How Technology is Democratizing Business Models
by Gabe Luna-Ostaseski with insights from Jack O’Holleran, co-founder and CEO of SKALE Labs
Technological advancements are impacting every industry and every business function within an organization.
It was only a matter of time before they impacted the business model foundation on which companies are based.
To explore this further, I recently caught up with Braintrust advisor Jack O’Holleran, to discuss the ways in which tech is empowering individuals to redesign the business model — and how that’s leading to exciting collaborations.
In addition to being the CEO and co-founder of SKALE Labs, Jack has also been an advisor to startups for more than 12 years. Much like many people in Silicon Valley, Jack transitioned into the startup and tech world after working within larger corporations earlier in his career.
And while previous generations looked to established companies for long-term, full-time employment and benefits, like Jack, many Americans are leaving larger firms to work within smaller, growth-stage companies.
Additionally, 42 million Americans are choosing to work full-time as freelancers, according to Deloitte Insights, collaborating closely with the corporations previous generations worked within.
“Technology has paved the way for…opportunities for talent to work remotely, connect with anyone, and communicate easily through the distance of space and time.”
An evolved partnership
While the relationship between organizations and skilled workers has evolved, the innovations that come about as a result of collaborating with freelancers haven’t stalled.
In fact, for many organizations, working with freelancers and contractors has helped drive competitive advantage more quickly.
“Technology has paved the way for this shift to occur — providing opportunities for talent to work remotely, connect with anyone, and communicate easily through the distance of space and time — even while working on complex client projects,” says Jack.
Tech also provides the foundation for freelance professionals to connect with clients outside of their existing networks, and to ensure they have continuous projects from a variety of employers.
But even with the introduction of new technologies, talent still faces hurdles when pursuing freelance careers.
Meanwhile, companies are facing increased challenges recruiting full-time tech professionals at a time when the demand for these skilled workers continues to increase, and the pipeline of skilled tech workers within specific regions isn’t pacing to match demand.
“First, let’s talk about the problem,” says Jack. “There’s a whole world of freelancers that enjoy being their own boss, but they don’t like the middlemen rake,” he says, referring to the fee talent platforms such as Toptal, UpWork and Fiverr charge, simply for the opportunity to connect with clients on their marketplaces.
Similarly, these platforms charge fees to the companies accessing the talent on their sites as well.
The challenge with this model is that once companies have found talent and vice versa, the incentive to take work off the platform for continuous projects, is too great for these marketplaces to be sustainable over time.
But when the collective needs of a growing talent workforce are united around a challenge, new models begin to emerge.
“When you can get groups of people together that design a system with agreed upon rules…you can develop democratized businesses — creating new types of control, of working, of collaborating — and as a result, new forms of organizations.”
Models enabled by new tech
Technologies such as blockchain and cryptonetworks are providing the foundation for talent and organizations to connect and build collaborative and mutually-beneficial platforms, based on cooperative business models.
As an expert in blockchain and cryptonetworks, Jack has seen the power that these technologies provide to networks.
“When you can get groups of people together that design a system with agreed upon rules, and a currency that acts as the liquid fuel between every interaction, you can develop democratized businesses,” shares Jack, “creating new types of control, of working, of collaborating — and as a result, new forms of organizations.”
What this does, says Jack, is provide opportunities for individuals as members of a network to eliminate monopolies in which only middlemen organizations stand to profit.
Rather, the value of the work that is completed is redistributed more evenly on both sides of the equation — for organizations, and for talent.
“Current business models allow companies to create monopolies…we’re finding a lot of ways in which we can add new technologies like blockchain and cryptonetworks to existing business models.”
The currency as liquid fuel Jack mentioned?
That’s a reference to how cryptocurrencies within private networks can be used to redistribute even greater value back to the talent. As owners of a token, talent can retain more of their earnings over time as the usefulness of that token increases.
“Current business models allow companies to create monopolies in which service providers — and users of systems — are getting the short-end of the stick, simply because the core company created a marketplace,” says Jack. “We’re finding a lot of ways in which we can add new technologies like blockchain and cryptonetworks to existing business models.”
As an example, most talent platforms not only charge service fees to their customers — clients in need of talent — but to the talent that completes the work on their platform and drives revenue for the core company with each completed project. It’s not uncommon for talent to pay 10–40 percent fees when working on such platforms.
And this, says Jack, is not good for freelance talent, or for organizations.
But as he points out, the transparency and security of blockchain allows groups of talent to organize as networks, without the need for a middleman company.
And when you add those agreed upon rules — core values, methods of engagement and project-based work systems — new types of collaborations can form to more equitably deliver value back to both sides of the marketplace.
His enthusiasm for this type of model is what led Jack to agree to join Braintrust as an entrepreneurial advisor.
“Braintrust is the first-of-its-kind, User Controlled talent platform,” says Jack. “What’s exciting is that Braintrust is using decentralization and tokenization to connect talent to companies, by using a token that acts, not as the primary payment, but as the governance system for the network.”
New networks shift the mindset, and drive results
The shift then is one of a mindset — from “mine” to “ours”. And this mindset shift? It makes all the difference.
In enabling a network of top talent to connect and control a platform, Braintrust freelancers are incentivized to do their best work for clients. Not only because they stand to make more money without middlemen taking a cut of their profits, but because as people who control the network, they feel deeply responsible for the reputation and sustainable growth of their platform.
As a result, companies are getting the best, most incentivized freelance professionals working on their projects, with a focus on successfully delivering their final products, as well as top-notch customer success.
And without middlemen taking a cut, organizations stand to save between 20–60 percent of the costs they would spend hiring via a traditional talent platform or recruitment agency.
Even better? They get to work with the world’s top talent, who are highly incentivized to help them drive cutting-edge innovations.
Learn more about how Braintrust is building The Future of Work, Today.
