Forever, Instantly w/ Eli Sheets | Ep. 163

In this episode of the Biz/Dev podcast David and Gary chat with Eli Sheets, founder of Ideablock, a platform that uses blockchain wizardry to protect ideas and data from getting snatched up by the competition. Eli’s an IP attorney turned entrepreneur, and he’s got some wild stories about how businesses can actually lock down their best ideas without breaking the bank. 

Links: 

Eli on LinkedIn 

Idea Block Website

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David Baxter has been designing, building, and advising startups and businesses for over ten years. His passion, knowledge, and brutal honesty have helped dozens of companies get their start.

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Transcript

[00:00:00] Eli: Any startup that's going to scale, it's a given that you have to have a good idea. Now, who sells the best, right? So it's the sales part that you, you don't really think of when it comes to the startup.

[00:00:11] David: Here we go. Hi everyone. Welcome to the biz dev podcast, the podcast about developing your business. I'm David Baxter, your host joined per usual by Gary Voigt, who is an all black today, Johnny cashing it up.

[00:00:23] Gary: I'm always wearing all black. It's the designer uniform.

[00:00:26] David: right? Up, uppity and pretentious.

[00:00:29] Gary: I don't want to make any decisions. 

[00:00:30] David: Good call. Good call. More importantly, we are joined by Eli Sheets, who is the founder and CEO of IdeaBlock. Welcome. Thank you for joining us, Eli.

[00:00:39] Eli: Thank you for having me boys. 

[00:00:41] David: So right off the bat, I just have to ask in, in our world where we've crypto go in and out. And you are still knee deep in crypto.

Tell me about that. How is that working?

[00:00:52] Eli: You just say the C word, the crypto word. It's not good. Okay. So it's, I like to, especially in sales calls, I don't like to sell, to scare people with the crypto term because it carries with it, as over the last few years, a little bit of a connotation, typically negative. And really what we're not using is we're not using blockchain for any of those typical, transactional or speculative asset based upsides.

What we use is a single blockchain that. That timestamps, so we use it for its utility, and that's it. We get in and out, and we don't really care what the price is. We don't really care what the future price is. All we care about is that the network's up, and that people are validating when something happened.

And that's really just a quick touch that we do. It's very vital, but, we kind of leverage I guess a little known aspect of of crypto or blockchain to get the advantage we need to bring our thing to market.

[00:01:43] David: I guess. So let's back up for a second. I jumped in a little deep there for the first question.

[00:01:47] Eli: That was a banger at the Batman.

[00:01:49] David: Hey, man, we don't play. 

[00:01:51] Gary: Keep you on your toes. 

[00:01:52] David: that's right. Tell me about idea block in general. What do you guys do? And how did it come to be?

[00:01:57] Eli: So idea block is a software platform that allows companies, no matter what size they are and what they do, if they're creating something, it doesn't matter what they can protect their innovation through creating a indelible timestamp instantly. It provides instant defensive protection against third parties in the market for IP that they want to create.

So one of the biggest, I spent almost a decade in the world of legal intellectual property in DC. Worked for, went to law school, obviously went to work for several large multinational firms. And even though it gets very complicated when it comes to the law with that stuff, if you zoom out far enough and you look at the critical aspects of that, of those cases, it always ends up being if you can prove that you were first.

And if you can do that, you typically win the case. And there, over the last 50 years human infallibility when it comes to that kind of evidence has been very evident. So you have, look at the fires in California. There's a lot of warehouses that I bet went up, for example, and a lot of evidence lost.

Our thoughts and prayers go out to them. But, it's just, there's things that happen, natural disasters, floods people pass away, secretaries pass away that knew who did what when, or managers move on to different companies, you can't find them. It's very difficult to provide that evidence 15 years later of who had what when.

When everything is so dynamic when it comes to a typical company that's doing things dynamically when it comes to idea block We leverage something that's forever and forever instantly and we provide the conduit for Establishing that kind of evidence for a lot of companies frankly all companies most valuable asset going into the 21st century here 

[00:03:36] David: So you, I think I'm getting, I gave you a hard time with that first question, but

[00:03:41] Eli: No, that's fine. I've got it before

[00:03:42] David: it sounds though, I've liked, me and Gary have been anti crypto bro for a long time, but what I think is you finally have described your startup as something, and I don't even know if startup, because you've been doing it for years

But you're describing the way that I've always thought blockchain should be used.

