Julian: Hey everyone. Thank you so much for joining the Behind Company Lines podcast. Today we have Vivien Zhang, founder and CEO of The Spot Room, which provides the infrastructure for decentralized commerce on blockchain enabling retail brands to offer a combined physical and digital product that can be monetized from day one.

Vivien, I'm so excited to chat with you and get to know your background. Experiencing and your interesting career transition, which I think is so fascinating in, in ways that I think blockchain really is enabling this really boom and growth in, in a new way in intersection with different industries that I think is extremely exciting in, in how it's being utilized.

So, but before we get into all that, what were you doing before you started The Spot Room?  

Vivien: Hi Julian. I so happy to be here. So before this farm, I have been in corporate America for over a decade, working primarily in luxury retail industry specifically in luxury jewelry for brands such as Tiffany and Co. Harry Winston. And other consumer brands. So yes, I know my background's very different from a typical tech entrepreneur. Since, you know, I was more from the consumer, the customer facing industry in the corporate side, working on merchandising strategy and marketing was very little to do with tech.

Julian: It's first of all there's never one back background and experience from what I've learned during the podcast. It's so diverse and everyone comes with such a great perspective on what you know they're building and why they're building it. But taking a step back here during your time in retail and then luxury, what were you seeing in terms of trends that are different now?

I'm always curious about people who have been in industries for a long time. , what are the trends you're seeing with in terms of luxury purchasing and the type of offerings that, and services that companies still have? You know, we think about luxury experience, we think about a almost white glove service to getting the exact thing you want.

Is it still like that? Are there different trends? What are you seeing in terms of that, that realm that is changing and what's still consistent?.  

Vivien: right? So, What so luxury is sort of, it's more of a fragmented industry. So talking about retail is pretty fragmented. So talk about luxury itself. A lot of the luxury experience is delivered in person.

So if you talk about a luxury Purchase, they encourage you to come to the store, you get. Seated you get served wine and dessert. You get to try things on, and that's part of the experience that you are buying, not just a product. And therefore, in the luxury, sort of the customer facing experience, very little is done online.

Actually, a lot of luxury brands don't even have e-commerce and just done intentionally to drive traffic into the store. Because to that, they get the personal experience that they can upsell, cross sell, build that CRM relationship. They're, for majority of the innovation in technology advancement has been done in the supply chain which is not seen to customers.

So, and that is where the blockchain technology has been utilized the most, which is increasing trust, authenticity, and accountability in supply chain. The only challenge is that because of that it's been done in a way that has not been translating into direct revenue. And for that reason, blockchain technology was never sort of used in a bigger way in the retail industry. And I think that is a huge missed opportunity.  

Julian: Yeah. Yeah. It's so fascinating. Thinking about how it's being integrated now. I guess just jumping into The Spot Room is, are you minting the physical objects and then using that that smart contract to then validate its actual authenticity?. , is that kind of the  overall.

Vivien: Yeah, so we are definitely taking the blockchain technology and integrating into the actual transaction, the retail commerce part, which is the customer facing side.

That a lot of retail brands or luxury brands hasn't really been sort of, paying attention to. So what we do is we register a finished physical product on the blockchain using a microchip and an NFT pairing technology. So then you can start track and tracing this product. Tracking its provenance, authenticity, change of ownership, not just in the first point of sales, but also throughout the life cycle of the product.

The reason why we had to do That's, you know, bringing huge revenue potential is that in the luxury goods or aren't in collectible industry, there's a huge resale market. That Yeah, in a lot of times that the value go up where, you know, you can cap, you can capture a lot more revenue in the secondary market.

And right now it's sort of a a market that is not touchable by the original creator. . So Nft, the whole digital art NFT market really sort of set the precedence of how this could happen and how this market could, you know, grow. So, you know, why don't we bring that, bring the technology into the existing physical luxury goods market and let the creators in the physical goods market be able to, you know, capitalize on the same oportunity.

Julian: Yeah. Yeah. It's like securing that the investment will appreciate or you at least have a physical interpretation of the trending of that particular product. I guess how does it benefit. Companies, do they min a certain amount and then hold onto some of those so those assets can appreciate, or is there some other way that they they are incentivized to kind of integrate your technology?

Even though it mostly from how I'm viewing it I guess affects the secondary market in buyers who might not necessarily purchase it right away. Right. But purchase it after someone has already owned it. .  

Vivien: Okay. So the way that we design our tech is very different from what you see in a typical Web3 sort of, tech company.

