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Startups descend on Spanish city of Salamanca for Startup Olé
Tamara Davison Posted On March 18, 2019


Written by Tamara Davison

In just under two weeks, the western Spanish city of Salamanca will yet again play host to the fifth annual entrepreneurial and technology gathering, Startup Olé.

Backed by a plethora of international bodies such as the European Commission, the city’s San Blas Auditorium will welcome over 30,000 entrepreneurs, investors and speakers from near and far. And for those who are in the city, there certainly is no excuse as attendance is absolutely free.

Taking place between March 26 and 28, this year is anticipated to bring even more visitors than previous years and as well as host exciting VIP guests who are supporting the country’s entrepreneurial development. But besides that, this year’s editions is different through its decidedly social and humanitarian mission.

Focus on technology for the social good

There are many humanitarian crises taking place around the globe as well as increased pressure to address serious threats to the environment and the future wellbeing of generations. Technology is called on to play a huge role, if not a defining one, in overcoming global threats and also being able to support and help people in need, for instance, for fighting growing wildfires across the globe.

Solving such crises starts with awareness – and that’s exactly what the organisers at Startup Olé hope to achieve. Throughout the event, a special focus will be placed on startups, technologies and businesses that can be used in humanitarian and social crises. Some of the best tech minds will be shedding light on artificial intelligence, cybersecurity, surveillance and even how technology support maritime rescue operations.

As well as boasting a startup fair, pitching competitions and matchmaking, attendees can catch a glimpse of round tables with investors and CEOs as well as evening celebrations throughout the event. This year, the event has also celebrated the launch of a Startup Olé app which, available on both android and apple, will provide users with real-time agendas, updates and the ability to even schedule meetings.

Last year, green agriculture startup Faromatics was among the winners, here in the Pitch Competition Green Award category. Image courtesy: Startup Olé.

Playing host to the much-anticipated event, the city of Salamanca also deserves some exploring. Easily connected from the country’s main airport in the capital of Madrid, visitors also have the chance to access flight discounts because of partnerships with Iberia and Renfe.

According to the event’s website, not only is Salamanca considered one of the ‘most spectacular Renaissance cities in Europe,’ but also boasts orange and pink architecture that has led to it being dubbed ‘La Dorada,’ (the Golden City). Its old city is a UNESCO World Heritage site and attracts visitors from around the globe.

However, its facades of golden sandstone do not only display its rich history, but also an astronaut hidden among its intricate carved images – a symbolic foreboding of  Salamanca’s tech-affinity.

Aimed at bringing startups together with investors, corporations, administrations, education bodies and even media partners, last year StartupOlé also welcomed His Majesty King Felipe VI and the President of the Portuguese Republic, Marcelo Rebelo de Sousa.

Now, anticipated to be almost three times the size of last year’s attendance, one must wonder whether more royal appearances are on the cards. As well as securing hefty funding, last year a selection of startups were also able to pitch their ideas in front of the royalty and leading politicians, opening up the floor for but further growth within Spain’s entrepreneurial circles.

Spain continues to be in the running as one of Europe’s most pivotal entrepreneurial scenes. which is only enhanced by events such as the upcoming Startup Olé. With El Pais recently writing about Madrid’s stunning rate of growth in the last five years, as well as investment opportunities only growing in the capital, Spain already holds a firm place in Europe’s growing army of startups and tech specialists who are giving Silicon Valley a run for its money.

  • Startup Olé will be held from March 26 to 28
  • For more information and the full program, please visit the program website 

Originally posted on 150sec


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Startups
Guide: Are ICO’s a Worthy Option for European Startups?
Team Posted On March 15, 2019


Financing can be a tricky issue for startups to solve.  ICO’s have emerged in recent years as an alternative means of financing, but are they a worthy option for European startups?

What is an ICO?

An Initial Coin Offering or ICO is a fundraising mechanism which facilitates the raising of capital through a blockchain-based crowdsale.  It is the blockchain equivalent to an Initial Public Offering or IPO of traditional equity stocks.

However, unlike an IPO, participants in an ICO do not receive an equity stake in the business through the tokens they are issued as part of the process. Essentially, the investor is betting on future cash flows that the project will generate and that will increase the value of the token.  In other words, the investment is entirely speculative.

The practice came to the fore in 2014 when leading cryptocurrency Ethereum raised $18.4 million in 42 days.  In the years that followed, the Ethereum platform itself became the go-to network upon which companies launched their ICO’s.

