About B.A.M. Ticketing GmbH
- Founders: Georg Müller (CEO) and Mirko Illic (CTO)
- Founded in: 2019
- Employees: 15
- Money raised: Incubator program of the Vienna University of Technology (INITS) and funding from AWS and Horizon 2020
- Ultimate goal: To become an infrastructure provider for the global ticketing market and eliminate any kind of ticketing fraud or black market
It was a personal experience gave Georg Müller the idea for B.A.M. Ticketing GmbH. He was working in the open-plan office of a bank and observed that many of his colleagues wanted to buy a Rammstein ticket—but no one got one. Shortly afterwards, people started announcing that they had now gotten a ticket after all, but at almost double the price. The concert wasn’t scheduled to take place for another nine months, so how could anyone know that they wouldn’t be able to go, Müller asked himself, and began to do some research. It turned out that there were massive problems in the ticketing market, but they could be solved with blockchain technology, the founder said. In this episode of our Start-up of the Day series, he talks about his innovation and the challenges of starting up a company:
What’s the problem with the ticketing market?
It consists of automated trading robots that buy up tickets in a very short time. Their share is 42 percent on average at large events, but it can be as high as 90 percent at highly sought-after events. This is a huge problem for artists because their fans are upset when they have to pay double or triple for their tickets. Bogus tickets are another problem, but that’s easy to solve with blockchain technology. At the time, I researched for several months and came to the conclusion that no regulation is needed here to change the market, as is the case in the financial sector, for example. Simply using blockchain technology could solve the problem.
What problem are you solving and why is it important?
I am familiar not only with blockchain technology but also with the ticketing market. As a result, I see that blockchain offers opportunities for interaction between different trading participants apart from trading robots and bogus tickets. A striking example is the transportation market. Here, competing transportation companies need to cooperate so that customers can buy an end-to-end ticket from one company to a destination that is beyond its reach. Blockchain technology can be used to bring these companies into a contractual relationship without their having to share customer data or trade secrets. The University of Birmingham has just received an EU grant for a project of this type, and Germany’s train system, Deutsche Bahn, is also working on this issue. Both of them are doing research on the problem that we’ve already solved. That means we could save them a lot of time and work. With our blockchain technology, they could start implementing their business case right away.
How can blockchain technology solve the problems in the ticketing market?
Blockchain technology is still young and the requirements for a ticketing system are huge. For example, if you want to sell tickets to an Elton John concert at Wembley Stadium, you need to carry out a minimum of about 250 transactions per second to process the sale. The best-known blockchain network, Ethereum, currently manages an average of 20 transactions per second. This means that the technology cannot yet be used in ticketing. A second requirement is latency. This is the speed at which a single transaction can be confirmed when tickets are validated at the entrance. Ethereum’s latency is eight seconds on average. That’s way too long to get the stadium full in a reasonable amount of time. The latency definitely needs to be under one second—and no blockchain technology can currently deliver that.
That was our goal for a technical proof-of-concept, and we were able to achieve it by making our system specific to the high demands of ticketing, as opposed to a general solution. As a result, we can perform up to 2,000 transactions per second with our blockchain technology with a latency of 0.5 to 0.8 seconds, an operation we can make available for every single event. This is another way we differ from Ethereum, which has these metrics for all applications running on the network.
How would you describe your business model?
Actually, we are technology providers—on the one hand for blockchain ticketing, but also for the interfaces between Web2 and Web3. We integrate this technology into existing ticketing systems, but since blockchain technology is still young, everyone requires market proof. That’s why we also have our own software-as-a-service solution that can be used to handle events, similar to Eventbrite. Our customers include a museum, a soccer club, festivals and music concerts. We also offer our solution as a white-label product in the Americas, in Asia and hopefully soon in Africa, where digitization is going full steam ahead.
What was the biggest obstacle you had to overcome?
That was definitely the uncertainty regarding technical feasibility. We knew there couldn’t be a use case with existing networks, partly because of the lack of business data privacy, and we didn’t know if we could overcome this obstacle. Only after a year of research and development were we sure. But there are other obstacles to overcome. For example, many are still mistrustful about cryptocurrencies, and that can only be overcome if it is clear what blockchain technology can and cannot do. That requires awareness-raising work.
This goes hand in hand with the fact that we actually still have to do basic research to find out the limits of this technology and to what extent it is still possible at a large scale. That is definitely an obstacle for a start-up. Most business angels don’t fund R&D; they fund a growth strategy and that makes it hard to get capital.
Have you already been able to obtain funding?
Additionally, we had the problem that we finished our technical proof-of-concept two weeks before the first lockdown in Vienna. From that point on, it was impossible to get a start-up funded in the life event industry. The process took a good year and a half so we didn’t receive initial funding until November 2021.
Can you think of a better or ideal location for your start-up?
Austria is a good location for an early-stage start-up because there is a lot of public funding. But when it comes to technology funding, the U.S. is far superior because there is an understanding there that it is a technology rather than an existing business that is being promoted. That’s less the case in this country, which is why our next round of funding will almost certainly be in the U.S.
What achievements have made you proud?
After we proved the technical feasibility of our concept, we got a lot of recognition for our development achievements. In 2020 and 2021 we won the German Blockchain Award and in 2021 the Austrian Blockchain Award in the Smart Tech category. There are some excellent projects in this area and it was great to see that our use case and the way we use the technology received recognition.
Where would you like to be with B.A.M. Ticketing in five years?
We want to be the primary infrastructure provider for ticketing. And that’s not an overly lofty goal, because there are already similar constructs for airlines that run the infrastructure for an entire industry. We have been encouraged by the fact that our technology is probably unique at the moment. Whether we will achieve that goal is a question of funding. But we heard from one of the largest ticketing companies in the U.S. that it had already spoken with 20 blockchain ticketing start-ups and that we were the only ones on the right track. That’s music to our ears.
What makes your blockchain technology better than or different from existing ones?
While others use off-the-shelf software that could be used for anything, our software is ideal for the ticketing industry and meets all requirements.
Want to read more posts about start-ups? You can find more episodes of this series here.