The secret of the "through" IPO of the A round was the issue of Equity Token?

Author: Nan Xin

A few days ago, a German financing platform used a blockchain to help an A-round company achieve an "IPO".

The total financing amount of the blockchain-based "IPO" was 1.4 million euros (approximately RMB 10.9 million), which attracted 1017 investors from 34 countries.

IPO and ETO

On December 6, according to Bitcoinist, Greyp, a high-tech company focused on the development of high-performance electric bicycles, completed a blockchain-based initial public offering (IPO) through blockchain fundraising platform Neufund.

According to public information, Greyp is a sister company of electric vehicle manufacturer Rimac automobile, led by Porsche and Camel Group. Partners include multinational mobile phone operator T-Mobile and German blockchain company Slock.it. The Greyp team currently has 68 employees, and more than half are engaged in research and development.

The report believes that this public fundraising through blockchain is of great significance. Thanks to the Neufund platform, private enterprises can use blockchain technology for IPOs.

Neufund is a compliant Equity Token Offering (ETO) enterprise.It has tried to use blockchain to raise funds and invest for enterprises since 2016.

As early as July 2018, Neufund partnered with the Malta Stock Exchange to establish a "regulated and multi-centralized global stock exchange for listing and trading tokenized securities and crypto assets."

Neufund's model is to issue Equity Token for enterprises that need financing support. The issue process is supported by blockchain technology, and the tokens are linked to the company's equity.

Investors can use ETH and Euros to purchase these equity tokens on the Neufund platform, with a minimum investment of 10 Euros per investor.

In other words, for companies that have issued equity tokens, the stocks of each share may be both large institutional investors and small retail investors. (A bit similar to equity crowdfunding platforms)

Investors who hold stock tokens may be entitled to dividends and have the authority to vote on shareholder resolutions. The user's equity transaction record will be kept on Ethereum.

In addition to the gains from investing in corporate equity tokens, investors will receive NEU tokens (Neufund platform tokens) for every investment in equity tokens. Investors holding NEU tokens will share part of the platform's revenue.

It is understood that equity tokens issued through Neufund can be traded on any licensed exchange that cooperates with Neufund. Neufund has established partnerships with Binance, BitBay, MSX of Malta Stock Exchange and Blocktrade.

Help companies raise funds quickly and lower the barriers to entry for investors

For most of the A-round companies like Greyp, if they carry out the IPO according to the traditional model, they may also go through the B-round, C-round or even D-round. In this way, there is still a long way to go before the real IPO. Neufund has shortened the time cost of corporate IPOs, which is indeed a big improvement.

Others believe that the use of ETO lowers the barriers for investors to enter the market, which can be regarded as a public invitation to individual investors. Looking at the data, the Neufund platform has brought together more than 11,000 investors in 111 countries.

Of course, blockchain-based equity tokens are not a new thing. The model of equity tokens was once considered by the industry as a "classic VC round with the advantages of both IPO and ICO advantages." Recently, there are teams in this field work hard.

For some traditional companies hoping for a formal IPO in the future, there are various uncertain regulatory factors for coin issuance. Therefore, equity tokens issued within the scope of compliance are a more preferred option with relatively high cost performance.

For example, in November of this year, Algorand officially disclosed that the Chess Organization announced that it will conduct a "Hybrid IPO" through Algorand. It will first issue securitization tokens and list on the British AIM traditional market in 2020. After the AIM is listed, investors can Convert securitized tokens into shares.

It is mentioned in the report that for the chess industry that has not been commercialized, most of them have been chronically short of funds. Chess plans to sell approximately 4% to 6% of the company's shares to qualified investors in the United States and the European Union, first raising "a few small dollars of millions of dollars" to prepare for listing.

According to reports, the relevant person in charge of chess said that this is a simpler way to introduce investors without having to go through a relatively tedious process of selling shares.

Speaking of the success of the initial public offering, Neufund founder Zoe Adamovicz said the end of the IPO is significant for both Neufund and the STO circuit.

Neufund believes that asset tokenization will bring many benefits, such as automated compliance, reduced costs, unlimited trading throughout the day, sharing of property rights, and true financial inclusion.

Odaily Planet Daily checked Neufund's official website and found that except for Greyp, which has been closed, there is also a one-stop entertainment ecosystem on the Neufund platform, BLACK ONE ENTERTAINMENT GROUP, e-commerce project MYSWOOOP, new energy project AIRPROFILE, electric vehicle company EMFLUX, and cryptocurrency wallet NGAVE Wait for 5 items waiting for sale.