Tech Crunch Japan: Token Economy x Restaurant Review App “SynchroLife”, Announces Seed Round Including Token Equity Convertible
SynchroLife’s major fundraising announcement was covered by the Japanese edition of Tech Crunch, one of the world’s biggest startup and technology news sites!
The article takes a fairly in-depth look at SynchroLife’s current and future features, our new business partner Ceres Inc, token economies, and what a token equity convertible is and how it effects investing for startups moving forward.
We’ve translated the piece into English below, and you can also read the original article in Japanese here: https://jp.techcrunch.com/2018/08/10/synchrolife-fundraising/
Tech Crunch Japan— August 10, 2018
Token Economy x Restaurant Review App “SynchroLife”, Announces Seed Round Including Token Equity Convertible
We just reported recently on the social restaurant review service SynchroLife, and how they are creating a unique new kind of platform by adding a token economy.
The SynchroLife platform is designed to reward users who leave quality reviews with SynchroCoin, the platform’s original token. In the near future, these tokens will be usable to purchase restaurant dining tickets or pay for meals at participating restaurants, creating a new economy within the service.
GINKAN announced a 720,000 USD (80 million Japanese yen) seed round on August 10th to further develop their platform. This seed round was an allocation of new shares and included Ceres Inc. and Former CEO of Cybird Holdings Fujio Komura.
Additionally, GINKAN also announced their business alliance with Ceres. Ceres run “Moppy”, the mobile point service with over 3.5 million active users, and by working together the companies hope to find new synergy between their platforms and explore how to bring blockchain technology to the average consumer product.
As part of this seed round, the allocation of new shares also contains a token equity convertible (TEC) for GINKAN’s subsidiary company SynchroLife Limited’s cryptocurrency token. We will cover this in detail later, but this allows the investing parties to exit even if GINKAN is not listed on the stock market or sold.
Personalized Restaurant Recommendations with Artificial Intelligence
SynchroLife is a social restaurant review platform where users can post reviews of their experiences at restaurants.
SynchroLife is unique in that it includes an artificial intelligence based recommendation system to curate personalized recommendations for each user. The service analyzes each individual user’s posts, what they look at in the app, and their overall actions within the service to determine their preferences. The more you use the service the more it learns and the easier it becomes to find a restaurant that matches your tastes.
Over 170,000 restaurant reviews and 420,000 restaurant photos have already been posted in the app. The service is available in English, Japanese, Korean, and Chinese, and has already seen users registering from 82 countries and posting reviews in 48 countries worldwide.
With their major update and new beta version released on August 2, 2018, SynchroLife added the SynchroCoin token to the mix. As mentioned in the introduction, the SynchroCoin is rewarded to users who provide high-quality content such as restaurant reviews, new restaurant information, restaurant information updates, translations and other content to the platform.
Tokens as a Means to Accelerate a Community
I’m sure many of you are now wondering, “What does a high-quality review mean?” or “What effect does distributing token rewards have?”.
Asking GINKAN’s founder and CEO Tomochika Kamiya about this, he commented that quality reviews are determined based on “Who it was who posted the review, and how other users react to that review.” This includes a trust score assigned to each user, and each user’s behaviors, the “wanna go” pin bookmarks on ratings and restaurants, and more.
Looking into SynchroLife’s token system further, you’ll discover that SynchroLife originally included an “experience point” gamification system as an incentive for users even before token rewards were added.
SynchroLife originally included a feature that allowed users to earn experience points based on their reviews and contributions to the service, and the more experience points they earned the higher their title would grow: from “beginner” to “god”. Users can earn more experience points for posting reviews for restaurants that don’t have any reviews yet, or only have a few reviews, for writing reviews a lot of other users find useful (that get marked as “wanna go” and pinned by users), and other actions seen as meaningful contributions to the service.
This preexisting scoring system for reviews helped the SynchroLife community grow up until now as it encouraged users to post good quality reviews, to add more photos, to report on or update restaurant information, and other meaningful behavior.
“I had been thinking of how to add some kind of in-app money to the service for a long time. Users have contributed so much to restaurants and the platform through their reviews and photos, all as volunteers. By adding token rewards to the equation, users will even be even more motivated to contribute and continue using the service. Token rewards were added to help us grow our community even larger.” CEO Tomochika comments.