And a lot of people get lost in that. Blockchain as a technology is really cool for making sure that things happened in the order in which they happen. And that's exactly what you're doing. You're not re inventing the wheel here. And I think that is pretty cool. It's actually refreshing because most people just went off into the weeds really

[00:04:21] Eli: Yeah, I think that, there's a lot of distraction and hand waving when it comes to that whole sector over the last, 2021 to 2023, it was a, people started to see who the scammers were inside of crypto and these altcoins that used chains that weren't even being validated very well and you just tried to, they tried to get in and get out and rug pull and stuff like that.

Obviously that didn't do a, it did a little bit of a disservice for my marketing efforts during that time and whatnot. As soon as people see what the. The underlying advantage and technology used by our company and our software is, but at the same time, I've been able to allow people to step back and see that it really we're a solution that didn't have to search for a pro a problem.

And I think that a lot of a lot of use cases when it came to, layer two, they say something that sits on top of the core blockchain. We are a layer two software product because we sit on top of, we use Bitcoin's blockchain, which is the most the strongest. And I, I believe the best suit best suited chain for what we're doing, you use that for something that is an actual problem that's existed before and we're It needs something like blockchain to solve it. Then you've got something that's marketable and a deliberate can last, last for a long time and can scale and become an actual company. If you use it for something that's speculative and you're going to take, meme coins.

and try to doge it up. For example, that's yeah, it's fun. It's a playful thing. But we're, what we're doing is a little bit more serious. It's a little more core to businesses that are serious businesses. And what they produce is their core assets for their company. We're, we, I think in a smart way, I've leveraged this technology to solve a problem that's existed for really the forever when it comes to capitalism, especially as a tech boom has risen over the several last few decades.

And really, we can talk about trade secrets are becoming a big way for people to protect their technology, especially lately for several reasons. But, we provide a, really the first use case for our first platform that allows people to protect their trade secrets in a way that, that moves it into the 21st century.

A lot of our clients are very excited about that. And it's not our only benefit obviously, going into the future, I think that will continue to be something that brings us to the forefront as a company and a solution.

[00:06:21] David: So forgive my ignorance. You can pretend I'm dumb. Don't say anything, Gary. have a question. I, let's say it's a legal thing and I, there's trade secrets. I have a secret thing. This is my secret sauce, but it's in this chain of evidence, right? That's now on the public blockchain. How does that work?

[00:06:43] Eli: So what we put on the block chain is not the entire file that you sent up that has the trade secret describes it on that file. For example, let's say you are let's use the most cliche kind of trade secret. There is, we can use KFC or Coca Cola. We'll do KFC. Let's do the KFC, recipe.

If I have, that written down on a napkin, the original one, and I take a picture of it what happens inside of ideablog is not that, we don't put that picture itself, all the ones and zeros on chain. We put what's called a hash of it and what that is a essentially it's a a cryptographic fingerprint of that file and that file alone, right?

So it's a one to one representation that can be proven. So it shrinks, even large files, we can shrink down to that little bit. That's a a one to one representation of what's included in those files. 20, 50, a hundred million years from now, if you run those same files through the.

Open source crypto algorithm that everyone uses for bank transactions. You use it every day and you just don't know it, but it's used for everything. 

[00:07:40] David: So six years ago, how crypto was pretty nascent back then. This is way pre crypto bro and NFTs and all that stuff. How did you come up with this? Or was this not in. Idea block is your name. So it had to have been in there.

[00:07:58] Eli: Yeah

[00:07:58] David: come from? 

[00:07:59] Eli: You know give you a little bit of my background I studied electrical engineering computer science and not a grad I went to law school, obviously, and I was actually a patent examiner for a year to see if I liked it. I did. Went to law school, worked for, I think seven years, and I did a lot of a lot of 5G patent work for large telecommunications companies that It was very all that stuff's in your phone now.

But anyway, that's my background. So I have the kind of legal and the coding background as well. And I know, I knew that, like I said before, that the time saving thing is very important. But I also like to stay updated on what's going on in the tech world. And, I picked up the Bitcoin white paper one night like one does, I don't know, but

[00:08:34] David: As one does in their spare time. Sure,

[00:08:36] Eli: but I picked it up because I was interested and I wanted to see what it was all about.

