Most people who hear the word blockchain automatically think of Bitcoin or cryptocurrency. Bitcoin and other alt-coins hold a great deal of potential, but the real attention should be on the innovation of Smart Contracts.
Since smart contracts run through blockchain technology they are decentralized between the parties involved. There is zero deception when it comes to exchanging the information — or currency — in a smart contract, and the only way the other party (or parties) can view the information is if the contract is activated.
Block Geeks provided a brilliant explanation for how smart contracts operate:
“The best way to describe smart contracts is to compare the technology to a vending machine. Ordinarily, you would go to a lawyer or a notary, pay them, and wait while you get the document. With smart contracts, you simply drop a bitcoin into the vending machine (i.e. ledger), and your escrow, driver’s license, or whatever drops into your account. More so, smart contracts not only define the rules and penalties around an agreement in the same way that a traditional contract does, but also automatically enforce those obligations.”
Smart Contracts eliminate the middle-man, especially in sports sponsorship negotiations. For example, let’s say the Los Angeles Lakers were approached by Citi Bank for a sponsorship deal. The two parties would need to transcribe the terms of their sponsorship agreement and have each other’s legal counsel review the agreement before sitting down at a negotiation table.
Contacting a lawyer, waiting for the agreement to be drawn up, and then finally gathering at the negotiation table is a process that can take up to 5 months … or more.
But this can be reduced to one step.
Smart contracts are the answer
Continuing with the example from before, only this time with the use of blockchain and smart contracts … if the Lakers set up a sponsorship agreement with Citi Bank through a smart contract, Citi Bank would have to accept the smart contract and send a payment through a blockchain network to the Lakers’ front office. As soon as the payment is confirmed, the smart contract will be activated.
Instant Sponsor is the only company in the sports sponsorship industry that is using smart contracts and blockchain technology to facilitate sponsorship inventory to brands.
The Instant Sponsor platform does all the leg work by connecting the potential sponsor with the appropriate the rights holder. When brands arrive to the Instant Sponsor website, they will be asked if they would like to use Instant Sponsor’s proprietary algorithm — Campaign Consultant — to determine what advertising campaign would best suit their brand.
Instant Sponsor takes into account the target audience, demographics, and budget of a sponsor before creating an advertising campaign that will be both affordable and effective.
Once the campaign is created, sponsors will simply confirm their purchase of the given sponsorship space through a smart contract. Just like that, their brand will appear on sport’s grandest stages. Not just in the United States but around the globe.