Start-up of the week: Bitnet

13 Apr 2015

Pictured: Stephen McNamara, co-founder and chief technology officer, Bitnet Technologies

Bitnet, a Belfast-based start-up led by former Visa and CyberSource executives, is a digital commerce platform that enables enterprise-scale merchants to accept digital currencies like bitcoin.

In recent months Bitnet secured a major deal with UATP that will enable 260 airlines from around the world to accept bitcoin payments.

Airlines that use the system include Delta, Ethiad, Lufthansa, Qantas, US Airways, United Airlines and American Airlines.

The Bitnet team already has a decade of experience implementing payment and fraud-management solutions for airlines.

The market

“The B2C e-commerce market is a US$1.5 trillion market and the B2B sector is more than four times as large,” explained Stephen McNamara, co-founder and chief technology officer at Bitnet Technologies.

“We’ve recently partnered with UATP (Universal Air Travel Plan), which provides payment services to more than 260 global airlines – this market alone is worth more than US$400m.”

The founders

“Back in the late ’80s I studied software engineering and went on to spend the next 17 years in the Dublin technology scene,” McNamara said.

“More recently, I spent almost three years in Silicon Valley, along with my co-founder, John McDonnell.

“John was responsible for business development at CyberSource and I was CTO.

“Together with our colleagues we’d spent years trying to solve the challenges of cost, risk and security for online merchants. Bitcoin is the most elegant solution to those three problems.”

The technology

Complicated is an understatement when it comes to explaining how the technology works, says McNamara.

“The good news is that we shield merchants from that complexity and provide a simple set of APIs and interfaces for them to use.

“I think it’s important for people to see bitcoin first as a technology, then as a network and payment system, and finally as a currency.

“Our goal is to be the market leader in digital currency acceptance: to enable the vast majority of the world’s merchants to transact safely and quickly with bitcoin.”

Aim big and work hard

As a young company in an emerging space, Bitnet’s first customers go live this month, and McNamara expects the business to go from strength to strength. 

“Any start-up business has it challenges: the first year, the first customer, raising new money etc… The team so far has hit every milestone. We all believe in the vision and I’m very pleased with our execution so far.

“I know there’s an abundance of talent on the product and engineering side of things, and modern tooling has dramatically reduced the cost of entry for new start-ups. With that being said, I still think the venture & mentoring side of Ireland’s start-up scene is under-developed.”

For McNamara and his co-founders, talent is the most vital ingredient in any start-up.

“Venture capitalists look at three things in a start-up: the team, the technology and the sector. They’ll take a risk on any one of those but rarely two, and in my experience you can’t add the right team later.

“So you can either improve an existing business with better technology (like AirBnB or Uber) or find a whole new problem space and solve that with proven technology (like bitcoin and distributed trust).

“Aim big and work hard. Stick to your plan until the evidence tells you otherwise,” he recommends.

John Kennedy is a journalist who served as editor of Silicon Republic for 17 years