The cryptocurrency exchange Binance is casting a wider net to find the next unicorn startup.
The company is announcing this global expansion, offering 10-week onsite programs for early-stage blockchain projects, just as the inaugural San Francisco program is set to end on Friday. Starting next year, all Binance Labs incubation programs will conclude together with a three-week trip to Singapore, where the parent company is based, and a collective demo day.
Stepping back, eight teams were selected out of over 500 applicants to each receive $500,000 and participate in the San Francisco incubator this year. Ella Zhang, head of Binance Labs, told CoinDesk the company will also welcome two more batches of applicants to San Francisco in 2019.
Speaking of Latin America and Africa, Zhang added:
“Those two emerging markets have native blockchain and crypto use cases. So we hope to find teams solving local problems like payments, the instability of local currencies, or remittance problems.”
Meanwhile, Zhang expects projects from the Hong Kong program will focus on solutions for the traditional financial sector. Unlike this year, in 2019 the chosen teams will start with closer to $250,000 each and then fly to Singapore to collaborate across the board. The number of teams accepted to each program will be determined by the quality and quantity of applicants. Then, during the Singapore chapter of the incubation program, roughly 10 teams will be selected for a second larger investment.
Zhang said the goal of this program is to foster a community of builders, including high-quality token projects that could get their assets listed on the exchange. In addition, teams will be able to promote their products or services through Binance platforms after graduating from the program. One such project from the inaugural San Francisco class, SafePal, is developing a hardware crypto wallet that would only cost $10.
“Some of our enterprise solutions will have Binance adopt them as clients,” Zhang said, adding projects that boost mainstream adoption could attract new users to Binance. “Also, we’ll push the hardware [SafePal] product to our community and users.”
The incubation program gives Binance a first crack at emerging technologies in the space, while founders gain access to potential investors and social media promotions. Although finding product-market fit is challenging in this space, it helps to have one of the industry’s most popular companies offering developers direct feedback on their needs and their users’ needs.
“We’ll help them build up the sales and distribution channel,” Zhang said of all the participating projects, including SafePal. “We have the user base. Binance itself has over 10 million users.”
Indeed, Binance’s contacts and user base were one of the main draws that attracted startups to apply for this program. Mentors included Lily Liu, the co-founder of Earn.com, which was acquired by Coinbase; Primitive Ventures co-founder Eric Meltzer; and Trust Wallet founder Viktor Radchenko. Zhang said such mentors have the opportunity to co-invest in startups that graduate from the program.
Robert Yau, founder of Path, a software startup that recently graduated from the Binance Labs program, told CoinDesk the diversity of mentors helped his team create a blockchain-agnostic API solution.
“When I went in we had a tax software [provider] that used the platform. The big feedback was, there are only so many people doing crypto taxes,” Yau said, speaking to how Path now makes data processing software that is compatible with a variety of exchanges and wallets. “Chatting with different mentors and folks is how we came from where we originally were to where we are heading towards.”
Yau said there are now 1,000 people on the waitlist, eager to use Path’s software. Speaking to what she looks for in an application, Zhang said the ability to prove demand like this is crucial. The leading factors for applicants are the founding team’s experience and proven demand for their solution.
“You should have customers, clients, if you’re doing enterprise solutions,” Zhang said. “Only if the users are willing to pay for or are dying to use this feature, that’s product-market fit.”