Equity crowdfunding startup Fundopolis has partnered with AlphaPoint, a blockchain technology provider, to integrate blockchain into its platform, the companies said on Wednesday at Consensus, a leading annual blockchain and crypto conference which took place this week in New York.
The Fundopolis equity crowdfunding platform, which has yet to launch, will allow companies to raise funding directly from the public. Business owners will get to choose the terms for the investments they issue and pay investors back with money, a stake in the business, or both.
Equity crowdfunding refers to the online offering of private company securities to a group of people for investment. In the US, equity crowdfunding began booming in 2012 with the launch of some of today’s top platforms, including Wefunder and SeedInvest.
According to equity crowdfunding platform StartEngine, US companies raised a whopping US$8.9 million in the first month of 2019 through equity crowdfunding platforms. Wefunder and StartEngine raised US$3.2 million and US$2.8 million respectively, representing 33.3% and 29.1% of market shares.
The collaboration with AlphaPoint will see Fundopolis leverage AlphaPoint’s cloud-based platform to power the issuance of equity crowdfunding perks, allowing customers who are raising funds on the portal to easily interact with their investors, and provide automation for key security behaviors and other back end functions.
In addition to security and fraud prevention, Fundopolis said blockchain will provide greater transparency to investors and companies alike, enabling them to gain access to timely, accurate information such as when and how investors will receive their perks or pay-out following a completed fundraising.
“Fraud and security issues have plagued the crowdfunding space for many years and small businesses simply cannot afford to lose out on the critical funding they’ve raised,” said Igor Telyatnikov, CEO, AlphaPoint.
Founded in 2013, AlphaPoint is a rapidly growing fintech company specialized in blockchain technology solutions. The company offers several products including the AlphaPoint Digital Asset Exchange Software, a full-stack software for digital asset and cryptocurrency exchange operators used by more than 100 companies; the AlphaPoint Asset Digitalization Software, a blockchain-based asset digitalization technology that allows clients to digitize assets, creating tokens for virtually any asset class, including currencies and securities; and the AlphaPoint eOTC Trading Platform, an institutional-grade platform for institutional clients supporting large block trades on hundreds of crypto-to-crypto and crypto-to-fiat pairs.