This series highlights the key insights and lessons from our Digital Leadership series of podcasts. We spotlight the important takeaways from our interviews in an accessible format. The following insights come from Lory Kehoe, Managing Director at ConsenSys in Ireland. Stay tuned for the full podcast interview with Lory Kehoe, in the meantime, take a look at our full library of podcasts.
What are formative experiences that you’ve had that have led you to where you are today?
I started my career lecturing at a city college in Dublin, The National College of Ireland, fortuitously landed a teaching assistant job and then my boss got promoted, so I picked up hours basically lecturing strategic management when I was about 23-24, which is pretty young. I did that for a couple of years and then I applied to join Accenture and was fortunate enough to become a part of their graduate program based out of Dublin.
I had a positive experience with Accenture, stayed there for about five-and-a-half years; primarily worked in financial services on large scale IT implementation project then I joined Deloitte to help them build their financial services consulting practice here in Dublin. I had just accepted a partner job with Deloitte in Hong Kong when ConsenSys came knocking and asked if I would be interested in starting ConsenSys Ireland.
I was really torn about that decision, but using Jeff Bezo’s Regret Minimization Framework Theory whereby you picture yourself when you’re 80, you look back on your life and think about some of the options that you had, and what you’d regret more. So, looking back if I was never to have given a start-up a go in starting a business from one person, I turned down Deloitte and rolled the dice to start ConsenSys here in Ireland.
Could you provide an overview of ConsenSys?
ConsenSys is a global technology company focused on blockchain, and effectively now we’ve developed a suite of products which we explain to our clients what they are, what they do and how they add value. Our clients see the value, and then we help them effectively integrate those products into their business, to help them generate revenue, or to help them save money, or both as the case may be. ConsenSys has grown up and changed over the last four years since it started, initially it was focused probably more around project-based work, and the company now is laser focused on creating really-really top-notch products, as to whether it be blockchain as a service, whether it be smart contract development, whether it be the auditing of smart contracts, whether it be in the supply chain space, and so-on. We probably have about five or six really-really well defined products which we’re going to market with now, which our clients are using.
Ultimately Joe Lubin is the founder of ConsenSys, and one of the co-founders of Ethereum. ConsenSys is the corporate vehicle to help the world understand what Ethereum is, and as per Joe’s vision is to create the world computer if you will, to create a way in which all the world can work off a shared ledger which will be Ethereum-based. That’s effectively what ConsenSys was four years ago, it’s quite different today. We have a part of the business that focuses a lot on venture investments in companies. We’ve made investments and we still listen to pitches. We have a $50 million venture fund that are businesses we are really interested in, that may not be right in our wheelhouse or sweet spot but we’re really interested in and we’ll make an investment of those.
There’s some really important innovations that had come out of Ethereum which a lot of that has been spearheaded by the young genius founder of Vitalek Buterin. Could you talk about the unique capabilities or the vision that has come out of Ethereum?
The Bitcoin blockchain is revolutionary and Satoshi Nakamoto, him-they-her whatever, is a genius. But what people started to realize is that blockchain is like having the internet but that can only do one thing, so maybe that’s online banking, but the internet would not be what the internet is today if it could only do one thing. Vitalek and a number of other folks including Joe developed a programmable blockchain, and that’s the genesis, and the impetus, and the reason as to how Ethereum came about.
So, think of the big Bitcoin blockchain as almost like an application, but still very cool and serves a very specific purpose, and is amazing. The way to think about Ethereum is more like your iPhone, basically a device in which many applications exist, and you can basically download many more. That for me is the key difference between those two.
The second part is how we use it in ConsenSys, and what makes it important is that ultimately there’s some key features. Ethereum really brought about the birth of the smart contract. Smart contracts are self-executing contracts when certain criteria are met, if this event happens, trigger this payment. We as a company have used smart contracts in 99% of the projects that we work on with their clients, whether that is to create automated workflow, whether that’s to create automated payments, whatever it may be, but they’re a big signature feature of this Ethereum blockchain and the work that we do at ConsenSys.
Are there some projects you would highlight?
A good example would be the work we’re doing on a company called Komgo, which stands for commodities go, and is a group of 10 banks, the likes of Citi, BNB Paribas, Mitsubishi, Credit Agricole, Rabobank, ING, and Shell. Komgo is a trade finance platform that enables companies to exchange letters of credit far cheaper, far more effectively, and faster than they currently do so. To give you an example, in the early days in phase one there was a crude oil shipment trade which actually took three hours back in the day, using the technology we’ve got that down to 25 minutes, and that’s resulted in a 33% efficiency increase for traders, so it is significant. From an operations perspective it streamlines costs by about 30%. Trade finance is an industry where letters of credit are very paper based, they’re manual, it’s all about payments and invoicing, and actually the transport physically of those letters of credit in briefcases, believe it or not. So, there’s an easy win where we’re seeing the letters of credit within a trade finance area be applicable to aircraft leasing, because they use lots of letters of credit, so I think there’s another substantial win there.
Another big area is all around counterfeit goods. We are working with LVMH, which is the group Louis Vuitton Moët Hennessey, where we are effectively tracking how goods are made, right the way through from where they’re made, how they’re made, to the consumer, so that when a consumer purchases an expensive Louis Vuitton handbag, or other products for that matter, they’re able to ensure that the product is actually a genuine LVMH product, and therefore the price that the company is looking for is warranted and justified, and if you wanted to resell it it’s easy for you to do. Track and trace is a big area for us.
I would like to ask a broader question about what you’re optimistic about as you look forward?
For me the mega-trend within blockchain technology at the moment of what I’m excited about is how we move from physical assets to digital assets, and how we move from illiquid assets to liquid assets, effectively this is through this whole thing for your listeners, a thing called tokenization; so how do we basically make a building, how do we turn it into tokens, and then how are those token sold or made available not just to institutional investors, but also even to retail investors. This has already taken place, there is a property in New York which was tokenized and then made accessible to a whole pile of people that would have never had access to make an investment in that building before. This is the beautiful part of the technology where it democratizes assets, so if I want to purchase a plane right now, one day hopefully, for me buying a plane of $40 million and I cannot afford that, but I’d love to understand how I can buy part of a plane so I can get some of the upside to it, as to how it generates revenue.
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