Zoe Adamovicz, CEO and Co-founder of Neufund, recently explained how a blockchain or distributed ledger tech (DLT)-powered fundraising platform actually works. Neufnd was established in 2016 and its main value proposition involves democratizing access to funding for  entrepreneurs and also to make it more convenient and secure for everyone to make such investments.

Crowdfunding has now become quite a widely-adopted way to provide funding for upstarts because of the requirements that investors and early-stage ventures typically have.

There are now many startup founders that have decided to use crowdfunding platforms to market their products and also to build a strong community and group of investors. Angel investors and VCs think that these platforms offer a more accessible way for startups to acquire funding without actually having to do a lot of leg-work trying to obtain financial assistance.

The blockchain or DLT-focused fundraising approach may have certain advantages but there are also some drawbacks like the relative uncertainty regarding compliance and applicable legislation (as it pertains to blockchain-based financing, for now at least).

These issues may be partially addressed by introducing various types of DLT-powered financing solutions like initial coin offerings (ICOs), security token offerings (STOs), or initial exchange offerings (IEOs).

These types of fundraising activities have helped with the effective management and distribution of assets or funds in a secure and transparent manner (on some occasions, but there have been numerous scams as well). There are many different fundraising platforms now for helping startups or NGOs that are planning to acquire funds to launch their businesses.

In a recent interview, Zoe talked about how to approach investments in these new platforms.

While commenting on what makes Neufund better or different from other fundraising services, Zoe noted that taking part in the investment space (from the fundraising and investing side), Neufund has seen how challenging it may be to find suitable partners and finalize deals.

She explained that fundraising requires a lot of time, upfront capital, and other types of resources, because each investor has to be taken care of individually or separately. She further noted that IPOs are only available to firms that have the adequate capital requirements of at least €100 million. She also mentioned that private firms are fairly limited by factors such as size, geography, and capital requirements, and many do not really fit into those traditional fundraising “boxes”.

She further explained that for investors, private markets are quite expensive and fairly inaccessible. She pointed out that access to unlisted equity is limited to accredited investors or those who invest €100,000 or as much as €200,000.

Zoe also mentioned that Neufund is a dual-sided platform that provides investment opportunities to investors and it also offers opportunities to acquire funding to firms. Investors and firms may sign up on the platform through an intuitive UI. The investment and fundraising process takes place on the platform itself, which helps with saving a lot of time and other resources, Zoe claims.

She also confirmed that Greyp bikes was the first retail offering that had been launched and fully hosted on the Neufund platform. The Greyp campaign showed how effective it can be to turn a community into active shareholders, and it also showed a way for firms to acquire funding outside of the more traditional startup hubs, Zoe added. She also noted that it proved that blockchain or DLT can support the future of finance.

The Greyp campaign lasted for 45 days and managed to acquire €1.4 million in capital from more than 1000 investors based in 34 different countries.

Zoe claims that Neufund enables flexible fundraising. She noted that as a business owner, you may be launching a new startup or are part of a more established company and are now prepared to grow. So, you may be a fundraising expert or even a novice. And thanks to their platform technology, businesses are carry out their campaigns (private or public) in an efficient manner, Zoe explained.

She confirmed that these processes are mostly automated, borderless, and companies are able to acquire funding from almost anywhere in the world. As the fundraising platform also supposes posting a prospectus, they do not have to deal with cap limitations, which more traditional crowdfunding platforms need to do, Zoe added.

She claims that Neufund has been lowering entry barriers because investors do not have to be accredited or qualified. They may be an individual, institution, or a VC firm that can invest as little as €10 or as much as €10 million, Zoe confirmed.

While sharing key milestones for Neufund, Zoe revealed that just 13 months after the platform was established, the very first campaign on the platform was also announced. Neufund’s ICBM managed to attract more than 1000 investors back in 2017.

Notably, Neufund carried out the first “fully compliant” public blockchain offering back in 2018. The first-ever blockchain or DLT-focused IPO via Neufund was finalized in 2019, with Greyp Bikes acquiring €1.4 million in funding. The campaign managed to attract 1017 different investors based in 34 countries, with only a €100 minimum investment requirement.

Neufund investors have committed nearly €20 million in total investments via the platform.

Last year, Neufund announced an additional €4 million of funding, which will be directed toward acquiring a financial license and also to support the ongoing development of new products.

Zoe also pointed out that they had been keeping a close eye on various blockchain sector developments and then realized that there was a key moment: we would be able to establish a legally-enforceable  environment for handling safe investments.

(Excerpt) Read more Here | 2021-02-20 10:15:34
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