 From the SiliconANGLE Media Office in Boston, Massachusetts, it's theCUBE. Now, here's your host, Dave Vellante. So, CUBE Conversations, simplifying blockchain for developers, Remy Carpanito is here, he's the CEO of Espresso. Remy, thanks for coming in. Yeah, thanks for having me, Dave. Yeah, so, you guys are in the C port, we want to hear all the action that's going on there, but let's start with Espresso. Founder or, yeah, founder, not a co-founder, founder. Founder, co-founder, okay, good. Just to clarify with respect to your co-founders. Why did you guys start Espresso? Yeah, no, it starts back kind of a little while ago. We originally wanted to kind of replace our first company, it was a company called CampusTab, and we want to replace student identity with NFC chips and smartphones, and it was a really cool concept back in 2010, but at the time, there's only one phone that had the technology capable of pulling this off, and we built a prototype with that smartphone, it was a Samsung phone at the time, and we brought that around to a dozen plus colleges showing, hey, you could replace the student ID with a phone, you could just tap your phone for attendance, for events, et cetera, and they loved it, but everyone had the same question, when is the iPhone going to have the technology? And we were three years early, the iPhone didn't come up with NFC chips until 2013, and we ended up pivoting into a mentoring platform, and scaled that company up to over 70 colleges across the country, but ironically enough, we came back to the same issue. A lot of CIOs and CTOs wanted us to interface with their single sign-on servers, which required us to support this legacy technology. So AJ and I spun back internally, AJ's our co-founder and CTO, to identify how can we replace identity again, but instead of using hardware and smartphones, let's use the blockchain. And AJ was an early Bitcoin adopter back in 2010, mining Bitcoin, really kind of passionate about the technology, and I started learning a little bit more about it and trying to find a way to incorporate blockchain technology into our student identity solution as a secondary offering for campus tap. What we quickly realized was that our front-end engineering team was a little bit underwater in terms of the technical skills that needed to help and participate in the development for the blockchain identity solution. So we ended up building up to middleware components to help them with the development, and that's where we saw, kind of that's where life all went off, and the bigger opportunity came about where a lot of the infrastructure and tooling needed in order to build a production-level blockchain application isn't quite there yet. So we ended up pivoting and building a new company called Espresso to make blockchain development more accessible. So let's talk about the challenge that your developers face. So you were at the time writing for Ethereum and in Solidity, right? Which is explain to our audience why that's so challenging. What is Solidity? And why is it so complex? Yeah, Solidity is a JavaScript-based framework for writing smart contracts on the Ethereum platform. It's not a fully baked or fully developed tools that yet, in terms of language, there's some nuances. But on top of that, you also need to understand how to support things like the infrastructure, so the cryptography, the network protocols. So if you want to sustain your own blockchain, there's a lower level skill set needed. So the average JavaScript engineer could be a little bit kind of overwhelmed by what's needed to actually participate in the full-blown blockchain development. Yeah, so they're probably close to 10 million JavaScript engineers worldwide. So it sounds like your strategy is to open up blockchain development to that massive resource. Yeah, and in JavaScript being a definite core focus out of the gates and we'll be developing a plethora of SDKs, including JavaScript and Python and Ruby, et cetera. And the thought process is, you know, activating these engineers that are coming out of new code academies or enterprise engineers that are really good at C++ or another language and allowing them to code in the languages they already know and allow them to participate in the blockchain development itself. Okay, and so how many developers are on your team? So we have a small ad product team. There's three people on the product team now but we're actually in the process of scaling that up quite a bit. Yeah, so those guys actually had to go on the job training so they kind of taught themselves and then that's where you guys got the idea, said okay. Yeah, yeah, exactly. And we realized that if we could build out this infrastructure and this tooling layer that just allows you to compile the languages you know into the software or the blockchain side, it can make it much more accessible. And then also the other thing too, that's interesting. It's not just kind of writing the languages they already accustomed to but it's also the way you architect these blockchain solutions. And one thing we've realized is that a lot of people think that every piece of data needs to live on the blockchain that's really not, it's not advantageous for you to do so because it's really expensive to put all the data on the blockchain and it's relatively slow right now with Ethereum and 30 transactions per second. There's companies like VeChain that are looking to remedy some of those solutions with faster data write times. But the thought process is you can also create this data store and with our middleware it's not just an SDK but it's a side chain or a really performant in-memory based data store that'll allow you to store off-chain data still in a secure fashion through