Cleveland has been riding a wave of positive momentum that has continued into 2018. New construction projects are underway throughout downtown and there’s a steady flow of M&A activity in the business sector. Heck, even the Browns have turned things around and won a few games.
However, there’s no glossing over the fact that since 1970, the city has lost more than 365,000 residents, dropping its population to an estimated 385,525 in 2017, according to the U.S. Census Bureau. The loss of people is only getting worse, as Cuyahoga County experienced the third-highest population loss in the country last year.
Jon Pinney recently cited this statistic when he called for an economic development summit to craft a unified regional strategy to get Cleveland growing again. It was around this same time that another ambitious transformation effort got underway. Bernie Moreno brought together a collection of Northeast Ohio’s top leadership minds, including Pinney, who believe that blockchain holds the key to Cleveland’s future.
Their goal is to make Cleveland ground zero for this young, still emerging technology with potential that is yet to be fully understood. The initiative is called Blockland.
What is Blockland?
The goal of the Blockland initiative is to create a technology and innovation ecosystem that would be for blockchain what places like Silicon Valley, Seattle, Boston and Austin, Texas, were for internet and digital technology — hubs that enjoy significant investment, thousands of new jobs and an influx of new residents.
Blockchain is mostly widely known as the means by which cryptocurrencies such as bitcoin can function. It’s a digital, decentralized and public ledger for recording transactions. It’s also very secure, giving it countless potential applications beyond just bitcoin, says Steven J. Santamaria, CEO at Folio Photonics and co-chair of Blockland’s Thought Leadership node.
“We believe that blockchain will be the seminal transformative technology of the 2020s,” Santamaria says. “You don’t have to understand how it works. You just have to understand how it’s going to have an impact on you and you have to figure out how to take advantage of it.”
The concept for Blockland originated about six months ago with Moreno, president of Bernie Moreno Cos. and Collection Auto Group. His theory is that the high cost of living in existing technology epicenters will drive existing talent, as well as those new to the workforce to look elsewhere to feed their passion.
“You’re going to have the largest migration of technology talent ever in the history of the U.S. going somewhere,” Moreno says. “The question is where are all these thousands of smart, educated, incredibly transformative people going to go? We need a disproportionate number of those people to come to Cleveland.
“IT is no longer a sector. It cuts across every sector in a significant way and it’s getting more and more significant. If Cleveland is not relevant in technology, we’re going to die as a region and as a city. What that means is we won’t have innovation that comes here. There won’t be opportunities here. We’re trying to solve for that problem. Blockchain is the center pole of a great big technology tent. It’s a catalyst.”
What is a node?
Blockland is made up 10 nodes, which is a term used to describe a device on the blockchain network. In this case, the nodes are groups of people focused on the 10 essential components to achieving Blockland’s goal of making Cleveland the hub for blockchain technology.
They include Thought Leadership, Business Applications, Talent Development, Entrepreneurial Environment, Political Environment, Legal System, Philanthropy, Place, Next Gen and Research and Innovation.
“These are the things that if we do all 10 at the exact same time in parallel, we can make this happen,” Moreno says. “If you do only one or two, it won’t work. You have to have all 10.”
How does Blockland “save” Cleveland’s future?
In a world where it seems as if someone or some organization is being hacked every single day, Moreno is confident that the potential of securing the massive amount of electronic data transmitted globally each and every day through blockchain has significant, broad-based appeal.
Doing so would create an opportunity for tremendous demand, which is where the benefit to Cleveland comes in, say proponents of blockchain. The effort to create a system that among other things secures financial transactions, supply chain management, medical records, voter certification, patents, copyrights, budgets and documents as simple as driver’s licenses and passports will require infrastructure and talent, says Brenda Kirk, co-chair of the Talent Development node and executive vice president and chief product and strategy officer at Hyland.
“We’re talking about building new talent and reskilling talent and bringing new talent to our community to take these new jobs,” Kirk says. “For us at Hyland, we have been literally replacing work with technology for a very long time. What it has produced for us and our customers, and I see this very same equation happening here, is an ability to leverage those minds for greater work.”
The need to reskill talent will be significant, Kirk says.
