This interview is part of our new Blockchain In Supply Chain Management series, where we interview the world's leading thought leaders on the front lines of the intersections between blockchain and supply chain management.
In this interview we speak with Payson E. Johnston, co-founder and CEO of Crowdz, to understand how his company is using blockchain to transform the supply chain management business, and what the future of the industry holds.
1. What’s the story behind Crowdz? Why and how did you begin?
PJ: I served for 18 years as global supply-chain manager for Cisco Systems, Inc., and I founded the company with Steven Lee, who spent 15 years managing supply chains for SanDisk, Cisco, and Honeywell. Throughout my 18 years as a global supply-chain manager for Cisco, I watched many small and midsize businesses experience cash flow issues. And when these companies failed, workers lost their jobs, and their families lost their paychecks. We founded Crowdz with one goal in mind: to ensure that all small and midsize businesses had access to the cashflow they needed to survive and grow.
2. Please describe your use case and how Crowdz uses blockchain to transform supply chain management:
PJ: Supply chain management involves dozens and sometimes hundreds of entities worldwide, with oftentimes scores of individual transactions for a single end-to-end raw-materials-to-retail conversion. A single supply chain can span the globe many times over, many products in the supply chain are of uncertain provenance or quality, and goods and inputs at various stages in the manufacturing process are in almost-constant transit. Blockchain is the only technology available that enables real-time, digitized management of information while providing permanent, tamper-proof documentation of all transactions along the way.
3. Could you share a customer/user that benefits from what you offer? What has your service done for them?
PJ: In 2018, Crowdz and HighPoint Technology Solutions were introduced by Barclays during their Techstars Accelerator program. Shortly after, the two companies began to collaborate on the POC project, along with the Barclays AV team, and Barclaycard (a division of Barclays PLC). The goal of the project was to modernize a very manual RFQ and ordering process between the companies. This process created a foundation for the Crowdz InvoiceXchange. We are thrilled with the results from the proof-of-concept project with HighPoint. The metrics show savings in overall time and effort. We see enormous potential for success in the production phase of our project.
4. What other blockchain use cases in supply chain management are you excited about?
PJ: We are most excited about blockchain's ability to accelerate supply-chain financing. Currently, more than 70% of companies involved in global supply chains are small and midsize enterprises, many of which are almost always on the edge of financial survival. Supply-chain financing allows these companies to accelerate their cash flow by providing them with near-immediate payment for their invoices, which funding companies can repay when their invoices are ultimately repaid. Unfortunately, most supply-chain participants don't have access to affordable supply-chain financing. By dramatically reducing the administrative costs of such financing and unlocking pent-up capital from potential funders worldwide, Crowdz's blockchain-based platform allows for the smooth, real-time, highly efficient flow of both documentation and monetary value in a highly secure, tamper-proof framework.
5. Where will Crowdz be in 5 years?
PJ: In 5 years, Crowdz will be the go-to platform for paying, selling and sending invoices. Businesses of all sizes will be leveraging the blockchain for secure invoices, using our payment gateway for low fee payments and adopting invoice financing to get paid faster. Additionally, funders will be able to bundle and securitize invoices, providing SMEs from all over the world the best possible rates.