Revolutionizing P2P Investments: A Deep Dive with Kimmo Rytkönen, CEO of Income
Revolutionizing P2P Investments: A Deep Dive with Kimmo Rytkönen, CEO of Income
Andy welcomes Kimmo Rytkönen, the co-founder and CEO of Income. Income is a next-generation peer-to-peer marketplace that offers a safer and more transparent way to invest in loans for earning passive income. Kimmo explains how the platform works and its vision for providing people with an easy way to invest their money in assets such as consumer loans or real estate portfolios. He also discusses the importance of investing in today’s economy, inflation concerns, fixed-income products, and diversifying one’s portfolio. The platform is currently only available to investors from the European Economic Area due to regulations around KYC/AML compliance.
Kimmo from Income discusses the global crowdfunding ecosystem, regulation, and tokenization with Andy. Income is a loan-based crowdfunding platform that offers investors an average rate of return of around 12-15% per annum.
The Dacxi Chain aims to create a fully regulated global ecosystem where everyday investors worldwide have access to new investment opportunities through locally owned platforms and tokenization. The Dacxi Chain will provide liquidity in secondary markets.
Music courtesy of BlackIrisFilms.com
Share this article
Andy Pickering – Host
Welcome to Unleashed with the Dacxi Chain – the podcast that features Experts from within Dacxi and from across the industry who are here to share their insights on developments shaping the global crowdfunding economy…
Andy Pickering – Host
My guest today is Kimmo Rytkönen. Kimmo is the co-founder and CEO of Income, which is a next-generation peer-to-peer marketplace offering a safer and more transparent way to invest in loans, to earn a passive income. So we’ll learn today exactly what that means. Welcome to the show, Kimmo.
Kimmo Rytkönen – Guest
Hey, Andy. Thanks. It’s a pleasure to be here.
Andy Pickering – Host
Pleasure to have you here, Kimmo. Let’s do what we do at the beginning of the show. Love to hear a little bit about your background and what you’ve been doing in the lead-up to co-founding Income.
Kimmo Rytkönen – Guest
Okay, cool. I’m Kimmo. Basically, my background is in fintech, more so in consumer lending, SME lending. So that’s what I’ve done for most of my adult career. And then through different turns and events, I ended up on this side of the ecosystem, if you may, to provide funding to those lending companies through crowdfunding or peer to peer as what Income is doing. Yeah, and that’s what we do today. We’ve been doing it for two years. It’s available on Getincome.com. And what we really do is we don’t issue loans ourselves, but we cooperate with different lending companies around the world to provide them funding. And on the other side then, to allow the crowdfunding investors to invest in loans and earn passive income, as you mentioned in the intro.
Andy Pickering – Host
Awesome. So let’s learn a bit about Income then. The idea is to provide people with an easy way to invest their money in assets such as consumer loans or real estate portfolios, anything like that. People that come through that funnel to you guys. So talk a little bit about, I guess, the vision for Income and where are you guys based and how long since you’ve founded the company?
Kimmo Rytkönen – Guest
Kimmo yeah, so I’m originally from Finland, but I’ve lived in Thailand, Estonia already for about 15 years, and that’s where we’re based as well. Estonia has a vibrant startup community. So basically we decided to set up the company here. And where the idea came from was originally when we started during COVID times to develop the idea with my co-founder, we thought that the current peer to peer marketplaces were a little bit like fire and forget from an investor perspective, meaning that there was very little security for the investors. There had been a lot of frauds in the space as well. So we thought that, okay, we can do this better. And that’s where the idea came from.
Let’s take some of those things we learned during our careers in consumer lending. So we raised funding from institutions. They usually took the loan book as collateral to the investment. And that was something that was lacking in the peer to peer or crowdfunding space. So, in a similar fashion, if you’ve done real estate crowdfunding, the project is usually the collateral. Right? So you invest in a development project or a rental property, and you know that your money is backed, your investment is backed by something real, a real asset, as such. And loans are an asset just as well as a real estate project, meaning that they have a cash value. So if the cash value of a house is the money, you can sell it for, the cash value of a loan is the money it produces.
So the cash flow that’s coming in from the loans, this is something we can use as collateral, as a security to, let’s say, keep the investors safe to improve their situation versus what was before. We launched in February 2021, and then essentially since then, we’ve been scaling up and growing the business. And today we have about 4000 active investors and around 10.5 million already on the platform invested. Cumulatively, maybe 40 million has passed through the platform already. But the outstanding investment is what’s my KPI that I’m keeping my eye on.
Andy Pickering – Host
I can see that you guys did indeed start in COVID Times. I believe you were nominated in several categories for the Estonian Startup Awards in 2021. And I understand that you also, in the early days, as you were getting going, you completed a successful crowdfunding around yourself?
Kimmo Rytkönen – Guest
Yeah, we used Seed blink, actually. So during the round, we had a lead investor from Singapore who took most of the round, and then we cooperated, actually with two different platforms. One was Seedrs, the other one was Seed Blink, both successful in their own right. With Seedrs, we actually decided then not to go forward with it. So there was such a big gap between actually getting all the structures ready from their side that a lot of things had passed. Right. So we were closing that at the start of 2022. Then the war in Ukraine broke out, and there was a big gap between actually closing the round in terms of Seedrs and then actually being able to download the funds. And a lot of the fundamentals at that time had already changed.
There was a downturn in the economy and all those things. So we thought, okay, let’s rather not download the money because our expectations on the growth of the business had changed. And then we discussed it with Seedrs and we thought, okay, let’s do this. This is the right thing to do for the investors, but seed blink, we downloaded and we did complete the round on both platforms. So all in all, a good experience of equity crowdfunding also.
Andy Pickering – Host
Yeah, well, that was going to be my next question. So it sounds like a little bit of a convoluted process as you dealt with a changing macro environment. But all in all, that was a positive experience for you, going through the crowdfunding route?
Kimmo Rytkönen – Guest
Yeah, absolutely. I mean, both platforms were actually a pleasure to work with as such. All in all, a very good experience. We learned a lot and I would definitely say that crowdfunding is a very good way to raise funding for startups.
Andy Pickering – Host
Yeah, fantastic. And one of the things that people really did start to learn about during the pandemic, a lot of people had more time on their hands, as I’m sure you’ll remember. And as well as watching lots of Netflix, a lot of people started turning to the various different investment options and started exploring the world of fintech, certainly the world of crowdfunding cryptocurrencies, equity stock portfolios. Lots of different investment options are now available. And of course, one of the other, I suppose, knock on effects of the money printing that all the big central banks engaged in during their response to the Pandemic – It’s led to this situation with inflation, which is increasing rapidly in many parts of the world.
And as a response to that, of course, how can people respond to inflation, how can they protect their money? One of the best ways really is of course for them to invest their money. So I suppose what I’m saying, Kimmo, is investing is well, it’s a hot topic again, right, I’m sure you’ll agree. Why is it important, do you think, for people to learn about investing?
Kimmo Rytkönen – Guest
Sure, yeah. I think from my own part personally, but also from the people I know. And what we discussed at the end of 2021 was kind of when the music was at its loudest. And you’re absolutely right, I think people had a lot of spare time on their hands and a lot of extra cash as well to invest. And I think that in itself drew a small bubble, maybe even in many places. So we saw good growth, then cryptocurrencies saw very good growth, stocks as well. And there were a lot of projects on the market that even in equity crowdfunding that raised funding, but necessarily were just based on an idea. They didn’t even have a product yet, so money was being spilled all around. And I think VCs also saw that they had a slight hangover this year.
Now what we hear is that they’re dusting their checkbooks again and looking at what other real investment opportunities that they could actually have in our case. Right? So what we offer is we offer a fixed income product as such. So when you invest in loans, it has a certain maturity. Twelve months equal installments. So if you put €1000 in, you get 112 back each month, plus you get an agreed interest from the loan company. We had capped these interest rates at 12%. Back in the day, this was when we still had the zero interest environment. Now today we’ve actually increased it. So now we’re capped at 15. So basically meaning that most of the loan companies that we cooperate with are happy to offer the 15% to our investors just to secure the fact that they have funding.
So this was partly driven by inflation, partly driven by yields that have gone up investments. It doesn’t matter if you look at bond investments, if you look at even set-term deposits, those have all gone up while assets are then down. Like you mentioned, cryptocurrencies. So these are still mostly the yield comes from, well, staking, but mostly from increasing value, I’d say for a lot of people. So they have been a little bit depressed. So maybe fixed-income products have raised their head a little bit during the asset downturn. But yeah, I think it’s super important that people have a diversified portfolio. They know what and they try to protect their money because otherwise, inflation hits it all.
Andy Pickering – Host
Yes, that is exactly right. Kimmo, just describe again how Income works and what you mean when you say that people can invest in the loans. So in my mind, if I’m explaining it really simply, you are providing a platform. So Income is the platform. So if someone wants to invest, they come along, they sign up to your platform, create an account, and then they can look at the different, what you call loans that they want to invest in. And on the other side of that is what can be a range of different entities, but it could be startup businesses, people like that are looking for new funding, capital injections. Right?
Kimmo Rytkönen – Guest
In our cases, essentially, we don’t have equity investments at all. So we do purely the loans at this point. So yeah, exactly what you said. How it works is you register on the platform. You come to getincome.com you register, you go through our Electronic KYC. Once your account is set up, you deposit a little bit of money, or a lot of money depending on your preference. And then you can take a look at the investment options. Right? So the investment options in our case are different loan companies. So we have Indonesian, Mexican, Bulgarian, Finnish. There’s several different entities. These are all separate loan companies.
And what we do with these loan companies before we onboard them or as we call it, investment opportunities when we open on board them, we do a due diligence on these companies. So we look at the quality of their loans, we look at the quality of their financial data and then we decide if they’re eligible to be actually listed on the platform. And once we say okay, let’s go, you guys look to be solid, then we integrate with their back end systems and then they can just list individual loans on our platform. So let’s say you have a Finnish entity giving SME loans and they give out a loan in Finland to a small company worth €5000, for example, they click a button on their loan management system. That loan appears in our system and now it’s available for investment.
