Yesterday, blockchain firm Data Gumbo announced a partnership with PrairieDog Venture Partners to streamline capital projects using smart contracts. PrairieDog (formerly OS2) is a joint venture between Texas-based Construction Industry Institute (CII) and the Construction Users Roundtable (CURT).
Capital projects contribute about $1.3 trillion to the U.S. economy each year. However, it is lumbered with high transaction costs, partly due to friction in sharing data and contractual disagreements.
PrairieDog estimates 41% of capital project spending is wasted because of non-value-added transaction costs. Meanwhile, 98% of megaprojects have cost overruns and are completed later than expected.
The joint venture plans to leverage blockchain smart contracts to automate payments, streamline operations to reduce costs and provide a shared platform for contract participants. It will work with Data Gumbo to develop joint use cases.
“This move indicates a marked development toward achieving long-term shared success collaboration models, with more effective supplier engagement, flattened supply chains and better risk allocation,” said Pete Dumont, CEO, and co-Founder of PrairieDog Venture Partners.
“This partnership extends PrairieDog and Data Gumbo’s value to the construction sector by improving trust, reducing drag and transforming the ways companies come together to execute projects, setting up the new ideal, long-term business ecosystem for the global capital projects industry,” said Andrew Bruce, CEO, and Founder of Data Gumbo.
Texas-based Data Gumbo has developed the GumboNet blockchain network. While the platform potentially has broad applications, most of its activities have been in the oil and gas sector.