Solo entrepreneurship has shaped the gig economy so far, but will decentralised tech help freelancers create and earn better?
Whenever we talk about startups, we always think about technology-driven and scale-focused companies that try to solve a pain point through some application or tech-driven solution. Think Uber for incentivising carpooling and ride-sharing. Think Airbnb for sharing of one’s excess space.
When it comes to individual entrepreneurship, however, the gig economy is usually more service-driven. Solo entrepreneurs or “solopreneurs” would usually offer their time and skill through some freelancing or contract arrangement, often driven by gig-focused platforms like Upwork and even smaller-scale marketplaces such as Fiverr and Hubstaff. The key concept here is usually exchange of value in terms of services and payment.
That is not to say solopreneurship is not scalable, however. Many startups start out as solo ventures, and entrepreneurs then find a growth path that comes with hiring employees, as well as partnering with potential co-founders.
In fact, solopreneurship does scale, at least as an aggregated activity. Some statistics: In the US, at least, there are 38 million home-based businesses, with a total annual revenue of US$ 427 billion yearly. The total-addressable market for the global gig economy is found to be US$ 1.5 trillion yearly, with Asia accounting for 11.3 percent of the population of freelancers.
And since we are already talking about trends and numbers, how about this for a trend? Blockchains and crypto assets seem to be dominating the tech space today. Both startups and enterprises, and even financial institutions are engaging in their own blockchain activities in one form or another.
For solo entrepreneurs, we are also up for some exciting times when it comes to doing business, with more and more blockchain-powered platforms that can help improve our productivity, output, and marketability.
Let’s move on to the ways blockchain can benefit the gig economy.
A marketplace for solopreneurs
Upwork has traditionally been the go-to marketplace when looking for outsourced skilled and professional work. Meanwhile, solo entrepreneurs who have wares to sell would usually focus on an e-commerce marketplace platform in order to reach their audiences. Think eBay or Amazon, or even regional incumbents like Carousell, OLX, and Flipkart.
The world today is driving toward a more social kind of marketplace, where trust and reach is better established through social mechanisms and connections. There is, however, an inherent disadvantage to such a social-oriented marketplace, and that is ensuring that trust is not breached. This is essentially how an escrow service, such as the one utilized by Upwork, works. Payment is only made when the service rendered is considered to be complete and acceptable.
If you look at it closely, this kind of arrangement can be addressed – or even disrupted – by blockchains. By deploying smart contracts, for example, it makes it easier to validate work done and make the appropriate transfer of payments or value.
Such a system is addressed by a blockchain startup called CanYa, which is building a global marketplace of services, all powered through Ethereum-based smart contracts. The main difference with existing marketplaces is that CanYa provides a truly peer-to-peer marketplace without any third-party, which is usually the case with established players like eBay. And true to the social nature of commerce, the platform also enables its users to curate and verify service providers and clients.
The platform also provides a mechanism to pay and get paid through different kinds of currency, be it crypto – Bitcoin, Ether, and others included – or fiat money like US dollars. This is something that could make life easier for solopreneurs or even e-commerce enthusiasts who want flexibility in how they get paid.
A mechanism for protecting intellectual property
Many businesses rely on the value of their intellectual property in ensuring their technologies and products are protected from being copied by others. With regard to solopreneurs, this might play an important role in protecting ownership of certain technologies and creative works.
Such intellectual property can include written material, photographs, music, and, some would argue, even pieces of written code.
While copyright is supposedly granted the moment a work is published (and while patents for functionality are granted by regulatory agencies like the USPTO), there might be difficulty in enforcing such copyrights and keeping track of entities that use your works online – such is the nature of the internet.
Blockchain-based mechanisms, like the ones deployed by Binded (formerly BlockAI) addresses this need to protect and track IP for your creative works. The platform currently focuses on images, and rightly so, especially with our tendency to share images and visual content on social media.
A digital repository of contracts
Working as a solopreneur would often mean signing work agreements with clients, and this has involved exchanging PDF documents, digital signatures, and in some cases, having to print out, sign, and scan documents for sending across to either client or freelancer.
As an alternative, contract data can be fingerprinted and stored on the blockchain. While it is different from the actual self-executing smart contracts that Ethereum is known for, having such a distributed and immutable database for contracts can help solve the issue of trust and accountability when it comes to agreements.
The takeaway: Blockchain empowers users
The main takeaway here is that by providing a means to perform transactions, track digital assets, and exchange value, blockchain technology is giving users power over their digital activities in ways unprecedented.
While digital marketplaces have long been enabling solo entrepreneurs and digital professionals to contribute to the value chain across industries, the returns are often diluted by fees and cuts that middlemen take. Having a truly decentralized marketplace and verification system ensures that solopreneurs can give and take better value from their works and from the service they render.
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Image credit: Pixabay
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