UNITALK丨Raphaël Mazet: Help Charities be more Transparent
“The purpose of the combination of blockchain and charity is not just for donation but for influential impact for people in need.”
Blockchain represents more than speculation and cryptocurrency. It applies to various social needs, which benefit society in general. Blockchain technology and charity go hand in hand in this purpose. Both evoke a number of issues of transparency and trust.
Today, I am honored to interview Raphaël Mazet, the CEO of Alice, a UK non-profit charity project, to discuss his application of blockchain technology to charities.
1. How did you get involved in a blockchain company? Have you had a relevant work experience in this field before Alice?
For me, it began when I started looking into solutions to help charities be more transparent. I was interested in Bitcoin, but I discovered Ethereum in 2015 and the potential of smart contracts was a revelation. I have a background in political science, and I spent 10 years working in financial PR and lobbying in Europe and Latin America. What I enjoyed the most during that time was building advocacy campaigns in partnership with social organizations. I eventually transitioned from that to co-founding my first charity tech startup, which eventually led to Alice.
2. Where the idea for Alice came from?
The idea for Alice came from a problem that one of my co-founders and I faced in a previous startup we founded focused on digital advocacy for charities and political activist groups. We realized that a lot of donors were holding back from giving because they weren’t confident about how the money would be used, and how it would improve people’s lives.
3. In what areas do you think that blockchain technology can be used in the charity/NGO industry? How do you think the future blockchain technology will be integrated with the charity industry? What are your expectations for Alice?
There are many areas in which blockchain technology can be used in the charity/NGO sector, from supply chain management to refugee IDs to funding transparency. In fact, there’s a growing ecosystem of projects that are dedicated to helping charities be more effective using blockchain.
At Alice, what we’re focusing on is creating incentives for charities to share verified data about their impact so that provably effective projects can be identified and scaled until the problems they are tackling are eradicated.
4. You have said that the purpose of the combination of blockchain and charity is not just for donation but for influential impact for people in need. Why did you say that? What inspired and embodied your thoughts in Alice?
When people think of charity/NGO transparency, they often think of it in terms of increased accountability to donors. But from our perspective, that’s the wrong approach. Charities should actually be accountable to the people they serve, and that means making sure that they’re improving their lives in a sustainable way.
That’s why we often say that donations in Alice are just an incentive layer that we use to make sure that the impact data is shared and verified.
5. Can you explain the mechanism of Alice briefly? What are the advantages of Alice compared to other competing projects in charity?
Alice is essentially a payment for success model: charities only get paid if they can provide proof, verified by an independent validator, that they have achieved their goals. The main advantage is that Alice gives the incentives for effectiveness: charities will do whatever it takes to achieve their goals, and the more provably successful they are, the more they can scale.
6. How does Alice manage the data transparency and reliability of non-profit organizations through smart contracts?
Alice uses smart contracts in different ways, but the most basic is that donations are held in escrow until a project’s validator verifies that the charity’s goals have been achieved. This is recorded on a public blockchain, so anyone can see how successful a project has been.
7. The difference between Alice and other project is that charity organizations will not receive funds from donors before proving their goals are achieved. Under this premise, how do you protect/guarantee the liquidity of funds?
Donations are held in escrow and are ready to be paid out when goals are achieved and verified. We use a Stablecoin system to avoid any volatility. Finally, impact investors provide the money that charities need to start projects upfront so that they don’t have to shoulder the financial risk of projects failing.
8. You mentioned that measuring the impact of the project is the problem that Alice will face. How will you solve this problem?
Each project has different impact goals which are all measured in different ways. Different metrics, different ways of validating, with humans or machines, etc.
It’s important to recognize this and give maximum freedom to NGOs to measure their impact in the most adequate way for their project, while also making sure the data is verified independently.
The first step is therefore to build a decentralized validator market and proper governance protocols that ensure the data is reliable. We will then incorporate incentives for users to systematically crunch that data so that similar projects can be compared and benchmarked.
9. How did you attract the impact investors for solving administrative fees?
We don’t solve for administration fees. There is a myth that good charities are the ones that spend the least on admin, but the pressure to be too lean often just leads to a vicious cycle of underinvestment and inefficiencies.
Impact investors are seeking both financial and measurable social returns, so what they’re really interested in is reducing transaction costs, such as the cost of carrying out due diligence on the impact of projects. That’s something that Alice does very well, by making sure that they have access to a perfectly transparent track record of the social performance of each project.
10. How does Alice guarantee that the funds raised are reasonably spent on those who need help?
That’s easy, the charity only receives a predetermined amount of money every time it can prove that it achieved its goal of helping someone in need.
11. Alice had completed preliminary tests in London, England last year, raising funds for homeless people. What was the result? What are you/Alice going to do next?
We learned a lot from the first pilot, both technically and operationally. We’ve spent time since then to redevelop certain elements of the platform and working on the next set of projects to be launched on Alice. We’ll be sharing all of that news soon, so watch this space!
12. How do you think of the ICO project? What are the necessary components of a good ICO project that you think?
ICOs are a great way for blockchain projects to raise funds, but they often lack proper market research into the real world problems they’re tackling, and how token economics can solve them. Figuring that out makes for a good ICO, in my opinion.
We would like to thank Raphaël Mazet for supporting Unitimes. If you have any related questions to Raphaël Mazet, please leave your questions below, or send an email to firstname.lastname@example.org. We will do our best to help link you up with Raphaël Mazet.
Interviewer: Shuyue Yang
Edit: Anna Niemira
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