Please describe your proposed solution.
Problem perception: The current postal delivery service in Africa is underwhelming .
Sending and receiving parcels in Africa is a real-life struggle as it is not just more expensive than in industrialised countries but also way worse in terms of reliability, convenience, speed and accessibility. These observations are not just derived from my personal experiences and conducted interviews but even underlined in the Integrated Index for Postal Development (2IPD) by the Universal Postal Union (UPU), a UN body.
Proposed solution: Disrupting the legacy of centralised postal delivery through a Blockchain-based Peer-to-Peer approach.
With this solution someone wanting to send an item from A to B (sender) would match with another one going from A to B anyways (transporter). A transporter wants to make money on the side for taking the item along his/her way.
This is not just the most ecologically friendly delivery solution as it reduces the C02 footprint but also the cheapest and fastest delivery solution for the sender, which opens up the opportunity for a side hustle for the transporter as well.
Thus, a win-win-win situation for the sender, the transporter and mother earth.
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Our start-up approach (to be funded): Building the MVP
After research and successful hypothesis testing which has been done during two incubators - HHL Digital Space in Germany and Ariob in Ethiopia which we are currently in - we want to build an MVP for further testing. For the Lean Startup approach - we decided to go for - we are now at the stage of testing our idea on the ground with people in Africa. For this we need to have a simple but properly functioning MVP ready.
The MVP shall entail the following:
- Web app (hybrid) with a simple UIX (for transporters, senders and receivers)
- Integration of a Cardano wallet (CIP-30) into the mobile app
- Development of an escrow smart contract on Cardano
- Connecting the back-end, smart-contract side with the front-end of the app
in order to replicate the basic economic transaction of the P2P parcel service delivery on the Cardano blockchain. This means that a sender and transporter could lock their ADA in smart contract for payment and deposit respectively with the automatic unlocking of the smart contract (into the transporter's wallet) happening through the confirmation of the recipient.
Output: An open-source MVP, including smart contract and a web app.
Precisely, for the technical development of this MVP the funds of our proposal are allocated. A proof of the technical feasibility of this idea, which is a requirement for further funding. An even stronger and more capable team for realizing this highly disruptive idea.
Outcome: New learning insights shared among the developer community. Opening up the next step of this project, which brings us closer to the final solution. Positive awareness from inside and outside the Cardano community that projects like ours are indeed trying to serve the people in Africa by providing solutions to real world problems. Feedback in terms of data from MVP testing on the ground in various African regions, which is not part of this proposal but will happen anyway. Bringing with this MVP testing and later a use case, more people in Africa and around the world to Cardano. Generally, this proposal can strengthen the value proposition of Cardano, like many other impact projects, as it is so fundamentally aligned with Cardano's core mission.
For the testing of the MVP we have another proposal in Fund 9's Challenge “Grow Africa, Grow Cardano”, for which funds will be shared among our stakeholders (WADA) on the ground helping us to facilitate the MVP testing: <https://cardano.ideascale.com/c/idea/423109>
Of course, if the analysis of the collected data provides positive feedback, we would ask in a future proposal for funds that would allow us to transform the MVP into a market-ready product.
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The envisioned, full-fledged technical implementation of this solution (not part of this funding proposal):
A mobile App for accessing the online platform for filtering and match-making between senders and transporters, into which Cardano wallets can be integrated for flawless payment and deposit transactions into the smart contracts on Cardano.
Why do we need a Blockchain for this solution?
You would never trust (and pay in advance) a stranger to deliver your item, right? The person might just run away with it. So the issue here is trust. And blockchains, like Cardano, were built for resolving the issues around trust, namely through smart contracts enabling trustless economic interactions merely based on the execution of autonomous and publicly verifiable computer code.
Through a smart contract escrow solution on Cardano setting up the right economic incentives for the transporter to deliver the parcel in the promised fashion, this P2P parcel delivery service becomes trustless, automatic and infinitely scalable.
