’t need to know a blockchain is involved anymore.

Tides Versus Waves

There are many low hanging fruits that can provide real value in the near term. It makes no sense to ask giant institutions to make a bunch of internal system changes, or try and get laws changed, or ask a compliance department into rethinking various risks.

The best path is to start with a limited number of participants and establish reasonable goals. Once a network in place, more features can be added and more functionality can be offered.

In an attempt to take advantage of the blockchain tide, many have even used the term inaccurately or sometimes in the wrong contexts. Clients and providers alike have felt such a strong urge to associate themselves with the hype, and in some cases, both have even been able to reap some short-term benefits.

But ultimately if it’s not providing value, it’s not going to last. Sooner or later, clients demand more. Proofs-of-Concepts that don’t move to production gets shut down.

The focus needs to be on tangible solutions that a blockchain product offers.

People have been told that tech is going to change everything. While that may be true, it is not going to overnight. Banks, for example, hold people’s funds and they are part of a big complex system which has evolved over centuries that is responsible for trillions of dollars. The change will come in waves, but it has to be undertaken carefully and it will take time.

Note: The views and opinions expressed are solely those of the author and does not necessarily reflect the views held by Inc42, its creators or employees. Inc42 is not responsible for the accuracy of any of the information supplied by guest bloggers.

Author

Jesse Chenard

Community
CEO at Monetago Inc.

Jesse is a technology entrepreneur and investor and he is also the CEO at Monetago Inc.

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