So our approach is physical first. So our priority and our sort of customer and client are Web2 companies that produce physical products. So if you are, say, a handbag brand, last thing you wanna do is to build a whole new team to start producing digital. That's completely not related to your core product, which is a physical product.

So what we do is we give them this one-to-one pairing technology where every physical product has a companion NFT that acts as its digital twin. Also, its certificate of authenticity and ownership. So a customer, whoever buys this bag, will also get the NFT as almost, you know, a digital receipt. So the digital receipt serves as a token in the trading in the secondary market, which happens with or without the NFT, but we are just making the secondary trading much more efficient.

So in the collectible market where the value do go up, some of the more limited edition street wear and sneakers, you know, the value do go up. So there is definitely we're making the market way more efficient by making it easier Yeah. To authenticate and trade, but in , other markets, especially in sort of the more female consumer focused market.

We women, consumers, or female, we just wanted to, we just want the latest fashion. So a lot of times we are selling things because we just wanna recoup our costs and move on to the next season. So there's a huge market there that has not been tapped that, so what we do is we're leveraging the NFT and blockchain technology to make secondary trading way more efficient without cutting out the middle man.

Now if you are trying to sell something in the secondary market, you don't have to send it to a centralized third party marketplace to authenticate before it can be sold to the buyer. You will be able to have the peer-to-peer transaction. You will be able to verify authenticity and ownership of that product on your own.

Using the microchip, the NFT on a blockchain. And at the same time, we wanted to incentivize the creators for producing, say, quality product that will, that are liked by many more people that last a long time. And there's no better way to do that than giving them monetary award, which is revenue, which is royalty revenue.

So in a way, we are promoting, you know, circular economy and sustainability by producing something tangible that rewards both parties.  

Julian: Yeah. I can see it's increased or it's a positive effect on not only quality of it, but also the. The way they build it, the way they make it, the style of it and what it means to the consumer.

And in a lot of ways it seems to connect the consumer and the creator more so, because then you're extremely incentivized to make something that they like or that it's gonna be innovative or extreme or something extremely in line for long term success, which is what I. You know, a lot of brands have been under fire for, which is quality in longevity of their products.

But in this way it's very fascinating to see it. It's kind of reintegrated in a way that it's kind of traded and has a second life. How, what if a product's damaged? I'm just curious, what if a product's damaged or isn't at a hundred percent quality? Is it based. Then it's value on the different bids.

Is it if I go to Kelly Blue Books and I wanna, you know, get a car or for, or if I'm on Zillow and I'm comparing is it using that data to kind of, you know, value the goods as well? .  

Vivien: Yeah. So the, so those, all of these information, every change of hand and every condition sort of update will be captured in the metadata that travels with the product using the NFT on the blockchain.

So say you are the third or fourth buyer of this item, you will be able to see the chain of custody and history of the product. So if it was damaged along the way, the value is going to reflect that and obviously your, your valuation of the product will reflect that according. , and at some point, if it was used by someone famous that the value goes up, you'll be able to see the reason why.

Right? So for that reason, we have a lot more accountability in the valuation, in the transaction of these things. There is actually another point I wanted to make is that, so this is what we are doing that will generate immediate revenue. We are also by, by transacting physical things on blockchain.

We're also preparing them for the next and for the next phase of Web3 economy. Like right now, there's a lot of activities happening in the digital space. Metaverse parties, metaverse shopping, digital skin, digital goods, certain brands that are more pioneer in the space, were able to monetize in a, you know, in a smaller scale or in a bigger way like Nike.

But right now it is still a very sort of, Difficult to tap or high barrier to entry market for many retail brands. So by now, if we enable them to transact physical things on blockchain, we almost built a portal for them to bundle physical goods with digital asset. So NFT itself is a digital asset, which doesn't have to be just a certificate or a picture.

It could be, you know, maybe behind the scenes video and maybe with every purchase you'll be able to get a digital skin that goes with a virtual goods AR filter. So we're giving a portal to expand your IP into the digital realm and really tap into the Web3. That I personally, coming from the retail industry, think that this is not gonna be an immediate revenue channel, at least not the mainstream channel for the, in the near term, but in the medium term, this is gonna become a substantial revenue channel for all retail brands.

Julian: Yeah. Yeah. There's so many larger retail brands and just brands in general that need to, or feel the the drive and motivation to get into blockchain and Web3, but maybe have the barrier of figuring out whether it's like technology infrastructure or the short term and lock term use cases.

