Al Burgio thought he was out but it drew him back in.
Mr. Burgio is the founder and CEO of DigitalBits, a next-generation loyalty and rewards program. A self-described serial entrepreneur, Mr. Burgio is well-versed in technology and industry, having founded companies in e-commerce, online media, security and routing architecture.
After spending most of his career with internet-based companies, Mr. Burgio was contemplating a change, before he saw “it”.
“After my last company I thought that was it, but then blockchain knocked me on my ass.”
Blockchain resonated on many levels, Mr. Burgio said, enough that he began looking for a problem that either already exists or will soon as blockchain adoption spreads.
But it’s far from a clean fit. Blockchain is at the beginning of its development cycle, and while exciting, much of the early discussion has been dominated by engineer-speak which can intimidate executives and board members, who see the blend of confusing jargon and lack of success stories and hesitate.
To foster wider adoption, speak in terms businesspeople understand – time and money.
“It has to be something easily consumable,” Mr. Burgio said. “Data transfer of any kind. People expect something to be low latency. They’re more impatient since the 1990s.”
Many entrepreneurs make the mistake of trying to fit society into the blockchain when they should be doing the opposite, Mr. Burgio said. Their focus should be on how to seamlessly integrate the blockchain into a learned behavior.
And eschew niche opportunities in favor of the big fish.
“Go somewhere with more staying power ,” Mr. Burgio suggested. “Where it’s good to be first but where centralized organizations have a hard time dealing with a decentralized model.”
Mr. Burgio believes he has pinpointed the ideal sector. Rewards and points programs and plagued by issues including changing collection and redemption conditions and a lack of trust. It is getting harder to amass enough points for the best rewards. Blackouts are a pain.
Put it all together and you have more than 100 million points on corporate balance sheets awaiting redemption. One in three points issued are never redeemed.
“The opportunity is massive,” Mr. Burgio said. “What we wanted to create from Day One is a solution for the liquidity issue.”
There’s three types of people when it comes to conversion, Mr. Burgio said. The first see blockchain’s merits without explanation – they’re the early adopters. The willing followers mimic the early adopters and come aboard.
The unwilling followers only adopt something if it is truly powerful, and blockchain technology has the strength, Mr. Burgio believes.
“It happened with the internet, which moved all three groups. Everyone gets a website.
“The blockchain is equally if not more powerful than the internet.”
DigitalBits’ vision is to support the loyalty industry with blockchain technology, Mr. Burgio explained. Develop an ecosystem of points issuers, and tokenize those points on the blockchain so recipients can trade points for ones they really want. If I have plenty of points from the wine outlet after I bought the supplies for an office party but am short a few for a vacation, I can trade those points with a homebody who enjoys a good beaujolais and is sitting on airline points.
The attraction is just as strong for retailers, Mr. Burgio said. The greater the liquidity associated with their program, the more people are incentivized to use them over a competitor who is not part of the DigitalBits ecosystem.
And like the internet, the heavy lifting is done on the back end so you don’t have to know what the blockchain is doing or even that it is the blockchain behind it, Mr. Burgio said while adding that DigitalBits can support a six-person exchange train.
The increased value and liquidity turns points collectors into miners, Mr. Burgio said.
“Do most people know how to mine Ethereum? No.
“But most know how to mine loyalty points.”