Blockchain revolutionizes fundraising exposing new perspectives on investing in startups

Fundraising for a business startup. Disappointment to find an investor

Your technology company has decided to launch a new project or boost its growth? Or maybe you want to start a project from scratch but don't have the necessary capital? In either case, you are most likely starting to look for ways for startup funding. It could be self-funding - say, you don’t have the huge capital in your nest; bank loan - which is given to well-established businesses and pretty risky during the dynamic inflation; venture capital or angel investor - costly, hard to find and persuade for startup investing. Today, it is possible to invest in startups online. Crowdfunding investments come into help opening huge startup investment opportunities. What is crowdfunding then? This is a form of investment that allows you to raise funds to realize your idea through the active participation of a large community - little and often fills the purse.

Crowdfunding investments open broad investment opportunities

Over the past decade, numerous crowdfunding platforms have emerged on the market focusing on fundraising for various fields. Since we are talking about the benefits for both investors and creators, investors are interested in equity crowdfunding. This is the fair form of the relationship between investor and creator, where the startup is offering various perks and benefits to the startup investors. Thus, thanks to crowdfunding, you can not only reach and show your startup to a broad audience - but also gain a reputation for the project among potential customers from all over the world.

Startup investors - you almost have them, but…

As an example, let's use a project from the longevity industry - a scientific project where it can take up to 10 years to develop one product. Would investors be happy about not being able to encash the investments during the project development? Investment in science is a different concept and not the same as supporting a music album or launching a clothing shop. Difficulties with the startup funding will arise during the crowdfunding stage - how to explain to investors that their hard-earned $50-300 invested in the project will pay off only after the project is fully ready for monetization - in 8-10 years. And even the finished MVP is incapable to change the mind of seed investors. This is one of the general problems for science fundraisers - convincing and captivating startup investors into the 10-year “funding crusade”. Also, let's not forget that big corporations often act as venture capital and business angels. 

Invest in startups and put your investments into cold storage

Suppose the project manages to raise funds on fundraising platforms, and the development of the product begins. Suddenly one of the investors wants to withdraw from the investment, but there is no centralized way to conduct this procedure. And this problem concerns investing in startups even with considerably uncomplicated technical solutions - you invested $90 into i.e. “Innovative BBQ oven” that had been developing the product for over 2 years, and all you have to do is wait until the project is on exchange. Wouldn't it be great if crowdfunding platforms had the option of cashing investments out right on the platform, creating one ecosystem? Other difficulties occur after a project enters the stock exchange, where there may often be low volume. Exchanges are used mostly locally, Polish ones by Poles, American ones by Americans, and London ones by Brits, thus giving the startup investors from other regions additional challenges.

Maybe it's high time to embrace technologies that erase boundaries? 

Invest in blockchain now and benefit in startup crowdfunding

Today, the emergence of blockchain technology is transforming many markets for the better - the financial sector is one of them. The fact that all information is recorded, can be tracked, and cannot be removed - opens up many investment opportunities in the field of startup funding. As a rapidly growing market, blockchain is attracting increasing attention from big startup investors every year, while the project itself may be of interest to a new group of investors - crypto investors. Now a startup can create its own cryptocurrency and offer it to the community. In this way, during tokenization, the project gathers the necessary funds, and the community receives tradable digital assets. Those tokens can represent a form of ownership or confirmation of the investment contract. Do not forget about the relatively easy opportunity to exit the investment at any time - through the sale of the token on the cryptocurrency exchange.

Decentralized finance - invest in companies by crypto

Hash-rates, crypto, mining - it all may seem complicated for project creators who have not encountered blockchain before. For those who are profoundly unfamiliar with how blockchain and the connecting elements work, Tecra Space platform provides specific experience in implementing this solution into your project. Tecra Space emits unique tokens on a dedicated blockchain for each project, which are sold to investors during crowdfunding. When giving the tokens to investors, creators sign the contract with token holders, obliging themselves to repurchase the tokens back from investors once the project starts generating the revenue. With the ability to trade tokens on Tecra CEX and DEX exchanges (which are currently under development) investors can either exit the investments before the startup's first revenue or join the project after the fundraising stage is completed. The market is to decide the tokens’ prices, and investors have the free land to operate the tokens in any way they want knowing the tokens will be surely bought and burned (right on the CEX and DEX) by the project they invested in. It creates one ecosystem providing startup investors and creators through the all investment and development path.