Democratization of financing thanks to cryptocurrencies (English version)
The world of business venture is complex and very competitive. In order to grow a good idea, not only do you need work and preparation, but after you have a well structured and very innovative business plan, there is the biggest challenge to overcome; the challenge is to find financing for this brilliant idea.
This situation is repeated every day throughout the world, but in regions such as Latin America, there are a lot of young people eager to innovate; the challenge to overcome is superior due to the changing economic environments of the area, the existing inequalities, and the scarce economic resources that many countries have.
There are several types of financing for the creation of new ideas; the first one is that the shareholders or owners of a business idea invest their assets to promote the project; however, the common thing is that entrepreneurs are millionaires in ideas but lacking an important patrimony to be able to grow this idea. The second option to raise financing is through family and friends circles and just as the previous case, it makes the financing excludable because you must have a social circle capable of supporting initiatives that are in the conceptual phase, and many times they lack the confidence of others. The third scenario is to knock on the door to traditional banking systems where access barriers are usually even greater, since by simply requesting information on which credit products are offered by any financial institution, the list of collections is extremely extensive and in many cases it gives the impression that it is designed for two things: 1) scare off the best of entrepreneurs and 2) that these tools are created only to lend money to people who already have money capital. This is the reason why this route is aborted by a large number of innovators. But this does not end here. The fourth alternative, and for higher levels of business ventures with structure and that are in execution, is an even more complex economic leverage. This is the case of launching your company to a stock exchange or as it is also known in other latitudes IPO (Initial Public Offering) where only the elaboration of documents and strategies to get to this would cost a few thousand dollars.
It is here where the Blockchain technology and the crypto currencies come into action to bring about a drastic and radical change in the traditional ways of seeking financing, with the emergence of the most democratic, equitable, and broad model of the new global financing: the ICOs.
The initial currency offer or ICO by its initials is one of the most important evolutions that the incredible White Paper of the enigmatic Satoshi Nakamoto has brought. This mechanism works in a simple way: after having developed an idea, make a roadmap, and show which is the work team that will support this initiative, launch the equivalent of an action of your project which is based on a cryptographic currency, but in this case it is called a token since it will not be used to buy bread in the corner, but it will have a representative cost value that the investors consider your great enterprise can be worth. This allows the collection of funds globally; then, this token will be commercialized in the virtual brokerage firms in the ecosystem allowing to observe the evolution of the project which will increase its value if the initiative is obtaining positive results, or its cost will decrease if the initiative it is not carried out satisfactorily, just as an action of the stock exchange of any country does.
The ICOs are in the process of development and have great potential for the development of all Latin America, reason why public and private education institutions should be the first places where professional training programs are developed in the area of crypto currencies and especially the ICO.
I strongly believe that these tools are going to mean a global re-balance of the power of business venture since it is undeniable that the great innovative capacity is found in the least economically favored regions and areas where there are crises, since it is the crisis that exacerbates the creativity, where challenges are conquered, and threats become opportunities.
In a next article, I will explain with a simple example of an ICO, how a Venezuelan pop music group could make a token release to seek financing worldwide to launch their own album to be marketed without the need to die trying.