Unlike issuing equity shares, participants in an ICO do not receive an equity stake in the business. Photo by Emilio Garcia on Unsplash

How does it Work?

In pursuing an ICO, a company creates a white paper which sets out exactly what the concept behind the offering is, explaining what the utility will be in the coin or token that will be issued.  This is accompanied by a website, together with ancillary marketing media, clarifying at a more fundamental level the concept that the company aims to develop.

A date is set for the crowdsale and the parameters for the sale are set out.  Some other fundamentals are set out such as the price at which the tokens will be offered by the company to prospective buyers and the minimum token sale level that needs to be achieved.

What Advantages bring ICOs for Startups?

ICO fundraising offers a major advantage for startups in that it doesn’t involve the loss of voting or financial rights, as would be the case with conventional equity shares. Founders can avail of capital raised via ICO and develop their projects without having to relinquish a proportion of company ownership.

The ICO process broadens the potential investor base substantially.  There is much less of a geographical barrier to entry for investors.  Furthermore, when pursuing conventional fundraising means, funding rounds are often reserved for institutional investors. Furthermore, the process can be less costly and less time-intensive compared to other types of fundraising, in particular, public IPOs.

ICOs can be a means to ‘beta-test’ and gain more traction of the protocol that a blockchain startup promotes. Image courtesy: Startup Stock Photos from Pexels

Furthermore, an initial coin offering usually provides financing at the early stage of the development of a company. In this stage, there is often not enough collateral needed for debt financing and an IPO is still too expensive.

For blockchain-related startups, there are further advantages. Blockchain projects are often advancing their own specific blockchain protocol, similar to a technical standard. Issuing of a token can attract the attention of the relevant developer community.  An ICO can thus be thought of as a way to “beta-test” the technology with investors and developers.

In addition, as the ICO kickstarts use of the blockchain protocol, the increased popularity can attract further users. In this sense, blockchain companies can create a “token network effect” with an ICO, explains the Harvard Business Review.

ICO Pitfalls

The first aspect that needs to be considered is the fact that cryptocurrencies are still in their infancy and undergoing a process of price discovery as the technology and the market finds its feet. Up to now, the majority of ICO’s have been launched off the Ethereum platform. If startups hold funds in Ethereum tokens post-ICO, they will be susceptible to price volatility associated with that cryptocurrency.

The vast majority of tokens offered through an ICO do not claim to provide equity in any underlying assets.  If the project fails, investors are likely to incur a 100% loss. Coupled with a technology not yet mature, this means that ICOs will be classified as high-risk. This is likely to narrow the scope of potential investors.

ICO are often classified as high-risk investment, which reflects in lower prices . Image courtesy: rawpixel.com from Pexels

Adding to this, in an ICO the company get one opportunity at a token sale and it has to price those tokens relative to the perceived value in the business proposition at that point in time.

This is quite different from traditional startup financing that occurs in iterations or funding rounds. The advantage of starting with smaller amounts of finance means that higher prices of shares can be raised when the venture becomes mature and less risky.

The amount that investors are ultimately willing to pay for the tokens will naturally reflect this risk at an early stage. The value raised by the ICO might be much lower than what the company will be worth (market capitalization) further down the road. In this sense, VC investors argue that just like issuing shares in an IPO that dilutes value, issuing tokens in an ICO will do the same.

As outlined above, blockchain startups have used ICOs to attract attention to their protocols. However, this comes with the competitive risk of exposing the core technology, often the software code, to the public.

In addition to the growing pains of the technology and the market pertaining to it, regulation worldwide is playing catch-up and the stance taken varies.  In most instances, there is a lack of complete regulatory clarity. This has led to some startups falling foul of regulatory authorities.

Originally posted on 150sec


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Startups
Europe’s first tokenised Real Estate sale pioneered by Swiss startups
Sam Brake Guia Posted On March 7, 2019


In a breakthrough for Europe’s emerging crypto startups, three Swiss companies just completed the first tokenised real estate sale of the continent.

Swiss Blockchain technology startup Blockimmo was central to the transaction in providing the tokenisation platform to complete the activity.  For achieving this technological milestone, Blockimmo partnered with Elea Labs and Swiss Crypto Tokens, equally hailing from the small Alpine country.