The transporter will have to deposit a certain amount - set by the sender of the parcel - into the smart contract, which will be released together with the payment for the delivery service (added by the sender to the Smart Contract) by the smart contract automatically once the receiver confirms the proper delivery of the parcel.
Thus, if the transporter delivers way behind schedule, not at all or has damaged the item, the locked payment and deposit will be transferred to the sender as a compensation.
A solution for who?
On the sender side, we see potentially anyone using this parcel delivery service, who wants to send any item to friends, family and relatives at lower costs and in a faster and more reliable manner. Of course, we do not expect that very expensive items will be sent through our service as economic value had to be matched by the deposit of the transport to some extent.
Next to the person-to-person sending, we also identified the e-commerce sector to make use of this service option if cheaper, faster and more reliable delivery is provided than compared to the existing options. Furthermore, a study (<https://journals.openedition.org/factsreports/3682>) pointed out that spaza shop owners could benefit from efficient delivery systems stocking up on goods by an external party, so they do not have to close the shop for doing it themselves.
On the transporter side, anyone willing to take something along his or her way could make a small financial gain. This ranges from commuters and travelers going via any means of public transportation to truck drivers and people with their own cars driving to potential destinations hours or days away.
Please describe how your proposed solution will address the Challenge that you have submitted it in.
MVP building (to be funded)
It allows us, first and foremost, to prove the technical feasibility of building such a dApp on Cardano. This is the first and most essential step bringing the Cardano ecosystem closer to an innovative dApp no other blockchain has right now.
Secondly, through the development of the MVP and its later testing we will be in the position to more realistically validate our problem solution fit to this real-world problem. With the collection and analysis of customer feedback, we can further assess what features are further needed and what challenges are found when it comes to implementing a blockchain-based parcel delivery solution in Africa.
In case of success, such a dApp would not just drive a wide adoption in Africa and anywhere in the world, where the postal service is poor, but would also shine a positive light on the entire Cardano vision and its community, which funded and supported this project.
All being open-source, other developers will benefit from our insights as other entrepreneurs wanting to build something blockchain related in Africa might also benefit from our collected data and experiences in building an MVP linked to the Cardano blockchain.
The awareness of Cardano as a blockchain and community will certainly increase in the African regions, where we will be testing our MVP, leading to more awareness first and adoption later.
Most importantly, this solution could enable real world use cases and non-digital business opportunities provided by a dApp built and relying on Cardano. It thereby increases Cardano's publicity by promoting Cardano as a blockchain and community that truly empowers and serves people in Africa particularly.
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General project
With this decentralised, blockchain-based approach, a sound alternative to the currently centralised and highly dysfunctional postal service system in Africa can be established allowing for cheaper, faster, more reliable and greener parcel delivery. A working decentralised solution on blockchain to the current centralized legacy postal system would be a disruptive game changer for the entire postal delivery industry.
But not only are the senders and receivers of post items served well with this solution with cheaper and faster delivery options, also for the transporting side a new income stream is created for anyone traveling, commuting or driving to somewhere boosting the regional economy as the payment goes directly to the transporter without any (western) cooperation/service provider extracting the profit.
It holds for some transporters even the opportunity to become sole-entrepreneurs and deliver postal items from one place to another on a daily basis as a profession.
The ecological impact is positive, too, as CO2 emissions can be saved through this decentralised delivery approach.
For the Cardano community, a real-world blockchain use case would drive adoption and improve the lives of many people in Africa, who can rely on a just better and fairer delivery solution for their items they want to ship to family, friends, and customers around their countries.
Lastly, the DAO approach would enable a fair community governed profit-sharing among users by avoiding the classical profit optimization strategies of large coperations, which come usually at the cost of local employees and/or customers.
What are the main risks that could prevent you from delivering the project successfully and please explain how you will mitigate each risk?
Risks for the development of the MVP (to be funded)
<u>Human risk</u>
Interpersonal problems could arise that make the team splits up or drifts apart from the goal of completing the development of the MVP.
