The streaming industry is the next to be disrupted by blockchain as an ambitious new project DeStream aims to provide users with a convenient way to donate in cryptocurrencies — and offers a multitude of unique features that would be impossible without blockchain. Today we have a conversation with the company’s founder and CFO Tachat Igityan.
Tachat, good afternoon! Please tell our readers a bit about yourself and your career path. What brought you to the blockchain industry?
I have been in the online business space since 2005, when I founded my own web studio. After the financial crisis of 2008, I left it and went to work for RBC SOFT, which was one of the top website development companies at the time. While working there, I realized that there are no educational courses in the field of Internet business, so my partners and I organized RIC business school, which trained specialists in Internet project management, marketing directors and other professionals for the industry. At that time, we were the only business school that issued state diplomas in these specialities.
After 5 years of developing the project, I sold the business and started to explore technological solutions for banks. I began to implement Internet banking systems in financial institutions throughout the CIS. I have also created a startup called tranzaptor.com and then successfully sold it to AmoCRM.
I have been following the crypto space since 2015, and I am particularly interested in the technological side of things. Most importantly, you need to understand that before the emergence of crypto, everything on the Internet was simply digitized versions of offline entities. Crypto is the first thing (well, after Angry Birds) that appeared initially on the Internet and found its application in everyday life. Since I am an Internet-oriented person, I simply could not stay away.
When I saw an existing problem in the streaming and financial services market, the idea of DeStream was born, and my friends and I decided to make this project a reality.
Tell us more about DeStream — what is the concept and business model of the project?
DeStream is a financial ecosystem that helps bring back the emotional component of the viewers’ donations to streamers.
Donation commissions are so high that receiving donations for a streamer became very similar to receiving regular workers’ salaries — only instead of payroll taxes, huge fees are paid to payment systems and aggregators. Not only do streamers have to give up to 30% of their income in the form of commissions, but also to set minimum thresholds for donations in order to reduce the average payments to intermediaries. Thus, all the emotional mechanics of the donations system have been exhausted by now. But it is crucial to understand that a donation is simply a viewer’s desire to thank the streamer, and emotions are the basis of this gratitude.
By implementing blockchain, we reduce commission size to just 0.77% per transaction, and also introduce new mechanics for interaction between the streamer and the audience. The objective of the project is to make streaming as easy as possible both for content creators and viewers.
We also work on developments in the field of IoT so that the viewers will not only be able to send a gif during the broadcast or send a text message along with the donation, but also control the light in the streamer’s room, blow up crackers, start up a confetti machine and much more. We will demonstrate some mechanics at the end of August at the largest gaming industry exhibition Gamescom to the audience of 400,000 participants.
Despite all this, we have a very simple and straightforward business model. We are a financial service that earns a 0.77% fee from each transaction. The more transactions there are within the ecosystem, the bigger our earnings will be. And there will be more transactions if innovative mechanics are implemented. Of course, there are other potential streams of revenue such as an “advertising platform” or a “marketplace” — but this is not our core business.
What other benefits can DeStream provide for streamers and content creators?
One thing needs to be understood: by implementing blockchain and smart contracts, we can have a number of new interactive elements that are impossible without blockchain. A simple example: today, when a voting is held, people give donations to vote for a certain outcome — and if they lose the vote, they lose money and don’t get the desired outcome, which makes them experience negative emotions. What we can do is offer a refund option for those who lose the vote, so that they will be happy to participate in further activities on the streamer’s channel.
There is another huge problem — the so-called chargebacks when about 30% of all donations are rescinded. Paypal, for example, is usually OK with cancelling these payments, thus driving the streamers into debt. In our case, thanks to the blockchain tokens, it is impossible to cancel the donation if the transaction has been processed and it is clearly stated in the blockchain that it was initiated by the viewer.
How do you plan to convince large platforms like Twitch to integrate your service? What benefits can you offer them?
We do not need to convince anyone. No donation platform is an official partner of Twitch. Twitch is not involved in donations — their main source of income are subscriptions and ad sales. We do not deal with video streaming and advertising, that is, we are not a threat to their business. Using the open API of Twitch and Youtube, we integrate our stream overlays, allowing viewers to use our platform.
I would like to stress that the streamer does not leave Twitch for our platform, so there are no obstacles for them to work with us as the current platform does not keep them “on a short leash” through partnership conditions. All that is required is to install our overlays and donations.
When processing donations, high speed is important — can DeStream compete in this regard with centralized payment systems?
The speed of centralized systems does not matter that much, because the streamers pause between donations anyway in order to read the accompanying text. The goal of the donation is not just to give money, but also to convey your message. So the current speed is already enough for us anyway. As a matter of fact, the interval between donations is pretty big.
Which countries have the broadest audience for streaming content? Which of these markets would you consider as strategically important for DeStream?
Of course, the largest audiences are the US, Asia and some European countries. We are still too small for the American and Asian markets, so we chose to concentrate on countries like Germany, the Netherlands, Spain and the UK for the launching stage. These are the most active streaming audiences in Europe. At the next stage, we will make a decision whether we will move towards Asia or the US in the future.
DeStream organizes its own eSports events. Tell us more about the company’s activities in this area — what has already been achieved and what are your plans for the near future?
We have already held a number of championships in all the major disciplines. For us, this is an entry point for some streamers, as well as users. People can participate in our championships and learn about the platform even before it is fully launched. It also enhances trust and helps us build a reputation for a platform that always pays its due. This is another big problem in this industry — some platforms either postpone the payments or do not fulfill their obligations at all.
Holding our own tournaments helped us get excellent stats for the overall audience reach — and it cost us very little. In the future, we will collaborate with brands and jointly hold championships with a larger prize pool. This is a very cheap channel for attracting an audience and brands are well aware of this.
Besides gaming and eSports, what other types of content can be popular on streams?
People are watching all kinds of things — and by no means is this limited only to gaming content. It prevails, of course, but formats like Just Chatting , when the streamer just communicates with the audience, are now growing in popularity. This is especially true for female streamers. But in general, people on streams do whatever they want — and other people watch and, most importantly, donate. (Laughs)
What are the company’s plans for the near future? What goals do you strive to achieve in 2019?
Today, the main goal is to properly present the project at Gamescom and interest users who will then go on to register and use the platform. Until the end of the year, we will actively engage in marketing and work with streamers and bloggers. We will also launch more and more new mechanics that none of our competitors currently have.
Tachat, thank you for your time!
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