“It requires an incredible amount of effort around education and certification,” Kirk says. “There is a tremendous need for us to pay attention to the incredible talent that we already have in our region and make blockchain interesting technology for them to look at by providing interesting work. It’s what’s been happening in the technology landscape since it began. This is not a new idea. It’s just that Cleveland is entering at the front of the game, which is a really cool opportunity.”
What type of infrastructure will be needed?
KJK is launching a startup LawTech company called Connective Counsel, which incorporates blockchain technology into a smart contract platform, says Pinney, managing partner at KJK.
“As a result of our work in building Connective Counsel, our firm became more aware of the disruptive and transformative impact of blockchain — in the legal industry and elsewhere,” Pinney says.
“Our focus is building a world-class innovation campus to house blockchain startups. Our campus, dubbed CityBlock, will also house startups in countless other emerging areas. We expect to announce the location at the Blockland Solutions Conference in December.”
The Place node has more than 50 members and is co-chaired by Pinney and Teresa Metcalf Beasley, a partner at Calfee, Halter & Griswold.
Another component the Place node is exploring is an intergenerational K-12 school focused on technology. This would meet the goal of creating the next generation of homegrown technology experts who can maintain the market position Cleveland hopes to attain.
“This would be a Cleveland Metropolitan School District-sponsored school where we would teach technology,” Beasley says. “There is one at Cleveland State University, which has a waiting list where they have to turn students away. One of Place’s objectives will be connecting with a new school for K-12.”
What factors will determine whether Blockland succeeds?
Opportunity zones will likely play a key part in Blockland’s ultimate success or failure. They were created as part of a new community development program established by Congress in the Tax Cuts and Jobs Act of 2017 to encourage long-term investment in low-income urban and rural communities across the country.
“Most of the east side of Cleveland, including downtown, is in an opportunity zone as well as part of the west side of Cleveland,” says Ray Leach, founding CEO at JumpStart Inc. and co-chair of the Entrepreneurial Environment node.
“There’s no way we’re going to get hundreds of millions of dollars focused on any technology in Cleveland in the next 12 months without something like opportunity zones. There are a lot of folks connected to the Blockland initiative and other folks who aren’t formally connected to it who are looking at opportunity funds. We’re very focused on trying to catalyze and bring all those things together.”
Leach announced in September that JumpStart has partnered with the Greater Cleveland Partnership and The Unify Project to hire Kenneth Clarke, who has experience with branding, marketing and fundraising, to serve as Blockland’s project manager.
“We want to make sure Cleveland is ready for the blockchain revolution in advance of the revolution happening,” Clarke says.
Leaders of the initiative are convinced that without each node operating at full potential, Blockland will fail. The Business Applications node is focused on opportunities like digital authentication and identity.
The Political Environment node is working with Ohio leaders at the state level to create legislation that would enable blockchain to flourish in Ohio. The Legal System node also has its place, along with the Next Gen, Research and Innovation and Philanthropy nodes.
“It’s important that the city not miss another technology wave like we have in the past,” says Don Graves, senior vice president and senior director, corporate community initiatives and relations at KeyBank. “This is especially for poor, underserved, overlooked and often forgotten parts of our community.
“The digital divide is continuing to widen and what that means is that in this community, there is a major divergence in our society as the world becomes more and more tech heavy and tech savvy. We have an increased number of folks in our community who are being left behind. So our work in the Philanthropy node is to help address this issue, focusing on how we use this effort to drive digital and economic inclusion.”
What if Blockland fails?
If all the time, energy and effort does not result in Cleveland becoming a hub for blockchain technology, Moreno says there will still be gains that can help the region going forward.
“Amy Brady, who runs talent development with Brenda Kirk, says the effort has already made a difference for two reasons,” Moreno says. “One is that she met Brenda Kirk. Just the fact that those two women know each other, great things will happen as a result of that. If nothing else occurs out of that effort, it was worth it for them.
“On the research and innovation node, Harlan Sands from CSU, Barbara Snyder from Case Western Reserve University and Alex Johnson from Tri-C have now developed a close personal professional relationship as a result of this partnership. Just the idea of having CSU and Case and Tri-C working together will pay dividends.” ●
Blockland Solutions will take place Dec. 1-4 at Huntington Convention Center of Cleveland. Visit blocklandcleveland.com for more information.