Bitreserve, based in Charleston, South Carolina, is offering shares in a cross national listing on both US based Venovate and UK based Crowdcube. The equity crowdfunding opportunity stands at over £5.2 million (or about $8.1 million) from 69 investors – including at least one institution. While the company was founded only last year the pre-money valuation today stands at $90 million – no small amount. Crowdfunding is quickly coming of age for accredited investors in the US and everyone in the more egalitarian UK. The UK has taken a light-touch regulatory approach embracing the fact that everyone should have access to these opportunities – not just the elite few.
Bitreserve allows registered members to hold bitcoin in the form of stable, real-world currency: euros, dollars, sterling, yen and yuan — but still spend it as bitcoin. Their process shields users from Bitcoin volatility but allows the speed and low cost of transferring funds in Bitcoin. “Bitreserve’s cloud-based system bypasses the slow, expensive, and inefficient legacy systems used by banks”.
The young company was founded by Halsey Minor, an entrepreneur with an interesting background having done stints at Grand Central (sold to Google and rebranded as Google Voice), CNET and elsewhere. Following more than a few successful exits, Bitreserve is his next initiative to change the world.
Bitreserve is described as a “new financial system”. Users may access their money anywhere, from any device without the delays and pain of using a traditional bank. Bitreserve is disrupting traditional banks on another front – dissimilar to P2P platforms. The company has the potential to remove billions in fees now captured by banks, credit card companies and more. This makes one wonder if the days of brick and mortar banks are truly numbered. Bitreserve wants to set a new standard for transparency and consumer protection. They hope to “define the future of the financial services industry”.
“As the world’s first financial service to publish a real-time, verifiable, proof of solvency, we are setting a new standard for transparency and consumer protection that we hope will define the future of the financial services industry”.
The current offer is a B round for preferred equity. On Venovate the minimum investment stands at $20,000. This follows a successful A round where the company was valued at $45 million – so there has been a bit of an increase in the valuation since this earlier round. The publicly available funding round was “spurred from the company’s belief that financing should be an accessible and egalitarian process”. If you are interested in this one – it closes on January 12th, 2015.
I will predict that a growing number of innovative firms will use a similar structure of cross border financing combining institutional funds with individual investors. Hopefully the SEC will get their act together and allow anyone to participate in these opportunities – just as long as they are willing to accept the risk.
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