SaaS Interviews with CEOs, Startups, Founders
1582 Blockchain CEO Says Could Go To Zero, Here's Why
23 Nov 2019
Chapter 1: What is the background of Kevin Hobbs and his companies?
founder of Vandex. Think of it like an agency, essentially for the blockchain space. They've got 42 full-time employees, launched in 2013, raised 500 grand a couple years ago. Him and his business partner still own 90% of the company. However, they did do a token sale and raised 30 million bucks. That was the value of the ether they sold kind of at the time. They liquidated about 60%.
So about 15 million bucks in fiat at that time. Good thing they did because now the price is obviously down to 13 million bucks just because Ether's obviously sank.
He does think some of these values could go down much, much lower than they are today, but he's prepared to kind of ride it out with a new mechanism he's invented to launch a few of his SaaS products he's got in the pipeline for blockchain enthusiasts. Hello everyone, my guest today is Kevin Hobbs.
He's a technology founder, recognized leader in the blockchain ecosystem, and currently the CEO of Etherparty and Vanbex Group. As an early entrant into the cryptocurrency and blockchain technology space, he's a veteran of the industry and has led the group of companies into becoming one of the largest blockchain solution providers in Vancouver. Kevin, are you ready to take us to the top?
Thanks, Nathan. Yeah, I am.
All right. So, you know, a lot of people who I would say are early adopters really understand blockchain. I would say mass market really doesn't yet. So try and dumb Vanbeck's down for us as best you can. What's the company do related to blockchain?
If you really want me to put it in layman's terms, what we do is we help incubate companies in the blockchain space. We help teach them about what they're trying to do, help them build the foundation of the blockchain business that they might have in the future. From consulting to technology development and everything in between.
So let me just let me break this out, though, for a second, because there's a lot of people making a lot of money timing the market right and essentially speculating on different tokens. There's a whole nother group of individuals that are building real technology based on decentralized blockchain and what blockchain enables you to do. Which kind of category are you catering to?
So actually we hit all aspects of the industry. So we started consulting with companies that wanted to raise funds via token sales, worked on the first one ever with MasterCoin and then MadeSafe. And then in 2014, started doing it for a lot of different companies. Then in the meantime, we started seeing a real disconnect. So we started building our own products in-house.
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Chapter 2: How does Vanbex help companies in the blockchain space?
That's great. So 20 developers, that's great. And then, I mean, is this, is this your typical kind of model where you pay a developer X price, you mark it up by a little bit and then you get the customers and that's your margin?
Um, pretty much. Yeah. Um, we, we try to base it out based on the solution that the, uh, that the customer's trying to, trying to do. So proof of concepts can start anywhere from $50,000 and sky's the limit really.
Yeah. So over the, we'll put this on a timeline for me. When did you launch the company? What year? Van Becks?
2013. 2013.
Okay, good. So good timing there, obviously. And then over the past 12 months, how much revenue have you done?
Last 12 months, I think we're on pace to do 4 million on the consulting side.
Okay. So there wouldn't be an on-pace aspect because we're talking about historical 12 months, meaning it's already done. What have you done over the past 12 months?
Are you including the raise that we did?
No, not raise. Just revenue dollars.
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Chapter 3: What is the business model of Etherparty?
Roughly, yeah. That's great. And so how do you view the kind of volatility right now happening in whether it's Bitcoin or Ether and blockchain in general? Does it really affect you? I mean, you already liquidated, so you have cash to fuel the growth.
Yeah, it does still affect us because we still do hold. So it definitely does affect what we do on a daily basis, how we plan. Also because the market has softened up so much right now. We're not bringing as much revenue right now. A lot of people are holding off until the new year to see what happens with these markets to kind of turn around.
I'm not talking about speculators. How should technologists that like blockchain take advantage of the cheap prices right now?
Oh, I mean, that's, that's really tough. Like we're blockchain agnostic. So whether cryptocurrencies kind of go to the moon or go to the floor for us, our day-to-day business doesn't change that much.
I really want people to, or I think people should look at, you know, their internal process and infrastructures and the problems they're trying to solve and see if blockchain is really a fit for what they're trying to do. A speculation comes that, I mean, I wrote a couple articles about this, talking about why I see the problems right now.
And that's because around January, we let it horse into the crypto space. And that was fiat currency without a barrier to entry. And right now, the entire market is oversupplied with very little demand. I literally just talked about this at a conference in Toronto, how this market could go to zero for where it's at right now. And I'm very worried about that.
And what I mean by the barrier to entry is... What happens if that happens?
You mean go to zero, Bitcoin at zero?
I can see Bitcoin going very low, maybe back to... Well, I mean, you know, Bitcoin could go to $1,000. And Ether could be even lower than where it is right now, you know, $10 range.
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Chapter 4: How much revenue has Etherparty generated in the last year?
He does think some of these values could go down much, much lower than they are today, but he's prepared to kind of ride it out with a new mechanism he's invented to launch a few of his SaaS products he's got in the pipeline for blockchain enthusiasts. Kevin, thank you for taking us to the top.
Thanks, Nathan.