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Jul
09
2018

Interview with Tixico - implementing blockchain in the ticket sales industry

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This month Liepaja Football Club tickets will go on sale with Tixico, a ticket sales platform on blockchain. Buyers will not noticed the difference between current ticket sales platforms, but the process will revolutionize the industry. The cofounder of Tixico, Normunds Vucans, tells us about his project in an interview.

What does Tixico do?

We sell tickets on the blockchain. There are two reasons we need it. First - it allows us to deal with ticket hawks by being able to apply certain limits, such as how many tickets can be purchased with one card. Similarly, you can set limits and predict how many tickets will end up for resale. It isn't that big of an issue in Latvia, but in larger markets, such as Germany, England and the USA, as much as 60% of tickets are purchased by bots created by ticket hawks. To avoid that, the seller can, for example, ensure that tickets that end up for resale can only be sold at the same face value for which they were bought. That way, the ticket hawks lose interest because of a drop in their profit. For example, an organizer can set that a $50 ticket that ends up for resale can be sold for no less than $45, and no more than $50, or any other organizer set limits.

 Second, we do something that others don't - we offer a crowdfunding system aimed at small businesses and small events. For example, for a big name actor to go to a rural theatre. A large sum of money would be necessary to book the actor, but there wouldn't be a guarantee that there would be enough ticket sales to afford it. There are two options. One is that tickets can be put of for sale before the event, and if the amount necessary isn't reached, the event is canceled and the money for the tickets is returned. It can also happen in a different way. If the event requires $200, and there's one person who strongly believes in the project that has $100, then they invest that money towards making the event happen, if they wish. After the end of the event, they receive a percentage of the profit, according to how much they invested.

Where did the interest in ticket sales come from?

For the past 9 years, I've been close to both the music and the sports industry and different event organizing. From this experience, I could already see several aspects to improve. On the other hand, my cofounder, Krists Kreic, had done his bachelor's thesis on blockchain, which was the first blockchain research in Latvia. Discussing event organization aspects together, we realized that this is an industry that certainly could be entered. There were already a few companies collecting funding for their projects that do ticket sales on the blockchain globally, but the niche is wide, and besides, no one has reached the zenith yet.

Is this an opportunity to improve the ticket sales for the Latvian Song and Dance Festival?

Yes, that's a great example. At the time [of the Song and Dance Festival ticket sales, ed.], we had started work on the project, but hadn't announced it yet. There are both objective and subjective reasons why this could've happened. In Latvia, there aren't often events that have so much demand, which explains why the technical base is not kept up to this standard. However it certainly could have been managed more successfully. And Tixico can do that. And here we see the secondary market, which finally became relevant in Latvia. This is how you can control it. Of course, you can't be certain that someone won't try to sell the tickets elsewhere, but if there's an official secondary market, then that ensures the event attendees with a safe and trustworthy source.

Tixico has been on the market since May 2018. How far away is the final product?

We're currently actively working on that, so that in mid-July we can start selling in cooperation with the "Liepāja" football club, for both European League games as well as Latvian League games. Currently the demo-platform is available and can be taken a look at. You can play around and see how ticket sales could look like on the platform, as well as what the system will look like when the blockchain is fully applied - currently it isn't fully applied on the demo platform. The platform will be fully integrated with the blockchain in the first quarter of 2019.

 

How did you convince the sports club to choose your solution, which hasn't yet proven it's the right choice?

Here we truly have to say a big thank you to the businesses that have chosen to work with us and take the risk. In some way it came as an advantage that we personally knew the majority of our current partners (Tixico is currently working together with projects such as Austras Balva, Tims Mints, ParaPops, Fuckup Nights Riga, etc.). That made us trustworthy. One important aspect - they like our vision. They like what we do and how we do it. It's important for small businesses that thanks to our blockchain solution, we can provide improved statistics and analytics. For example, it's possible to identify the most active game attendees over the course of the season and, for example, send them an invitation to the season final dinner, or send them some team merchandise.

What does this change for an individual buying tickets?

Nothing changes from a ticket-buying perspective - everything you're used to stays the same. The buyer goes to the website,  makes a payment, and receives a ticket. The magic, which is connected to the blockchain, all happens behind the scenes, and regular users don't get to see that far. We believe that's very important when using blockchain - it has to be simple enough to use, and it doesn't need to require the use of cryptocurrency, which is usually the case with blockchain-based projects. That audience's goal is to simply go to an event and enjoy themselves. That's why we shouldn't have to place any more barriers or make them do more steps during the process. Rather this solution should help them. For example, when a game is sold out, then the interested buyer can simply go to the official market, knowing that everything will be safe and fair. We can guarantee that they'll receive a ticket to attend the event.

Will you be competitors of large ticket selling players in the market, such as "Biļešu Paradīze" and "Biļešu Serviss"?

Possibly, yes. But  not right now. Taking stock of our abilities and possibilities, we'll currently continue to work with partners, integrating ticket sales into their websites. We ourselves will be looking out for partners that we find interesting to work with. However we see ourselves as mainly with working with businesses outside of Latvia. We most likely won't be directing the majority of our resources to developer ourselves in this market.

Have you received investments to finance the development of your project?

We had a small angel investment round in Latvia at the beginning of the year, with which we created the demo platform and secured our first partners. We'll now have our first pilot project and will attend various conferences in Europe and abroad. Currently we're actively working on our next round - securing a private investment. Later we plan on creating a public offering.