And, one of the, I think it's on the second page was like, It says like timestamping engine is one of the paragraphs and I was like, Oh, that's interesting. And then I got to thinking, I didn't even finish the white paper. I don't think that I, cause I got to thinking about that because, I just recently at that point come to this realization that the time saving thing is very important, right.

And that's a problem. And so I saw this thing that kind of hit me over the head and I was like if there's a way to get this on chain on this chain, that would be, that would solve a lot of problems for people. And I think that it would be marketable for sure. So from that point on, I started by moonlighting and one of my, I have four, four kids, young kids, believe it or not.

And when I was, feeding them at night or whatever, I would code while they were up and stuff like that. And I figured out, I only need to figure out if it would work first before I went and brought it to people, if I could actually do it. And then I figured out, I coded it. So it works. And I was like, it was like Eureka and then quit my job and raise a little money from family, friends and family.

And off we went. That's not a lot of detail. That's the, that's a 30, 000 foot view.

[00:09:35] David: That's what happens when you mix a lawyer and a computer scientist. Wow. That's pretty impressive. I've asked that's so where are you? So are, did you become, you got some money from friends and family? Is this an idea that you're like, okay, this is just a lifestyle business for me, or is this a, I'm going to go raise this up and turn this into the super lawyer firm.

[00:09:58] Eli: So this is, what we, our customers aren't firms, like they can be in a way, but our customers are actually people or tech companies that actually make things for the most part. It can be anybody that's making, it can be a writer. We have artists that use our platform for, copyright protection defensively.

We have music makers and producers that use it. And recording studios. But most of it is those who write code, like gaming companies that write write code that they want to protect because it's very hard to protect software right now with traditional means. And we provide a really forward looking, very Robust, very strong form of defensive protection that you can get instantly.

And especially with code that's exactly what they need right now. And I think that's why they've been drawn to our company. And you're right. Like early on it, no one knew what the hell I was talking about. Sorry if I can say that or not, but no one knew what the heck we were talking about when it came to blockchain.

It's like they were, I think I've heard of that one time. And then, over the last couple of years. I think that it's settled to a place where it's gotten over that negative connotation in a way and people are able to sit down even at a, at a. Corporate environment and, suit and tie people in a boardroom were able to sit down and talk to me like I'm not a kook and they take me seriously as a, as to how we can protect their most valuable assets coming out of their company.

Look at like Pfizer, for example or other companies that produce drugs or other types of bioproducts is, they've, they come up with thousands of formulations only to bring one to market. They pay for all the other ones that have other uses. It's typically those have been in the garbage can now you can essentially defensively protect those and license them using our technology as well.

It just, it recoups some costs that typically was thrown away in the R& D process for those companies, for example. And this is just one use case for those companies to say, okay, now we can prove that we had these things. Somebody might want to look through our garbage can and we can license that over to them.

And generate a new form of of income for the stuff that we had zero for up until now. CFOs like us as well,

[00:11:51] David: So if you have five years in front of you, that is 

[00:11:56] Eli: hopefully.

[00:11:57] David: blue skies, right? No, no major mountains, no major hurdles. The world doesn't end. Where does idea block? What does it look like then in five years? 

[00:12:06] Eli: I've got the, I've got the spreadsheets to tell you. It's going to be a, a multimillion dollar company. We just, right now where you caught me at the verge of really pushing out our our first, marketing and sales effort to really get the, the megaphone out there to get us out and get people to know about us.

And I think it's, it's been a while that we've been running the company, but I think it's actually good. I think it's the prime time. We actually timed it right. Whether that was intentional or by accident to come to market when, like we touched on before. Blockchain is something that's not a four letter word anymore.

And so pushing this out right now is I think the perfect time to really scale it. We're working on finishing up our biggest round and we're taking for the first time, external investment. And given that, given us the gas to do so the product is done, it's ready to use.

People are on it. People are using it. But now we just got to spread the word. So I think that in five years, hopefully it follows the plan that I'm talking about. I've got, I'm pretty detail oriented. I like to think about all the, Permutations of what could happen or what not, we've got ourselves covered for the most part.

