Technology

Who needs VCs The largest companies in the crypto world are continuing to build the ecosystem through aggressive investments of their own, as I forecasted at the start of this year.

Binance, the worldlargest exchange, is the latest example. The company is marching beyonda gargantuan $1 billion fundit unveiled earlier this year after itannounced an incubator programthatfocused on nurturing early-stage blockchain startups.

TheBinance Labs Incubation Program was teased back in June when the company announced its fund, but now the company has taken off the wraps and provided more details — the venture is very aggressive.

The program will take on around 8-10 companies per batch for a 10-week period, Binance Labs CEO Ella Zhang told TechCrunch in an interview, adding that the target is to hold one program per quarter.

That frequency is unheard of, even by those who do incubators full-time, but theremore.Binance Labs will hand out $500,000 to each programparticipant in exchange for a 10 percent stake in the business. Again, thata big effort compared to most other programs, although it is worth noting that Binance hasn&t decided whether that investment will be in fiat, crypto or a combination of both.

Beyond money,the company wants to open itself up and allow participants to access the benefits of being the worldtop crypto exchange. That&ll includementoring, technical advice, access to the Binance network and also support on non-technical organization-building activities like HR, admin and more.

The maiden program will be held in San Francisco starting October 9 — applications to take part are open until September14.As is commonplace, the program will close with a demo day — the &BUIDLer Day& — which will see startups pitch to anaudience of investors, media and other industry figures.

Zhang explained that the focus on startups for the program is similar to the Binance fund. That, she said, includes projects focused infrastructure, public chain scalability, security, decentralized exchanges, wallets, custody, payment, coin stability, compliance, decentralized apps, gaming, virtual goods and more.

Ideal candidates have not taken any investment yet since Binance is aiming to be the first check, said Zhang — who joined the crypto firm in May and was formerly an investment director withKPCB China.

Going forward, Binance is aiming to operate the program in different parts of the world each time to address what it sees as global opportunities for blockchain businesses.

&We&re looking atdifferent cities across the world because blockchain and crypto are international. We see problems and opportunities in different regions with different ways to leverage the blockchain,& Zhang said. She added that Africa and Asia are of particular interest at this point but no other destinations have been decided yet.

Binance Labs CEO Ella Zhang spoke at TechCrunch Hangzhou 2018

Zhang and Binance Labs directorChristy Choi explained that the large equity check is designed to &facilitate& startup founders by allowing them to focus on developing a product or service, rather than having to set up a business.

With that in mind, the $500,000 investment will cover flights, accommodation and living costs associated with the incubator program and provide the capital to get a product off the ground and towards deployment. The program will maintain close links with the Binance fund, which is also managed by ZhangBinance Labs division, so there will be follow-on investment opportunities once the batch is done and as companies scale.

&Binance Labs began to do investments in the past few months and we&ve seen a lot of market hype which is distracting many founders from launching and delivering because therea huge demand from investors to get into their project,& Zhang said. &They need a lot of help to become a more mature team and company in order to really shape what they want to do.&

Unlike traditional companies that tap private investors for capital to start out and then as they grow, blockchain and crypto projects typically jump quickly into ICOs. Though often lucrative, the process can leave them dealing with retail investor expectation and concerns around legalities and other areas, all of which steals resources from actually building the business itself. Zhang believes the Binance program will help founders &get rid of those noises and focus on their product.&

Binanceaggressive investment strategy makes perfect sense. As the worldlargest crypto exchange by volume — with over $1 billion trade in the last 24 hours at the time of writing — it is practically printing money but is also wholly reliant on the crypto industry.

Binance made a profit in the region of $450-$500 million (dependent on token prices) from its first year of operations —according to figures from the company, which uses 20 percent of its quarterly profits to buy back and ‘burn& its BNB token — but it will always be a reflection of the crypto industry, and thus it needs it to be healthy.

That vested interest means it must ensure that there are meaningful blockchain and crypto companies in the world. That goes some way to explaining why it is offering a whopping $500,000 per participant and operating a massive $1 billion fund, which will be used to invest in funds as well as direct investments into startups.

To her credit, Zhang acknowledged the situation, stating that real use cases for blockchain and crypto are what will make Binance &thrive.& The incubator and fund are aimed at identifying those cases and enabling them to flourish, the question is whether Binance can find enough of what it is looking for.

Note: The author owns a small amount of cryptocurrency. Enough to gain an understanding, not enough to change a life.

It used to be a one-vendor, stack-driven world in the enterprise. Today, the cloud has changed that and best of breed and interoperability are the watchwords of the day. Two enterprise cloud stalwarts have announced a new integration that brings Box content directly into ServiceNow.

For ServiceNow customers, it means that they can access Box content without leaving a ServiceNow application and changing focus. Company CTO Allan Leinwand says the two share a lot of common customers, and it made sense to bring them together.

