World’s first equity token offering exceeds expectations
With ICOs leaving the spotlight, people are looking forward to better replacements.
Out with the old, in with the neu.
At the midway point of its equity token offering, Neufund has already raised €3 million, doubling its soft cap.
Increased regulatory scrutiny has seen ICOs pull back sharply in 2018, and start getting replaced by more regulatory-friendly alternatives such as security tokens. And based on the initial success of this equity token offering (ETO), it seems there's a real appetite for these new financial products, which might steadily replace ICOs if they prove their viability.
An all-around success
In total, Neufund now has more than €12 million in commitments for future investment. Notably, the success of this meta token offering might more directly reflect anticipation for the wider industry than most. This is because Neufund is a platform for tokenising equity, and its first ETO was the company selling its own equity through its own platform.
The token that was being sold here was FTH – an ERC20 representing ownership of equity in Fifth Force GmbH, the company that owns and operates the Neufund platform. Ownership of the FTH token entitles the holder to shareholder benefits such as dividends.
The fundraising effort succeeded in other respects beyond the amount raised in that it attracted more than 3,000 investors from 91 countries. This kind of reach might strongly point at the ability of these systems to go global and bring in investors who would have previously been less able to participate in this IPO-like effort.
It managed this at a time of tumultuous markets and at a time when venture capital is perceived as being increasingly wary of the space.
"Neufund's first Equity Token Offering has received overwhelming support from Europe's most experienced VC & angel investors, as well as entrepreneurs," said Neufund CEO and co-founder Zoe Adamovicz. "It is the first time such a diverse group of investors could come together so easily and invest within the same round. Blockchain-based equity fundraising offers highly liquid assets with codified functions such as dividend distribution and automated compliance – features that are beneficial to both companies and investors. Blockchain is not just cryptocurrencies: It is, above all else, a powerful technology enabling us to build better financial services."
“Neufund is a refreshing wind of change in the traditional VC and private equity worlds," said Michael Jackson, a prominent venture capitalist who last year committed funds for future investments in Neufund.
"Digitizing real-world equity into Blockchain-based tokens brings a variety of benefits," he explains. "Increased liquidity, programmable functions, full transparency, automated compliance, to name just a few. I'm excited to support Neufund, and truly believe we are on the way to making fundraising much more accessible."