Bill Erbey doesn’t court publicity. He is one of those old-fashioned, hard-working, straight-talking businessmen, who rarely gives interviews. So when he does, the business and investment community sits up and listens.
William Erbey, CEO of Salt Pond Holdings has been described as an entrepreneurial Renaissance man. He has a history of driving major change in a plethora of commercial areas, from Internet technology to mortgage finance. Earlier this month he gave Ed Harrison, the managing editor of Real Vision, a wide-ranging interview about his latest ventures, including crypto-currency, and insightful analysis into the history and future of the Internet.
But first, to truly understand the secret of Bill Erbey’s success, it’s important to understand the philosophy behind it. This can be simply summarized in two words; math and analytics. Bill uses both tools to solve physical problems.
In his interview, Bill explained that the current Internet structure is antiquated. No news there. He explained that it has the same logistical struggle as companies like Amazon. “The Internet has a simplistic routing protocol. It says ‘routers cause congestion, ergo we should send the data packets over the routers with the fewest number of intervening routers. Of course, it does this without knowing which ones are congested”.
“I tried to solve that problem by using math and statistics,” he said. “Everyone knew we wanted to use transportation optimization as any other physical solution would use. But in order to do that, we knew we would have to be able to forecast the amount of usage desired and capacity that was available”.
Like others at the time, Bill realized it was a massive problem in terms of data packages. “There are literally billions and billions of nodes out there, huge numbers of pieces of data”, said Bill, “we saw that the problem was so large, that everyone thought you couldn’t calculate it. Our breakthrough was essentially analyzing the data being used, in order to forecast it effectively and then act upon it”.
Bill’s history is that of a man who thinks outside the box. “I think we have to change our thinking in that space, not just by adding hardware but how we do it more intelligently. Most of the Internet isn’t really being used for most of the time”, said Bill. “but it’s congested because we are all using the same routes to get there when we do. So that’s one example of people thinking it’s a physical problem but actually it’s a mathematical and statistical analysis solution that we are looking for”.
Onto one of Bill’s most recent and exciting ventures; launching an app which facilitates the use of cryptocurrency. Wait – Cryptocurrency? Wasn’t he against it?
“I want to start by saying that I was always a crypto sceptic because it was like tulip bulbs. You couldn’t use the currency for anything. But then I read an article which talked about the six characteristics of money: durability, portability, divisibility, uniformity, limited supply and acceptability. On five of these criteria, it dawned on me that crypto is better than any other currency. But on acceptability, it was horrible!”, he smiled.
Bill highlighted what appeared obvious to him; that one cannot walk into a store and buy a loaf of bread or a bunch of flowers with crypto money. In order to make it a true currency, to make it a practical currency, he needed to be able to invent a way where you could actually use crypto, in retail outlets for starters.
There were, of course, serious problems in doing this, but Bill and his team have invented a product which could be used by anybody with a crypto wallet. People can now go into a store and if it’s a customer of ForumPay, can pay their bill in the cryptocurrency of their choice, but the merchant can get paid in whichever currency they wish.
Significantly, merchants are paid instantaneously, so there is no gap like before, when you bought with bitcoin, it’s not paid until the blockchain clears. “Again, what we’ve done is try and use math and analytics to forecast the issues around clearing so that we can eliminate the delay”.
So could bitcoin purchases really be the future? Bill is hugely optimistic. “If you think about it, it’s really the next generation. It’s contactless, so you don’t have to worry about touching, like other credit cards. That’s especially important during a world COVID19 pandemic. You don’t have data associated with it, so consumers don’t have to worry about identity theft and merchants data breaches”.
“We are very excited about it, and the fact that we have now set up a crypto exchange in Europe. We think this is a very exciting opportunity because the market cap for payment companies totals between three to four trillion dollars. It’s a massive industry, and this will make it more efficient than what happens today”.
The smart money is understandably keeping a keen eye on William Erbey’s innovations – watch this space.