And then our investors on income, they will be able to buy a part of that loan. So you can think of it sort of as a small share or a percentage of the loan that they buy. So let’s say the €5000, they can buy the whole loan or they can just buy €500 worth it or €10 worth it or €100 worth of that loan. And then they get the economic rights related to that piece they bought and an agreed interest that the loan company is willing to pay them. And then as the loan gets paid back, they get part of the capital pack and they get also part of the or they get the interest that has been agreed for the invested capital.
And then most investors put it on an auto invest, meaning they don’t need to log in and choose the individual loans. They can just say my portfolio is €5000, I want to invest it in these loan companies. So they click the ones that they want to invest in and they say that I want to put €100 per loan. I don’t want to be exposed to just one loan with a full 5000 and I want to have 50 loans or 500 loans or whatever. And then the system itself keeps a track of it and keeps investing in the loans based on the parameters you as an investor have given. So your money rotates and earns interest. And then if you wish to stop investing, you just stop your auto invest.
And as the loan gets paid back, the money gets returned to your account and then you just withdraw it normally onto your bank account in a similar fashion as you would do a deposit.
Andy Pickering – Host
Got it. Thank you. Kimmo and can you explain who can use Income? Are there any restrictions on which people from which jurisdiction are able to use income? And maybe also talk about is Income regulated?
Kimmo Rytkönen – Guest
We decided early on that we’ll only take investors to start with from the European Economic Area. And essentially we’ll take a look if we’ll add Asia, so forth, other regions. But today we’re doing a European Economic Area mainly because of the Kyc Aml. It’s much easier to deal with the banks in that sense.
Andy Pickering – Host
Yeah, that makes sense. Kimmo thank you for that. If we zoom out a bit, I’d like to just get your thoughts on how you see, I suppose, the global crowdfunding industry at the moment. It seems to us here at the Daxci Chain that there are lots of interesting innovations happening all around the world, but we’re missing the pieces that can bring it together to really bring everyone together. So we have a truly global crowdfunding ecosystem where different participants can get access to those early stage investment opportunities and of course, innovators can get access to the capital that they need to take their businesses to the next step. But yeah, what do you think is going on with crowdfunding at the moment?
Kimmo Rytkönen – Guest
Well, I think I’ll continue from the regulation part you asked before. I think regulation is one of those things that we see. I mean, it’s in crypto, it’s everywhere, and it’s sort of tied perhaps to the anti money laundering KYC things, which anybody dealing with banks these days knows that they ask a lot of questions. I think regulation is kind of somewhat targeted at that, but also ensuring that there are only good players or honest players on the market. How well that has been implemented so far is a question mark, but shortly on incomes regulation status, we’re not regulated today because we are not an equity crowdfunding platform. We’re also not a real estate crowdfunding platform which were the main targets of the EU regulation.
And at the moment in Estonia, you don’t have a regulation for anyone doing loans such as us, I mean, loan, crowdfunding investments. The legislation is being penned by the local legislator, but it hasn’t arrived yet. We’ve seen some early drafts. Essentially it all turns around, the investor security, stability of the platform, and so forth. I don’t expect any problems there. But yeah, the status of income today is we’re not yet regulated. Looking forward to seeing the final draft of the legislation before I can say how much it will affect our business, if at all. So that’s definitely one of the things that I see overall coming more and more, is regulation. We know some similar platforms that are in different jurisdictions.
They have gone the route of offering securities as such, meaning that the investment opportunities need to have a prospectus and basically listed with the local regulator. So that’s kind of the heavy end of crowdfunding, if we talk about equity crowdfunding, then is it viable for many of these early stage projects, for example, to do a prospectus similar to IPO? And on that scale, I think crowdfunding fills a space. If we talk about equity somewhere around, what I say maybe between VC investments or similar to VC investment. Whereas if you go the security route, if you go to the prospectus route, then you’re turning more into this IPO route, which is probably not the space crowdfunding is at its best, so it should find some sort of a balance in between.
So that’s definitely one thing. And then if we talk about how to get the companies to be able to operate in sort of like more globally, then we probably boil down to money movement, how to ensure the ownership of these investments. So perhaps some sort of tokenization or some sort of, I don’t know if it’s Bitcoin or whatever, but something that enables you to fast and cheap transfer money without too much hassle to those projects. But I think we’re still a long way from a really global crowdfunding ecosystem as such because a lot of it is based on local regulations and then country specific regulations.
Andy Pickering – Host
Well, that is exactly right, Kimmo. You’ve really identified the problem there. And that is really what we here at the Daxci Chain are working on. We’re hoping to provide some solutions to that, you said it yourself, through tokenization and working with various locally owned crowdfunding platforms in different jurisdictions around the world. So those local platforms would do their own due diligence on the investment opportunities. And then eventually the Dacxi Chain would build out this tokenized global crowdfunding ecosystem and create a secondary market so that investors are able to access the liquidity in their Tokenized investments. So it’s a massive project and it’s a big project, but can you see the ambition and the potential of something like that?
Kimmo Rytkönen – Guest
I think this secondary market is something where a tokenized environment or tokenized assets could really work much better. Individual platforms, tokenizing, having their own token, each of them, you’ll end up with the same problem. So where’s the liquidity? Where’s the aftermarket? We thought, when we started, we thought about, okay, should we do something in a blockchain environment? But then we thought also that okay, actually what we’ve built in the background is a ledger which tracks all the interest payments. It tracks all the other things, capital payments, how much interest do you need to pay? So we built that.
But we thought that should we go to Blockchain, we thought that, well, a centralized ledger as such run by individual companies such as ours, it doesn’t give us too much benefit because the real benefit would come if a lot of the companies would adopt such a ledger and then really these assets could be in one place. In loans cases, same thing. There’s a huge aftermarket if you would find a way to tokenize individual loans and you could push it to the loan companies and then there’s a lot of players, institutional players, buying loans, non performing loans, right? So even though they have an aftermarket for institutional players, everybody’s doing it a little bit batch based, portfolio based and individually.
So in a similar fashion, it would be great if all of these assets would be if we talk about loans or equity, if they all would be in one blockchain or one ecosystem, and then the liquidity would come, investors would just come, they could buy, sell, and they would have the economic rights to whatever asset they’re holding. And definitely but as you said, it’s a massive project, and it would require a lot of the market players to adopt.
Andy Pickering – Host
Yes indeed. We’re working on it, Kimmo, we’re working on it. Well, as we start to finish off it would be good to understand just what is the average rate of return, if there is such a thing that investors can potentially earn on income?
Kimmo Rytkönen – Guest
I think historically we are around 12% per annum, but we just quite recently increased it to 15%. So the maximum amount that the loan companies can actually offer to the investors. So I would assume it will be going up a little bit. So I would say it’s probably today, depending on your preferences, 13%, 14% is probably realistic, yes. And that puts it a bit higher than some bonds, for example, from similar companies and definitely higher than, I would say, bonds from your traditional banks or others. I think still, let’s say low to mid double digit is still a very good yield. And looking at the current inflation figures, it should leave you even a healthy profit after inflation.
Andy Pickering – Host
Yes, I think so. Very well said, Kimmo. Well, it has been a pleasure talking to you today, I have very much enjoyed it. As we finish off, please tell people where they can go, particularly if they’re based in Europe and are able to invest on your platform. Tell people where they should go to learn all about the income platform.
Kimmo Rytkönen – Guest
Yeah, so we’re available on Getincome.com so you can find everything you need, all the information or more information about the company, about who we are, what we do, about the loan opportunities so you can read more about there. There’s a lot of resources online already, a lot of affiliates, and a lot of bloggers are writing about it. So I would say the ecosystem is growing in loan investing. So there’s a lot of stuff available for you to read online, but Getincome.com is a good place to start to understand a bit better what investing in loans means and how it looks.
Andy Pickering – Host
Got it. Fantastic. Thank you so much for coming on the show, Kimmo. All the best and bye for now.
All right, well, there you go. That was Kimmo from income. Fascinating talking to Kimmo. And look, if you’re listening to this podcast, you are probably aware that a crowdfunding revolution is coming and it’s set to unleash innovation, world changing potential. It’s the world’s first global equity crowdfunding network. And that is what the Dacxi Chain is. That is what the Dacxi Chain is trying to do. We’re trying to create a new, fully regulated ecosystem where everyday investors all around the world have access to new investment opportunities. And for those founders who have innovative ideas, they need funding for those ideas or they can access that global investor pool. And of course, it’s done in a safe, sophisticated, and mature way. Now, of course, if this is going to be done at scale, what’s the answer? Well, tokenization.
So tokenization of those equity shares means it can be done at scale and anyone can invest at whatever amount they wish in line with the regulations in their own country. So the Dacxi Chain is working on all of this via tokenization at the local level through a network of locally owned crowdfunding platforms. And then, as mentioned, Dacxi will launch a specialist secondary market so people can offer their tokens for sale. And that all-important liquidity is there. So lots going on. That’s the very brief and concise overview of the Dacxi Chain and what it is. But of course, we’ll be learning more about it as the podcast continues. So do please make sure you’re subscribed to the podcast and ready for each new episode and then you can learn more.
Thank you for listening and bye for now.
https://getincome.com/
The Power of Equity Crowdfunding: Revolut's Inspiring Journey
Welcome back to the CrowdFunded Giants series, where we spotlight successful companies that have harnessed the power of crowdfunding to turn their ambitious ideas into reality. In this edition, we focus on Revolut, a UK-based fintech company that has disrupted the traditional banking landscape, demonstrating the transformative potential of equity crowdfunding.
The Genesis of Revolut: A Groundbreaking Idea
The Emergence of a Radical Concept
Revolut’s story began in 2014, sparked by the frustration of Nikolay Storonsky, a former trader at Lehman Brothers and Credit Suisse. Storonsky was dissatisfied with the financial industry’s cumbersome and expensive procedures, particularly those associated with international transactions. This dissatisfaction led to an innovative idea: a financial service that was instantaneous, efficient, and affordable, defying conventional boundaries.
