great question. Yes - and no. I'll go into a bit more detail about our thinking on this - tell me what you think.
One of the functions of the token for the tokenised companies is the function of equity - regardless of how the token is actually defined. Although CFI is defined as a utility token, for us it also represents equity. We will never sell off parts of the underlying company. The actual legal entity is like a janitor, nothing more - tokens are key.
Given that role we feel that most of the projects sell off too much tokens at the beginning of their journey. There is a reason startups do not sell 85% of their equity in the seed round. It's not about how much money they would receive for it. It's about retaining flexibility for the future. For regular startups that might include selling later, but more importantly it could serve the role of cementing the relationship with key partners. You simply cannot predict everything at the very start - it's wise to keep some sort of reserve for future flexibility.
When a company grows large enough it has to take its place in the value chain with the established players. They have two options - accept the new company or try and squish it out of existence. A share in the equity is typically used to make sure the other companies accept it - then, its success becomes their success.
Something similar holds true for tokenised companies - except that at the moment we're all so small and swimming in such a small pool that the big guys don't care about it. But what happens with Cofound.it in 2,3 years when we really grow? Our plan is to have a stash of tokens we can use to partner with the key players from the old and new economy. This reserve will be on a public address and constantly auditable by all so you can make sure we're not selling it or anything - we will communicate our plans for this transparently (but, again, not for at least 2 years).
And that is the main reason for the 25% of reserved tokens. We do not intend to use them to raise more money, but to ensure our place in the ecosystem.
20% go to purchase Cashila assets and know-how. Cofound.it is built upon the know-how and code developed by Cashila for the ICONOMI ICO and the core of the idea was developed by them, not me or Daniel. Plus, we want to make supporting Cofound.it crowdsales for people new to crypto economy as simple as possible - ideally one-click! For that we need the fiat-crypto gateway and Cashila already has one.
10% go to ICONOMI that supported Cofound.it (and still supports it) both financially and by providing guidance and access to their network.
5% are reserved for advisory team. You've seen our advisory bench and I think you have to agree that experts like those are worth it.
And 15% are reserved for the team, vested over 24 months with a 6 month cliff.
I think that Gnosis has showed that the actual % does not really impact token price. What matters is what happens to the rest - does it hit the market, causing the price to plummet, or not. Team is vested, ICONOMI considers this a long-term investment, and Cashila founders and VCs are experienced investors who realise what happens when you dump tokens so I have no fear of that.
We did not come to this decision lightly. It would be easiest for us to go the usual way and we would definitely have an easier task at communicating our crowdsale. But we are building Cofound.it for the decades ahead and have thought hard about what challenges might await us. Our token distribution strategy reflects that.
Welp, this got a bit too long - sorry
Jan
