EQUI, the cryptocurrency-backed peer-to-peer investment platform co-founded by entrepreneur Baroness Michelle Mone (pictured) and her billionaire venture capitalist partner Doug Barrowman, is set to launch its public initial coin offering (ICO) next week.
Retail investors will be able to acquire stakes in or lend to early-stage businesses using EQUItokens, for as little as $100 (£72), from 15 March.
“I’ve been in the conventional world of private equity and venture capital for the last 30 years, which is typically the preserve of institutions and ultra-high-net-worths,” Barrowman told Peer2Peer Finance News.
“I thought to myself, wouldn’t it be great to open this up to individual investors, people from the crypto community?
“I thought it was a wonderful way to take an old, established industry and combine it with new technology and launch in crypto space.”
A pre-sale, which is running from 1-15 March with a minimum investment of $100,000, had already attracted $7m as of 5 May, said Barrowman.
“Essentially that underpins the success of the platform already,” he added. “What we now want is for hundreds if not thousands of smaller investors to get involved.
“It’s a minimum of $100 because we want to have a wide circulation of the EQUI token as a crypto currency, which will be good for the exchanges as there are three exchanges that are very keen to list us.”
Investors who commit their tokens to underlying projects will receive 75 per cent of profits generated by projects they participate in, and a further five per cent will be awarded to those who leave their token within the platform.
EQUI will focus on early-stage businesses in the tech, bio-tech and blockchain technology sectors.
Mone, who founded the lingerie firm Ultimo and was appointed as the government’s start-up business tsar in 2015, will provide help and advice to the businesses that raise money on the platform.
“My contribution in all of this is the passion about helping tomorrow’s superstars,” she said.
“We’ve got an incredible board of highly successful entrepreneurs and we will hand-pick those businesses to take forward.”
The board includes Mark Pearson, the founder of MyVoucherCodes, and Duncan MacInnes, who was an early-stage backer of innovative tech giants Facebook and Deliveroo.
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Mone and Barrowman are also developing a Dragon’s Den-style proposition, whereby start-ups will display their business plans and be judged by the panel.
“The crypto community themselves can look at the projects showcased and actually vote as to whether they think it’s any good, which really is empowering a whole new people-investment movement out there, which I think it quite exciting,” said Barrowman.
“I’ve been asked to do the show many times, but I never have, so maybe we’ll do our own show,” said Mone. “The BBC Dragon’s Den had better watch out.”
Barrowman is aiming for EQUI to become “a household name” in a couple of years’ time, with a presence around the world. Both Barrowman and Mone are emphatic that cryptocurrencies are here to stay, shrugging off the doomsayers who predict the market to crash.
“In the near future, we will probably have a Bank of England digital currency called the pound,” said Barrowman. “The US will have a digital currency called the dollar. We won’t actually use money anymore. Money is redundant. We’ve got to get on board.”
The co-founders say they have taken legal advice to ensure the ICO is fully compliant with UK rules as they stand. However, they would welcome tighter regulation of the sector, with Barrowman referencing the “very, very vague” Financial Conduct Authority (FCA) guidelines on ICOs.
EQUI enters phase two in the second quarter of 2018, when it will integrate crypto and fiat currency deposits on to the platform, develop Open Banking software to link the platform with bank accounts and start discussions with exchanges.
At this stage, the firm will apply for FCA authorisation, if it keeps its operations in the UK.
“We’ve drawn up all the preliminary papers we need to for stage two,” Barrowman said. “It depends where we finally house stage two. We believe we want to house it in the UK because we believe in the FCA and we believe in the strong financial regulatory environment in the UK.
“We are in consultation with people about that the whole time. This is a moving target and a moving feast, so we’ll go to the area that best understands our technology.”