Cindicator and the Five ‘C’s’
Almost every other day in the popular online BlockChain and Fintech press you hear about another Initial Coin Offering (ICO) from young start-ups with great ideas and using the BlockChain to disrupt the standard ways of doing things. In reference to these NewCo’s (New Businesses) I am also including start-ups engaging in the process of issuance of a ‘Generation Token Event’ (GTE) as they are often spoken about, in respect of an ICO, although there are significant differences between both issuances in respect of structures, strategy and desired outcomes. For the purposes of this discussion I will not differentiate the two, just to say they share just as many difference as similarities.
To say not all ICO’s are create equal is certainly not an exaggeration! But want is the ‘magic ingredient’ that separates the very best ICO from a ‘run of the mill’ ICO? Almost without argument the mechanism of raising money via an ICO is revolutionary. Consistent with the architecture of decentralisation, the mechanism of an ICO has taken ownership and control of the money raising process away from the traditional dominion holders being, Venture Capital Funds and enabled NewCo’s with innovative new ideas to have an audience in respect of their respective fund raising needs.
Is Token Utility an important ingredient in the consideration of, to Token or not to Token? Some leading commentators have recently argued without true ‘Token Utility’ a NewCo may not be a pure ICO candidate. The argument seems to be, if another mechanism can perform the function of the Token then perhaps the ICO is not necessary. In respect of this, I take the opposing view. If the issuance of a Token can represent value and the building of same, in an architecture of transparency, without the traditional costs and overheads of legacy systems, then I say, the fit is good and consideration of an ICO mechanism for Capital raising and value appreciation is open to you. More important than the discussion of ‘token Utility’ is the recognition that for value to be created, within an ICO ecosystem, there needs to be consideration and careful attention to some traditional business pursuits of due diligence, an understanding of unit cost economics and an understanding of the intended business model and competitive environment.
The NewCo GTE (ICO) which has grabbed my attention in the recent month is Cindicator. Cindicator describes itself as a “decentralized, community-driven infrastructure that harnesses the value of the collective (+) artificial intelligence. Hybrid Intelligence is a technological symbiosis of Man and Machines. This synergy enables Cindicator to make more precise decisions in a world of growing uncertainty, benefiting individual members and the community as a whole.”
As I ponder the question of value, I wonder what will differentiate the successful from the failures. What trait or traits will a successful start-up possess that will enable success and what key omissions will ensure failure?
The following set outs, what I refer to as, the five (5) C’s of cindicator! It is an observational piece, written by an industry outsider, describing where I see the Cindicator difference, and generally what is see as worthy of comment. The ‘punch points’ are worded as an analogue of the first letter of the company name. The piece is not intended as an almanac of company value, but rather a comment on where I see the value of Cindicator against others using the issuance of a digital coin to garner investor interest in their prospective value offer.
Collaboration
Collaboration is arguably the most powerful word in the English language today. If it is not the most powerful word then it surely the most utility-rich word. This is certainly the case for digital technology start-ups looking to disrupt on a constrained and sensible budget.
Digital Technology has proven potential as an agent for disruption. Digital technology, in this case BlockChain, in concert with ‘an agent of collaboration’ offers the greatest opportunity to create a shared new ‘economies of scale’ around a new way of solving an old problem or alternatively a new way of creating new value around an old and well established service need.
The critical part of the collaboration puzzle is seeing the ‘NewCo’ defining the right partnerships leading to collaboration and potential ‘convergence of will’ around the value creation process. Partnerships will enable non-traditional partners and traditional competitors to partner with each other, industry groups, platform enablers, and service providers in incentivizing consumer, economic, trading and historic data. When I speak of collaboration in this sense, I am not only speaking of businesses collaborating with other businesses, but rather a technology collaborating with another non-kind technology, or a process born of a technology collaborating with another process born from another non-kind technology.
Collaboration, in all its forms, is something Cindicator has mastered! The number of examples I have sensed, as I read the Official White Paper, are too many to mention. An example to illustrate the above originates from Cindicator’s trading domain, described in the Official White Paper, which sees the creation of new collaborative relationships of data and information between groups, indices, and forecasters, and matrixes thereof, that have never previously come together, in an environment of collaboration and testing, where the value of these new trading signals are studied, manipulated and tested, to ascertain their predictive value against market forces?
I suspect it is this kind of collaborative innovation that permeates the Cindicator system, from top to toe. The value of an organisation who understands and can speciate collaboration through its organisational value chain is immense.
Corroboration
Corroboration is often the forgotten cousin of collaboration, different in many respects, but also very valuable. The reading of the Cindicator White Paper reveals a professional technical team of Traders, data scientists’, AI and ML mathematician and engineers working together to grow a set of trading signals that either by themselves or collaborated and speciated with other intellectual know-how corroborate to produce a unique set of know-how that is highly accurate in predicting trading movements of asset classes and indices of interest.
