#StartupsEverywhere Profile: Ben Golub, CEO, Storj
This profile is part of #StartupsEverywhere, an ongoing series highlighting startup leaders in ecosystems across the country. This interview has been edited for length, content, and clarity.
Providing Encrypted Cloud Storage Capabilities using Decentralized Blockchain Technology
Storj is an encrypted, decentralized cloud storage provider that utilizes its own digital token to facilitate transactions. We spoke with Ben Golub, the CEO of Storj, about how their platform functions, the current uncertainty around cryptocurrency and digital asset regulation, and the importance of considering startups’ perspective in policy making.
Tell us about your background. What led you to Storj?
While my educational background is in public policy, I’ve spent most of my career in the startup space. Storj is my eighth startup and the fourth where I’ve served as CEO. Most of my startup work has leaned towards the internet infrastructure space broadly covering security, storage, or cloud-native applications. After my last startup, I was not looking to do another one, but there were many aspects about Storj that intrigued me. It was conceived in a dorm room at Morehouse College by a Black founder and it was not your typical startup. It was a company with a unique approach to cloud computing in a decentralized way. In some regard, Storj competes with Amazon, Microsoft, and Google in the cloud market, which is also an intriguing challenge.
What is the work you are doing at Storj?
We are in the decentralized storage space and are taking an interesting approach towards building a network that, in some ways, is reflective of a market. We offer cloud storage, but instead of storing your data on drives that we own, the data gets encrypted then split up and stored on drives that are owned and independently run by tens of thousands of people all over the world. Storj might be most easily described as Airbnb for disk drives.
Most people have spare room on their disk drives—as many as 90% of all drives are severely underutilized. With Storj, they can rent out the unused space and get compensated with a digital token. We store data in a technical way where security is built into the system, so files will not get lost even if half the drives go away tomorrow. The system is also designed in a way where the data cannot be compromised even if it is stored with a bad actor. For data storage, our target audience is developers, rather than consumers—people who are building applications and need storage on the back end. Critical to making this work is a compensation system that relies on a digital asset, the STORJ utility token.
You use encryption to secure the data that you store and move on behalf of your users. In the past, we’ve seen attempts by policymakers to weaken encryption through regulation or legislation under the assumption that it is primarily used to protect bad actors. Are there things that you think policymakers should keep in mind when engaging in this debate?
Effective policymaking requires a sound understanding of the issues, but too often in the technology space, policy aims are set without this understanding. For encryption, this has led to a worst-of-both-worlds situation where criminals have access and people who should be using the technology are hampered in their ability to do so. It will always be true that any bad actor who wants access to strong encryption anywhere in the world can get it. Policymakers need to enable people who should be protecting data with encryption, like hospitals or financial institutions, with the ability to do that. We’re now in an era where state actors are engaging in hacking as a form of warfare, and targeting private companies, utilities, the health care system, and our critical infrastructure. The widespread use of encryption is key to protecting consumer, financial, healthcare, research, and other sensitive data, and its use should be encouraged, not undermined.
How do cross-border data flows and data-localization measures that exist around the world factor into your work at Storj? Do they ‘steer’ where you can operate?
There are a few proactive approaches we take in this regard. We do not sign up people from certain countries, like Iran, or individuals on the denied persons list. Where customers are subject to data residency requirements that restrict where data can be stored, Storj is building the capability to restrict the placement of data to particular locations. That said, we believe that it should not matter to the customer where it is stored because we are dealing with encrypted bits of data. What matters is where the keys are and where the data is when it is unencrypted and that is under the customer’s control.
How do decentralized networks work with various privacy regimes (like GDPR and the California Consumer Privacy Act (CCPA))? Does it get more complicated as more states and other countries pass their own varying privacy laws?
Varying regulatory regimes always makes life difficult for startups, and even just figuring out what the rules are can be a challenge. Privacy is just one particular area where many startups struggle to understand what is required of them. We operate in the crypto asset space, an area where there are disparate regulatory approaches globally and there is little clarity about the direction that laws are headed domestically. As policymakers grapple with these issues, it is important that they give startups a role in policy debates. There are things that Amazon, Microsoft, or Google can do that startups cannot, so it helps level the playing field when the voices of startups are included in policy debate. We are operating in a global market, and if, for example, the EU has a far more liberal attitude towards crypto assets than the U.S., we are in danger of losing the U.S. as a center of gravity for web 3.0.
Are there any local, state, or federal startup issues that you think should receive more attention from policymakers?
An area of particular concern for us and a large number of startups in the space is digital asset regulation. Presently, the Securities and Exchange Commission (SEC) is pursuing litigation as a means of regulation, but this approach lacks the clarity and certainty that businesses and innovators need to operate. When formulating the rules to govern this space, it is critical that policymakers also consider the broader global regulatory landscape. Doing so will help policymakers protect American consumers, bolster U.S. competitiveness, and ensure that the U.S. remains the best place to start a company.
What are your goals for Storj moving forward?
Our goal is to usher in the future of decentralized cloud technology. The Internet was a huge innovation because it was largely decentralized and we want to see the same thing happen in cloud computing. So, we are trying to do that first with storage and then ultimately with computing and networking. We hope our success will result in us not only being a great company but also in the creation of a lot of great innovation.
All of the information in this profile was accurate at the date and time of publication.
Engine works to ensure that policymakers look for insight from the startup ecosystem when they are considering programs and legislation that affect entrepreneurs. Together, our voice is louder and more effective. Many of our lawmakers do not have first-hand experience with the country's thriving startup ecosystem, so it’s our job to amplify that perspective. To nominate a person, company, or organization to be featured in our #StartupsEverywhere series, email ian@engine.is.