It's just a matter of executing it. And I think that the team I've put together is, has done a good job of that so far and hopefully that continues 

[00:13:13] David: So how many people is idea block now? 

[00:13:16] Eli: right now we have, five people on board and I try to keep a thin slate when it comes to that stuff. And I think, after the race is finished and we close on that's going to change obviously it's, we're going to, we're going to scale up the sales force, especially in the marketing dollars as well.

But, When it comes to hiring, I like a a Delta or Special Forces type team instead of, an army, so to speak. It helps with the burn, first of all. It also obviously gets more bang for your buck. And, it's, this isn't your average product either. People have to understand what you're doing.

What's how the inner workings work to some extent And how they're going to sell this from the sales team and how to get people not in the weeds. We lose people in the weeds when we get down to their to the technology. We just we need to We found success talking about more of the macro stuff and how we protect you On a legal front and also your bottom line So you know having that pushed out first by a sales team having this sales team skill You And we don't hear no very often.

It's just a matter of getting more people that are listening to us is the thing. 

[00:14:11] Gary: Yeah. I have two questions. You mentioned that you have a Delta Force or special operations team, which is actually a pretty good description. Cause immediately I thought, yeah, with what you're selling, you can't just have

average mid level developers. You can't just have salespeople that come on board, learn about the product and then try to sell it.

This is some pretty highly technical stuff. And in order to communicate that to the clients. And build upon, what you already have built as far as the software goes, you need a pretty specialized team, I would assume.

[00:14:37] Eli: It's true. It's very true. And luckily I came into it thinking that would be the case. And I think that's been proven true. It's this almost a catch 22 where you do have to have people that understand that, but you also have to present it to people that you're talking to not as that, so as to not confuse them, it's, you have to have smart people who are, who can think on their feet and a sales call.

And can get the cut of someone's Jim very quickly, see what their background is whatever position they have in that kind of target company and be able to tailor that message to their level of understanding so that they don't get confused. I think the, what I learned in the first couple of years in terms of selling, it was like, you cannot if I get into what I told you about, Putting hashes on the blockchain and like little finger, it's that's already I'm going to lose them.

So I try to keep it at the level of just almost glazing over it intentionally in a way where it's just okay, we timestamp this better than anyone else. What does that mean? 

[00:15:24] Gary: Now you mentioned you're going to start with a heavier marketing effort. Going forward so far, how has the client acquisition come about? Is it basically referrals and networking?

[00:15:35] Eli: Yeah, for to this point, it's been a lot of that and it's been intentional. Honestly, it's, the marketing plan and the sales plan that I put together early on was we want to start with smaller companies and, cut our teeth down at the startup and smaller company level where we have a better relationship and we're able to get feedback from them early on.

And if we burn a few of them, it's a little easier to recover in terms of that, to get their feedback in terms of, okay, this button should be here. We don't like this aspect. We think it should do this. Getting that from a shop of five developers that are making a, an indie game or something like that is a lot better than getting it from IBM because you burned your shot already.

Even though I have meetings with people that are at market or companies that are at market, That's more of planting the seed for later when we're ready to come to this than with a more serious, a serious plan. 

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[00:16:56] Gary: Are there specific industries that you're looking as like your main goal? Would it be

[00:17:01] Eli: Yeah, there are four. There are four verticals honestly that I have always hammered and we've our list of targets are generally You know, it's starting to expand a bit but are generally built around those and number one being software whether that's a gaming company, like I said before, or just someone that's making games.

Other type of software product. We fit really well with that culture. I think a little bit more progressive thinking when it comes to forward looking thinking when it comes to blockchain, for example, it's been a little bit more of a welcome reception at those companies. And that's some, a little more uptight old school type companies, but that you look at, I, again, to the to the pharmaceutical and life science sector as well.

Very strong sales pitch to them as well for retaining that value in the R and D pipeline. And then you go out to, traditional, chemicals and industrials and, the pitch to them has been, and they've actually been fairly receptive, especially for an industry that's older.

And their mark, the trade secrets that are in their marketing processes or their their manufacturing processes. It's, there's a lot of secret sauce that these guys have and they haven't found a way to protect it. And it's become something that they really need and they notice that right away.