But it's so exciting. You're, I think, yeah, you're the second founder that's found this middle ground to essentially enable and bring these companies on board. And kind of find, be that solution for them which I think expedites a lot of these different brands doing so otherwise I, who knows how long it would take them to do, or the incentives that would then lead them to what I think you mentioned this a little bit, but what inspired the idea?

Was there like an aha moment that you had, or were you seeing this trend in, in blockchain, this minting and then realized that there was this. You know, synergy with luxury items and creating a more secure, validated product and service experience. What, what in particular inspired you to go in this direction from retail?

Vivien: Yeah, so I follow retail brands play in the Web3 market very closely and I've seen, you know, the ups and downs of the NFT market where a lot of them started off selling one of our kind digital artwork. It's now sort of turning into a me an exclusive membership club where their main selling point are the utilities that goes with it.

So it became a marketing thing. And the way, and I also follow a lot of retail brands that don't know how to enter the Web3 economy, and they think that maybe the easiest or the shortest way is to partner with existing NFT projects that are known in order to tap into this market. So I feel like they're spending a lot of money treating that like a marketing.

Expense and not getting the return that they wish for. Yeah. So I delved deeper into the blockchain technology myself and realized that actually one simple upgrade to your existing e-commerce system will allow you. To capture all of the benefits of Web3 and be able to monetize from day one.

For that reason, we put that into our tagline because our mission is to accelerate the mainstream adoption of Web3, and there's no better way to do it than starting with the retail industry where everybody uses every day. That's where you're gonna get the. Customers and people. Yeah. And yeah.

Yeah. And I am coming from retailers. I really want to help these retail brands to monetize in Web3, showing them that there is benefits in doing this and there are better ways to just sort of, you know, burning your marketing spend in the metaverse that doesn't really give you the traction that you were hoping for.

Julian: As a founder, you know, within this transition you know, going from one area of expertise into, you know, a new area of expertise in, but also taking some of that information from old and then leading a company yourself. What are some things that you didn't expect to learn along the way that you ended up having to either have a necessity or out of strictly curiosity?

Vivien: Yeah. So I think coming from my background, so the, you know, the biggest challenge, like I said earlier, was learning the technology, especially when blockchain itself was so new. You know, before I saw my own company, my interaction with blockchain was superficial. Buying NFT here and there, buying some cryptocurrency here and there.

I never even traded anything. Now I'm deep in, you know, knee deep into the industry. I start, you know, learning about cross chain. How do we mint different things and how do we, like how do I become an owner of a small contract? How do I deploy a small contract? And I realize how difficult it is to use this technology and how it is not user friendly at all.

And the worst thing is if you make a mistake, there's no way to To change that which is very unlike what retail industry it has to offer. So I had to learn the inside the ins and outs of blockchain, realize the roadblocks with technology that we have to overcome in order to deliver a user friendly, more seamless shopping or online e-commerce experience for our users.

So for that reason, I, you know, I went on a recruiting spree. I was very fortunate to have the right team that by my side, To, you know, to brainstorm, to overcome the technical challenges to really deliver a product that we are both happy to use, but also proudly to say that it's secure and has the purpose that we intended to be.

Julian: Yeah. That's incredible. Tell us a little bit about your traction. What companies are you working with? What products are you working with? Where's the technology now? Where is it gonna be leading into the future? What have you built so far? And what are you excited to you know, kind of push into the new year?

Tell us a little bit about the momentum that you're seeing.  

Vivien: Yeah, so. Very sort of, lucky for us that we haven't had any problem recruiting Web3 brands and companies to partner with because there is sort of a void or a lack, a wide space in the industry delivering sort of a seamless fidget or experience.

Like, like I said earlier, a lot of NFT projects start of selling nft and now their members are screaming for physical product or for in-person experience, and now they're all scrambling to make physical product. And then they realize how do I build the digital element into my physical product? So my technology comes in perfectly in filling that.

So we were lucky enough to get, you know, at least 12 of these NFT projects join and partnering with us to help them deliver the next level of utilities and experience for their members. And on the Web2 brand side, we have some pioneer brands that have already started dabbling in the Web3 space, experimenting with AR filters and NFTs.

That became the early adopter of our technology. . But our vision is bigger and greater than that, so we really wanted to convert some of the bigger legacy retail brands to join this movement. . So we've been talking to a few legacy, sort of a higher level, bigger brands that we, I cannot discuss at this point, but, you know, our intention is to start.

