Conference Presentation, Webinar, Tutorial
Andy Bromberg - Startup Investor School Day 4
- Speed to liquidity is expected to revert from recent slowdowns, with trends historically bending toward faster access continuing into the foreseeable future.
- Increased capital availability is predicted to spur growth in startup formation and individuals attempting to drive global change.
- Foundational costs for startups and fundraising are anticipated to decrease due to advancements in platforms, seed funds, and legal automation.
- Market evolution will likely see a rise in equity secondaries and structures allowing investors to access both equity and tokens, or equity converting to tokens.
- The ICO market is currently considered immature with irrational pricing, where fundraising structures are predicted to evolve significantly as prior investment standards remain low.
- Future ICO rounds may bifurcate, with early stages resembling traditional seed funding while later rounds diverge in structure and purpose.
- Regulatory frameworks are expected to evolve, potentially including non-exemptive safe harbors or legislation similar to the JOBS Act to codify ICO rules.
- Increased regulation may result in more restrictions on token fundraising activities, with most tokens likely classified as securities requiring built-in protections.
- Public market access for tokens is predicted to become rare for direct live tokens due to security classifications and mandatory lockups.
- Early investors are expected to face lockup periods of one to two years, or approximately 18 months, to ensure ongoing company support despite overall liquidity trends.
- Regulatory pressure is projected to drive significant lobbying activity within the crypto and venture capital sectors over the coming years.
- Established venture accelerators like YC are evaluating the implications of ICOs, leading to anticipated evolutions in investment documents such as the SAFE agreement.
- Investment bank services are predicted to emerge to stabilize ICO prices and support structured, scheduled, or unscheduled fundraising for later stages.
- A significant portion of token companies are forecasted to fail due to capital exhaustion, as the ideal model suggests no need for post-launch fundraising.
- Long-term investment decisions are advised to account for structural shifts projected over horizons of one, two, five, ten, and twenty years.
- Tokenized networks built effectively may render traditional equity rents obsolete, making ownership of equity functionally equivalent to token ownership.