You have that, that as well. And then it the medical devices world does a ton of IP and they they traditionally gravitate toward patent stuff. And, it's been a lot more difficult for them to be successful in that world when it comes to patents. We've seen a lot of success with, the Metronics, the, Boston Scientific. So those kinds of companies that are building those things out when it comes to MEDTECH. 

[00:18:26] Gary: well with your experience from computer science to lawyering and now growing this business, what would you say are your top three pieces of advice for any new entrepreneur or small business starting out?

[00:18:39] Eli: Yeah. It's, I was thinking about this earlier. It's what kind of advice can I give? And I, I can give you a top 30, honestly, there's so many things that, it's. There's so many things you learn that over the course of, five years of doing this, that you don't realize you've learned them until you look back like today when I was thinking about it.

But, I think that kind of the overarching things, first of all, is sales is important as your product. Like you have to learn how to sell something before you want to go jump in and quit your job and just go after something. Yeah. It's important that you have it. It's a good product, a good product without the ability to sell it to anyone is you're going to be back at the old job pretty quickly.

So I didn't recognize that early enough. I think it's taken me a while to realize that, that's really critical no matter what you're selling is that you have to be, you have to learn that market, you have to learn that as a, as an engineer and a lawyer, like I never had to do. Direct sales very much.

And I'm not afraid to, I'm a bit more gregarious. I think that most of your electrical engineers are computer scientists, but like at the same time, you have to realize that the guys that you're, on your team have to be extra gregarious, have to have the the communication skills and also the kind of the strategic thinking, to sell something, you have to put together a plan. That's a very detailed. And don't just say, Oh, we're just going to go talk to people that, maybe that's good for the beginning to get a product market fit, but then you have to actually be very diligent about it as diligent as you are when you're making your product to really be honed in and specific about who you're talking to and what your pitch is going to be.

And if you can't have the same pitch every time, you have to have people that can. moving their feet and be a little Fred Astaire out there on the dance floor when it comes to talking to these people. It's learning what you, what's in your bag when it comes to sales, testing it and moving horizontally.

If something isn't working right, you got to be able to move and take feedback and you can't be stubborn. You got to be coachable when it comes to the feedback and do that. So I think number one is sales is bigger than you think it is. Realize that and have a plan for that and be open to learning about it and realize it's.

It's really as important or sometimes more important than what you're actually selling, which seems a bit counterintuitive. But I think that. 

Any startup that's going to scale, it's a given that you have to have a good idea. Now, who sells the best, right? So it's the sales part that you, you don't really think of when it comes to the startup.

You think of the innovation involved. Yeah, that's great, but you have to be able to tell people about it. They have to buy it. I know that's a little cliche, but it's very true. It surprised me a bit. I guess the other thing is You're going to have to work there's a lot of glamor, obviously, when you look at okay, all these, you look at the Facebook movie and it's oh, it's in Hollywood and everyone idolizes these entrepreneurs, whether that's, Steve jobs or whoever else through history, it's like they become icons in industry.

They earned it. Believe me, there are times like when you're down to your last dollar, you got to call people you don't want to call to float you you've got to you've got a race coming or we're not doing this right. Current rate is like. It's taken a long time and it's taken a lot of my bandwidth out of my day that I should have been focused on a product, but you have to have money on the floor.

Yeah. So it's even how much time that you put in on your product to make it good and the sales stuff. You got to keep that going. In addition to this, the fundraising part to keep going. I've had people, I've been down to the end of due diligence and just get a call. It's yeah, we talked to this one guy and you weren't in the room.

I wasn't in the room to tell him the correct, plan about idea lock and what the future held and why we think that it was just this guy that kind of knew about it was talking to his buddy to get advice that if he pooh poohs, that's the deal I've had that, that a couple of times, and it stinks because, for one moment, you're really high on this potential deal.

I think it's a great fit. And then, some lawyer in Dallas You have no idea what his name is he just decided based on five minutes that it is like you have to be you have to have a lot of irons in the fire always have a plan cde and never get in love with someone until the money's in the bank i guess the best way to put it it's never done until it's signed and closed and you have to keep plan bc all the way in front of your mind when it comes to this stuff yeah It's not coming from a jaded person at all, I swear.

But it's just it's just a reality. It's, those guys are trying to find deals. If something doesn't smell right at the last second, they're just, they don't owe you anything. You just have to be ready to move on your feet. And I think that the disappointment associated with that, you have to be ready for it.

