Interview with William Mougayar at DEVCON1 in London

Transcript

so hello everyone right now I'm with William mugay from Toronto Canada who is a famous angel investor in this space who has invested in lots of interesting companies we'll be talking about business models and ethereum uh but first let's have an introduction about your background okay so I've been in technology for a long time more than 30 years but uh recently I've uh been more interested in Investments in the space uh I am also an entrepreneur not too long ago I founded two companies uh I like to blog about the topic uh and try to explain what the blockchain's impact is from a business perspective so I try

to explain it in non- technical terms that's been my uh my mission recently and I'm also on The Advisory board for ethereum and and a few other companies involved in the space so for Williams articles do checkup startup management or.org startup management.org and he has a 4500w article on ethereum and its impact on the ethereum blog that is quite interesting yes that one is on the ethereum blog actually the business imperative of ethereum for ethereum it's called the business imperative behind the ethereum vision that's right so uh so let's start off with u with with one

question that I think many many user many listeners of ours have what what many listeners perceive is because the value of the Bitcoin token and ethereum is very short Bitcoin is is going down they see uh they see this shift in this year where the amount of venture capital rise has also Fallen quite a bit inside the venture capital and angel investor Community do you think that this technology is having challenges raising funding or is this a normal part of any technology trend well I don't think I agree with uh saying that the investment is going to be down this year I'm aware of a number of Investments that are happening but

that may not be announced so uh there's a bit of lag usually when the whoever is uh adding those statistics so that they can tell us how much money is going on is is happening in terms of Investments there's a a delay um but uh and we may not know until early next year what these numbers are but especially in the capital markets space uh blockchain companies going after the the trading aspects of the financial services there's a lot of money being raised in that category and um uh I know for a fact many of these companies will

not announce it at least they would announce it later uh so that's a characteristic that's happening right now and usually at the end of the year you never know that there's some business that gets done very quickly before the end of December but this is tracking very much what has happened with the internet 20 years ago and uh about 20 years ago the investments in the Internet space were about $1 billion or so per year and today the investments in technology uh and the internet and anything to do with it is about $60 billion dollar just in North America alone yeah so uh I'm not worried that uh the investments in the blockchain SL

Bitcoin space is is taking any hits or any slowdowns uh it's it's uh it's actually going in the right direction it's actually that's that's quite interesting so um we've had like five days at the Devcon where lots of interesting companies came and pitched um and you have been in involved in the ethereum ecosystem for a long time what are the some of the ideas that you find really interesting here well the the main thing about the ethereum ecosystem as I was saying in my earlier talk is that ethereum is more than just one thing uh from this point going forward maybe it wasn't obvious to everybody but more and more we are seeing now ethereum kind of

coming out of the foundation itself so the foundation is one piece of ethereum there's also the network the network is now out it's in the wild there are hundreds of nodes running it so that is another important component the third component is all of the technologies that make up uh ethereum from a development point of view and some of them have been developed by ethereum core and some have been developed by Outsiders that's an important piece and finally there's uh as well all of the partners uh the investors and the stakeholders uh that are also part of the ecosystem and uh the other piece is the clients and the customers uh we didn't have a lot of users and and customers before and and they they make

up the other uh side of the whole ecosystem of ethereum so it's really coming out uh and this is only the beginning I think and we're going to see Improvement in each one of these uh these segments specifically uh in terms of where ethereum is going so in ethereum like in the ethereum ecosystem we can see many segments emerging like um things that focus on payments things that um focus on say gaming on ethereum prediction markets on ethereum um there are there are things that interface with energy markets a lot of these different segments are coming are there any segments that stand out to you in particular as having potential in a short short run in a short run uh well

there there's a good variety there's a good variety uh in in terms of where the activity is the one that uh got a lot of AirPlay this week is a financial Services we kept hearing over and over again uh so many banks uh getting involved in in trying ethereum technology I think uh the part that I have not heard a lot about that I'd like to hear more about I think it's an area that's that's very natural is government services um the the the topic of uh anything to do with titles Registries um and and all of the government services that already exist

