A year ago, Skype co-founder Jaan Tallinn and Funderbeam co-founder, Urmas Peiker, had a vision of a blockchain-trading platform designed for new startups looking for angel investors. A service to give these new ventures a leg up before they go public or are sold.
A year later, incubator Funderbeam has launched its innovative trading platform for startups saying it is “the first time in history where startup investments are being traded using blockchain technology.”
Funderbeam’s goal is to change the game for early stage investors, making it their own choice as to how long they want to hold on to their investments. By using the Bitcoin blockchain to “tokenize” the investments, Funderbeam wants to make trading secure, efficient, open and transparent.
“Investing in the future will be digital, always on, and transparent. As will companies,” said Kaidi Ruusalepp, Funderbeam’s CEO and co-founder and former CEO of Nasdaq Estonia. “I’m excited to see us take the first steps toward that future.”
The first two companies to be listed on the new exchange are two Estonian startups, Shipitwise and SportID. Both companies successfully conducted crowdfunding campaigns on Funderbeam first. A third startup, Sportlyzer, will follow shortly.
Funderbeam is currently working with interested young companies in the U.K., Germany and Finland to expand its service beyond Estonia but wants to conduct a trial run with the first three startups to ensure a smooth operation.
Venture capitalist Tim Draper said when Funderbeam first launched: “I love what they’re doing. You know, the existing public market is not working and Funderbeam is doing something about it.”
At the original announcement, CEO Ruusalepp predicted the growing importance of blockchain technology in the financial world:
“Blockchains are going to do for the financial sector what the internet did for daily life as we know it. Stock exchanges have many intermediaries between the money and the company. Securities depositories, central banks, central counterparties, brokers, dealers and account operators. The blockchain is taking the role of some of these intermediaries. So it’s making the process easier, cheaper and cross-border.”
Over the last year, Funderbeam has helped angel investors and entrepreneurs discover, benchmark and analyze startups, using data from services such as AngelList and CrunchBase.
Funderbeam has raised $2 million from investors to date and has an extensive data platform with information on more than 150,000 startups. The company’s website includes a detailed listing of new companies looking for funding, including how much has been raised to date as well as their funding goals and timeline.
Funderbeam plans to take a 3 percent commission from successful ventures and may introduce trading fees in the future.
Nasdaq has led the way in developing blockchain technology for trading platforms with its Linq project and is currently working with Estonia’s Tallinn Stock Exchange. Other exchanges developing or looking at applying blockchain include Deutsche Borse and the Australian Securities Exchange.
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