VIDEO: TokenFunder CEO Alan Wunsche on Being Ontario’s First Regulated Token Offering
TokenFunder is a token platform powered by blockchain technologies. CEO Alan Wunsche talks about how the start up is keeping up with the changing regulatory blockchain environment to build trust in digital finance.
James West: Alan, thanks for joining us today.
Alan Wunsche: My pleasure. Thanks for having me.
James West: Alan, let’s start with an overview: what is the value proposition and the function of Token Funder?
Alan Wunsche: Token Funder is a platform we are building in Canada in the regulatory space to help other companies, and start-ups specifically, use the Blockchain to raise funds in the future. So we’re bringing it to start-ups, and we’re bringing it to the mainstream.
James West: Oh, so you’re an enterprise that creates ICOs, ITOs…
Alan Wunsche: We call them ITOs, and ours specifically is live right now. So our Initial Token Offering is live, that you can invest in the future of this platform, which is itself a start-up. And we’re quite proud, because we’ve been working with the OSC for the last year to build a model and to bring a model to the market that would have investor protections that you don’t get elsewhere globally.
James West: So the Ontario Securities Commission has approved this platform, this offering?
Alan Wunsche: The Ontario Securities Commission has given us specific exemptive relief that allows us to take this model to market – so it basically allows us to sell a token to actual investors that are interested in the future of this as a platform. So it’s a sandbox environment. We’ve got a limited time, which is a year, to have this exemptive relief, and what we’re allowed to do is engage with the retail investors, as well as accredited investors, because usually what you get is the opportunity is for accredited investors primarily to come in on these really interesting start-up opportunities – and the average retail investor doesn’t get a chance to play.
James West: Okay.
Alan Wunsche: So we have been working with the OSC to kind of take the first steps along this kind of continuum of where we are today, bridging to this future of using tokens in literally every business.
James West: Okay. What’s the difference between a token and a coin?
Alan Wunsche: That’s a really important point. So a token is actually the more generic term.
James West: Okay. So a coin is just another word for token, then?
Alan Wunsche: It’s interchangeable.
James West: Just like the word security and stock is the same interchangeable thing?
Alan Wunsche: Yeah. So our token is a security. Our token specifically, and this is really important because the coins in the initial coin offerings around the world these days are, in fact, described as non-securities by their promoters and by the projects as much as possible, because they try to avoid the regulatory frameworks.
So we specifically work with the OSC to build it as a security with rights. So our investors are real investors, and they will share in the profits of the platform.
James West: Sure. So right now, you have a distribution underway as your initial token offering. How much money will you raise with this token, what is the value of one unit?
Alan Wunsche: One unit is $0.05 CDN.
James West: Oh, okay. So what’s the total amount you’re going to raise?
Alan Wunsche: We have a cap of $10 million.
James West: I see. And is that $10 million representative of a portion of the equity of Token Funder, the company?
Alan Wunsche: What it is, is a new asset class, in fact. And this is where we differ from other initial coins out there: the tokens have rights to the distributions, and so it’s like equity, and we’re going to give our token holders voting rights on the future of the projects that go onto the platform. So it’s a bit of a hybrid; it’s not exactly equity, but it’s equity-like.
James West: So can we categorize this as a customizable, configurable security?
Alan Wunsche: Yes.
James West: Right. So you can give me a royalty on your revenues, you can give me secure me with a portion of your equity – you’re basically writing a smart contract for exactly what this thing is?
Alan Wunsche: That’s very much it.
James West: Okay, great! So how will Token Funder make money as an enterprise?
Alan Wunsche: Okay, so a couple of ways, because we’ll be the on-rep for mainstream companies, start-ups that are less techie, that need that assistance, the legal, the financial support to bring their tokens to market. So we’ll have a suite of services around this.
James West: Sure.
Alan Wunsche: And then, of course, we’ll be very interested in aligning our success to their success. So we’ll be receiving a portion of their tokens as a result, and therefore building a portfolio of their tokens for our token-holders.
James West: Interesting.
Alan Wunsche: So in the future, should we dispose of them, should we liquidate them, then we’ll also have that as a distributable revenue stream.
James West: Interesting. How does the Canadian investor who’s presented with this range of options for investment, ranging from cryptocurrencies to ICOs or ITOs, how do they differentiate quality from more risky?
Alan Wunsche: First of all, I think we should all be very clear that this space is a start-up space, and everything you’ll see when you go to Token Funder is that this is a start-up, and it’s a higher risk. We are pioneering the change in capital markets with this particular offering. I mean, pioneers take risks, and we are at the forefront of this change in capital markets, honestly. I mean, this is what’s so exciting about it.
In fact, one of the agreements we made with the OSC was that we would ensure that people met certain thresholds of financial suitability before they were even allowed to pass through the steps of being onboarded to our investment.
James West: That’s an excellent introduction, Alan. We’re going to leave it there for now; we’ll follow Token Funder with interest. Thank you for joining me today.
Alan Wunsche: Thanks very much, James.
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