PassageX, Listia Partner to Use Blockchain to Resell Tickets

Alex Linebrink is on a mission to cut out the middle man.

Linebrink is the founder and CEO of Passage, a Detroit-based ticketing startup. The company’s bread and butter is servicing smaller, niche events, such as Halloween-themed tours, beer festivals, comedy shows, and minor league soccer.

“Passage powers ticketing for specialty events,” Linebrink explains. “We try to find event categories with different needs and provide a custom experience. We’re the largest provider of haunted house tickets in the United States, and we’re probably the top provider of Escape Room tickets. Semi-pro soccer is where we’re growing the fastest.”

Passage, founded in 2014, landed a spot in Wisconsin’s Gener8tor startup accelerator in 2015. Linebrink describes the experience as “incredibly helpful, and it helped us raise more than $1 million in our seed round.”

Since then, the company has been focused on growing its business. Linebrink says that last year, Passage sold tickets for 3,000 events across the world, facilitating roughly $20 million in sales. Linebrink says the company can manage both online and at-the-door sales of tickets, merchandise, and concessions.

Two years ago, he began getting calls from customers who bought tickets online to Passage events only to be turned away at the door. He started digging into the situation and discovered that counterfeit tickets were being sold on StubHub. Essentially, a person would buy a legitimate ticket and then sell fake copies of that ticket, Linebrink says.

“It turns out that StubHub doesn’t validate tickets at all,” he says, making fraud easier to pull off. As this was happening, he was getting more acquainted with blockchain technology, which underpins cryptocurrencies like Bitcoin. He realized there was an opportunity to use blockchain to create a decentralized ticketing network open to all ticket sellers, which could keep track of buyers’ identification, reduce fraud, and increase transparency as to where service fees are going.

And so, Passage launched PassageX, a resale market for tickets a la StubHub, as a proof-of-concept project last fall.

“Unless you’re Taylor Swift and you can control the whole process, most of the time service fees don’t go to the artist,” Linebrink notes. “We can build in fee splits back to the artist or venue. PassageX was made to be neutral and connect to marketplaces.”

In June, PassageX announced a partnership with Listia, a site with 10 million members that enables “peer-to-peer sales of random stuff,” Linebrink says. Although Passage’s ticket inventory will now appear on Listia, no money is changing hands between the two companies as a result of the partnership.

“We’re trying to implement each other’s technology,” Linebrink says, adding that he and Listia CEO Gee-Hawn Chuang met at a blockchain conference in California and decided they needed to work together. Listia’s users transact with blockchain-based Ink tokens, and Linebrink says PassageX can use the Ink protocol to grow, while Listia can charge a fee for each PassageX ticket its users buy.

At the moment, the tickets listed on PassageX are from Passage events, but Linebrink hopes to change that. There’s plenty of room for competition, he points out, with ticket sales representing more than $30 billion in transactions each year. (To illustrate the David vs. Goliath nature of the industry, Linebrink says TicketMaster controls about a third of that business, with StubHub not far behind and companies like Passage making up the rest.)

“There are more than 1,000 small ticket companies around the world, of which Passage is probably in the middle of the pack” in terms of size, he says. “Big corporations have all the power now. We think we can change the industry if we can get enough of these little guys together. It might be enough pressure to get the big guys involved.”

Right now, PassageX is focused on the secondary ticket market, but next year, Linebrink plans to expand into primary ticket sales. In 2020, he’d like to tackle a new vertical: travel and transportation.

“Consumers are abused in that market,” he says. “I think we can make it more fair, more transparent, and lower service charges. The ultimate goal is to make it totally peer-to-peer and eliminate every middle man we can.”

Sarah Schmid Stevenson is the editor of Xconomy Detroit/Ann Arbor. You can reach her at 313-570-9823 or sschmid@xconomy.com. Follow @XconomyDET_AA

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