You have to be prepared with the backup plan. I think it's, that's the kind of second thing. The third thing is you like, you On a deeper level more of a meta level like you got to have you have to be personally gritty First of all like more than you think by a mile but to deal with that before you go in you have to have a pretty solid support system And whether that support system is based on People that are associated with your business like an advisory board or something like that Those guys are great too when it comes to avoiding hurdles and You know avoiding road bumps along the way when you scale it But you have to have a personal support system that you could go to to talk about how are you feeling you know that can help you introduce you to people to get you over a hump or just make you feel better to talk for 50 minutes to get it out of your brain because as someone who's starting a business you're gonna be thinking about this thing You won't be able to sleep It's how much it goes through your head and to have Somebody that's going to listen to you and look in your eye and tell You know, you're doing a great job.

I understand the disappointment with X, Y, Z, but you're still gonna be great. Keep pounding, without having to listen to YouTube motivational videos it's actually human. You can talk to it and and realize that it's not Jocko Wilnick that's going to tell you that it's going to be it's going to be like someone in your family or a friend that you've met that, that cares about you and it's important to have that support structure and.

And be comfortable reaching out to them at certain points, so you don't just quit. 

[00:24:00] David: One of the things you mentioned reminded me, I went to a course called Oradium, which is this famous course about how to speak to people and to give presentations and whatnot. And one of the things that they mentioned was when you give a speech or a sales pitch, you shouldn't be. Selling to the people in the room.

You need to be selling to the people who are, they're going to talk to right after the meeting. And I thought that was really, I had never thought of it that way, but if you built, if you do your sales pitch just right, and it makes it memorable enough so that they're going to be sales pitching it to somebody else.

And if you do that, 

[00:24:42] Eli: yeah,

[00:24:43] David: Cause that's like you were saying, they're going to go talk to somebody. You don't know them. You don't get a, you don't get a shot in this. So the only thing that they're going to take with them is. Either materials you provided or the little sound bites or whatever that stuck with them so that they can then make the actual sale.

And that's what it, sorry. It just reminded me of

[00:25:00] Eli: no, that's the best way to be in the room. That you're not invited to is to give soundbites and like that kind of, full circle to the beginning of our talk, staying out of the weeds when you're pitching this to someone, staying away from the tech and talking high level generally benefits our sales efforts.

And I'm sure that's true of a lot of companies as well, because you don't want to confuse them. You want them to be able to go to the next person and say, it does this, and that's very exciting and beneficial. Rather than I'm not sure about this blockchain technology. I don't know anything about it. So but it sounds cool.

That's not where you want to be with the next person.

[00:25:33] Gary: If anybody wants to learn more about idea block or yourself or my dog barking in the

background, 

[00:25:38] David: timing.

[00:25:39] Eli: Hey, is your dog like 

[00:25:40] Gary: I'm

sorry. 

[00:25:41] Eli: I could pitch your dog right now. It sounds like they like it. 

[00:25:44] Gary: Yeah. So if anybody wants to learn more about idea block or yourself what's the best way to reach out?

[00:25:49] Eli: So you can go to you can go to our website. IdeaBlock. com is a great place to start. You can go on Twitter, you can just Google it or search for us on Twitter. And really those are the two big ones. LinkedIn, you can go to my thing. We've got a page on LinkedIn for IdeaBlock as well, but you'll find the contact information on our website.

It's easy to get in contact with us. There's actually a form on there that's easy to get through. That's the best way. And, It's not hard to get to me either. If you've got any specific questions I've got my contact information is easy to find on there. And if you want to hit me on LinkedIn, that's cool too.

[00:26:18] Gary: We'll make sure we put those links in the show notes too.

[00:26:21] Eli: Sounds good. 

[00:26:22] David: Very good. Thank you so much for joining us. This has been a lot of fun.

[00:26:25] Eli: I'm glad to, glad that you guys join me or invited me today to talk about it. It's always good to get the word out and tell new people about it. And I really liked the format. ​

[00:26:39] OUTRO: Hi, I'm Christy Pronto, Content Marketing Director here at BigPixel. Thank you for listening to this episode of the BizDev Podcast. We'd love to hear from you. Shoot us an email, hello at thebigpixel. net.