In today’s article, we interview Zoe Adamovicz, CEO and co-founder of Neufund, to see how a blockchain-enabled fundraising platform works. The startup was founded in 2016, and its value proposition democratizes access to capital for innovators and entrepreneurs, making it easy, secure, and accessible for everyone to invest.
Crowdfunding has become a popular way to fund startups in recent years due to the needs of both startups and investors. Many startup founders turned to crowdfunding platforms to share their brand story, cultivate a loyal following, and receive support from potential investors. Angel investors, VCs, and more looked at platforms as an easy way to access startups needing investment without having to search extensively.
The blockchain fundraising approach has a range of benefits over conventional methods, but there has been uncertainty about legislation and compliance with blockchain financing since its introduction. This is partially solved by implementing new forms of blockchain financing solutions such as ICOs, STOs, or IEOs. This type of fundraising helps manage and distribute funds securely and transparently. Many fundraising platforms, either for startups or NGOs, function like this and have gained success in recent years.
By interviewing Zoe, we want to answer a few questions that will help us understand:
- What makes Neufund different from other fundraising platforms?
- How does their platform work, and why does this approach have more benefits than other conventional methods?
- How did you come up with the idea? What problem are you solving, and for what type of clients?
Participating in the investment ecosystem from both the fundraising and investing sides, we’ve experienced how hard it can be to find partners and close deals. Fundraising demands enormous amounts of time, capital, and resources, as each investor has to be handled individually. IPOs are only available to companies with capital requirements of €100M or more. Private companies are limited by size, geography, and capital requirements, and many just don’t fit traditional fundraising “boxes.” For investors, private markets are costly and inaccessible. Access to unlisted equity is restricted to accredited investors or those investing €100K or sometimes even €200K.
At the same time, we’d been watching the development of blockchain closely and realized it was a pivotal moment: we could build a legally-binding environment for safe investments. Finally, we had a chance to solve the problems we’ve been experiencing for years.
How Does Your Solution Work?
Neufund is a dual-sided platform that offers investment opportunities to interested investors and opportunities to raise capital for companies. Investors and companies can register on the platform using a user-friendly UI. The investment and fundraising process happens fully on the platform, saving time and resources.
Greyp bikes were the first-ever retail offering announced and hosted on Neufund. Together we made history. The campaign demonstrated the power of turning a community into shareholders, showcased a way for companies to raise capital outside of traditional startup hubs, and proved that blockchain makes the future of finance possible today. Altogether, the campaign lasted 45 days and collected €1.4M in funding from over 1000 investors from 34 countries around the world.
How Is It Better Than Other Solutions? What Is the Innovation That You Bring?
Neufund enables flexible fundraising: as an entrepreneur, you can be a startup or an established business ready to grow; you can be a fundraising novice or a curious veteran. Thanks to our platform technology, entrepreneurs can address venture capital, institutional and individual investors, and prepare their campaigns, private or public, easily and quickly, in mostly automated ways. It’s borderless: you can raise capital from anywhere and from investors anywhere. As the platform also supports publishing a prospectus, we don’t have cap limitations like traditional crowdfunding platforms do.
We also lower the barriers to entry in the world of investments: you don’t have to be an accredited or qualified investor; you can be an individual, institution, or venture capital firm, committing €10 or €10M.
How Was the Startup Evolution So Far?
We’re happy to have had a good track record so far with the following notable facts:
- 13 months after Neufund was founded, the first campaign on the platform was announced. Neufund’s ICBM attracted over 1000 investors in 2017.
- Neufund conducted the world’s first fully compliant public blockchain offering in 2018.
- The world’s first blockchain IPO on the platform was closed in 2019, with Greyp Bikes raising €1.4M. It attracted a total of 1017 investors from 34 countries, with a minimum investment of just €100.
- To date, investors through the platform have committed almost €20M.
- At the end of 2020, we announced €4M of funding, which will be used to obtain a financial license and accelerate the development of new products and notable hiring.
How Do You See It Growing in the Next 2-3 Years?
We aim to prioritize and work closer with impact-driven businesses that are, or could be, profitable while solving some of the world’s urgent problems and contributing to sustainable development. The market is still obsessed with unicorns, but many investors are looking for sustainable and impact-driven companies, and we are here to help them connect.
What Do You Think the Landscape of Fundraising Will Look Like 10 Years from Now?
We believe that the future belongs to a decentralized economy. In practical terms, that means transparent rules that are known to all participants, and equal access to information and investment opportunities, no matter your location, background, and wealth status. Our top priority is to give everyone equal access to investment opportunities and make investing easy and safe.
In conclusion, Neufund is an example of a blockchain-based fundraising platform that offers a different approach and that automates and streamlines the fundraising process for both startups and investors. We should look towards Neufund as a use case for their business model and approach towards their users and see how we can apply blockchain solutions to our users. By acknowledging the way Neufund works and understanding the processes they have, we can see how this solution is an alternative to accessing investment opportunities easily.