today and if you think about it a few years ago in the more developed countries uh governments have stepped up with eServices with allowing uh businesses uh to register online allowing us as Citizens to file taxes online and a whole variety of U of government services have been online uh so I think the the trust Bas Serv trust Based Services based on ethereum or other blockchains are a natural evolution of where governments can take their eServices into uh society and into business and I'd like to see more uh more activity and more work done in the government servfaces area and then maybe

a bit more in the in the consumer space the reason why consumer is interesting like the games the gaming I think somebody's developing ether poker uh and because uh there's a visibility that that happens when when a when a product hits the consumers then U by default it could hit millions of users so it it spreads the footprint um more aggressively whereas with the Enterprises and the businesses they are they are the the numbers are smaller because that's the nature of of businesses to business and and half of them will not tell you what they are doing so if you've heard of six Banks here this week I can bet you there's at

least 12 that are doing something and not saying what they are doing yeah yeah yeah that's that's that's really true and um one of the challenges that seem to confront the um the ecosystem in general of of companies is the is the question of monetization that ideally we want the logic of of a decentralized application to to be transparent on the blockchain and we also want the uh the application to not control any user data but the this creates kind of unique challenges at monetization what are your thoughts on that yes I mean we're still learning we're are still learning and exploring

the business models that are going to be viable uh on top of these new networks these new protocols like the open Bazar protocol which is a peer-to-peer e-commerce protocol and um but we shouldn't be fearful of uh of trying to deploy them because first you have to deploy it and then you have to get users on it and then you can learn you can learn the possibilities only when the users are on it I mean in theory everything makes sense uh and the crypto space is is U has a lot of theoretical work behind it where every almost every startup has a white paper behind them or

every uh company has some kind of of theoretical uh construct behind them and it makes a lot of sense but the real test is when it goes on the market and uh so I would encourage anybody to just put their product in the market put their service in the market and then let the users uh guide you to where where they want to go and then a lot of innovation will be will become more obvious and more possible in terms of the business models I think the business models will come after to deployment we have to install them we have to deploy them and we have to gain some experience in using them and then we shouldn't be afraid uh of of what we're going to

discover after all after that so the ethereum like as somebody who's been involved in ethereum uh and who has influen in the ecosystem I ask you this question U like you have been involved for a long time that part of the part of the uh part of the reason uh people are kind of a bit worried about ethereum or uh not not converted to to ethereum yet is that they perceived that um ethereum had this amazing spike in in development funding which was 18 million and uh theyve they seem to have spent quite a bit of it and can run the next year uh the CM Foundation quite safe but then after that there is no kind of central

uh funding funding point at which uh they can draw to develop the very great ideas that vitalic and others are coming up with and on the other side if you look at the way the E ether tokens are issued they've gone for a proof of work function that does not have any annual rewards for the ethereum foundation at all um and also the proof of work function is also something that kind of um is very longlasting like unlike Bitcoin that just goes flat out at 21 million ethereum token will be created for as as many years in the future as you can see so um where do you think the like how will ethereum as an ecosystem

continue to develop its core infrastructure yeah I mean you've raised a lot of uh points here first of all I'm not worried U about when people say the foundation is going to run out of money I mean that seems to be um something I hear once in a while but it's more perception than reality the first thing I would say is that now the ecosystem is is Big so it's not just a foundation that is developing the technology uh although they are committed to developing uh and researching uh a number of the Technologies but they are not the only ones and uh if there is money for a year this is plenty because

we take it one year at a time let them take it one year at a time and you know we cannot predict what's going to happen in one year as the technology uh gets deployed there will be a lot of opportunities to continue to fund the uh the foundation uh there has been supporters that have come uh in and and supported it already out of China and there's going to be more of that uh conceivably speaking and then vital even said that he he's thinking of ways to to issue potentially a little bit of ether uh which would form a small inflation part to continue funding the Foundation if he has to uh so right now I think the foundation is is fine uh but it's more than the foundation and it's really at

the end of the day it's the people it's the people that that are developing uh so in the very very worst of cases and I don't want to even speculate that this would happen uh even if there was no Foundation the people are still there and the same people are going to continue to develop on the same things and that's what matters really is to continue to push the envelope on the research on the development on the science aspect and and vitalic and all of the others are committed to it and that's what counts really yeah that that was definitely seen on this Devcon there are like so many for-profit companies that are now invested in ethereum that conceivably they could also keep contributing to to the development of of the co protocol exactly I mean it's it's