The Founders: Uniting Expertise
To bring this pioneering idea to fruition, Storonsky teamed up with Vlad Yatsenko, a seasoned developer with experience at Credit Suisse and Deutsche Bank. Their combined expertise in finance and technology formed the foundation of Revolut, setting the stage for a revolutionary journey to transform traditional banking.
The Capital Journey: The Power of Equity Crowdfunding
Early Financing Rounds
Revolut’s initial financing came from friends, family, and angel investors, laying a solid foundation for the venture. However, the pivotal moment came when they decided to embrace equity crowdfunding as part of their fundraising strategy.
The Crowdfunding Triumph
In 2016, during their Series A funding round, Revolut decided to allocate £1m to a crowdfunding campaign on Crowdcube. The campaign was an overwhelming success, achieving the target amount in just a few days. The demand was so high that a random ballot system had to be implemented to select investors from the more than 10,000 interested parties.
Successive Funding Rounds
Following their crowdfunding triumph, Revolut continued to raise funds through various rounds involving venture capital and private equity. As of 2021, they had raised over $900 million in funding, attaining a valuation exceeding $5.5 billion.
Revolut’s Continued Success: Redefining the Financial Industry
Revolutionizing Personal Finance
Revolut has since experienced exponential growth, offering an array of services that include foreign exchange, cryptocurrency and stock trading, peer-to-peer payments, and budgeting tools. Their seamless, intuitive platform has attracted millions of users worldwide.
Expansion and Continuous Innovation
Revolut’s success extends beyond the UK, with a significant presence across Europe, North America, Asia, and Australia. They continue to innovate, expanding their product offerings to include business accounts, children’s accounts, and insurance services.
The Future Vision: A Global Financial Superapp
Revolut’s aim is to build a financial superapp, allowing customers to manage all their financial needs in one place. They plan to extend their services to more countries, introduce additional financial products, and persist in their mission to make financial services more inclusive, innovative, and customer-focused.
Lessons Learned from Revolut’s Crowdfunding Success
Revolut’s journey provides valuable insights into the power and potential of equity crowdfunding.
Community Building
One key takeaway is the importance of building a community. Crowdfunding not only provides a platform for raising capital but also helps in creating a loyal user base that believes in your product or service. Revolut’s crowdfunding campaign attracted thousands of investors, many of whom became dedicated users and advocates for the brand.
Product Validation
Crowdfunding also serves as a tool for product validation. The overwhelming response to Revolut’s campaign demonstrated that there was a high demand for their innovative banking services. It gave them the confidence to continue to expand and innovate.
Market Research
Moreover, crowdfunding can serve as a form of market research. Through the campaign, Revolut was able to gauge the market’s response to their product and understand their customers’ needs better. This feedback helped them refine their services and deliver a product that truly resonated with their users.
Broadened Investor Base
Lastly, crowdfunding can broaden a startup’s investor base. By opening up the investment process to the crowd, Revolut brought in investors who may not have had the opportunity to participate in traditional funding rounds. This diversified investor base further helped spread the word about Revolut and increase its market penetration.
The Dacxi Chain: A New Era in Equity Crowdfunding
Equity crowdfunding is evolving, and platforms like Dacxi Chain are at the forefront of this transformation. Dacxi Chain is a global equity crowdfunding platform that networks crowdfunding companies together, allowing them to scale and providing investors with greater access to opportunities.
Enhanced Accessibility for Entrepreneurs
Dacxi Chain offers entrepreneurs more access to funding. By joining a network of crowdfunding companies, startups can tap into a larger pool of potential investors. This increased accessibility to funding can make all the difference for startups looking to turn their innovative ideas into reality.
Greater Opportunities for Investors
For investors, Dacxi Chain provides access to a wider range of investment opportunities. By networking crowdfunding companies together, investors can easily explore and invest in startups across different industries and regions. This not only diversifies their investment portfolio but also gives them the chance to contribute to innovative ventures around the globe.
Scalability for Crowdfunding Companies
Dacxi Chain also enables crowdfunding companies to scale. By being part of a global network, these companies can reach a larger audience of investors and startups. This increased reach can lead to more successful campaigns, helping these platforms grow and expand their operations.
Conclusion: The Transformative Power of Equity Crowdfunding
Revolut’s journey from an innovative idea to a multi-billion dollar fintech giant is a testament to the transformative power of equity crowdfunding. It’s a compelling example of how a startup, equipped with a powerful idea, a committed team, and the backing of the crowd, can disrupt an entire industry.
As we move forward, we expect to see more stories like Revolut’s. With platforms like Dacxi Chain, the future of equity crowdfunding is brighter than ever. By networking crowdfunding companies together and providing greater access to funding and investment opportunities, Dacxi Chain is helping to shape the next generation of crowdfunding success stories.
Thank you for joining us for this installment of the CrowdFunded Giants series. Stay tuned for more inspiring stories about the power of the crowd in funding innovation and success. The journey of Revolut is just one of many; with the ongoing evolution of crowdfunding and the rise of platforms like Dacxi Chain, the future promises even more exciting journeys of innovation, disruption, and success.
Decentralizing Finance: The Dacxi Chain’s Vision for Equity Crowdfunding
In a fast-paced world driven by technological innovation, the financial landscape is undergoing a dramatic transformation. A game-changing force leading this revolution is Dacxi Chain, guided by its visionary CEO, Ian Lowe. In a recent podcast, Ian painted a vivid picture of the future of equity crowdfunding, the role of blockchain and tokenization, and the exciting journey Dacxi Chain is embarking on.
The Network Effect: A Paradigm Shift in Crowdfunding
Ian began by emphasizing the importance of the network effect, a principle that parallels Metcalf’s Law, which states that the value of a network is proportional to the square of the number of users on the network. This law is the driving force behind the exponential growth of many social networks and digital platforms, and now, it is poised to redefine equity crowdfunding.
In the context of equity crowdfunding, the network effect implies that as more people engage with the network, the value of the network to its users increases significantly. This growth, in turn, attracts more users, creating a virtuous cycle of expansion and value creation. This transformative concept is underpinning the development of equity crowdfunding as a decentralized network.
Blockchain and Tokenization: Breaking Barriers in Equity Crowdfunding
The next part of our conversation ventured into the transformative role that blockchain and tokenization are set to play in this evolving landscape. Blockchain technology is creating a paradigm shift in how we think about financial transactions, while tokenization is poised to revolutionize asset ownership.
Tokenization, according to Ian, addresses a significant barrier for investors in privately held companies—liquidity. The traditional notion of equity in privately held companies often leaves investors in the dark, unsure of when they can realize the value of their investment. Tokenization presents a solution to this dilemma.
By tokenizing equity, investors receive a legally binding digital record of ownership—a token. This token, backed by blockchain’s immutable record, can be traded on secondary markets, providing much-needed liquidity. This significant shift can accelerate the adoption of equity crowdfunding for everyday investors, opening up new avenues for investment and financial growth.
Charting the Course: The Dacxi Chain Roadmap
Ian also shared exciting updates on the Dacxi Chain’s roadmap. Currently, they are on the brink of completing their minimum viable product (MVP). This critical milestone will be announced later this quarter, marking the beginning of a thrilling new chapter for the Dacxi Chain.
The roadmap for Dacxi Chain unfolds in three stages. The first stage is all about proving the concept: demonstrating that the technology works, the partners are real, and the business model is viable. Ian assures that the technology is undergoing careful refinements to ensure the success of the first deal that will be executed using Dacxi Chain.
The second stage involves building out the network, establishing relationships with equity crowdfunding companies around the globe. Ian describes this phase as laying the foundation for a global network, creating partnerships with leading players in select markets.
The third and final phase is about scaling and acceleration. Once the foundation partners are in place, the goal is to significantly increase the number of participating partners on the Dacxi Chain network. The overwhelmingly positive response from equity crowdfunding companies so far gives Ian confidence that this growth will unfold quickly and smoothly.
A Look Ahead: The Future of Equity Crowdfunding
Ian’s vision for the future of equity crowdfunding is inspiring. He envisions a future where tokenization is as commonplace as the internet was two decades ago, with Dacxi Chain playing a pivotal role in this transformation. He sees a future where the Dacxi Chain operates globally at a genuinely impressive scale, including all the essential markets with a significant number of leading platforms participating.
Tokenization isn’t a far-off concept. Leading business consulting firms around the world have predicted that the tokenization of all asset classes is inevitable, and by 2030, it will be a 20-something trillion-dollar industry. It’s an idea on the cusp of ubiquity, one that can reshape our understanding of asset ownership and investment.
The Dacxi Chain seeks to make this future a reality. By leveraging blockchain’s benefits, tokenizing shares, and creating an equitable crowdfunding platform, it has the potential to democratize investing. The essence of the Dacxi Chain’s vision is to make investing a broadly accepted, everyday practice, not limited to the privileged few.
In this journey, transparency and communication are of utmost importance. Ian assures that regular updates will be provided, with the next one due right before the launch of the MVP. It’s an exciting period for the Dacxi Chain team, as they work towards making the first deal a successful one.
As Ian eloquently puts it, “We’re making refinements to the technology to make sure that the first deal that goes through is going to be a successful outcome for everybody involved and we’re really confident about that.”
The revolution in equity crowdfunding is just beginning, and Dacxi Chain is at the forefront of this movement. Ian’s insights reveal a promising future, a world where finance is more accessible, equitable, and efficient. Dacxi Chain’s three-stage expansion plan lays out an ambitious but achievable roadmap, fueled by technological innovation and a vision for a democratized financial future.
As we follow Dacxi Chain’s journey, one can’t help but feel the anticipation and excitement of being part of a transformative moment in financial history. As Ian signs off, we look forward to future updates and the realization of Dacxi Chain’s vision in the dynamic landscape of equity crowdfunding.
You can listen to the full podcast here. Stay tuned for more updates, and here’s to the future of finance!
