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Perhaps one of the most exciting technologies influencing the world of business today is blockchain. Thanks to its growing applications, more entrepreneurs than ever are exploring this new technology as a solution for everything from raising funds to creating contracts.
According to a disruptive tech survey conducted earlier this year by GetSmarter, a brand of 2U, Inc., four in five business leaders believe that emerging technology will continue to disrupt their industry to a high degree in the coming years. And with all the ways that blockchain is already impacting business, and startups in particular, it’s not surprising why.
Here are just some of the ways entrepreneurs are harnessing blockchain in their businesses:
One of the most well-known uses of blockchain is the ability to send and receive payments instantly.
Cryptocurrencies bypass banks and their hefty fees, meaning businesses can transfer funds directly and securely to almost anyone in the world, and at a much lower cost than typical online banking. This is particularly useful if you’re involved in the global marketplace or have remote contractors or employees.
Transparent supply chains
Another powerful aspect is its potential use in a company’s supply chain. Businesses owners often don’t have site of who their vendor’s suppliers are, but new technology could help them track their supply chain more efficiently and identify key players if something goes wrong.
Bringing transparency into the supply chain also helps in verifying things like the authenticity of parts and ethical sourcing. By harnessing this technology, a company can also provide digitally permanent, auditable records for stakeholders and investors.
Smart contracts provide a reliable, affordable option for entrepreneurs looking for an alternative to traditional contracts.
Smart contracts are self-executing computer programs that can carry out the terms of any contract as laid out by their creator. While a standard contract outlines the terms of a relationship, a smart contract enforces a relationship with cryptographic code, making it unbreakable.
For example, with smart contracts small businesses that need consistent cash flow can ensure that they are paid on time by automating the process — this has could have profound implications for a startup, where one late payment could mean the difference between success and failure.
The most important aspect of turning an idea into a business is funding. But the fundraising process can take up a lot of valuable time and resources. Raising money from venture capitalists in the traditional way is a lengthy commitment that can take months.
Instead, using a self-verifying system means venture firms can transfer funding instantly, as soon as they’ve made their investment decision. This will speed up the entire process and reduce the amount of back-and-forths in the fundraising funnel.
As well as assisting in more mainstream investments, one of the technology’s biggest contributions to entrepreneurship is its effect on crowdfunding campaigns. In fact, according to a recent report by Fabric Ventures and TokenData, blockchain startups raised $5.6-billion in initial coin offerings in 2017 alone.
With cryptocurrencies, any entrepreneur with a good idea will have the opportunity to gain access to capital from around the world; and backers will have the support to invest in ideas they believe in, without incurring hidden international fees and exchanges.
The truth is, the way businesses are currently using blockchain is just the tip of the iceberg. David Shrier, Associate Fellow at Oxford Saïd Business School says, “When the internet was born, people used it to email one another. Things like Amazon and Uber were inconceivable. Blockchain is a revolution of similar proportions, with unexplored potential, ramifications and opportunities.”
For entrepreneurs to fully take advantage of the potential that blockchain holds, they must first understand the implications of it on business strategy to be able to make better decisions for the future.
The online Oxford Blockchain Strategy Programme is specifically designed for business leaders looking harness its power in their organisation. It takes them through the fundamentals while giving them the insight needed to stay ahead of the technological curve in a new corporate world defined by disruption.