Convergence
My own experience in the realm of start-ups was made possible by an act of convergence. The convergence of technological, process and model can lead to the creation of new products and services and the economies of opportunity which accompany the new speciation. I see many examples of convergence throughout the Cindicator value offer much like fingerprints left at a crime scene. The Cindicator business model may be a ready example of a convergence; the convergence of the very new and innovative seeing the creation and generation of a token to represent value issued and recorded against a distributed digital ledger (BlockChain) converging with the traditional business of Asset Back Instrument trades, a domain dominated by very large business.
In the case of Cindicator, convergence sees a mobile app, supporting Android and iOs, used to harness and collect many thousands of individual inputs. These inputs form a collective intelligence which come together (converge) with machine learning (ML) to form a hybrid intelligence. Cindicator is a decentralized, community-driven, infrastructure provider, bringing AI and collective Intelligence together to increase accuracy of financial forecasting.
The product of this convergence sees new and innovative trading signals purchased, via cindicator token, for use by professional and licensed trading experts to enhance their own trading and financial forecasting.
Capital
The raising of money to grow a business comes from two basic sources, Capital and Credit. We will not discuss the Credit (debt) path, as it is outside the remit of this discussion. The traditional route, the raising of Capital, typically sees a private company going public by way of an Initial Public Offering (IPO). In this instance, the founders of the company sell a portion of ownership introducing outside investment. The process of going public ensures future management of the venture comes under the control of a Board of Directors who report to all shareholders of the company. The process of going public is highly regulated involving the issuance of shareholder certificates and a heavy onus of reporting and compliance.
Cindicator has chosen a path of GTE (ICO) to fund and appreciate its business value. An ICO, colloquially known as a crowd sale or token sale, is an event where a NewCo releases its own digital currency in exchange for another or other cryptocurrencies which have liquid value. It is often the intent of the NewCo to have its own digital token released onto the exchanges as soon as possible after the ICO has closed successfully. The purpose of an ICO is the raising of capital against which the NewCo can grow, in personnel and sales channels and pay its debt and obligations.
Why has Cindicator chosen the ICO path rather than a path to IPO? The simple answer to this question is threefold: (i) speed of access to funding, (ii) ease of access to funding and (iii) much lower costs. Recently many ICO’s have been successful. Success removes the strangle hold of the Venture Funding market by the traditional custodians of this dominion. This bodes well for new innovation as the VC market is a tough market to breach requiring an onus amount of documentation. Personal experience dictates, in the majority of cases, the NewCo needs positive Cash Flow or a major A round funder before the VC will introduce B round funding, still with a majority of its risk ameliorated by the NewCo’s founders. Further the path to an ICO is often laid by a White Paper alone. Contrast this with the regulation, cost and compliance around due diligence reporting and you can clearly see where the dichotomy lies. The ICO fit for Cindicator, as a mechanism for Capital raising, makes great sense considering what it is now and what it will become.
Cash (Liquidity)
What technology blog post, ‘worth its salt’, mentions the word, cash or cash flow in a blog post featuring a company in readiness to launch a digital coin on a BlockChain? My blog does, and I do so without shame! The concept of positive cash flow, or liquidity in the digital currency case, is critical to any business notwithstanding which domain it operates. What do I mean by positive cash flow and what importance does liquidity play in the realm of a digital currency?
The question of liquidity is really a question of intrinsic value and supply and demand. Does the issuance of a digital currency support real tangible value, something that the customers of the business will be willing to pay for? Value that a business can build an active user-base against? Value that a business can grow an increasing revenue stream against? In the case of Cindicator — I believe the answer to be a resounding, YES!
In the case of the Cindicator tokens (CND), Cindicator will buy back tokens from the market at market rates. This buy-back strategy can be used to stabilise the currency, it can also be used to help create an environment of ‘scarcity’ around the Cindictor token therefore be great for CND holders and the appreciation of CND price and value. I believe Cindicator will list with digital currency exchanges as soon as possible after the closing of the issuance of the token event.
Conclusion
I like Cindicator, but not for the sole reason it is supported by a digital currency and uses the Ethereum BlockChain to manage it currency issue. I like Cindicator because I like the holistic value proposition, the underlying value of what will grow its customer base and revenue stream, and what it promises to deliver today, but more excitingly, tomorrow.
Disclaimer
As I have read the Cindicator White Paper, examined the Cindicator web portals, messaged Cindicator online staff, via the online chat feature, and generally assessed the Cindicator offer, I have become more and more impressed with the ‘A — Z’ of Cindicator. I believe I will take a position in the Cindicator token event and become a supporter of this professional and highly energetic team of professional.