I love spreading the word about TBOs! In my mind, it's just a better all-around fundraising solution. It's pretty clear that the easy money has been made in this industry. But that doesn't mean that there aren't a lot of opportunities out there to make life-changing investments. Now may be the perfect time to commit fresh capital to the cryptosphere due to the evolving nature of token-based capital raises. The blockchain asset industry is moving away from funding the dreams of “two geeks and a whitepaper” via public crowdsales, or what many people call initial coin offerings (ICOs), toward a dilution-free extension of the entrepreneurial runway via tokenized business offerings (TBOs).
People just haven't realized yet that that's what is happening. ICOs, at least in the traditional way that we refer to them, are dead. The days of raising $40 million in an hour via the Ethereum network are gone, never to come back again. The plummeting value of ETH proves this maxim.
No crowdsales, no use case for ETH, no value.
That was the message I spread on Thursday September 6 at Let's Talk Blockchain, a community event organizer sponsored by ViewFin, the company behind the very first Chinese cryptocurrency project Metaverse(ETP).
The main thesis of my talk was that fundraising mechanisms are always evolving. The main idea that spurred the traditional ICO to prominence in 2017 is a reaction to the dramatically reduced access that regular folk have to the part of the capital markets where potentially life-changing, alpha-generating investments exist. The longer that bleeding-edge technology behemoths stay private, the less impact their going public has on the wallet of the common man.
PE and VC whales, and the rich families and lucky individuals that fund them, get bigger and bigger. The hoi polloi minnows get more and more painted into the corner of workaday life.
Traditional ICOs were supposed to disrupt that powerful trend. But, as is often the case with new movements, they were coopted by the very forces they were intending to displace. Such is the power of the dialectic. Private sales, read VC whales, and certainly not crowdsales, are how blockchain startups raise money these days. That looks like it is going to be the case for the foreseeable future.
But that doesn't mean that token-based capital raises don't have a future!
Token-based capital raises are just evolving, like all funding mechanisms do. Their next, better iteration is TBO.
What is a TBO?
A tokenized business offering (TBO) creates a tokenized ecosystem based around an existing platform solution that requires an easily verifiable utility token to unlock features of the platform. They may often require staking those tokens on a blockchain as a prerequisite for platform participants to perform work, and get compensated with utility tokens for that work, in the ecosystem.
That's my idea and I think it's pretty useful in terms of wresting power away from the powerful forces of private money and giving some of that power back to entrepreneurs and their minnow investors directly.
I'll keep telling this story for as long as people are willing to listen. It's that important to me, to investors, and to the overall future of the blockchain industry.
Please ask me anything or make any helpful comments below! 👇👇👇
To read my first post about TBOs, please visit my Medium channel.