Elea is focussing on real estate, but with ambitions to be a “digitally driven pioneer”.  More specifically, the company is geared towards a future that implicates the tokenisation of real estate – up till now, a distant technological future for the Real Estate industry.

Swiss Crypto Tokens, on the other hand, is a crypto-startup established in 2018.  The company has established a stablecoin which runs on the Ethereum platform. The coin is based on the Swiss Franc, meaning each token is pegged to the value of the Swiss currency.

Swiss startup Blockimmo partnered with Elea Labs and Swiss Crypto for pioneering the first tokenized real estate sale. Image courtesy: Blockimmo on Medium. 

What is Real Estate Tokenisation?

Real estate tokenisation is the process of recording fractional ownership interest in property through the use of a blockchain-based token.  One of the most prominent blockchains utilised for this purpose is the ERC20 Ethereum platform.  The token employed by these three Swiss startups is based on that blockchain standard.

Tokens can be used to represent value in a wide range of assets,
including equity, commodities, or – as here – real estate

Tokens can be used to represent value in a wide range of assets, including equity, commodities and – as in this case – real estate.  In compliance with recently clarified Swiss regulation in relation to Security Token Offerings (STOs), these systems legally represent an ownership interest in the underlying asset.

That ownership interest could come in a variety of forms: For example, equity in a legal structure that owns an asset, interest from debt which has been secured on real estate or income (rent) through cash flows from the real estate asset.

What is the benefit of tokenised real estate?

In most markets, property is an illiquid asset.  It’s less than straightforward to buy or to sell. Tokenisation makes is much easier for an investor to enter or exit the real estate market.

First, tokenisation opens up access to real estate globally, reducing barriers for international investors.  Because of difficulties with the movement of money or regulations in individual countries, it is not always possible for investors to have access to an investment proposition they would otherwise be interested in.  From the point of view of the developer, this system increases the potential to fund a project.

Second, through distributing the high asset value of real estate on smaller-denominated tokens,  tokenisation can make it possible for smaller investors to get involved in larger projects. And lastly, tokenization promises less red tape, bureaucracy and costs involved as the process cuts out middlemen by design.

Blockchain-based tokenizations could be revolutionizing the traditional limitations of the real estate sector, believe the Swiss startups.

“Traditional property investments and their issuing programmes have barely moved forward”, explains Bastiaan Dom, founder and managing director of Blockimmo:

“In Switzerland, you have a non-transparent market with asynchronous information that is difficult to access.  This has a negative impact on the liquidity potential of the real estate market.  By using blockchain technology, Blockimmo enables a solution to a problem, representing a paradigm shift for real estate ownership and trading.

“In Switzerland, you have a non-transparent market with asynchronous information that is difficult to access”.
Bastiaan Dom, founder and managing director of Blockimmo.

The use of cryptocurrency has faced major criticism in recent times due to its volatility.  That would have been a cause for concern in a property deal of this nature.  However, through bringing in Swiss Crypto Tokens with its ‘CryptoFranc’ (XCHF), the transaction could be pegged against the relatively stable Swiss Franc.

“With the stablecoin CryptoFranc, we have developed a key piece of the puzzle for the Swiss blockchain ecosystem”, believes the CEO of Swiss Crypto Tokens, Armin Schmid, celebrating the realization of what he calls the “future of real estate transactions”.

Swiss ‘crypto valley’ keeps disrupting industries

The first real estate tokenization was completed last Friday in Baar. The municipality lies in the heart of what is dubbed the Swiss ‘crypto-valley’.  Approximately 3 million CHF ($2.98 million) – representing 20% of the overall property value – was tokenised as part of the deal.  Four investors took an ownership stake in the property by buying the tokens.

As the actual transaction was carried out on the Ethereum blockchain and can be verified on the Blockimmo platform.  Elena Labs input was to support the transaction through the provision of real estate data for the property.  The company ensures that all data relative to the property is stored decentrally.

It is likely that we will see accelerated growth with regard to Security Token Offerings (STO’s) in the coming months.  For its part, Blockimmo intends to tokenise further properties in the not too distant future.

There are other players in the Swiss market who are in the process of making their own impact in terms of real estate tokenisation. These include SwissRealCoin, an investment token which is linked to a portfolio of commercial real estate assets for which the management is automated.

Token-estate is another Swiss startup which is developing a disruptive platform to facilitate faster, easier and cheaper investment in real estate companies.  The company provides private companies and real estate asset managers with access to a broader range of financing options, with a more diverse investor base.