Dacxi Chain Update: Transforming equity crowdfunding with tokenization
Dacxi Chain Update: Transforming equity crowdfunding with tokenization
In the latest Dacxi Chain update, CEO Ian Lowe discusses the platform’s mission to connect global investors with entrepreneurs, democratizing access to hyper-growth opportunities. Through leveraging blockchain and tokenization, Dacxi Chain aims to overcome the limitations of traditional equity crowdfunding, offering a scalable, decentralized network for seamless transactions. As they approach the launch of their MVP, the vision is to operate globally at scale within a few years, all while maintaining regular, transparent updates to the community.
Music courtesy of BlackIrisFilms.com
Share this article
The Dacxi Chain update with CEO Ian Lowe
On this episode, Andy speaks with Dacxi Chain CEO Ian Lowe. The Dacxi Chain aims to connect entrepreneurs and investors all across the world, giving entrepreneurs access to a global pool of potential investors and providing investors with hyper-growth opportunities. Ian says that the Dacxi founders identified equity crowdfunding as an opportunity several years ago, after which they conducted exhaustive research into the industry to build a business model architecture. They found that equity crowdfunding is constrained by its local nature and by perceived barriers for investors around owning equity in private companies. To address these challenges, they are pursuing a decentralized model where existing equity crowdfunding platforms can plug into an infrastructure capability that immediately transitions them into becoming part of a network along with other participating platforms. Blockchain and tokenization can accelerate the adoption of equity crowdfunding by providing digital records through smart contracts on immutable blockchains so people can trade tokens in secondary markets. The Dacxi Chain is in the final stages of building its MVP before launching later this quarter under its three-stage expansion plan. The ultimate goal is to operate globally at scale within a few years or less. Regular updates will be provided until launch, which is expected later this quarter. Despite the complexity of the project, progress is being made according to schedule.
Andy Pickering – Host
Hey, folks, Andy here. Welcome to Unleashed with the Dacxi Chain, the podcast that features experts from within Dacxi and from across the industry. Experts who are here to share their insights on developments shaping the global crowdfunding economy. Now, if you’re listening to this podcast, you are probably aware that a crowdfunding revolution is coming and it is set to unleash true innovation at scale. We’re talking about the world’s first global equity crowdfunding network, and of course, it is called the Dacxi Chain. Now on today’s Podcast, I’m joined again by Dacxi CEO Ian Lowe to get a status update on everything on the Dacxi Chain. Ian, welcome back to this show.
Ian Lowe – Guest
Hi, Andy, how are you doing? Good to be with you.
Andy Pickering – Host
Excellent. I’m doing well. Ian. Pleasure to have you here. Ian, the Dacxi Chain is about connecting entrepreneurs and investors all across the world. It’s about giving those entrepreneurs access to a global pool of potential investors, giving those investors access to hyper growth opportunities. This, of course, is the vision of the Dacxi Chain. Ian, how long has this been in the works? How long has the team been working on the Dacxi chain?
Ian Lowe – Guest
Yes, thanks for your question. The founders identified the opportunity associated with equity crowdfunding, really not realizing its true potential. That opportunity was identified a few years ago. And so the work that’s transpired since then has been an exhaustive research process into the industry. The various segments in the industry, the constituent players in the industry, the technologies that operate in the industry, how those technologies work, and how that ecosystem operates more generally. And then that process established some really important insights that were then used as foundations to build a business model architecture. And from there, the business has evolved into going and building the underlying technology that makes all of that possible. So look, it’s been going on now for a couple of years.
We’ve tacked along the way, of course, as you do over when you’re innovating in the way that we are. So we’ve made refinements along the way. But this is not something that we picked up yesterday. We’ve been at it now for a number of years.
Andy Pickering – Host
Got it. Thank you, Ian. And look, another way of describing what the Dacxi Chain is all about is simply, crowdfunding. I’d love it if you could perhaps talk about the potential of crowdfunding at scale, which is what the Dacxi Chain is all about, right?
Ian Lowe – Guest
Yeah, that’s absolutely right. So look, there’s a couple of core principles that really are the premise to the whole project. The first is a fundamental belief that crowdfunding should change the world. And it should change the world for two core groups of people. One being growth companies that are looking for funding, and the other being everyday investors that want access to great growth companies to invest in and realize a return at some future date. So crowdfunding, when it first came along, was this very exciting new world where the benefits of connecting investors at scale and large numbers of well qualified and suitable growth companies ready for investment would be realized, essentially redrawing the lines of the whole innovation economy.
I mean, if we think about how growth companies are funded today, something like 99.5% of that funding comes out of venture capital. Now, venture capital is a large market. In 2022, it’s about a half a trillion dollar market, but it’s controlled by a surprisingly few number of very large players who operate a very small number of primary locations. So essentially what it means is that this democratization, if you like, for both the everyday investor and really smart companies who are growing and need growth capital to continue growing, that whole dynamic or opportunity of the byplay between the supply and demand I’ve just described is massively constrained when we only operate in a world where 99.5% of investment capital is coming from one source.
So if we look at crowdfunding today and we realize that it simply hasn’t developed to become what it should become, which in our view is a 100 billion dollar market, the question is why? Why hasn’t that happened? And what all of our research revealed is that there are essentially two underlying reasons why crowdfunding is constrained today. And the first of those is that crowdfunding is almost exclusively local. It’s not a global proposition. So you might have multiple crowdfunding platforms that operate in multiple corresponding markets, but they are essentially local businesses. So they attract local companies looking for capital. We call them issuers. They attract local issuers looking to raise capital, and then they seek to raise that capital from local investors all within one market.
The primary reason for that is that it’s extremely problematic for a company or a crowdfunding platform in any given country to go and build a database, a meaningful database of well-qualified investors in other countries around the world. I mean, how do you do that? That’s extremely difficult to do, it requires time and capital that these companies don’t have. And so by definition, equity crowdfunding platforms specifically are local operations. And the fact that they’re constrained in this way limits the scale that is achievable for equity crowdfunding as an industry more generally.
And the second constraint is around the perceived barrier for investors around owning equity in a private company. So we’re obviously talking about private companies, public companies. Theoretically, anybody can own or dispose of shares in public companies. We’re talking about equity crowdfunding with private companies and specifically gross companies. And so for a lot of everyday investors, the threshold of owning equity in a business where I don’t know what my liquidity event might look like, is too high of a barrier, and so it discourages them from investing. So these are the two issues, a lack of scale and the barrier in the mind of the investor around a liquidity event. These are the two things that are getting in the way of equity crowdfunding becoming a 100 billion-dollar market.
Andy Pickering – Host
Yeah, got it. Ian, so you talked about how traditionally crowdfunding is more locally based, right. It happens all over the world but it is constrained within local jurisdictions. And of course, the vision of the Daxci Chain is to take equity crowdfunding global. What are some of the key things that need to happen to unlock this global potential by making the move from local to international? I’ve seen you mention the Dacxi Chain network effect. So that might be part of this as well.
Ian Lowe – Guest
We’ve looked at this really closely and thought a great deal about it. Look, globalizing the industry can be done in one of three ways. The first is under what we would call a proprietary model. And this is where essentially one company expands into multiple markets over a period of time, and is able to compete in a very successful way in every market. And as a singular entity, they become a global juggernaut that essentially owns the industry. And so, look, the parallels might be the likes of Google, for example, or Amazon. The challenge with this, of course, is that if you’re an investor you’re going to have to pick the right horse and you’re going to have to wait many cycles and many years for that global dominance to take effect.
So the proprietary model is a high risk proposition for an investor and the period to harvest is an extremely long one. And the quality of the outcome is ultimately in the hands of very few at that point. It’s not really a network, it’s just a single business that’s dominating an industry globally.
The second model is a centralized model. And so this is akin to a business like, let’s say, Booking.com. So they are an aggregator where they’ve created a marketplace which is its own standalone destination. And that marketplace aggregates all of the opportunities that exist across its constituent partners businesses. And so in the world of equity crowdfunding, it would mean that a centralized and incremental equity crowdfunding platform is created, and needs to be fully licensed. It needs to be licensed in every market in which it operates.
And it needs to do deals with existing equity crowdfunding platforms where they share those deals with this aggregator, this centralized aggregator. Of course, the problem with that is that just like the Booking.com model, and there are many examples of this approach, is that the aggregator ends up actually competing with the platforms that it’s partnered with. So really what the aggregator relies on is the investor coming to its own marketplace rather than going to the marketplace of the partner that provided the deals in the first place. So that’s highly problematic. And we’ve seen this become a really difficult business model in a whole range of industries, not just travel, but real estate and automotive and any number of industries. So we believe the centralized model is highly problematic. That brings us to the third one, which is a decentralized model.
Now, what we mean by decentralized is essentially this idea of providing a technology infrastructure which existing equity crowdfunding platforms can plug into. And through that infrastructure they become part of a network along with other participating equity crowdfunding platforms, where deals can be shared from the platform that is the originator of that deal into an ecosystem of multiple other platforms, all of which have databases of investors within those platforms. And of course, that same dynamic in reverse. So essentially what we’re talking about is a nondisruptive infrastructure capability that immediately transitions a local crowdfunding proposition to being a global crowdfunding proposition, where they can access investors from all the other platforms around the world.
And really what it does is it gives those platforms, and therefore the issuers that are raising money through those platforms, access to infinitely more capital, which means that more deals can be done and those deals can be done faster. And for the investor, they now have access to a vast catalog of investment opportunities. So the network effect that you refer to is really where, as we build this network of participating platforms, over time, the growth of that network accelerates because you have this multiplier or compound effect whereby the increase in the number of deals and the increase in the number of investors that participate through that network creates more investors and attract more deals.
And the whole thing compounds through this network effect where if we start to achieve the scale through this global capability, we start to achieve the scale that realizes the true potential of equity crowdfunding. So that decentralized model is vastly superior in our view. And that’s the model that we’ve pursued in the technology that we’re building.
Andy Pickering – Host
It reminds me, when you’re talking about the network effect, it reminds me of Metcalf’s law, which is that the financial value or impact of a network is proportional to the number of users on the network. So of course the network effect grows as more people are engaging with the network, then it starts to go exponential and the value increases to all participants in the network. And you’re talking about this as a decentralized network, Ian. So my next question is how does Blockchain and Tokenization fit into this?