A Potential Never Seen Before in Restaurant Review Services
SynchroLife will be distributing 20% of the total SynchroCoin tokens, so 20,000,000 tokens, as rewards. The system is designed to distribute a set amount of tokens weekly. So users will have their score calculated weekly, a receive token rewards based on the quality of their contributions for that week.
Right now users can only receive token rewards for posting restaurant reviews and adding new restaurants. But there are plans to give rewards for translating restaurant information, introducing participating restaurants, and more in the near future.
According to CEO Tomochika Kamiya, “It’s important to remember that rewards are not for reviews, they’re for good quality reviews”. So you won’t be able to earn tokens just by writing any kind of review, you need to contribute meaningful content to the platform to earn rewards.
CEO Tomochika comments that he believes, “The key to overcoming the chasm and connecting new technology to the average consumer is making it easy and fun for them.” SynchroLife is planning to develop more features that allow users to receive a set percentage of SynchroCoin tokens as a cashback reward for dining at participating restaurants. By allowing restaurants to set this percentage themselves, SynchroLife hopes restaurants will be able to use it to attract customers as well!
Additionally, users will soon be able to use tokens to purchase dining tickets or pay for meals at participating restaurants. If this cycle of users earning token rewards and spending them goes well, SynchroLife will be able to build a foodie community of the likes that has never been seen before. Much will depend on how many participating restaurants they can acquire, so their path is not without obstacle though.
Funding with a Token Equity Convertible
Lastly, I’d like to address the funding method used for this funding round. As mentioned in the introduction of this article, the allocation of new shares in this seed round also contains a token equity convertible (TEC) for GINKAN’s subsidiary company SynchroLife Limited’s cryptocurrency token the SynchroCoin.
GINKAN’s fundraising up until now consisted of a 270,000 USD angel round from Mr. Komura as well as an ICO held by the Hong Kong-based SynchroLife, Limited last fall that raised 755 Ether (approximately 450,000 USD).
There’s still a lot of uncertainty regarding ICOs and companies that have held ICOs. Both CEO Tomochika and Ceres representative commented “You often hear it is hard to get funding from investors or find an auditing company once you’ve done an ICO.”
Ceres has invested in a variety of cryptocurrency and blockchain technology related services and startups, but they still have only put limited investments into the application layer. They wanted to invest in SynchroLife and were interested in the potential synergy with their token economy, but the fact that SynchroLife had held an ICO was a problem.
“Here at Ceres we’re our own business, so it’s not as if we’re constantly looking for an exit on our investments, but it’s still something we have to discuss with our board of directors. When we were considering what to do if an auditing firm would not take the case, someone proposed “What if they included rights for token equity conversion?” This is because if the business goes well, we believe the value of the token will increase over time,” comments a Ceres representative.
By including a token equity convertible, an exit is possible even without an IPO or M&A. Both GINKAN and Ceres see this as a new option of funding for startups. They hope flexible investment strategies like this one can help the startup industry as well as the development of the token economy.
Thank you again Masumi Ohsaki for the great article!
The original Japanese article can be read here: https://jp.techcrunch.com/2018/08/10/synchrolife-fundraising/
You can also learn more about SynchroLife’s recent funding announcement in our recent press release here:
Please visit the following links to learn more about SynchroLife! 📲
Official Website: https://synchrolife.org
White paper: https://synchrolife.org/whitepaper.html
SynchroLife Mobile App:
iOS App Store: https://itunes.apple.com/app/id557532449
Android Google Play: https://play.google.com/store/apps/details?id=jp.co.synchrolife
Other Medium Articles by the SynchroLife Team:
・SynchroLife Major Launch Announcement — Becoming the World’s First Restaurant Review Platform with Token Rewards
・SynchroLife CEO Tomochika Kamiya Interviewed by Plug and Play Japan
・SynchroLife Nominated at “THE COIN” in Tokyo, CEO Tomochika Kamiya Presents
・How SynchroLife Takes a Unique Position in the Competitive Restaurant Search and Discovery Market
・Current Features of the SynchroLife Beta App
・Why We Decided to Use Blockchain Technology with SynchroLife
・SynchroLife’s Token-Based Economy: How Users Can Earn & Spend SynchroCoin (SYC)
・Behind the Scenes: The Meaning of “SynchroLife” and Our Seahorse Icon
・How SynchroLife will Handle Fake Reviews