So the biggest challenge with onboarding these companies is education. A lot of these companies have no idea. Three is in, they think Web3 is selling NFT on the side. And that is not the case at all. , so we, so a lot, so a big part of is educate, build case studies. So we actually have a team that we dedicated to build bespoke business proposals to.

Have a tailored business strategy specifically for their business to demonstrate the use of NFT and blockchain for their business and to show them how this can move their core business function, which is selling of the physical product. It is not a marketing spend, it is not an advertising you know, skim.

It's something that will actually move their core business. Yeah. So, in a big, and we are really proud that we spend a lot of time to the UI and UX design of our product. . I actually tell my investor that our product demo is probably the most underwhelming because it looks like typical Web2 e-commerce site, but there's, users would not know that they're actually buying on blockchain.

But that was designed intentionally. Yeah. Cuz we put a lot of effort into the backend to make the blotch experience feel like web. So we are actually launching our MBT approval concept this weekend to really test the technology Sure that we cover all the corner cases that we didn't think about.

A big back gap that we're closing is, like what I mentioned earlier, was blockchain. All transactions happens immediately and there's no way to revert the transaction. But with e-commerce there is, you know, you have to offer the level of customer service, which includes return exchange, you know, shipping time allowance.

So we've built in that technology into our pro into our product where you can buy a product on blockchain just like you buy on a Web2 site where you can, you have the option to return exchange. And we can, you know, store the product for you while you trade the token. So we are sort of in the sweet spot of Web 2.5 that we have the tech for both technologies, but the UIUX is simple enough for any Web2 clients to use.

So our plan is to use the proof of concept that we launching this weekend to really get traction, get user feedback and so that we will be ready next year to build our api, which is our core product. We don't. So having a marketplace is nice that you can drive traffic, but when you are in the web, two, sort of the real fashion world, every brand wanted to have control of their own customer journey and their own branding.

And therefore, we are using an API to power their existing website to make sure that every brand has full control of their customer experience and journey but using the same technology that they can trust.

Julian: Yeah, it's so exciting to. Where not, first of all, congrats on the launch. That's exciting to see the proof of concept kind of come about, but also the API play just is so smart and I love the web 2.5 bit because it's really that sweet spot too where I think a lot of companies maybe forget about, which is making it such a seamless.

Experience that it doesn't feel any different from what you've done before. But using just more sophisticated technology and then integrating that in that experience that's, it's, I think that's just so right and that, and it's gonna be exciting to see what companies are gonna adopt this over time.

I, I guess outside of, you mentioned of course couple things that are challenging in terms of education and other aspects, but what else if you were to, if you were to think are some of your biggest challenges that you face today?  

Vivien: Yeah, so like all, like most technologies, this, you know, we, we need that network effect, right?

You need to convert the few early adopters until you cross the chasm, which is a marketing word, and that's when once you cross the chasm, this is when you hit the mass market adoption. So we are really looking to, you know, recruit some of these early adopter, whether you are a Web3 brand or Web2 brand, to really start building that network effect.

And from there we're looking for strategic partners that can help us to build that flywheel. , which is so, okay, now every customer that owns your back has an nft. Then what? Maybe you can have token gate experiences. Maybe there could be ticketing, ticketing opportunities through, you know, the token holders may maybe you can invite them to metaverse experiences.

So there are a lot of things that we can build. Yeah these tech, these technology, not necessarily to us, but. , the other startups and companies that can offer complimentary services and products. So those are things that we are hoping to see more and more of these companies that sort of take the same approach as us.

You know, designing our product for the web. Two, the mainstream community focus on UI US experience and not to sort of show off on vtech, which is very impress. But I think more in need, more what the market needed more is something that is practical that can be used for every day. So I'm hoping to see more of these partners on the market to allow me to build a richer experience for my brand.

And from there on, we'll be able to build a massive network that everyone can benefit. Because the, you know, the, so like all things retail, the bigger the network it is, the more reward there is for everyone in it. The bigger the market, the bigger the return. So I'm really hoping that we can get to that point sooner than later.

Julian: Yeah. And in line with kind of, kind of that thought what's the long-term vi if everything goes on, what's the long-term vision for for spot room?  

Vivien: We are very ambitious. We wanna set the golden standard for retail on chain, which I think is the future that we are going.

Inevitably, probably in the next three to five years, all things will be on chain. So we wanna be the first person that can set the standard. We might not, we don't wanna monopolize the market. But, you know, we want to be the pioneer in leading these move. Inspiring other companies to, you know, produce better products and to really sort of upgrade, provide this radical change to retail technology that hasn't been innovative since, say, Amazon time.

