Investing in startups and innovation has always been the tool with which humans improve the present in order to create their future SEED Venture, the open source platform based on blockchain technology, was created to stimulate venture capital and improve the funding aspect of this ecosystem: as CEO William Pividori says.
This will be the place where investors, incubators and their startups can meet and interact freely without intermediaries, in a transparent and immutable environment, minimizing risks and sharing objectives, to ensure that no good idea goes to waste. WHY ARE PEOPLE STILL AFRAID OF INVEST ING IN STARTUPS NOWADAYS? We believe that investing in startups and allowing them to grow is of fundamental importance, as innovation has always been the tool with which humans improve the present in order to create their future. It is also an investment that, if successful, yields enormous profits. Currently, the way to finance a startup idea is to buy shares in companies through capital increases, hence only on those occasions and with fixed amounts. Result: a very high risk, because you “bet everything” on a single startup (statistically 9 out of 10 do not achieve success), and the illiquidity of the shares (5 years or more on average).
SEED Venture radically changes the approach for investors and the business rules for incubators and their startups, all while adhering to the philosophy at the core of blockchain technology: thanks to the platform, anyone can access freely without any predetermined requirements or constraints, participating in a transparent, fluid and advantageous way within the ecosystem. Competition, reputation and results will drive all players to converge towards a single goal: capital that supports innovation and that, driven by the talent and ideas of the startups along with the managerial support skills of the incubators, will compete to achieve success and profits.
HOW DOES SEED VENTURE WORK? SEED Venture is an open and decentralized platform, currently based on the Ethereum blockchain. This solution solves the major problem of bringing together the capital needed to launch innovative projects and ideas. The blockchain-based nature of SEED Venture is the pillar on which the platform’s activity is based, and the solution for a venture world that is struggling to grow; the startup projects do not necessarily have to be inherent to the crypto and blockchain world. Investors can choose how much to finance, when to do so, and what to finance, in a totally autonomous and transparent way, furthermore, they can also verify the use of the funds. Startups will be funded and supported by incubators in each phase of the investment and growth plan presented, without fundraising being the main focus.
The incubators will be encouraged to choose with caution and confidence the projects and startups of their pool, which they will assist and support in achieving success. WHAT ROLE DO INCUBATORS PLAY IN THIS PROJECT? The mechanisms of the platform do not propose financing a single startup, as it has been shown to be very risky, but a pool of several, carefully selected by the most talented incubators who are encouraged to do so by putting their reputation on the line. The role of incubators within SEED Venture is fundamental, and will be key to the true functionality of the innovation ecosystem: today most of them provide space, courses (mentoring and training) and networks to access funds, but rarely a really interested, specific and lasting managerial support; there is no real economic incentive to do so, because the current model is neither stimulating nor generates competition.
In SEED Venture, on the other hand, the incubators, by adopting a rewarding economic model and gaining a reputation by playing on an equal footing, will be encouraged to give their best so that the projects they manage can achieve success, which means earnings for everyone and a continuous flow of capital. WHAT ARE THE ADVANTAGES FOR INVES TORS? Our goal is to bring startups closer to those investors who are startled by the world of illiquid shares and by the very high risk of non-return, or worse, loss of invested capital: with SEED Venture the investor will be making a conscious choice to finance innovation, obviously still accepting a risk component, but certainly inferior.
Thanks to SEED Venture the investor will also be able to follow the projects throughout their progress in an active way, ready to reduce, modify, suspend the financing of one or more startup pools in the face of poor results. The free decision to invest will be immediate, public, immutable, and not conditioned from the point of view of amount or time. The risk for the investor is minimized because the startups that do not comply with the submitted plans, which the incubator will attest, will not receive additional funds; the investor can finance more pools or directly purchase tokens representative of already funded pools, then switch from one incubator to another, and invest in more pools.
SEED Venture is the platform with which it will be possible to overcome the very concept of venture as a niche activity, reserved for a few operators able to juggle the complex problems of valuation, and opening the doors of innovation for the common investor, who until now has prudently stayed away. WHAT IS THE CURRENCY OF EXCHANGE USED BY THE SEED VENTURE PLATFORM? The platform uses SEED, a native token with which investors will participate in the financing of startup pools represented by the incubators. The first Exchange that started the negotiation of the SEED token is The Rock Trading, an Italian Exchange which is a guarantee of reliability, solidity and reputation. The listing on centralized exchanges ensure easy and immediate value conversion, and the value will be influenced by the platform’s functionality, by the quantity and quality of the startup players and pools and, above all, by the support of the incubators. Thanks to the ownership of the SEED token the investor has access to the platform.
The token can also be transferred to the financing contracts of the various pools or used to obtain tokens of the incubators already issued within the platform by means of an internal Decentralized Exchange (DEX). The exchange rate risk is closely linked to the price of SEED tokens on the exchanges, which is expected to be volatile in the early stages of the platform’s life. The demand will be that of investors, who will be able to attract the reputation of the incubators, eager to finance innovation with a view to keeping the investment liquid and mitigating the risk.
The offer will be that of the startups, who will sell SEED tokens to finance their projects, using over the counter for example, with the mediation of the incubators to mitigate the exchange rate risk, so as not to induce abrupt changes in prices. The SEED Venture platform will be launched, and will become independent, in the summer of 2019; it will be an instrument whose adoption will serve both as a stimulus to the growth of the real economy, as a new financial education and finally as a healthy competition to avoid wasting projects and money