Ian Lowe – Guest
Yes, this relates to the second point around this barrier for certain investors, there remains a perception that having equity in a privately held company is a problem because I don’t know when that equity will be crystallized and I can get the benefit of the growth in the value of that equity. And so when we looked at the whole equity crowdfunding model and the global opportunity to become this 100 billion dollar industry, one of the things that we realized would greatly or potentially greatly accelerate the adoption of equity crowdfunding for the everyday investor was being able to tokenize the equity that they receive when they invest. And the reason for that is that if my legal record of ownership of shares in a company that I’ve invested in, if that legally binding record of ownership is a digital record through a Token, a digital token, via a smart contract on a blockchain, an immutable record, then what it gives me is the ability to trade that token on any number of secondary markets that already exist. And the number of these is growing every week. So it means that I can tap into a secondary market to find a buyer for that equity in a way that is literally impossible now. If I have a good old sort of paper-based share certificate sitting on my desk at home, we can totally transform that whole liquidity event proposition for the individual investor if we tokenize the shares. And look, this is not remotely controversial. Blockchain has been around for a long time. The number of real-world applications solving real-world problems built on Blockchain is growing exponentially.
I think every leading business consulting firm in the world has come out and said that the Tokenization of all asset classes is absolutely inevitable and by 2030 will be a 20-something trillion-dollar industry. So we’re talking about tokenization is on a path to becoming ubiquitous, just like the Internet was 20 years ago. And so on that basis, leveraging the benefits of blockchain and tokenization we think has the potential to accelerate the acceptance and adoption of equity crowdfunding as a broadly accepted method of investing for everyday investors. So we think it’s part of the solution.
Andy Pickering – Host
Got it. I love it. Just as we start to finish off, can we get an update in terms of where the Dacxi Chain is at and the next steps. I believe you call it the three stage expansion plan, please talk us through what that looks like.
Ian Lowe – Guest
The stage we’re in at the moment is really the final stages of the build of what we call the minimum viable product. And we’ll make an announcement later this quarter about the launch of that minimum viable product. And we’ll also be looking to make an announcement about the first deal that will go through the Dacxi Chain technology and also share with everybody who our foundation partners are, that is established equity crowdfunding companies working with us on this very important first deal. Proof of concept. So that’s the stage we’re in at the moment. That’s the timeline. We’ve given guidance on that previously and none of that has changed once we get through that. The first deal is about saying the technology works, the partners are real, a deal has been successfully executed, and on that basis we have a viable business.
So that’s the first stage that’s really important. The stage that we enter after that is really about building out the network. And so by that we’re talking about doing deals with equity crowdfunding companies in select markets around the world as foundation partners to build out the first version of the global network. And so this is about meeting with these leading players in select markets around the world, agreeing how we’re going to work together and establishing that version of a global network. So that’s that second phase. And then the third phase is really about scaling all of that and doing it in an accelerated fashion. So in the same way that you’ve described, once we have the foundation partners in place, we want to greatly accelerate the number of participating partners on the Dacxi Chain network.
And we envisage a scenario where as we build momentum and look, the response we’ve had from equity crowdfunding companies we’ve talked to has been overwhelmingly positive. We’re not asking these companies to put any money on the table. We’re building all the technology. The integration points are very simple and easily executed. The business models we’ve put in front of them are resonating. So we expect that scaling of the network, once we’ve got all the foundation partners in place in phase two, that scaling of the network and the acceleration and growth of the business that comes from that, we expect that will unfold reasonably quickly.
So what we’re talking about is getting to a point in the future where we are operating globally at genuine scale, with all of the important markets participating and a really significant number of the leading platforms participating within a handful of years or less. So that’s that third phase is accelerating the growth of the network.
Andy Pickering – Host
Got it. Thank you, Ian. Thank you for reminding us what the Dacxi Chain roadmap looks like. And yeah, that’s exciting. So later this quarter, in a few months, you’ll be in a position to tell folks what that MVP looks like and the foundation partners.
Ian Lowe – Guest
Yeah, that’s absolutely right. So we’re committed to regular updates. We’ve been providing those for a few months now. We’ll continue to provide those right up until we make the launch announcement, which, as you can imagine, we’re really excited about. And at this point in time, we’re making refinements to the technology to make sure that the first deal that goes through is going to be a successful outcome for everybody involved and we’re really confident about that.
Andy Pickering – Host
Fantastic. Well, I’m sure I speak on behalf of the listeners, a pleasure to have you on and to hear what you’ve got to say today. We can’t wait to hear more details in due course later this quarter. But for now, thank you very much for the update. All the best, Ian, and bye for now.
Ian Lowe – Guest
Good to talk to you, Andy. Cheers.
The Future of Crypto Valuation: Unraveling the True Potential of Token Value in a Rapidly Evolving Market
Assessing Dacxi Coin’s Commercial Demand and the Need for a New Era of Token Valuation Metrics
As the crypto market evolves, it becomes increasingly evident that traditional approaches to assessing token value, based primarily on technology metrics, are inadequate. With financial analysts entering the field, the crypto industry is naturally shifting toward emphasizing commercial demand as a critical determinant of token value. This article delves into the complexities of this shift, exploring the valuation of Dacxi Coin, an innovative project poised to disrupt the global equity crowdfunding market.
I. The Problem with Traditional Crypto Valuation Metrics:
1. Justifying Market Capitalization through Ecosystem-based Analysis:
A coin’s current value is simply the price someone would pay for it today, factoring in the liquidity of the market for that coin. Market capitalization, a widely-used metric for valuing crypto projects, is calculated by multiplying the total number of coins in circulation by the current market price of the coin.
In the absence of credible income streams for most assets, the industry has justified a token’s market capitalization and its future potential based on ‘ecosystem metrics’, such as the number of developers in its community, dApps launched, projects built, follower community, or daily users. However, as an asset driven by demand and income streams, a crypto-token’s ecosystem only serves as an indication of market strength or potential. Ultimately, this approach is as flawed as the ‘counting eyeballs’ strategy used during the 1990s Internet Dot Com boom.
2. The Case of Ethereum:
Ethereum (ETH) exemplifies the limitations of traditional valuation metrics. With a market capitalization of $225bn, analysts struggle to justify this valuation based on its annual revenue from fees (less than $2bn). Its $19bn in locked ETH in staking is based on that fee income, so it delivers approx a 5% return, which is unjustifiably high. The valuation is 100 times fee income, with leading commentators predicting 200-500% price growth. Ethereum may have the world’s largest and strongest ecosystem, but justifying a 500 times fee income growth is challenging, especially considering the rise of strong competitors offering much lower fees and the entry of major companies like Google, Microsoft, and Ant Financial into the token platform space.
3. Commercial Realities:
While these ‘ecosystem’ metrics were the only credible valuation argument in the early days of crypto development, they fail to capture critical aspects of a project’s commercial viability, such as income generation and the competitive landscape.
II. The Need for a New Approach to Crypto Valuation:
1. The Importance of Commercial Metrics:
To accurately assess a crypto project’s value, like all financial sectors, the industry will shift its focus to commercial metrics like project income and the likelihood of competitive price pressure. By emphasizing these factors, investors can gain a more comprehensive understanding of a project’s potential and make more informed decisions.
2. Adjusting for Market Dynamics:
The crypto market is continuously evolving, and as new players enter the space and existing projects mature, it is crucial for valuation methods to adapt accordingly. By incorporating commercial metrics into valuation models, analysts can better account for market dynamics and more accurately predict future capitalization growth.
3. Aligning Valuations with Traditional Finance Principles:
Incorporating commercial metrics into crypto valuation models can help bridge the gap between the crypto world and the traditional finance sector. By aligning valuation methodologies with principles used in mainstream finance, crypto projects can attract a broader base of investors, fostering greater market stability and growth.
III. Dacxi Coin: A New Benchmark for Token Valuation:
1. The Launch of the Dacxi Chain and Tier 1Exchange Listings:
As the Dacxi Chain approaches its launch and listing on Tier 1 exchanges, the question of Dacxi Coin’s valuation takes center stage. Traditional metrics that focus on the developer community and dApp projects are ill-suited for valuing Dacxi Coin, as it is a fundamentally different kind of project.
2. A Unique Value Proposition:
Unlike projects like Ethereum, Uniswap, or Chainlink, Dacxi Chain is not a ‘tokenization infrastructure’ project where its token’s demand and value are based on fee income. Instead, Dacxi Coin serves as an internal currency for a global equity crowdfunding network, facilitating investments across borders and offering a faster, more efficient alternative to traditional fiat systems and stablecoins. A secondary use case for Dacxi Coin is as a Dacxi blockchain currency for fees, like ETH, but its demand is tiny compared to transactional volume.
IV. Valuing Dacxi Coin Based on Commercial Demand:
1. The Global Equity Crowdfunding Network:
Dacxi Coin’s value is driven by the demand generated from transaction volume on its global equity crowdfunding (eCF) network. This network aims to revolutionize the equity crowdfunding option for early-stage investments by providing global scale. Deal issuers gain access to a worldwide pool of investors, and investors gain investment opportunities from across the globe, underpinned by global standards. Blockchain technology has seven potential applications, from tokenized equity to cryptocurrency-based payments to global KYC.
2. The Inefficiency of Fiat Systems and Stablecoins:
Dacxi Chain requires its own currency because traditional international fiat payment systems are too slow and expensive for a global network that will eventually encompass deals and investors from 100 countries using 100 currencies. The network could require investments to be sent from any country to any other country, creating the need for 100 x 100 = 10,000 different currency pairs. The stablecoin option is burdened by limited currency pairs and very negative regulatory challenges. Dacxi Coin is the best option for the network.
3. Demand is based on the Network:
The quantity of Dacxi Coin issued is fixed, so its value is based on demand produced by the Dacxi Chain network. The Dacxi Chain links local equity crowdfunding platforms together in a network. Each platform launches deals for investment, and its investor base invests in deals offered from the network. The Dacxi Coin moves the investments from investor to deal issuer.
