Aventus — Competitor Analysis
June 02, 2017
In this blog post, we would like to bring attention to the other actors in this space, and explain how Aventus differs.
The main problem we are solving is the issue of unregulated touting in the ticketing industry. A nice side effect is the issue of counterfeit tickets, since the blockchain allows for a transparent and immutable record keeping. A more detailed description of these problems can be found in our blog post here.
Below is an infographic of our three levels of competitors, indirect competitors, direct competitors (non blockchain-based) and direct competitors (blockchain-based). If there are any we have not yet mentioned (we know of Bittickets, but we have not put them on here), please let us know.
Existing ticketing companies in both primary and secondary markets (indirect competition):
These are companies that do not attempt to solve the problems of counterfeit tickets and more specifically, unregulated touting explained in our blog post explaining the existing ticketing industry. The largest of these companies in the primary and secondary ticketing markets are TicketMaster and Stubhub respectively, holding 80% and 51% share in their respective markets. Other significant existing companies include EventBrite, an event management and primary ticketing platform who processes over $1.5 billion in tickets annually, and SeatGeek, a secondary market aggregation network, who has over $25 million in revenue and has closed an exclusive resale contract with MLS in the U.S.
Our differentiation to them of course is solving the problems that these companies take part in creating.
Non-blockchain-based solutions attempting to tackle one or more of the problems above (both indirect and direct competition)
There are two main types of these solutions — the first are mechanisms that only allow resale/ticket transfer at face-value or less, used by primary markets such as Resident Advisor or fan-to-fan transfer marketplaces like Twickets. The second are data-driven techniques for identifying touts at point of purchase, and for identifying tickets on secondary market websites. Companies using the latter include Songkick and Dice.fm.
Unfortunately, both of these methods fall short of solving the range of problems described above. Preventing resale altogether stops genuine fans who cannot attend from selling their tickets to other fans. Transfer at face-value or less creates incentives for black markets, where tickets are transferred at face value online along with an offline monetary transaction. Identifying touts using machine learning is an impossible problem to solve, as scalpers can create tools to learn these algorithms and change their own behaviour to avoid being caught.
Our differentiation from these competitors is that:
- We try to stop unregulated touting via economic dis-incentivisation, i.e. by forcing all transactions to occur through the protocol, thereby allowing event organisers to set price controls and receive commissions from secondary sales, and thereby reducing touts profit margins from resale activities.
- We allow flexible prices in the secondary market (with some degree of control from event organisers), since the mis-pricing in the primary market (desired as it guarantees maximal attendance, but undesirable because it causes resale) should be corrected in the secondary market. We do not want to completely re-build the industry, as pricing strategies are very situational and thus we cannot force across the board pricing mechanisms at real market value that completely discourages resale.
Blockchain-based solutions attempting to tackle one or more of the problems described above
Most blockchain-based ticketing solutions are still in very early stages of development, but from the limited information available they can be separated into 3 categories:
- Counterfeit prevention only: Companies fitting this description are Espass and Blocktix. These solutions do not prevent unfair touting.
- Counterfeit prevention and unfair touting via resale at face value: Solutions fitting these descriptions (from the limited information available) are Hello Sugoi, Lava Movement, and Guts Tickets. As explained above, however, this creates incentives for off-chain black markets, and does not respect free market economics. Further, they do not allow artists/entertainers to obtain new sources of revenue from secondary markets.
- Counterfeit prevention and unfair touting via resale at any price: This includes TicketChain, who is Aventus’ closest direct competitor. From the information available, they allow resale markets to be controlled by event organisers with price caps, however they do not allow artists/entertainers to obtain revenue from these secondary resales.
Disclaimer: since there is not that much information about these companies other than Blocktix, there could be features in some of these that we do not know about.
Our most notable competitor is Blocktix, and below details some of the key similarities and differences.
In a nutshell, Blocktix is a counterfeit solution that focuses heavily on building a user base via a sophisticated smart contract and application-based advertising network, which then attracts event organisers to the network. They do not aim to solve problems associated with unregulated touting; instead, they focus on using their native token and event listing interface to reward users for view in-app advertisements for events in their area. There is a close tie between the Blocktix user interface and the blockchain-based backend.
We, on the other hand, primarily aim to stop the unregulated touting and unsold inventory problems in the ticketing industry. That isn’t to say we stop all touting, just unregulated touting (e.g. people can buy and re-sell within the bounds of a secondary market defined by the event organiser). But with the Aventus solution, black markets are completely eliminated. We have designed an open protocol, almost completely decoupled from the initial Aventus proof of concept and micro-services layer on top of the blockchain, that anyone can use to build a ticketing application that stops unfair touting, of course counterfeit tickets, and unsold inventory problems.
The real idea is to have a protocol where an open, verified pool of events sit, that any application on top of the protocol can plug into, sell tickets for, and gain commissions for doing so — a nice example of what we mean by that is here. This is how we stop problems of unsold inventory, as anyone can “become a promoter” and sell tickets; think — next time you go to a concert and you get 5 friends to go, you could make money for doing that!
Our primary objective is to grow a community of developers and existing ticketing applications that plug into our protocol and micro-services so they can have better ticketing backends. We are building an application but more as a demonstration of functionality to drive adoption by third parties. We are not focused on advertising, only the mechanics for commissions on sales. Someone (or an application) who sells tickets on behalf of an event can gain a commission off of the ticket price directly at the smart contract level (set by the event organiser).
Ultimately, Aventus and Blocktix have different customers; Aventus’ customers are ticketing applications, promoters, social influencers; anyone who has an audience and wants to sell tickets with their own app on top of the protocol. Blocktix’s customers are mainly event organisers and on the other side, ticket buyers.
There are some similarities:
- Both systems plan to be, at the smart contract level, completely decentralised. This means that both will need DAO-like voting on parameters that determine the competitiveness of the system (such as fees), and the economic behaviour of blockchain-level participants (such as the event creation price).
- Because both are decentralised in nature, there needs to be consensus mechanisms around fraudulent activity in the network — e.g., fraudulent events, or in Aventus’ case (unclear if it is the same in that of Blocktix), fraudulent applications using the protocol.
- At a higher level, both of course are tackling event ticketing with the blockchain. Because of the properties of the blockchain, both end up solving the problem of counterfeit tickets, as stated above.
Despite our differences, we believe all blockchain based projects mentioned here ultimately want the same same thing — to bring change to a poorly functioning industry. Whilst we may overlap in some areas, we do also have complementary components. Competition is healthy and will not only keep each of us on our toes but also yield the best possible platform(s) for the end users. In the end this will help us all achieve our goal of bringing about much needed change.
Some notes about Aventus:
- Our operating company Aventus Systems Limited was incorporated in April 2016 — we have been around for a while. You can check this on Companies House here.
- We have institutional investment from Global Advisors Jersey Limited, one of the first regulated Bitcoin/blockchain investment vehicles, which we received in September.
- We are a company that has come out of Imperial College London’s Cryptocurrency Research and Engineering Centre, the director of which — Professor William Knottenbelt — is on our advisory board.
- Our other advisors include Professor Mike Waterson of Warwick University, an expert on secondary ticket markets in the U.K. and commissioned by the government to do a study on the ticketing industry.