it's becoming almost a self sustainable uh environment uh not 100% but almost it's getting there it is going towards that self- sustainable mode where everything supports it basically from the bottoms up and then there's going to be some money coming from the top down as well a lot of the Venture capitalists are uh very interested uh about ethereum uh compared to bitcoin it's a bit it's coming later I mean it's only been out in the wild for not even four months so it is a fairly fairly um young uh technology uh and um and uh I think the best days are yet to come mhm okay so in principle

like uh would you support like some kind of Maintenance issuance to the ethereum foundation that that that some some section of ether that a small amount of inflation that keeps going to the foundation and uh and helps maintain the core infrastructure that so many people are going to depend on I'm not sure I I'm in a position or that I would be the right person to answer that question it's really in the realm of the foundation that for them to decide um and and the thing that that we have to keep in mind is we don't have to speculate uh what might happen in a year from now because the variables and the parameters and the

environment and the situation will be different a year from now H the whole thing is advancing almost in dog years MH every 3 months it's almost like a year in terms of development and uh they are very close to what's going on so um I think uh I'm confident that they will make the right decisions at the right times and um in the in the uh Venture cap Angel investment Community um there have been many venture capitalist that have come out vocally in support of Bitcoin and have taken the position that it's the blockchain with the in bold capital letters uh whereas you have been of the outliers in that community that has uh kind of supported ethereum from from

from from early on and you have taken a different stance to the other ones do you do you see the stance that Bitcoin is the only game in town softening well I would correct you slightly on that I I am more of a a middle of the road person actually my last three investments in are in the Bitcoin space specifically um so I have supported the Bitcoin ecosystem and I'm also supporting the ethereum ecosystem uh almost equally I mean i' I'd like both of them to succeed and uh and and they each have their strengths and weaknesses and um I am more of a proponent of of

decentralized Technologies and decentralized models uh peer-to-peer uh constructs and protocols and networks and I see Bitcoin uh and blockchains and ethereum are as applications yeah um on on this trend that hopefully will stay with us for a long time um so U uh and and the other thing I mean I've I've been telling everybody that we we shouldn't uh say any bad things about each other uh from either side uh I've heard the Bitcoin Community say some bad things about ethereum and I've heard the ethereum community say some bad things about Bitcoin and whenever I hear that I I if I can I I will remind people that

we should not uh be uh doing that because we're all in the same boat and if the ecosystem gets bigger everybody benefits and that's what we should be focused on MH okay so so you you you do how do you do you see um more other venture capitalist now investing in ethereum or or or going so because like if if if the assumption is that the Bitcoin is going to be the only blockchain then any investment on on on on on on ethereum is is is difficult so this uh this Frame of Mind in a sense needs to be broken and we need to go to your frame of mind which is both can

survive and coexist absolutely I mean the look at again I don't want to use the banking examples too many times but look at the financial services they did not want to touch Bitcoin but they are touching the ethereum blockchain so to ethereum's credit and we don't say it um too many times but we should I think as ethereum the banks are adopting ethereum on their own uh whereas they wouldn't touch Bitcoin so that's a big achievement for for ethereum um Bitcoin is is has a has good Network effects right now because it has a lot of users but it's not a

fair Apple comparison because ethereum is not going after the payments space ethereum is more a fundamental uh platform technology as you know for developing decentralized applications and that's The Sweet Spot of ethereum it takes care of a lot of the decentralization uh features that applications will need and and it makes it easier for developers to develop on the ethereum platform um I'm not saying developing on bitcoin uh is is is um let me correct what I develop developing on bitcoin is different than developing on ethereum let's put it that way at this point but there will be a little bit more

convergence um going going into the future um and uh and what's important is to make the ecosystem bigger and that's what I'm focused on yeah cool so we can our listeners find out more about you or or your thoughts on this ecosystem sure I I block regular on Startup management.org blog uh or follow me on Twitter wmay m o u g a y a r all right so that was William mugay thank you so much for coming on our show thanks mayor