4. Demand is Empowered by the Network Effect:
The ‘network effect’ is the power behind digital leaders such as Facebook, Uber, and Amazon. The more users they have, the more network connections they create, adding to the value exponentially. The more eCF platforms join the Dacxi Chain, the more deals attracted and offered, the more investors attracted and investments made, attracting more platforms. Investment volumes should grow exponentially, driving demand for Dacxi Coin exponentially.
V. Estimating Dacxi Coin’s Market Potential:
1. The Early Stage VC Market and the Global eCF Market:
Based on the size of the Early Stage VC market in 2021 at $230bn, a global eCF market worth $100bn annually is conceivable. Considering the growing interest in alternative investment opportunities and the potential of crowdfunding in developing economies of Asia, this projection may be conservative.
2. Market Share and Dominance in the Decentralized eCF Network:
A decentralized eCF network could capture 90% of the market share, with one dominant company claiming at least 80% of that share. In this scenario, Dacxi Coin could potentially command an annual turnover of $70bn.
3. Monthly Turnover Fluctuations:
Given the inherent fluctuations in investment activity, Dacxi Coin’s monthly turnover could range between $3bn and $15bn. The market will decide how much currency will be held to support this turnover.
4. Comparison with Ethereum:
Ethereum’s 100x annual turnover should not be compared with Dacxi Coin’s potential $70bn turnover, as some have suggested. Dacxi Coin will need to be bought and sold to facilitate investments with high currency velocity. Total demand would be a couple of months turnover.
Embracing the Future: A New Era of Crypto Valuation and the Unfolding Potential of Dacxi Coin:
While traditional metrics make it challenging to accurately value most cryptocurrencies, Dacxi Coin’s valuation is refreshingly straightforward. It is based on the expected demand generated by the global crowdfunding platform network set to launch in Q2/2023. As the crypto market continues to evolve, the industry must embrace new valuation methods that prioritize commercial demand, ensuring that investors can make well-informed decisions in a rapidly changing landscape.
As the crypto space matures, it is essential to recognize the limitations of traditional valuation metrics and adopt innovative approaches that better capture a project’s true potential. By shifting the focus to commercial demand and market dynamics, the industry can facilitate more accurate valuations and foster informed decision-making among investors.
The case of Dacxi Coin serves as a powerful example of the need for a new approach to crypto valuation. With its unique value proposition and potential to disrupt the global equity crowdfunding market, Dacxi Coin’s valuation cannot be adequately assessed using technology-based metrics. Instead, its potential lies in the commercial demand it generates as a transactional currency within a rapidly growing market.
As the global eCF market expands and more investors and deal issuers embrace the Dacxi platform, the demand for Dacxi Coin is expected to increase, contributing to its growing value. This demand-driven valuation approach aligns with traditional finance principles, helping to bridge the gap between the crypto world and mainstream finance.
In conclusion, the future of crypto valuation necessitates a paradigm shift that moves beyond traditional technology-based metrics and embraces commercial demand as a critical determinant of token value. By adopting this new approach, the industry can better assess the potential of innovative projects like Dacxi Coin and support the continued growth and maturation of the crypto market as a whole.
The analysis presented in this article underscores the importance of understanding the intricacies of token valuation, particularly as the market continues to evolve at breakneck speed. As the industry matures, investors and analysts alike must be willing to adapt and embrace innovative valuation methodologies that better capture the true potential of crypto projects. In doing so, we can ensure that the future of crypto valuation is as bright and promising as the innovative technologies it supports.
Unleashing Exponential Growth in the Global Equity Crowdfunding Space: Dacxi Chain's Vision and Strategy
- The global equity crowdfunding space is evolving rapidly, with innovative platforms and technologies enabling new opportunities for businesses and investors alike. Dacxi Chain is at the forefront of this transformation, leveraging the power of blockchain and the network effect to create a decentralized ecosystem that connects investors with investment opportunities across the world. In this blog post, we’ll delve into the insights shared by Ian Lowe, CEO of Dacxi Chain, in a recent video update, exploring the company’s vision, strategy, and its potential impact on the global equity crowdfunding landscape. You can watch the full video here:
The Power of the Network Effect
Before diving into the details of Dacxi Chain’s strategy, it’s essential to understand the concept of the network effect, which underpins the company’s approach to growth. Most companies grow in a linear path, with incremental growth over time. However, some businesses, like Uber and Facebook in their formative years, experience exponential growth driven by the network effect.
The network effect refers to the compound impact of building an ecosystem where a fast-growing number of providers transact with a rapidly increasing number of customers. As the number of participants in the ecosystem multiplies, the network’s value and growth potential also expand exponentially.
Dacxi Chain leverages the network effect by connecting equity crowdfunding platforms to one another through its blockchain-based infrastructure. As a result, investors on one platform can access deals on other platforms, creating a bi-directional flow of investment opportunities and capital. This dynamic, combined with the growing number of platforms connected via Dacxi Chain, leads to a compound growth effect in which more platforms lead to more deals and investors, further attracting even more deals and investors, and so on.
Dacxi Chain’s Three-Stage Expansion Plan
To capitalize on the network effect and drive exponential growth, Dacxi Chain has devised a three-stage expansion plan:
- MVP (Minimum Viable Product): In this initial stage, Dacxi Chain focuses on a few platforms in the Asia-Pacific (APAC) region to pioneer the core elements of the project. With a proven demand for the technology and a functioning platform, the primary goal is to validate the business model and refine the platform’s features.
- Expansion into Key Markets: Once the MVP stage is complete, Dacxi Chain plans to expand the number of partner platforms, targeting around ten platforms in eight markets worldwide, all operating in English. This expansion will increase the network’s reach and facilitate access to a broader range of deals and investment opportunities for investors.
- Unleashing the Growth: In the final stage, Dacxi Chain aims to bring licensed equity crowdfunding platforms from across the globe into its network. With potentially hundreds of partners, the network effect will reach a tipping point, resulting in an explosion of deals, investors, investments, and demand for the Dacxi Coin.
Presently, Dacxi Chain is focusing on the MVP stage and has made significant progress in refining its platform and establishing partnerships in the APAC region.
The Importance of Circulating Supply and Dacxi Coin’s Value
In addition to its ambitious expansion plans, Dacxi Chain has also made headlines recently with CoinMarketCap acknowledging the accurate circulating supply of Dacxi Coin. With a fixed total supply, Dacxi Coin’s circulating supply sits at an impressive 90%, placing it in a strong position compared to other major cryptocurrencies like Cardano and Polygon.
A high circulating supply is crucial to avoid devaluation from an influx of new coins, as it reassures the market that there won’t be a sudden flood of coins that could undermine their value. The value of Dacxi Coin is driven by investment demand and the need to move investments across the world, converting between different currencies. As Dacxi Chain moves into Stage 3 of its expansion, the network effect will ignite exponential growth, further increasing the value of Dacxi Coin and its utility within the ecosystem.
The Impact of Dacxi Chain on the Global Equity Crowdfunding Space
As Dacxi Chain continues to expand and connect equity crowdfunding platforms worldwide, the company’s innovative approach has the potential to revolutionize the global equity crowdfunding landscape in several ways:
- Increased Access to Investment Opportunities: By connecting platforms, Dacxi Chain enables investors to access a broader range of deals across different regions, industries, and market segments. This increased access will allow investors to diversify their portfolios and discover new, high-potential investment opportunities.
- Enhanced Cross-Border Investments: Dacxi Chain’s blockchain-based infrastructure facilitates seamless cross-border transactions, making it easier for investors to participate in deals outside their home countries. This will encourage capital flow across borders, stimulating economic growth and development in various regions.
- Empowering Smaller Platforms and Businesses: By leveraging the network effect, Dacxi Chain can help smaller equity crowdfunding platforms and businesses access a larger pool of investors and capital. This will enable these platforms and businesses to compete more effectively with larger, established players in the market.
- Greater Transparency and Trust: Blockchain technology offers enhanced transparency and security, which can help build trust among investors and businesses within the equity crowdfunding space. This increased trust can, in turn, encourage more participation in the market and fuel further growth.
- Streamlined Regulatory Compliance: Dacxi Chain’s platform can facilitate compliance with various regulatory requirements in different jurisdictions by providing a standardized, transparent, and secure infrastructure for conducting equity crowdfunding transactions.
Final Thoughts: A Promising Future for Dacxi Chain and the Global Equity Crowdfunding Market
Dacxi Chain’s innovative approach to harnessing the power of the network effect and blockchain technology has the potential to reshape the global equity crowdfunding space, driving exponential growth and creating new opportunities for investors and businesses alike. As the company progresses through its three-stage expansion plan, the network effect will only continue to amplify, ultimately leading to a more interconnected, accessible, and vibrant market for equity crowdfunding.
With unwavering support from its investors and community, Dacxi Chain is well-positioned to achieve its ambitious goals and establish itself as a powerful, global network that fuels deals, investments, and coin demand. The future is truly exciting for Dacxi Chain, and we look forward to witnessing the impact of its growth on the global equity crowdfunding landscape.
Be sure to stay updated on Dacxi Chain’s progress by watching Ian Lowe’s video update here and following the company’s latest news and announcements. Your continued support will play a vital role in driving Dacxi Chain’s success and transforming the global equity crowdfunding market for the better.
The Global Financial Revolution: How Dacxi Chain is Transforming Equity Crowdfunding Through Cryptocurrency
In an ever-evolving financial landscape, traditional solutions, business models and technologies are being reimagined and disrupted. And a new new wave of blockchain enabled innovation is underwriting some of the world’s most exciting and significant changes.
Dacxi Chain is one of these. A groundbreaking platform that’s set to redefine what is possible for the world of equity crowdfunding. In this blog post, we’ll delve into the intricate details of Dacxi Chain, its innovative approach to equity crowdfunding, and the pivotal role of its native cryptocurrency, Dacxi Coin.
