According to Crunch Base, July set an impressive record for the number of “supergiant” VC rounds of $100 million or more. Following on from this, while August might not have been the strongest month, the summer overall has been incredibly positive which saw Q2 2018 set records for global venture deal and dollar volume. What’s more, this is only just the start as Q3 may improve on this, considering the huge rounds seen so far.
In addition to this encouraging news, other VCs around the world are using new technology and methods to improve how they operate. Bloomio, a blockchain based equity crowdfunding platform that allows investors to fund promising startups in return for tokenized shares, recently announced that it has appointed a new board of independent experts to conduct rigorous due diligence of the potential strength and scalability of startups applying to raise on the platform.
The panel is comprised of ten industry experts spanning various technological sectors – notable members including NeoFelis CEO Eduardo De Barrios, Metahash Chief Legal Officer Maria Agranovskaya, and Real Advisors founder Juliet Kasko. The experts have been carefully selected for their experience as business leaders, investors, and founders. They will not only add invaluable knowledge as assessors, but also as mentors to the startups which are selected.
“The primary profiles we considered were professionals with a track record in at least one relevant industry and people with experience dealing with and evaluating startups,” said the company’s co-founder Mark Shmulevich.
Bloomio is a pioneer in equity crowdfunding, a new form of investment which allows large groups of micro-investors to put money into projects in return for shares. Equity crowdfunding is designed to be much more accessible, and offers more investor liquidity than the lottery-esque venture capitalist (VC) system – a model which many argue is broken.
By hiring independent assessors with rigorous industry knowledge, Bloomio is cultivating an investor ecosystem which capitalizes on the benefits of the VC system. The external due diligence process, undertaken by at least two experts who meticulously analyse a startup’s team, product idea, innovation, product state and process maturity, provides prospective investors with reliable information and the assurance that they are not signing up to a scam.
The vast majority of other crowdfunding platforms conduct in-house due diligence, a tactic which can open the door to internal conflicts of interest, as the assessors hold a financial stake in the projects they are evaluating. Independent experts are crucial for conducting unbiased due diligence and subsequently maintaining the highest financial standards of equity crowdfunding.
By leveraging the best elements from blockchain crowdfunding and the VC system, the company is helping worthy projects to secure funds whilst simultaneously providing investors with improved access to expert industry guidance vis-à-vis other platforms.
“All in all, we witnessed a very positive reaction from those we offered the opportunity to join the Bloomio expert board,” said co-founder Shmulevich. “The idea of VC industry disruption – giving everyone an easy opportunity to invest and preserve liquidity in their startup investments – resonated well with them,” he said.
Bloomio was founded in 2017 with the objective of disrupting the venture capital industry. So far it has raised CHF 1.4 million in funds and plans to start up business in Q1 of 2019.
Disclosure: This article includes a client of an Espacio portfolio company