consensus, et cetera, that can allow you to write data rich or today's level applications on the blockchain which is really kind of the next step I see coming in the blockchain space. So I want to follow up on one question there. I mean historically distributed database which is what blockchain is, it's been hard to scale. It's like you say low transaction volume. So you had to pick the right use cases. Smart contracts is an obvious one. Do you feel as though blockchain eventually, you mentioned VeChain, sounds like they're trying to solve that problem, will eventually get there to where it can compete with a more centralized model head on and some of the more mainstream apps. Yeah, and that's kind of where we are because our thought process, if we were to move campus tap but kind of private LinkedIn for colleges per se onto the blockchain back when we started it wouldn't be possible. So how do you store this non pertinent data, this transactional or not even transactional this attribute data within a blockchain application and that's really where that second layer solution comes into play and you see things like Lightning Network for Bitcoin, et cetera and Plasma for Ethereum but creating this environment where a developer comes on they create an account, they name their application, they pick their software language and then they pick their blockchain this pre-built smart contract we offer them but on top of that they already have this data store that they can leverage. These are things that people are already accustomed to in the web 2.0 world. These are the caching layers that everyone uses, things like Redis, et cetera that we're bringing into the blockchain space that we believe will allow this kind of large scale consumer type application. Well, and when you think about blockchain you think, okay, well you think secure, right? But at the same time, if you're writing in solidity and you're not familiar with it the code could be exposed to inherent security flaws is that so do you see that as one of the problems that you're solving sort of by default? Yeah, I think one thing here is kind of as you write a smart contract, you need to audit and you test it and so on and so forth and so we're helping kind of get that core scaffolding put up for the developer. So they don't need to start from scratch. They don't need to pull a vanilla smart contract off of an open source library. They can leverage ones that are kind of battle tested through our internal infrastructure. So the last part of our kind of offering is this marketplace of pre-developed components that developers can leverage to rapidly prototype or build their applications whether it be consumer, engineer, or enterprise level engineers. And are you a developer? What's your background? My background, yeah, so I studied entrepreneurship and information systems. So I do have, I was a database analyst at Fidelity. It was my last job in the corporate world. So I do have some experience developing nowhere near that of my co-founder AJ or some of our other engineers, but yeah, I understand the core concept pretty well. Well, speaking of blockchain, which we were talking about obviously, you see a lot of mainstream companies and obviously the banks are all looking at it. You're seeing companies, we just heard VMware making some noise the other day. Certainly IBM makes a lot of noise about smart contracts. So you're seeing some of these mainstream enterprise tech companies, commit to it. What do you see there in terms of adoption in the mainstream? Yeah, now I think the enterprise space is going to want to fully embrace this technology first. I think the consumer level, we're still a little bit ways away there just because this infrastructure and this tooling is needed before developers kind of get there. But from the enterprise space where we see, I mean, obvious things like supply chain being a phenomenal use case, the blockchain technology, Walmart and IBM are already implementing really cool solutions. One of them, my advisors, Rob Dolcey, is the president of ASUN. They've successfully implemented several blockchain projects from car parts manufacturers to track and trace through wine seeds from grape seeds. And so there's a lot of different use cases in the supply chain side. Identity is really exciting. Estonia is already doing some really cool work with digital identity, so that's going to have a big impact voting systems, et cetera. But also thinking through newer concepts like video streaming and decentralization of network maps. And so there's many different use cases. And for us, we're not trying to necessarily solve like the supply chain problem or anything. We're trying to give a set of tools that anyone can use for their verticals. So we're excited to see kind of what a spread is used for and over the next seven months to a year. And Remy, you mentioned V-Chain before. So explain what V-Chain is and what you're doing with those guys. Yeah, so V-Chain is a kind of next generation blockchain. Their V-Chain Thor is the new platform and actually their main net launch is tomorrow. And they're really excited. They're introducing heightened security, faster block times, more transactions per second. They have a really interesting governance model that I think is a good balance between purity centralization and the centralized world, which I think is that intermediate step that a lot of these enterprises are gonna need to get into the blockchain space. And we're working with them, we're launching on their platform. So our token sale will be run through V-Chain, which is great. In addition, we'll be working with them through strategic partnerships. And the goal is to have Espresso be the entry point for developers