2. 2
Agenda
1. The pain points of Venture Financing
2. The rise and rise of crypto tokens
3. New kids from the “block”
4. Opportunities and challenges
3. 3
Source: Earlybird, AL
The struggles of Venture Financing
Startup VC
LP
• Risk return profile against other assets
• 6+ months roadshow
• Access to capital (pre
IPO)
• “Hit big, miss big”
• Illiquidity of assets
4. 4
Source: Earlybird
How ”hit big” led to a centralized world
• Network- & Lock in effects
• Hyper growth mechanics
• Creation of gigantic new
markets
• Shaping / creating new
economies
5. Centralized networks come with downsides
5
Algorithmic abuse
Censorship
Single points of failure
Wealth creation for very few
Mass Surveillance
Lack of innovation
Filter bubbles
Transaction costs
6. 6
Agenda
1. The pain points of Venture Financing
2. The rise and rise of crypto tokens
3. Introducing the new kids from the “block”
4. Opportunities and challenges
8. What’s so special about crypto tokens?
8
Equity Tokens
Liquidity low high
Access exclusive, local inclusive, global
Growth mechanism NW effect NWO effect
Execution of rights courts automated
Capital efficiency milestone based “all in” ICO
DD & Regulation standardized wild west
Tokens represent an atomic unit of an organization’s business
model.
9. Will crypto tokens make VCs disappear?
9
„(...) You can
basically throw the
venture playbook out of
the window.
This completely
destroys the existing
Venture business model,
which is based on
proprietary access
early on. Now everybody
has that.“
Naval Ravikant
Founder & CEO AngelList & Coinlist
(@Blockstack Conference, Aug. 2017)
14. 14
Agenda
1. The pain points of Venture Financing
2. The rise and rise of crypto tokens
3. Introducing the new kids from the “block”
4. Opportunities and Challenges
16. 50 shades of smart smoney
16
Limited Partners
Inv. Strategy
Portfolio
Market Position Independent Strategic
Inst./Accr. Public
Value Inv. Trading
Hybird Tokens only
17. 17
Agenda
1. The pain points of Venture Financing
2. The rise and rise of crypto tokens
3. Introducing the new kids from the “block”
4. Opportunities and Challenges
18. Opportunity: Tokenization just started
18
2013
<$5bn
2014
$10bn
$6bn
2016
$15bn
2027*2015
$100bn
2017e
Sources: Coinmarketcap.com, WEF. 10% of global GDP (today 80 tn).
http://www3.weforum.org/docs/WEF_GAC15_Technological_Tipping_Points_report_2015.pdf
$8tn
80x
. . . . . . . .
Software Tokens are eating the world
• Private Equity
• Stocks
• Real Estate
• Fine Art
• Commodities
• Gaming / itmens
19. Discussing the challenges ahead
19
• ICO structuring & crypto economic design
• No standardized Evaluation methods & DD processes
• No sufficient Market Liquidity
• Immature technical infrastructure / security
• No Investor protection rights
• High Regulatory uncertainty
20. Looking forward to getting in touch!
20
@EarlybirdVC
alex@earlybird.com
@EarlybirdVC
https://medium.com/birds-view
@alexruppertVC