&When you&re inside of a ServiceNow record, for example, you&re looking at an incident or problem or a knowledge base article, you are going to link to directly with a Box document or save files directly to Box from ServiceNow. Therea lot of very practical things that help people get their work done faster,& he explained.

Jeetu Patel, BoxChief Strategy and Chief Product officer says the two companies are working to drive innovation inside organizations and that means working with multiple products to solve organizational issues.

&Our goal has been to be a neutral central content layer for every business process. Part of that ambition is to be able to plug into best of breed applications like ServiceNow. Companies already use these tools, and use Box, and they want to be sure they work seamlessly with each other,& Patel said.

On a practical level, customers can grab the Box plug-in from the ServiceNow Store. It comes with some prebuilt workflows fpr typical ServiceNow product usage scenarios, but the integration is flexible and allows customization. As an example, in an HR scenario, the ServiceNow administrator might build a workflow for onboarding a new employee in ServiceNowHR application. Using the companyFlow Designer workflow-building tool, they can pull in all the documents a new employee needs to sign with other tasks into a single workflow.

Contract workflow with Box content in ServiceNow Flow Designer. Screenshot: ServiceNow

It comes down to helping customers work more efficiently. &We&re both cloud companies, and we&re both driving digital transformation for our customers. And we&ve really seen a lot of synergy between the way people work in Box, and how people are working in ServiceNow. We think we can integrate together and make work get done better,& Leinwand said.

How best to counteract the Facebook effect in political and other discourse Consider a plan to create an alternative funded by public money. That was the suggestion today put forward by Jeremy Corbyn, the leader of the Labour Party in the UK, who proposed the creation of a &British Digital Corporation& (BDC) that would be a sister organization to the BBC (the publicly-funded British Broadcasting Corporation), and would work as both a think-tank to lead on digital policy and technology, as well as become the home of non-profit services to rival those that are for-profit, including a Facebook alternative.

&A BDC could use all of our best minds, the latest technology and our existing public assets not only deliver information and entertainment to rival Netflix and Amazon, but also to harness data for the public good,& Corbyn said today, in a speech delivered during the Edinburgh TV festival.&A BDC could develop new technology for online decision making and audience-led commissioning of programmes and even a public social media platform with real privacy and public control over the data that is making Facebook and others so rich.& The full text of his lecture can be found here.

The BBC today is largely financed by something called a &TV license&, where people living in the UK pay annual fees for the &right& to receive terrestrial channels. Corbyn suggested that the BDC would be run in a similar way: the government should introduce a digital license fee, he said, to supplement the TV license fee. This would be paid either by way of ISPs (who might pass the cost on to their customers), or by &tech giants&, or perhaps a combination of the two. Poorer households would pay a reduced fee.

Corbyncomments and ideas come at a time when the we are still getting to the bottom of just what role widely-used social media platforms like Facebook played — if not actively, then passively, as a highly influential social media platforms manipulated by others — to influence the outcome of key democratic processes, such as the Brexit referendum in the UK and the most recent US Presidential election.

In that vein, he also suggested a wave of proposals to increase transparency in media communications.

They included a Freedom of Information reform that removed ministerial vetoes and expanded it to include cases where private companies are delivering public services; allowing local, investigative and public interest journalism to be taxed as charities; asking &tech giants& to contribute to an independent fund for public interest journalism; and expanding an existing BBC scheme to foster more local journalism (which has really died a death in the UK, as it has in many other places). Digital delivery would, of course, have a big role to play in this.

The issue of there being too few for-profit tech companies that control tech services has a precedent in the media industry, something that Corbyn also directly attacked. &We must also break the stranglehold of elite power and billionaire domination over large parts of our media,& he said. &Just three companies control 71% of national newspaper circulation and five companies control 81% of local newspaper circulation.&

Corbyn, coming in the wake of moderate leaders like Tony Blair and others in his mold, is one of the more left-wing Labour Party leaders in recent times who has advocated for a much wider set of social services and a move away from for-profit organizations and their encroaching role in how these are delivered. In that context, any comments about publicly funded social media services shouldn&t come as a surprise.

And even if he is not the Prime Minister, Corbyncomments should not be taken lightly. In his role as leader of the opposition, his speech sets an agenda and debating points around how publicly-funded digital services might take shape in years to come. That is something that the Tories (whose leader, Theresa May, is the Prime Minister) have also been contemplating. Up to now the focus has been in areas like developing AI, 5G and cybersecurity, although with a heavy emphasis on helping fund and boost private-sector businesses.

There are a number of issues that Corbyncomments raise, not just about the free market, but about what a publicly-funded model might imply for startups — which are (in theory!) for profit and part of a large push to boost entrepreneurship and small businesses. Similarly, in cities like London, the same oversized tech companies that Corbyn might be criticising have had a big part to play in boosting the local economy, and threats of much higher taxes could have a chilling effect on their activities here. Ultimately, all that will need to be considered when and if we see these ideas mature from their early introduction in a summertime speech.