coming into V-Chain. So we'll help kind of navigate the waters and kind of have them leverage the pre-built smart contracts and get more developers into the ecosystem. Okay, let's talk about your token sale. So you're doing a utility token? Yep. And so that means you've actually got utility in the token. So how is that utility token being utilized within your community? Yeah, so the data, actually the token is used to meter and mitigate abuse in the platform as well. So at every single transaction, it'll validate the transaction. In addition, it'll be an abstraction layer. Since we do speak to multiple blockchains, that easy peasy token will have to abstract up to Ethereum to Thor, which is the V-Chain token, the future dragon chain, et cetera. So that's a really interesting use case. And one of the interesting things we're trying to solve right now, if you're a developer trying to come in and use a cryptocurrency for development, you need to go to something like a Coinbase, you have to exchange fiat to Ethereum, you have to push that out to a third-party exchange, you have to do a trade, and then you have to send that digital wallet address where you get easy peasy out to our account after. That's a ton of friction. And that's more friction. If you're not a crypto person, you're gonna be asking what's going on. It's not gonna do it. So we're talking to some pretty big potential partners that'll allow kind of, they would be the intermediary or money servers to allow a seamless transition for an engineer just to come straight onto Espresso, put down a credit card bank account, verify and go through the standard KYC-AML process, and then be able to get easy peasy in real time. And that's something that at a macro level, I think is one of the biggest barriers to entry in the blockchain space today. So what do you call your token? Easy peasy. Easy, I love it. Okay, so you're making that simple and transparent. And so you're doing a utility token, you're doing a raise. Where are you at with that raise? Give us the details there. Yeah, yeah, so we just closed our friends and family round. We're in our private sale right now, working closely with the VeChain and VeChain Foundation, helping kick that off right now as well. And we're, yeah, this is gonna be a much more strategic capital in this round. And then after that, we'll be moving into, since we are partnered with VeChain, their community gets a little bit of exclusivity in the next piece of the round. So their master note holders will get a bigger discount in the next round. And then the last round will be the public round for the general community. And that's where we anticipate a lot of developers. We already have development shops coming on participating in the first round, which is great because the thought process is, we want to get as many developers on this platform as possible throughout the summer. And I think that's one of the most unique things about a token sale, it's not just raising capital, it's actually getting people that want to use your product to buy in now. And that's amazing. So, okay, so you're doing the private sale first, and you open that up to those types of folks that you just mentioned, and they get some kind of discount on the token because they're in early and they're back in you guys early. And then you guys get a Telegram channel, I know it was on the recently, the thing is exploding. So it looks like a pretty hot offering. And then what happens next? Then you open it up to just a wider audience. How does that work? The funnel starts to open up a bit and we start getting the core community members from VeChain, and then after that, the public sale will be really targeted for the end users. These are the people that you don't need to put in a large substantial amount of capital to get in at that point. You can put in a couple hundred dollars and actually participate in the token sale and you'll be getting on the kind of ground floor, in a sense. And the SEC just made a ruling recently a week ago or so that Bitcoin and Ethereum were not security. So that's a good thing. Nonetheless, as a CEO and entrepreneur, you must have been concerned about a utility token, making sure everything's clean, that there actually is utility. You can't just use the utility token to do a raise and then go build the product. So you had it, you have a working product, right? Yeah, so there's a lot of functionality already set up and we're going to continue to iterate before we even get close to the actual tokens or the public sale. So we anticipate having full functionality but we want to get out there to the development world by the end of the sale. So it's the thing that we, I think one of the biggest things in this space right now in terms of the law and then compliance side is a lot of self-regulation since in the US in particular, it's such a great area. You need to once day up to date with every single hearing and announcement but also really make sure you're taking best practices with KYCAML, making sure that you know your people that are investing into the, or kind of participating in the allocation. And that's something we've spent a lot of time with our legal team. I've gotten pretty intimate with our lawyers and really understanding kind of the nuances of this space over time. What about domicile? What can you advise people based on your experience in terms of domicile? Yeah, I'm not a lawyer, but based on our experience, I mean, there's some great places over in Europe, you know, Switzerland, Malta, Gibraltar, we're down in the Cayman and also Singapore. There's, you know, these different legislations are writing new law to support the effort. And I think that's going to continue to happen and I hope it