Hello and welcome to this SPinvest post
SPinvest is a tokenized investment fund/club for all users of social blockchains. Everyone is welcome! The concept of SPinvest is to get rich slowly by using time tested methods of earning, saving and compounding long term. This lets SPinvest offer an ROI of 20% per year on SPI tokens. We encourage long term investing on and off the blockchain. We hope someday everyone will HODL some SPI tokens that can be bought directly from @spinvest are through the hive-engine
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@spinvest took a major turn in the last couple of weeks in terms of the direction of the project.
It is also a big step for the crypto industry.
So far, the crypto-sphere is basically a bunch of individuals who are doing their own thing. Most are from the development background, working on applications or projects that interest them. Up to this point, it is basically what built the industry.
However, as evidenced by Bitcoin, things are changing. We are starting to see bigger players enter the industry. While this is good for token price, it changes the landscape a great deal.
We are also seeing a shift with the like of Mark Cuban entering the mix. Cuban, along with others of his ilk, are venture capitalists. They put up money to fund start up projects. This helps to really push innovation forward as entrepreneurs suddenly have access to the capital required to build.
It does come, nevertheless, at a cost.
The challenge with venture capitalists is they want to be paid. At some point, their patience with consistent funding without a return runs out. It is usually a 7 or 8 year deal, but the money have to flow out.
This creates a massive conflict. In the early days of a project, the main focus, aside from development, is getting users. This means that all is done to onboard people. Getting them tied into the platform is the first goal.
Here we see the user experience pretty high. A lot is given with little taken in return. Since making a profit, at this stage, is not the priority, the user experience explodes.
Of course, the day comes when the VCs want to get paid. This means the business model has to change. Monetizing what was build suddenly becomes the priority. The investors do not care about the user experience, they only want their money. This, naturally, puts them at odds with the user base.
This is an age old situation. We see it throughout the social media world. We are to the point where people just accept from the big entities. However, other smaller ones have faced headwinds due to this process.
Within crypto, we have an advantage: tokenization. This allows us the ability to fund newer projects ourselves. The key different is that investors will be token holders. Thus, unlike VCs, the business model will not change since the token value is mostly going to be derived from the Network Effect. This is something that is radically different with what is being termed Web 3.0.
On Hive, SPInvest engaged in its first venture of this nature. The VIBES tribe, which is focused upon music, was funded by a combination of SPInvest and @brofund. This put those two entities in the position of being venture capitalists.
The return to the fund holders is through the VIBES token. We see the goal of these two entities and all the users as the same: the growth of the platform in getting more users, kicking off the Network Effect. This is going to add value to the token, which both entities hold a piece of.
Operating with a self funding mechanism is vital for the crypto world to accomplish its goals. If the traditional Silicon Valley VCs take over, we know how this story will change. However, if we use our internal resources to keep expanding and growing, we will see a completely new system arising.
One of the reasons that decentralization is so difficult is because starts up ultimately get bought out by bigger players. The participants, mainly the VCs, want the payday. One of the common approaches is to sell the company to someone bigger, usually a rival in some form.
In the end, this stifles growth and innovation.
With this approach, there is no desire to cash out by selling. We can see millions of applications/projects remaining as they are. There is no need for one main entity to keep getting bigger at the expense of everyone else. The value is in the token, which is derived from the user base and activity tied to that project.
Investing from a traditional financial perspective, i.e. buying assets, is one way to get a return. Another way, often more powerful as well as beneficial, is to invest in businesses (or ideas). Most of the largest technology companies in the world started in this manner. It is where huge payoffs can result while helping to innovate and create more options for users.
SPInvest is now into the venture capital game. Hopefully VIBES will explode, providing the resources to further fund other ventures.
In doing so, we will keep the pie growing, ultimately attracting more people to what is already here.
This will benefit everyone involved.
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SPinvest's content is contributed by @silverstackeruk, @no-advice, @metzli & @taskmaster4450
Today's post comes to you from @taskmaster4450