That was 25 years ago. Yeah. And I think it's my fault. Radical change. Yeah.  

Julian: Yeah. No, I agree. What in particular makes your job challenging?  

Vivien: I wear many hats since we're a small team, so I'm customer service, customer, you know, acquisition. I also, I'm very hands on with products. I'm actually learning blockchain coding myself because, you know, there's no better way to learn than actually doing it yourself.

So, yeah, it's all of that. And also, you know, trying to raise money in a challenging time, rebuilding investors. Yeah. Confidence in Web3. You know, there are certain things that might have set us back as an industry, but I think the future of blockchain in Web3 is going to happen and it's right around the corner.

Yeah. So, you know, it's a good message for us to just keep building, keep proving. You know of that there is great usage and application for the technology in everyday life that can significantly improve our everyday lives. It's not just a trading, you know, mechanism. Therefore certain people, for a small group of people to make quick money, it's much, much bigger than that.

Yeah. Yeah. So learning my own, influencing other people is sort of my three main sort of, targets right now.  

Julian: I love that. What advice would you give someone in a similar position who is transitioning from maybe a non, you know, tech entrepreneur background, even though there's, like I said, there's no normal background, but what would you, in terms of advice, give someone who kind of is going through a similar journey as you maybe coming from a different background, but enabling where they came from with technology and even more sophisticated technology like Web3?

What advice would you give? ,  

Vivien: I would say to, you know, dream big. You know, don't limit yourself to what you think that you can be, you know, that you can realistically achieve dream big like I dream of myself. Yeah. Becoming, you know, the, you know, the Jack to China. It is to jack to the, you know, father or mother of blockchain retail commerce.

So dream big and stay curious. I have, you know, very little yes. Launching knowledge. When I first started I learned, I talked to as many people as I can. I try to, you know, get my hands dirty and coding to really stay curious and don't be afraid of asking questions and be a good problem solver. I'm actually very excited.

Every time when I encounter a problem, I know that there's always a solution. It's my, you know, job to find out how to find. . So it's, I think it's more a mindset that is more important than a hard skill that, or than a hard and soft skill that you have. So, but getting the right entrepreneurial mindset, don't be afraid of doing things that you haven't done before.

And once you are in the right mindset, once you are in the right mentality, everything else will just come very easily and naturally. .  

Julian: I love that. I love that. I always like to ask this question. One for selfish purposes, but also for my audience. Whether it was early in your career or now, what books or people have influenced you the most?

Vivien: . I, you know, I really like Elon Musk. I think that, you know, as controversial as he can be I, think that as an entrepreneur, he has really set the golden standard for a lot of us that, you know, he's not afraid of dreaming big and he can always execute it even in a field, an area that he's. You know, never done before and he can always prove people wrong.

And I also really admire Steve Jobs because he's a perfectionist, just like me. Sometimes I drive my team crazy because I want a product to be as perfect as possible. Have that attention to details. You know, which is sort of different from what the early stage starter mindset, they said that, you know, get a, get an ugly product out and.

You know, if your first product is not ugly, it's not terrible, then you are not doing your job. But I, you know, I want to be able to deliver a product that is, that I'm proud of myself you know? Yeah. Before it's out to the market.  

Julian: Yeah. Yeah. Well, Vivien, it was such a pleasure chatting with you and getting to know your background, your experience, what you're doing with Web3 and how it's enabling such, you know, an old like you said, it's a it's an industry that needs to be disruptive because logistic, you know, we're shipping and logistics.

That's the most recent you know, in terms of innovation. But now it's reaching a new layer, which I'm excited about, especially as someone who likes to consume luxury. To even have you know, the benefit of having them age more beneficially long term. I always like to give my founders and guess a chance to also give us your plugs and give us where we can be supportive of The Spot Room and your product and your mission and be fans of it, but also maybe even get involved.

Where are your websites? Give us your LinkedIns, your Twitters, where can we find you and support the mission and the product that you're building?  

Vivien: Yeah, so we're launching our MVP this weekend, so go find us on www.thespotroom.com and you can follow us on LinkedIn. Follow us on Twitter, follow us on Instagram. We're live in all these channels. And then a handout is just The Spot Room.  

Julian: Awesome. Awesome. Well, Vivien, I really hope you enjoyed yourself, and thank you so much for being on the podcast.  

Vivien: Thank you for having me. You're wonderful, Julian. I'm a big fan of the podcast. Keep up the good work.  

Julian: Thank you.