Comcast Ventures On Finding Blockchain’s ‘Killer App’

Even as a telecommunications conglomerate, it’s hardly surprising that Comcast is jumping into the world of blockchain. Via the firm’s Comcast Ventures, the company led a nearly $3.3 million funding round for blockchain startup Blockdaemon, solidifying Comcast’s presence in the distributed ledger scene.

Gil Beyda, managing director of Comcast Ventures, is among the growing list of investors convinced that it is bitcoin’s underlying distributed ledger technology – not cryptocurrency itself – that has the real potential for market disruption.

“Right now, a lot of folks are enamored by the fact that bitcoin went from $100 to $20,000,” he recently told PYMNTS’ Karen Webster. “That’s great for speculators and gold-rushers, but that’s a narrow part of the population. As an investor, at this point, I’m less interested in cryptocurrency per se, but I still believe the fundamental blockchain technology has value.”

Blockchain has its own gold rush starting up, though, and Beyda warned that one of the biggest mistakes the market can make is to assume “that it can solve every problem – or many problems, for that matter.”

Despite the growing hype – and an endless list of experiments and pilot projects – blockchain has yet to emerge as the disruptor its backers claim it to be. So what must happen to get blockchain out of the gate?

“We need that killer app,” Beyda said. “It has to be a new service, a new business model, a new value proposition so that the consumer says, ‘Wow, that’s new, that’s different, I want that.’ Most folks are going to look for a killer application in order to move that adoption needle.”

For investors like Comcast Ventures and Genacast Ventures (for which Beyda serves as managing partner, and which also participated in the Blockdaemon funding round), cutting through the noise will take patience. In Blockdaemon’s case, investors were sold on the company’s Blockchain-as-a-Service business model. The company facilitates the deployment of nodes to scale blockchain and DLT-based applications.

Beyda told Webster that it’s this focus on infrastructure that caught his eye.

“In order for blockchain applications to mature, there need to be tools for setting up blockchain, monitoring solutions, updating them – and today, blockchain technical experience is difficult to find,” he said regarding the Blockdaemon investment. “If there is a service that can be provided, like Blockdaemon’s, to automate all of that, it’s something that developers and DevOps folks need. It’s part of our overall strategy to provide tools and automation to help enterprises and developers quickly come up to speed in this environment.”

The ability to actually manage and work with blockchain applications will be critical if and when blockchain apps emerge from pilot testing and into the real-world market. Beyda sees significant potential for blockchain solutions in a variety of markets.

“We’ve been looking at the technology in a number of initiatives as they apply to the Internet of Things, advertising, loyalty,” he said, adding that in the communications industry in particular, there are a few ways blockchain could go.

“I could see applications like the exchange of media and content,” he explained. “There is no dollar value, but there are viewing tokens that are exchanged. Applications don’t necessarily have to be financial in nature. There are a number of efforts out there around publishing real-time video, and the consumption of real-time video. There is a token, but not necessarily a cryptocurrency being exchanged.”

Focuses like these could have obvious, significant implications for businesses like Comcast and NBC/Universal, which is also a longstanding partner of Genecast Ventures. But for now, blockchain remains such a young technology that it may not be ready to disrupt the world’s major conglomerates – and, Beyda added, those conglomerates may not be ready for blockchain, either.

“Sometimes, it will turn into a great partnership and great relationship, in which Comcast becomes the first customer [of a startup],” he said. “But it has to make sense on the company’s side, and it has to make sense for Comcast. Comcast can be very demanding. It’s a large company with big needs, and sometimes startups aren’t ready for that. Sometimes, Comcast isn’t ready to adopt new technologies or work with a small company.”

Clearly, though, Comcast wants to remain connected to the world of distributed ledger technology, if only through its VC arm for now. Beyda said his inbox is slammed with blockchain startups vying for funding – and while difficult, finding a focus for potential new investment targets is straightforward.

“We look for companies that are solving real problems,” he said. “They’ve created value. We look for teams that are able to develop a real product and bring it to market, and hit some real milestones. We look at the endgame – we’re a venture fund, and we need to show returns.”

Beyda said he’s already seen some startups going overboard with their blockchain focus, noting that in some applications, a database with API access may be a more appropriate strategy than blockchain.

“Blockchain is hot, so they try to solve a problem using blockchain,” he said. “Sometimes it lends itself to that problem. Sometimes a database is a better solution.”

But to say investors like Beyda are dismissive of the deluge of blockchain startups popping onto the scene wouldn’t be fair. After all, while the blockchain gold rush appears to be accelerating, backers at Comcast Ventures and dozens of other funds remain confident that distributed ledger solutions will eventually be able to live up to their promise of disruption (according to recent Crunchbase data, VC funding in the blockchain space so far this year is already 40 percent of the entire funding total seen in 2017).

And if investors like Beyda want to find that killer app the industry needs, they’re going to have to wade through the noise for a bit longer.

“Our email inboxes are filled – but I like to read all of those emails,” he said, “because you never know where the good idea is going to come from. I would hate to have missed out on that killer app and find it was in my inbox six months ago.”


New PYMNTS Report: Preventing Financial Crimes Playbook – July 2020 

Call it the great tug-of-war. Fraudsters are teaming up to form elaborate rings that work in sync to launch account takeovers. Chris Tremont, EVP at Radius Bank, tells PYMNTS that financial institutions (FIs) can beat such highly organized fraudsters at their own game. In the July 2020 Preventing Financial Crimes Playbook, Tremont lays out how.