The Vision and Mission of Dacxi Chain
The core mission of Dacxi Chain is to democratize access to investment opportunities and create a truly global equity crowdfunding ecosystem. By connecting multiple, independent, and fully licensed local equity crowdfunding platforms from around the world, Dacxi Chain is able to create a seamless, interconnected investment experience for users across the globe.
Ian Lowe, the CEO of Dacxi Chain, explains that the company aims to “turn a whole bunch of otherwise disparate and disconnected local equity crowdfunding propositions into a singular global proposition.” In other words, the platform seeks to enable investors from all walks of life to participate in growth opportunities, regardless of their location or the local currency they use.
For a more in-depth look at the Dacxi Chain vision and the exciting potential it holds, be sure to watch Ian Lowe’s video, where he, as the CEO of Dacxi Chain, provides a comprehensive overview of the project and its unique approach to tackling the challenges of global equity crowdfunding.
A Practical Example of Dacxi Chain in Action
To illustrate the transformative potential of Dacxi Chain, let’s consider a practical example involving a licensed crowdfunding platform in Korea. Let’s say this platform, which typically connects Korean investors and Korean growth companies that seek growth capital – all in Korean Won – is connected to the Dacxi Chain network.
As part of the network, the Korean platform can now share local investment opportunities with the rest of the world, while also giving its users access to additional investment opportunities from the rest of the world. This creates a powerful network effect, opening up new avenues for investment and growth for both businesses and investors.
Now, let’s imagine another licensed equity crowdfunding platform in Germany, is also connected to the Dacxi Chain network. German investors can now access deals from Korea, while German companies seeking capital can tap into a pool of potential investors in Korea. And the same in reverse – Korean investors can see and invest in opportunities in Germany, and Korean companies can raise growth capital from investors in Germany.
This simplified example of the network effect, played out across many platforms and countries, creates previously unseen access to vast amounts of growth capital, and previously unseen access to a vast catalog of investment opportunities from around the world.
It also creates a complex web of transactions across multiple currencies in all directions, presenting unique challenges and requiring an innovative approach to cross currency, cross market payments.
The Role of Cryptocurrency in Dacxi Chain’s Vision
Cryptocurrency plays a central role in Dacxi Chain’s mission to revolutionize global equity crowdfunding. With its ability to facilitate fast, efficient, and cost-effective transfers of funds between different local currencies, cryptocurrency offers an ideal solution to the challenges posed by cross-border transactions.
However, not all cryptocurrencies are suitable for this purpose. Fiat currencies are slow and expensive, Bitcoin is not a long term viable payment currency, and stablecoins face regulatory hurdles and accessibility challenges. This is where Dacxi Coin, the native coin of the Dacxi Chain ecosystem, comes into play.
The Advantages of Dacxi Coin
With a native coin, the Dacxi Chain platform can control the method, timeliness, and fees associated with transferring funds around the world. Instant transfers protect both investors and companies from fluctuations in coin value, ensuring a secure and stable investment experience.
As the Dacxi Chain network grows and attracts more users, the liquidity of Dacxi Coin will also increase. This, in turn, will draw more traders to the coin, contributing to demand and positioning Dacxi Coin as an attractive investment opportunity. In essence, Dacxi Coin is central to the success of the Dacxi Chain solution, playing a pivotal role in revolutionizing global equity crowdfunding.
Why Fiat Currencies Fall Short
Fiat currencies, while the traditional choice for cross-border transactions, are simply not up to the task when it comes to facilitating the kind of seamless, interconnected investment experience that Dacxi Chain requires. These currencies are slow to transfer and via established banking and payment rails, attract exorbitant fees, making them an impractical choice for a platform like Dacxi Chain which relies on speed and efficiency to deliver its services.
The Limitations of Bitcoin and Stablecoins
While Bitcoin has earned its place as a valuable store of wealth, it falls short as a payment currency. With high transaction fees and limited accessibility, Bitcoin simply isn’t a practical choice for a global equity crowdfunding platform like Dacxi Chain.
Stablecoins, on the other hand, offer more liquidity and are an improvement over Bitcoin in terms of transaction fees. However, they still face significant regulatory headwinds, with authorities in various markets applying increasing scrutiny. Moreover, major exchanges promoting their own stablecoins have started to block other competitors, further exacerbating the accessibility challenges for everyday investors.
Conclusion: The Future of Global Equity Crowdfunding with Dacxi Chain
Dacxi Chain represents a new era in the world of equity crowdfunding, leveraging the power of cryptocurrency to create a truly global, interconnected investment ecosystem. By harnessing the potential of its native coin, Dacxi Coin, the platform is poised to overcome the limitations of traditional financial systems and revolutionize the way businesses and investors connect.
As the network expands, so too will the liquidity and demand for Dacxi Coin, further cementing its place as an integral component of the Dacxi Chain solution. With its innovative approach, Dacxi Chain is set to democratize access to investment opportunities, opening up new horizons for both investors and growth companies alike.
The future of global equity crowdfunding is here, and Dacxi Chain is leading the charge. Through the power of cryptocurrency and the ingenuity of its platform, Dacxi Chain is poised to reshape the investment landscape and usher in a new era of financial inclusivity and opportunity. Don’t miss your chance to be part of this groundbreaking revolution – join the Dacxi Chain community today, and experience the future of equity crowdfunding for yourself.
CrowdFunded Giants: Crafting Success with BrewDog – A Tale of Craft Beer Revolution
The Power of Equity Crowdfunding
Welcome to the CrowdFunded Giants series, where we shine a light on the remarkable journeys of successful crowdfunded companies. In our inaugural episode, we raise a glass to the phenomenal success story of BrewDog, a trailblazing craft beer company that leveraged the power of equity crowdfunding to revolutionize the industry and achieve international stardom.
BrewDog: A Crowdfunded Craft Beer Empire’s Remarkable Journey
From humble beginnings in 2007, BrewDog, founded by James Watt and Martin Dickie from Scotland, embarked on a mission to bring fresh flavours and a passion for quality beer to the masses. Their meteoric rise to global prominence can be attributed to a combination of dedication, innovation, and an unwavering commitment to their vision.
Equity for Punks
A game-changer in the world of funding, BrewDog launched its first crowdfunding campaign, “Equity for Punks,” in 2009. The goal was to raise capital to expand production and distribution while preserving their independence from traditional investors. This groundbreaking approach struck a chord with the public, attracting thousands of investors eager to be part of a company that dared to challenge the status quo in the craft beer industry.
“Equity for Punks” turned out to be an astounding success, raising £750,000 from more than 1,300 investors. This achievement paved the way for four additional rounds, collectively amassing over £74 million from over 100,000 investors worldwide. These funds enabled BrewDog to scale its operations, open bars globally, construct a state-of-the-art brewery in the United States, and even launch a television network dedicated to craft beer.
Investors who backed BrewDog during its equity crowdfunding campaigns in 2017 saw impressive returns on their investments. The company’s Equity for Punks IV campaign raised over £26 million from 50,000 investors, with a minimum investment of just £25. By 2019, the value of the company had doubled, with the company’s founders James Watt and Martin Dickie announcing that investors who had backed the 2017 campaign would see returns of up to 2,800% on their initial investment.
Fostering a Loyal Community
The crowdfunding campaigns didn’t just provide BrewDog with the necessary capital to grow but also fostered a strong sense of community among its investors. The company’s loyal fan base has been instrumental in driving its success, as they act as brand ambassadors, spreading the word about BrewDog’s products and ethos.
Embracing Transparency and Sustainability
BrewDog’s commitment to transparency and sustainability has further endeared it to its customers and investors. The company has implemented various eco-friendly initiatives, such as using renewable energy to power its breweries, repurposing waste products, and purchasing an area of land in Scotland to create a BrewDog forest for carbon offsetting purposes.
While BrewDog’s rapid expansion has not been without its challenges, the company has taken them in stride, using them as opportunities to learn, grow, and improve its business practices. Despite facing scrutiny and criticism regarding its marketing tactics, corporate culture, and environmental impact, BrewDog has maintained its commitment to transparency and sustainability.
Inspiring a New Generation of Craft Beer Enthusiasts
One of the key takeaways from BrewDog’s remarkable success story is that equity crowdfunding can be a game-changer for startups. By harnessing the power of the crowd, BrewDog was able to maintain its independence, foster a loyal community, and secure the necessary capital to fuel its rapid expansion. This approach has allowed the company to disrupt the beer industry and inspire a new generation of craft beer enthusiasts.
China: The Next Frontier for BrewDog’s Expansion
Looking towards the future, BrewDog has set its sights on China as the next frontier in its global expansion plans. In 2023, the company announced a joint venture with Budweiser China to produce its flagship craft beer, Punk IPA, at the Putian Craft Brewery in Fujian province. The beers will be sold through Budweiser China’s sales and distribution network, providing BrewDog with a strong foothold in the Chinese market.
The move into China is a significant step for BrewDog, as it marks a continuation of the company’s mission to disrupt the beer industry and drive growth through innovative strategies. With plans to open several new bars in China and tap into the country’s burgeoning craft beer scene, BrewDog is poised for further success and expansion.
Final Thoughts: The Potential of Equity Crowdfunding
BrewDog’s remarkable success story serves as a testament to the power of equity crowdfunding and the potential it holds for startups and established businesses alike. By leveraging the power of the crowd, BrewDog was able to maintain its independence, foster a loyal community, and secure the necessary capital to fuel its rapid expansion. With its expansion plans into China, BrewDog is poised to continue disrupting the industry and inspiring a new generation of craft beer enthusiasts. The company’s commitment to transparency, sustainability, and community-building is a shining example of what can be achieved through innovative financing methods and a passion for quality products.
Are you interested in learning more about equity crowdfunding and its potential to help businesses like BrewDog thrive? The Dacxi Chain and its global equity crowdfunding network are revolutionizing the way businesses connect with investors. Visit dacxichain.com to discover how you can be part of this exciting new world of global crowdfunding and help shape the future of innovative enterprises.
Join the Dacxi Chain Revolution Today – Visit dacxichain.com!
