Investment world is a scary place to many small investors as they face a number of extra challenges that put them at disadvantage against larger and wealthier investors. A lot of profitable investment opportunities are usually far-off to small investors and they are too complicated and expensive to them. Small investors cannot manage the higher percentage of investment and management fees of a typical brokerage firm. Besides small investors lack the much needed diversification and information to make profitable investments.
To round off these problems a concept of pool fund has been designed. Pooled funds are funds from many individual investors that are aggregated for the purposes of investment. However, the major disadvantage of traditional pool funds is that investors have no or little authority over their funds. Typically funds are controlled by fund managers they are the decision makers. And there will never be a direct communication between the investors and the entrepreneurs who receive funds for their projects.
So we have developed a tool for our platform. The tool is called DPF, which reads Democratic Pool Fund. It works on the principle of democracy, which is citizen’s participation in the decision making. Just like citizens have rights in democracy, in DPF investors are given rights to take part in decision making.
Let us tell you how DPF is different from others; we are planning to build DPF keeping all desirable qualities of a traditional pool fund, along with few added advantages, and we have tried to eliminate the disadvantages associated with traditional pool funds. The qualities of DPF are as follows
Large fund…. Just like any other pool fund our main agenda is to create a large fund so as to enable small investors to invest in stocks and projects, they normally may not have access to due to larger capital requirements.
Investor driven….Unlike traditional pool funds here investors decides which project gets funding, using the voting rights given to them. Projects are presented for voting for a time frame of 7–10 days, at the end of the period projects with more than 70% of the total votes would be awarded with funds.
Professional advice….Before allowing any project to pitch in the platform our team will filter out projects thoroughly, and prepare a project viability report, only allowing appropriate projects to pitch to our token holders.
Direct Communication…. We will make the project owners available to the investors so that investors can have a direct conversation in case they want to clarify things.
Diversification….We will make sure that a variety of projects be available to investors rather than sticking to blockchain related projects. Traditional areas like IT, Pharma, Infra related projects would also be given chance; this diversification is needed in order to make safe investments. But blockchain related projects are given high priority.
We planned to operate two funds under SISA; initially we want to roll out the closed fund. It is created by the contributions of the early adopters of SISA; we issue SISA tokens to raise this fund. And the token owners are considered as the shareholders of this platform and are eligible to receive quarterly bonus out the profits that this platform makes during that period. While making fund allocations to projects this fund would be given primo importance and also it is pre dominantly concentrates on block chain technology projects.
Secondly we have planned to introduce an open fund, which would be launched after a year from the inception of our platform. This fund is primarily aimed at all those conservatives and laggards, but everyone can take part in it including the early investors. But in contrast to closed fund, there won’t be any tokens issued to create this fund. People who have not participated in the initial round of fund raising but developed a liking towards the platform after noticing the performance and the initial adopters who want to invest more in the platform can participate in creating this fund. This fund focuses more on traditional projects other than blockchain/crypto. The perspectives of the open fund would be elaborated before the launch of the fund.
Also this idea crossed our mind during the development of this platform; the idea was to develop DPF as a separate application and make it available in the market, so that it can revolutionize the way pool funds operate around the world.