Why I decided to do an ICO and ditch traditional VC’s and Angels

And it is exactly for the reasons you might think

An ICO (initial coin offering) is a token sale in which a company sells a cryptocurrency they create (usually based off of Ethereum’s ERC standard) which is given a function inside of that company’s ecosystem, for example, to purchase the products they produce.

If you haven’t heard about the whole ICO craze going on, take a minute and do a quick internet search.

I found out about this whole ICO craze through a friend of mine who had started day trading crypto currencies and making a living doing it! Which I thought was crazy because about a year ago one of my fathers friends told me about cryptocurrencies one day and I literally laughed at him and said it’s just another sham!

Little did I know a year later I would be participating in one (crazy how life works sometimes).

Anyways, during this time me and a few other people were in the middle of designing a house we were going to build. I’ll go more in depth about that later on.

We needed to raise money and we were crunched on time because there was the greatest piece of flat land in LA that was only 120k and big enough to build a 2,500 sqft house on! (I’m not going to say where because it is still for sale and we are planning on buying it very soon.)

The traditional approaches for raising money through VC and Angel:

Below is an excerpt from the pax capital website about the process(beginning and ending with- -)

-The venture capital funding procedure gets complete in generally six stages of financing corresponding to these periods of a company’s development:

• Seed Money: Low level financing for proving a new idea

• Start-up: New firms needing funds for expenses related with marketing and product development

• First-Round: Manufacturing and early sales funds

• Second-Round: Operational capital for early stage companies which are selling product, but not returning a profit

• Third-Round: Also known as Mezzanine financing, this is the money for expanding a newly advantageous company

• Fourth-Round: Also labeled as bridge financing, 4th round is proposed for financing the “going public” process

It is the need for lofty returns that makes the process of VC funding not only expensive, but also very detailed. It is a most suitable option for funding a costly capital source for companies, and most for businesses having large up-front capital requirements which have no other cheap alternatives. Software and other intellectual property are generally the most common cases whose value is unproven. This explains why venture capital funding is most widespread in the fast-growing technology and biotechnology fields.-

As you can see from above it’s quite a hassle

I truly believe we are coming into an era of unconventional fund raising for small companies and their ideas. It’s only so long where a certain system can last comfortably without being disrupted.

It could eventually get to a point where Venture Capitalists are no longer getting a thousand knocks on their doors everyday and they will in turn be a dying breed.

Now to the juicy part on why I decided to do an ICO:

At the same time I found out about ICO’s, I found out about blockchain.

It then became clear to all 4 of us that we needed to implement blockchain into what we are doing (read my other article to find out why).

And look i’m not going to sit here and b.s. anyone, i’m saying it straight up. We all seen this as a flash of opportunity to raise money efficiently and in a short amount of time for this project.

So we are taking advantage of it and incorporating it into what we are doing and adding more to it.

You can all say as you like. Call us this and that. Tell us that what we are doing is unrealistic, stupid, unachievable, and I will just leave with this quote — A question that sometimes drives me hazy: am I or are the others crazy?- Albert Einstein

If it works, it works. And we will celebrate with some Trader Joe’s champagne. If not, it doesn’t and we raise the money else where and continue with the house.

Let me explain:

The first thing is the house

The house we are going to build is to be called the “House of Tomorrow” a bit of an ode to Walt Disney’s EPCOT. The reason being is that we are going to implement everything into this house that isn’t conventional in house building today.

Just to quickly break down the house

House of tomorrow:

• the house will be made of extremely durable steel reinforced concrete
• we are using double pane low-e windows and superinsulation to maintain a constant temperature without the need for HVAC
• we are following the guidelines of the passivhaus standards — which are guidelines for creating the most energy efficient home
• we are adding fixtures that are water efficient (toilet, sinks, showers)
• the technology will be non-intrusive but up to date through out the house
• there will be seasonal trees provide shade in the summer and fresh air throughout the year
• we are still tightening the design, so we will most likely be adding a few new proofs that we discover as the process goes on
• see our website for more — tmrrw.org

The next thing is the marketplace:

We added the marketplace to the mix after finding out about blockchain.

The Marketplace of Tomorrow:

• Every product we are going to sell will have its history recorded on a blockchain. We are doing that by creating relationships with local designers and exclusive tech producers
• The store will only accept the TIMEtoken to display adoption of crypto’s and show it in the real world. Yes this is a big risk but it gives the TIMEtoken real world use and value.
• The store should be looked at as a showcase. Showing what can be done for the future of stores.

To sum everything up we are taking a big chance doing this and we have dived into it head first. We don’t have very many connections and do not have any backers or fancy marketing budget or even any marketing budget at all, but we do have a vision and the willingness to make that vision into a reality.

If anyone is curious at all, https://www.tmrrw.org/ is our website and you can get all the info there. Thanks