Navigating the Post-Banking Crisis Landscape: Dacxi Chain's Global Crowdfunding Solution for Tech Startups
The collapse of Silicon Valley Bank (SVB) was a monumental event that sent shockwaves through the global economy. This devastating financial catastrophe, the largest since the 2008 global financial crisis, left thousands of tech startups in limbo. With many startups relying on the bank for early-stage funding through SVB Venture loans the collapse has undoubtedly made it harder for these young companies to secure the capital they need to grow and succeed. In light of these challenges, some startups may be forced to merge or collapse, and the possibility of further banking collapses only exacerbates these problems. Amid this uncertainty, Dacxi Chain emerges as a powerful alternative financing solution. By leveraging a globally networked ecosystem of crowdfunding companies, the Dacxi Chain provides much-needed support for tech startups in these turbulent times.
The Current Funding Landscape for Startups
The collapse of SVB highlighted the vulnerabilities in traditional funding models for tech startups. Reliance on centralized institutions for early-stage financing can result in a domino effect of problems when these institutions falter. The impact of the SVB collapse has left many startups scrambling to secure funding, and the uncertainty surrounding the future stability of other banks creates additional challenges for tech companies seeking investment.
Ethan Kurzweil, a partner at Bessemer Venture Partners, shared his thoughts on the current startup funding environment via email. He acknowledged that SVB’s downfall leaves a “clear void” if the bank’s startup-focused services like venture debt are not maintained. However, he also pointed out that high-interest rates and a “pseudo-recessionary environment” for selling new products have a more direct impact on the funding landscape. (Yahoo Finance)
Furthermore, a recent survey by NFX revealed that over 60% of the 800 founders in their network are worried that SVB’s collapse will make the already challenging fundraising environment even tougher. This sentiment further emphasizes the need for alternative funding solutions to support startups during these uncertain times.
Moreover, the financial crisis has prompted a shift in investment strategies, with many investors turning to private equity as an alternative to stocks, bonds, and shares. This shift further underscores the need for innovative funding solutions that cater to both startups and investors.
Introducing the Dacxi Chain Solution
The Dacxi Chain offers a unique solution to the funding challenges faced by tech startups in the wake of the SVB collapse. By creating a globally networked ecosystem of crowdfunding companies, the Dacxi Chain enables startups to access alternative sources of financing, bypassing traditional banking institutions and their inherent risks. This groundbreaking approach empowers tech companies to raise capital from a diverse and global investor base, ensuring their continued growth and success despite the uncertain economic climate.
The timing of the Dacxi Chain’s emergence is crucial, as the current situation provides the perfect opportunity for the platform to showcase its innovative approach to crowdfunding. The financial turmoil has created a void in the startup funding landscape, and the Dacxi Chain is poised to fill that void by offering a reliable, efficient, and secure alternative to traditional financing methods.
A quote from Ian Lowe, the CEO of the Dacxi Chain, highlights the significance of this moment: “The collapse of Silicon Valley Bank has highlighted the risks of an overly centralized startup funding ecosystem, but it’s also created a unique opportunity for alternative financing solutions like the Dacxi Chain. We’re in the right place at the right time to help tech startups overcome these challenges and unlock their full potential.”
The Benefits of the Dacxi Chain’s Global Crowdfunding Ecosystem
The Dacxi Chain’s globally networked ecosystem of crowdfunding companies provides several key advantages for tech startups and investors alike:
Scale: By uniting the world’s investor bases, the Dacxi Chain creates an enormous global investor community that no single platform could hope to achieve. This ensures a sufficient number of investors with interest in every conceivable deal concept.
Decentralization: By leveraging a decentralized network of crowdfunding platforms, the Dacxi Chain reduces the risks associated with relying on a single, centralized institution for funding.
Diversification: The global reach of the Dacxi Chain allows startups to access a diverse range of investors, increasing their chances of securing the funding they need to succeed.
Flexibility: The Dacxi Chain’s ecosystem is adaptable and can accommodate a wide range of investment strategies, including private equity investments, making it an attractive option for investors seeking alternative investment opportunities.
Security: The Dacxi Chain blockchain employs advanced security measures to protect the investments and personal data of its users, ensuring a safe and secure environment for both startups and investors.
Closing Thoughts
The collapse of Silicon Valley Bank was a stark reminder of the fragility of traditional funding models for tech startups. With thousands of companies left in limbo and the potential for further banking collapses, the need for alternative financing solutions has never been more apparent. The Dacxi Chain, with its innovative approach to crowdfunding and globally networked ecosystem, presents a promising solution for tech startups seeking funding in these uncertain times.
By providing a decentralized, diverse, flexible, secure, and supportive platform for startups and investors, the Dacxi Chain is well-positioned to help companies overcome the challenges posed by the current financial landscape. As Ian Lowe, CEO of the Dacxi Chain, put it: “We’re in the right place at the right time to help tech startups overcome these challenges and unlock their full potential.”
As the global economy continues to evolve and adapt to the consequences of the SVB collapse, the Dacxi Chain stands as a beacon of hope for tech startups and investors alike. By embracing this innovative crowdfunding solution, startups can secure the funding they need to thrive, while investors can access new and exciting investment opportunities in the burgeoning world of private equity.
Is Equity Crowdfunding a Good Investment? Dacxi Chain's Transformative Potential
As the world of investment opportunities continues to evolve, equity crowdfunding is quickly gaining traction as an alternative investment vehicle. This innovative approach allows investors to contribute capital to early-stage companies in exchange for equity, allowing them to participate in the growth and success of these companies. In this article, we will discuss the merits of equity crowdfunding as an investment, and towards the end, we will explore the transformative potential of the Dacxi Chain Global Equity Crowdfunding Solution.
The Rise of Equity Crowdfunding
Equity crowdfunding has experienced tremendous growth in recent years, with the market’s value predicted to reach new heights. This surge in popularity is largely attributed to the democratization of investment opportunities, which has enabled everyday investors to access a previously exclusive domain of Venture Capital companies and their institutional backers. By investing in startups and small businesses, individuals can now play a more active role in nurturing innovation, job creation, and economic development.
The Benefits of Equity Crowdfunding
- Access High-Growth Potential: The allure of hyper-growth. Investing in early-stage companies presents the exhilarating chance to participate in a startup’s hyper-growth journey. When these ventures succeed and expand rapidly, the return on investment can be extraordinary, igniting the passion of investors as they contribute to the development of groundbreaking ideas and thriving businesses.
- Diversification: Equity crowdfunding allows investors to diversify their portfolios by investing in a wide range of industries and sectors. This diversification can help mitigate risk, as it reduces the impact of poor-performing investments.
- Supporting Innovation and entrepreneurship: Equity crowdfunding enables investors to contribute to the growth and success of innovative ideas and businesses. By backing new ventures, investors help foster a vibrant entrepreneurial ecosystem.
- Democratization of Investment Opportunities: Equity crowdfunding has opened the doors for everyday investors to participate in the world of startups, allowing them to invest in companies at various stages of development.
The Risks of Equity Crowdfunding and Its Market Share Challenge
As with any investment, equity crowdfunding comes with its share of risks. Potential investors should be aware of the following:
- High failure rate: Startups and early-stage companies inherently carry a higher risk of failure, which could result in the total loss of an investment.
- Limited information: Compared to publicly traded companies, private businesses may not provide as much information, making it more challenging to assess their potential.
- Illiquidity: Unlike publicly traded stocks, investments in private companies are generally illiquid, making it difficult to sell shares and realize gains.
These risks contribute to the primary reason equity crowdfunding holds only a one percent market share in early-stage innovation funding compared to venture capital: the challenge of achieving scale. Attracting a sizable crowd of investors to this sector has proven difficult, and crowdfunding remains largely localized in entrepreneurial hubs like California, New York, London, and Berlin. The vast majority of the world, home to 90 million potential investors, has yet to embrace this new sector. As a result, the industry has struggled to gain national or global traction, inhibiting its growth and impact.
Dacxi Chain Global Equity Crowdfunding Solution: A Transformative Landscape
In light of the risks and challenges associated with equity crowdfunding, the Dacxi Chain Global Equity Crowdfunding Solution aims to revolutionize the landscape. By leveraging blockchain technology, the Dacxi Chain solves the scale problem and creates a global crowdfunding solution akin to how the internet eliminated distance as a factor for accessing information.
The Dacxi Chain is a network of local crowdfunding companies where deals are tokenized on the blockchain and shared globally. Payments are made locally and then transferred globally using the Dacxi Coin, the native currency of the Dacxi Chain. This approach fosters transparency, security, and efficiency, addressing the challenges facing investors and businesses alike.
With its blockchain foundation, the Dacxi Chain ensures that transactions and records are secure, tamper-proof, and easily accessible. This increased transparency allows investors to make better-informed decisions, while businesses benefit from improved trust and credibility.
The platform also streamlines the investment process, making it more efficient and cost-effective for both investors and businesses. Through smart contracts, the Dacxi Chain automates many aspects of the investment process, reducing the administrative burden and lowering barriers to entry for investors.
Furthermore, the Dacxi Chain facilitates secondary market trading, addressing the issue of illiquidity often faced in equity crowdfunding investments. By providing a platform for investors to trade their shares, the Dacxi Chain enhances liquidity and enables investors to better manage their portfolios.
Final Thoughts
Equity crowdfunding presents a unique and exciting investment opportunity, enabling investors to participate in the growth and success of early-stage companies. While there are inherent risks associated with investing in startups, the potential for high returns and the opportunity to support innovation make it an attractive proposition for many.
The Dacxi Chain Global Equity Crowdfunding Solution aims to transform the landscape by addressing some of the challenges faced by investors and businesses in this space. With its focus on scaling, transparency, security, and efficiency, the Dacxi Chain is poised to usher in a new era for equity crowdfunding, making it an even more viable and attractive investment option.
In conclusion, while equity crowdfunding may not be suitable for every investor, its potential for high returns, diversification, and support of innovation make it a compelling addition to a well-balanced investment portfolio. As solutions like the Dacxi Chain continue to improve the equity crowdfunding experience, we can expect this form of investment to gain even more traction in the coming years.