The worlds first real estate tokenisation was achieved in the United States by real estate and finance company, Elevated Returns. In Europe, progressive regulation by the Swiss Financial Market Supervisory Authority (FINMA) has created the right environment for these Swiss startups to get ahead of the game with a practice that is set to disrupt the conventional market.

The completion of this first tokenization in real estate should now send a strong signal to more European regulators, inviting them to follow the path for facilitating crypto innovation.

Originally posted on 150sec


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Startups
The 6th Edition of the Seedstars Summit will Celebrate Innovation, Impact and Investment
Sam Brake Guia Posted On February 22, 2019


Seedstars World [SSW], the largest startup competition for emerging markets and fast-growing startup ecosystems, is hosting the sixth edition of the annual Seedstars Summit in Lausanne, Switzerland on April 2-5. This year, the summit will undertake a new format, focusing primarily on five key industries – finance, healthcare, education, agriculture and energy to address the global challenges and find efficient tech solutions for each sector.

 

Seedstars is a Swiss-based group with a mission to impact people’s lives in emerging markets through technology and entrepreneurship, with a particular focus on the UN Sustainable Development Goals. Through a variety of worldwide events, acceleration programs and competitions, including the largest startup competition in emerging markets (Seedstars World Competition), Seedstars aims at fostering impact investing and impact entrepreneurship over the world.

 

As the entrepreneurship forum for emerging markets, the summit will gather more than 1200 participants at the SwissTech Convention Center, EPFL. This will include 80+ hand-picked startup teams, corporates, entrepreneurs, government representatives, ecosystem builders, business experts, investors, ambassadors and mentors from over 75 countries to connect, learn, and bring us closer to achieving Sustainable Development Goals (SDGs) 2030.

 

The new highlight of this year’s Summit will be five key industry-focused workshops, where a dedicated group of experts will tackle real-life challenges for specific groups and countries, by applying various Seedstars-designed methodologies such as problem identification, ideation and peer-to-peer brainstorm.

 

The Seedstars Summit will kick off with a private bootcamp (2nd and 3rd of April) for pre-selected startups, where they’ll refine their growth strategy and participate in one-on-one meetings with mentors from the world’s top companies like Google, Udacity, Merck, Amazon, IBM and many more. There will also be an Investor Forum (4th of April) to connect well-known investors with Seedstars World startups, and keynote speeches from renowned experts, including Fabio Cannavale, CEO of lastminute.com, a digital entrepreneur and serial investor.

 

On April 5, the final day of the summit, attendees will gain access to the Main Stage with a chance to meet and learn from entrepreneurs like Anthony Ndungu, an innovation architect, techpreneur, and founder of Kytabu, an EdTech platform revolutionizing education in Kenya. Parallel will be the Breakout Stage, aimed at discussing the hottest trends in tech today such as blockchain, AI, machine learning, peace innovations, and more.

 

The Seedstars Summit marks an end to the 2018 Seedstars World Competition that took place in 75+ countries across Africa, Latin America, Asia, Eastern Europe, and the Middle East. The competition helped uncover the most promising startups in each region and invite them to the Summit. All 67 startups selected along the way will have a chance to compete for up to $1mn in equity investment and the title of Seedstars Global Winner.

 

Around 85% of the world’s population is located in emerging markets with 59% of global GDP coming from these markets. But today, developing countries face a $3 trillion to $5 trillion annual investment gap in sustainable growth. Seedstars strives to identify and connect future entrepreneurial minds and seed-stage startups with its global network of investors and industry players to help pave the way towards a successful and sustainable future.

 

“Entrepreneurs who get valuable support and knowledge can become the key enablers in their country’s ecosystem and double the impact by sharing their expertise, mentoring, and investing in other ideas,” said  Alisée de Tonnac, CEO and co-founder of Seedstars. Among the companies and institutions that help make the Seedstars Summit 2019 possible are SPEI, School of Management Fribourg (HEG Fribourg), TRECC (Jacobs Foundation), TAG Heuer, TRECC (Jacobs Foundation), Bill & Melinda Gates Foundation, Merck, Rising Tide Foundation, EPFL (École Polytéchnique de Lausanne), Innovaud, CVCI (Chambre Vaudoise du Commerce et de l’Industrie), Lausanne Région and Ville de Lausanne, Nespresso.

Disclosure: This article includes a client of an Espacio portfolio company


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