Samsa wins 100K Blockchain Investment Challenge at SXSW

By Laura Lorek
Publisher with Silicon Hills News

Capital Factory awarded Samsa, a startup that runs a cryptocurrency index platform, $100,000 in its Blockchain Investment Challenge on Thursday at South by Southwest.

Judges selected two other runners-up: Topl, which is building a platform for international investment on blockchain technology and Vertalo, a blockchain-backed platform to secure professional credentials and verify who a person is.

Blockchain is a way to structure data on a digital ledger which is distributed on multiple computers and no one person has control of that data to manipulate it. It is the foundation for cryptocurrencies like Bitcoin and Ethereum, but it has many other applications to verify information in a global marketplace. Blockchain is one of the hottest technologies at SXSW this year.

The other finalists for the competition included Verimos, a health data startup using blockchain technology to create a marketplace for patient data and ERC dEX, a hybrid-decentralized cryptocurrency trading platform.

The judges for the competition included Stephen Wolfram, founder and CEO of Wolfram Research, Richard Garriott, entrepreneur, game developer and astronaut, Manoj Saxena, first general manager of IBM Watson and founding general partner of the Entrepreneurs Fund and Laurence Tiana, co-founder of Factom, an Austin-based blockchain company.

Capital Factory reviewed hundreds of applications for this 100K Challenge to select the finalists, said Gordon Daugherty, managing director at Capital Factory. Capital Factory ran a 100K Challenge last year at SXSW focused on Artificial Intelligence, which Austin-based New Knowledge won, and they are doing extremely well, he said.

“We are trying to shine a light on a technology and a startup that we believe is going to make a huge difference in the market and the world,” Daugherty said.

And Capital Factory has awarded other startups $100,000 in geographical and thematic focused challenges, he said. The next Challenges are in April for San Antonio startups and July it is partnering with Austin Technology Alliance for a Smart Cities 100K Challenge. Startups can apply on AngelList.

Samsa, an Austin-based startup, created an online platform that lets users create custom portfolios from a basket of indexes, said Chris Slaughter, its CEO. The indexes offered on Samsa vary in volatility and exposure, Slaughter said. The idea behind the platform is it lets investors hold multiple different types of cryptocurrency in their portfolio and offers less volatility than single coins, he said.

“Once you own Bitcoin or Ethereum, we help you trade it,” Slaughter said.

Slaughter was working on a hedge fund startup, Paladar Capital when he pivoted his company to focus on Samsa. He thinks investors in cryptocurrencies should have the same advanced strategies hedge funds use.

So far, Samsa has more than 1,000 customers using its platform. The bootstrapped startup plans to use the $100,000 to further develop an educational portal, Slaughter said.

William Baxter and Dave Hendricks, co-founders of Vertalo

Vertalo, founded in February of 2017, is in Capital Factory’s accelerator program. The startup is liked a next-generation LinkedIn platform to verify identities, including employment and educational history and achievements, using the blockchain. It has raised about $2 million from friends and family and has seven employees, said Dave Hendricks, its CEO, who moved from London to Austin last year.

Vertalo Co-founder William Baxter, who serves as the Chief Technology Officer, lived in Austin. Later this year, Vertalo plans to make its platform live. It’s been getting a tremendous amount of attention at SXSW, Hendricks said.

“We’re a blockchain for normals company,” Hendricks said. “We’re the kind of blockchain company that you can actually use as a normal human. Most people are not traders and so if you are not a trader and you are not into crypto, but you want to understand the blockchain then getting your profile certified using a platform like Vertalo is your way to get introduced into the blockchain, a crypto-wallet and to the certifications functions of the blockchain.”

Kim Raath and Chris Georgen, founders of Topl

Another runner-up Topl is building a blockchain financial platform that allows low-cost capital to reach small and medium-sized businesses and projects in developing countries, said Chris Georgen, founder, and chief architect. The startup, based in Houston, plans to sell its dual use utility and platform token with Iconiq Lab in May.

Georgen met Kim Raath, the company’s head of financial engineering, at Rice University in Houston and founded the company about a year ago. Right now, the company, with 12 employees, is based in Houston with a Dutch office in Holland, but Georgen is thinking about moving it to Austin, he said.

“Investors want access to developing markets. Developing markets want access to investors’ money. The question is how we facilitate these investments,” said Raath, who is from South Africa, and earned a dual degree with a Ph.D. in statistics and master’s in economics at Rice. “So yes, Topl has a social and economic impact…We do need to give access to capital into the developing world and there is a lot of money that wants to move into the developing world and we just give them a way to do that.”