==> Yes, this might sound silly but is academically confirmed to be one of the top reasons why startups fail and thus can never be entirely ruled out. We have had team building and coaching sessions in our Ariob incubator program to avoid such a scenario. Also the devotion for the past months going through this incubator program together showed sufficient passion for delivering this project. Furthermore, the fact that all team members have already invested substantial time into this project without any compensation at this point underlines the fact that the working climate among the team is so good that everyone has the enthusiam to work on it and deliver. Lastly, Jeremy has done some training on intercultural communication and mediation if a conflict would ever arise.
Both of the two Haskell/Plutus leave the team and no developer with at least Haskell skills is to be found under our very minimal budgeting conditions.
==> Highly unlikely scenario as the two Plutus developers have already committed lots of time researching into the dApp, which has so far been utterly uncompensated. One developer at the end would still be enough to ship the smart contract part though requiring some more time.
<u>Technological risk</u>
The postponing of the Vasil hardfork with a later one coming in October might take up some new changes that need to be incorporated requiring some additional time and resources.
==> By having 2 Haskell Devs on the team that went through the Plutus Pioneer Program, we are capable of adapting to updates on the Cardano side and make our smart contract code even more performing.
Reliance on 3rd party Cardano wallets: As we are not planning to build our own wallet but want to integrate one (and later more) into our MVP, we rely on the functionality of them.
==> There are enough open source Cardano wallets out there that have implemented CIP-30 and thus can be integrated in other 3rd party tools, like our MVP.
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From our research we have identified five major risks for the general project idea:
- Business model/ platform risk
- Mule risk
- Insurance risk
- Dispute resolution
- Overall crypto risk
1. As our business model is built on the logic of a functional platform economy, the threshold supply (of transporters) and demand (of senders) within a certain region must be reached. Otherwise it would not work. It is a chicken-and-egg-problem. If there are not enough transporters offering the carriage of an item along their way the delivery system does not work just as if there are not enough senders wanting to send items on the platform. Demand and supply has to be created almost at the same time. The solution to it is to create a sufficiently large network effect through regionally targeted marketing campaigns with the help of the WADA and the overall Cardano community.
2. The mule risk involves the abuse of this delivery through sending illicit items, like drugs and weapons. Besides a disclaimed 'transparent and open parcel policy' allowing for the transporter to check what he/she is carrying, we are planning to incorporate Atala Prism's ID solutions, too, trying to deter criminals from abusing our system due to enhanced traceability for the police.
3. The insurance risk concerns, first and foremost, the transporter who exclusively bears the economic risk in case the postal item gets stolen, lost or damaged. In this case, he/she would not just lose out the payment but also would lose the deposit made into the smart contract (to the sender as a compensation) as this is to incentivise for reliable delivery. For this we are thinking hard about a third party or community based insurance solution which copes with the challenge of moral hazard. The sender to a lower degree is exposed to the insurance risk as he/she gets refunded with the deposit made by the transporter in case of theft or damage. It is ultimately up to the sender's risk assessment of how much deposit the He/she demands from the transporter to deliver the item.
4. Associated with the risk of damaged and stolen goods is the dispute resolution mechanism that resolves complaints coming from either side - the receiver or the sender. Through an incentivised community effort as an extra service to be paid this risk of false complaints can be handled. Furthermore, the Atala Prism integration would allow for ratings and verifications of senders making it even in the short run hardly profitable to perform a poor delivery service.
5. The overall crypto risk entails regulatory as well as technical concerns. From a regulatory perspective payments in the form of cryptos, including stable coins, are under scrutiny and the risk of a crypto ban is hard to mitigate. On the technical side, the smart contracts in the most basic (and cheapest) form are autonomous and cannot be controlled by a third entity, like the DAO, in case someone loses its wallet access or unlock code. We are having a less decentralised version of smart contracts also in mind as a premium feature which carries less risk in the form of proper private key management for crypto beginners. Overall, the risk of exploiting the escrow smart contracts are perceived to be rather low due to security audibility of smart contracts written in Plutus and the very limited amount locked in them.