Startup financing processes migrate to blockchain

If we look at the financing systems for new ideas and teams that are emerging here and there around the world, we will see that the time has come for rapid changes. Yesterday the projects were financed by banking methods and with the help of corporate structures, as was done in the past and the nineteenth century. Only a few who had the necessary connections easily achieved success, while all the rest had to make twice as much effort. Now we are on the threshold of a new era of organizational development.

WINGS Marketing Consultant Dominic Zunis shares his observations:

“A few years ago, when I was working on a technology project for the first“ crowdsale ”, I witnessed how MaidSafe was the first to collect several million dollars in bitcoins. It was an event. Today it happens every week. Bitcoin has essentially become the world's largest platform for crowdfunding ideas. ”

Blockchain is not only fertile ground for launching new breakthrough ideas, but also a kind of promise of a new economic order. The new concept of the future, where everyone will have access to economic tools, and the benefits derived from labor, knowledge and innovation will be distributed, and not concentrated in the pockets of a handful of corporate investors.
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However, many of these projects do not fit into standard crowdfunding schemes. And there are no control mechanisms here, even despite the existence of legislative regulation, which would help to understand what are the chances of success for each specific project. And Goldman Sachs and Merrill Lynch are definitely too old-fashioned to start working in this area.

The procedure for the initial placement of the currency ICO (Initial Coin Offering, by analogy with the IPO - the primary placement of shares) has become commonplace. But it has at least one major flaw. Often, the community, due to the lack of technical knowledge or the need for prior in-depth study of the issue, simply does not understand whether to support this or that project. There are cases when investors end up with a bag of worthless shares or currency. More recently, a single European project raised more than $ 10 million just by claiming that the ICO always allowed the first participants to earn huge amounts of money and promises to provide a simple system for managing an index fund of currencies.

In turn, the Waves platform, where tokens are the main “fuel” for all operations, is striving to become a kind of decentralized Kickstarter and instant-exchange exchange using the “asset-to-asset” scheme. Waves simultaneously supports cryptocurrencies, such as Bitcoin and Ether, and national currencies - euro, dollar, yuan. Assets can be represented by services, securities, real shares of companies with built-in dividend receiving system, which allows payments to investors at the touch of a button and in any currency, national or digital.

Another company, Funderbeam , provides stock exchange services based on blockchain technology for growing startups. The exchange allows startups to obtain the funding necessary for development, and users - opportunities for obtaining information and investing in projects that they like. Thanks to Funderbeam, the user will be able to use investment opportunity assessment tools before investing in a startup. Moreover, Funderbeam provides data on all previous investors of a startup and offers options for draft shareholder agreements.

Another platform - WINGS - is a real decentralized Kickstarter, which also offers some functions from the category of project management. The platform allows any user to submit their projects to the WINGS community, which will review them and provide a forecast of success and fundraising potential. The system allows users to concentrate on truly innovative projects and weed out proposals that are not worth attention without the intervention of any centralized government body that dictates its opinion. In addition, anyone can participate in making forecasts, this activity is encouraged by the system built into the platform. Startups who do not have the necessary knowledge or experience to predict can delegate this function to more experienced users and contribute to the success of the project with the help of a decentralized reward system for completing tasks.

Blockchain introduces new and significantly simplified ways of transforming ideas into well-designed projects. Including the blockchain provides platforms for crowdfunding and asset allocation. Unfortunately, only a very small number of platforms are seriously interested in providing the tools necessary for investors to check the legal purity of startups. In addition, new concepts such as swarm intelligence and innovative tools like it radically change our understanding of how to finance and manage projects. For example, the mechanisms of a decentralized analytical network, which today can be applied in decision-making processes, provide the right to vote to all holders of project shares, and not just management, as it was before.

Thanks to the blockchain and the freedom that cryptocurrency provides, new projects that could not be launched by other means were released due to the support of the global crypto-investor community. But more importantly, the new opportunities for earning money are no longer limited by the safe rooms of the investment houses of Wall Street and London.