Sirin Labs recently raised $115M in an Initial Coin Offering to fund their new attempt at a secure blockchain smartphone, in a phase of downturn for ICOs, signing up soccer star Leo Messi as brand ambassador.
Though it was launched last March — with a huge marketing campaign with movie stars, including Leonardo di Caprio – by September their CEO admitted they had sales of “just under $10 million”, which amounts to just about 700 units sold.
A total utter failure, which proved beyond any reasonable doubt that the hundreds of thousands of top executives, and the rich and powerful of the World — with assets of trillions of dollars — did not even remotely trust their claims and approach. They sticked to their iPhone as the least-worse alternative, and just assumed all to be cracked or crackable by a large incalculable number of actors.
Nevertheless, Sirin Labs had by March had enough millions of dollars to decide to pivot/rebrand by “integrating” the blockchain to increase their security, positioning as crypto wallet an client, and committing to switch from obscure proprietary to an unspecified level of “open source”. They previously raised equity for $25M in 2013 and another $75M in 2016 for their $15,000 Solarin smartphone, claiming to be the most secure phone in the World.
From this huge product failure and consequent huge fundraising success story we can learn a few lessons:
(A) Validates a huge demand for more secure client devices for communications (like the aforementioned blockhain phone), cryptocurrency wallet and general cloud computing – quantified in hundreds of billions from Snowden onwards – that are way more secure than current state-of-the-art.
(B) Shows how a few million dollars spent in marketing and buying influencers and renown crypto investors can lead hugely successful ICOs, even if those are lead by provenly failed teams, products and approaches, even after the Tezos debacle. On Sirin Labs site you can read the following, with little regards to their proven failure: “Developing a smartphone is a big deal, has Sirin Labs done this before? Yes! You are welcome to check out www.solarin.com to see Sirin Labs’ first smartphone, SOLRIN, the world’s most ultra-secure blockchain smartphone.”
(C) Shows how disruptive early stage startups in the client endpoint security space cannot afford to not pursue ICOs in addition to equity rounds – even though it is ricarries reputational and operational risks, and excludes some more value-added funding sources – let alone risk competitors out spending them to run ahead or to catch up.
Similar story for Rivetz, which recently raised $15M in an ICO even though their offering is based on a Trusted Computing approach and standard – a provenly failed approach based, like Sirin Labs, on blind trust on several critical components and providers –which is the perfect antithesis of the trustless blockchain decentralisation – and reliant on vague and dubious claims about the foreseeable full adoption of Trusted User Interface standards in mobile phones.
So, how can disruptive endpoint security startups compete against startups of dubious value backed by even tens of millions of marketing power and engrained manufactured deceptions in the media space?
Not easy, but doable by leveraging the great power of glaring truths. Such leveraging requires the public support of top global cybersecurity experts and consultancies, through a well-planned community and narrative over a few months, to break through a thick wall of manufactured deception. Furthermore, the unmet market demand (even for a blockchain smartphone) is huge, so there is plenty of space for multiple players.
At TRUSTLESS.AI, we’ve been pursuing for 4 years a uniquely uncompromisingly trustless approach to endpoint security and general purpose computing, with amazing partners. For over 2 years, through our Trustless Computing Association and its Free and Safe in Cyberspace global event series, we’ve brought together the most authoritative and credible independent voices in cybersecurity — rather than soccer and movie stars – to debunk time-proven failed approaches to security through obscurity and blind trust, and uncover the fact that only complete trustlessness can deliver meaningful trustworthiness.
CivicNet members will consume cybersecurity by leasing CivicPods, standalone 2mm-thin touch-screen WiFi computing devices that are attachable to the back of any smartphone / blockchain smartphone via a CivicCase, or inserted face-out in a decicated leather Civicwallet. They will produce cybersecurity by running our CivicDocks: ultra-secure hardware-based anonymization and blockchain nodes – running private forks of Ethereum and TorProject – or by proposing technical or organizational security improvements, core software upgrades; or apps and dApps.
Finally, there is the CIVICCHAIN, a semi-permissioned blockchain offering unprecedented security of dApps by running exclusively on ultra-secure and ultra-authenticated CivicNodes, on its native SAGO Coins, Trustless Computing Coins. SAGO Coins can be used to pay for all CivicNet services and third-party decentralized apps. It will also allow interaction with other public blockchains (bitcoin, ethereum).
Guest post by Rufo Guerreschi
CEO & Founder of TRUSTLESS.AI
Exec. Dir. at Trustless Computing Association