happens in the US too. So we remove some of this nuance in gray areas so people can feel more comfortable operating and I think that's going to happen hopefully soon in the next six months or so, we'll see. But as long as more guidance continues to come out, I think we can operate, or people can operate in the US. I know a lot of people are moving offshore like we did. So it's just something that's going to, it's a tough area right now. Well, it gives you greater flexibility. And like you said, it's less opaque so you can have more confidence that what you're going to do is on the up and up. Cause as an entrepreneur, you don't, you know, you don't have to worry about compliance. You just want to do your job and write great code and execute and build a company. And so, I mean, I feel, I don't know if you agree that the US is a little bit behind, you know, this kind of really slow to support entrepreneurs like yourselves, like us, we'd like more transparency and clarity and you just can't seem to get a decision. You're sort of in limbo and you got to move your business ahead. So you make a decision. You go to the Cambridge, you go to Switzerland, you go to Malta and then you move on. Right. And I think it's interesting too. And you know, a lot of what the SEC did in the beginning there's a ton of bad actors out there just as well. And there's a bunch of good actors too. So again, if you self-regulate, you play, you really understand what you need to do to be compliant. You should be fine. But again, I think the flexibility you get right now with the more kind of defined law and some of these other jurisdictions makes a lot of sense. Yeah. And I don't mean to be unfair to the SEC. They are doing a job and they need to protect the little guy and protect the innocent, no question. I would just like to see them be more proactive and provide more clarity sooner rather than later. Okay, last question. The seaport scene in Boston, you know? We always compare Boston and Silicon Valley. You can't compare the two Silicon valleys of vortex in and of itself. But the Boston scene is coming back. There's blockchain, there's IoT, the seaport is cranking. You guys are in the seaport, you live down there. What are you seeing? We give us a, what's the vibe like? Yeah, no, blockchain we just passed about a month ago, maybe a blast. And great turnouts. I spoke at a few events, a few hundred people kind of each one, which was great. And it's interesting, you get a good mix of enterprise people looking to learn and educate themselves in the space. You see the venture capital side moving into the space and participating in a lot of these larger scale events. And it's definitely growing rapidly in terms of the blockchain scene in Boston. And I spent some time in New York and that's another great spot too. And even places like Atlanta. And I was down in Denver. I did a big presentation down in Denver, which was awesome. And the coolest thing about blockchain that really is global. I spent a lot of time in Asia and in Europe. And speaking over there, the pure, like the tangible energy in the room is amazing. And it's one of the most exciting things about the industry. Many people that in this space know we're on the cutting edge here. We're on the, this is the new frontier that we're building along the way. And being part of that and helping define that is pretty exciting stuff. That's cool, you know, I said last question, I lied. I forgot to ask you a little bit more about your team. Maybe you could talk a team, your team, your advisors. Maybe you could just give us a brief over there. Yeah, for sure. My co-founder and CTO, we've been working together since I believe my sophomore year at college. So it's been a while. And he's their original crypto blockchain guy and pushed us into this space. He's the leading product development on that front. And on top of that, we have Craig Gainsborough, our CFO. I actually spent a lot of time at PWC. He was the North America Tax and Advisory CFO over there. We have Gylan Liu as the director of product marketing. Kevin Kutu is the head of product. He worked, I think he was nominated for Webby. And then we have our ops team, Kyle, who's a former campus type employee, lead business dev guy over there that's working on us. From some of the other side, on the advisory team, we have a really good team. Sonny Liu from the CEO and founder of VeChain just came on. Eileen Quinan, the president of Dragon Chain Foundation. That was the blockchain company that spun out of Disney. And then David Fragale is the co-founder and head of product of the autonomy. It's an IoT protocol. Really, really cool stuff happening over there. New program coming about. Rob Dolce is the president of Asian North America, which is this pie chain company. And they've already successfully deployed a handful of use cases. And Dr. Mihaila Yuliru, who is really interesting in the sense that she was working on decentralized systems before they were called blockchain. She worked with a professor in Berkeley that defined decentralized technology. And she speaks in the world economic form frequently and is really just a global presenter. So we feel like we have a really strong team right now. And we're actually getting to the point of scaling. So it's going to be exciting to start bringing this new people and picking up the momentum. It's super exciting. Well, listen, congratulations on getting to where you are. And best of luck going forward. Best of luck with the raise and solving the problem that you're solving. It's an important one. Thanks for coming on theCUBE. Yeah, of course. Thank you so much. You're welcome. All right. Thanks for watching everybody. We'll see you next time. This is Dave Vellante.