Innovating on Asset Securitization with Jamie Finn
Jamie Finn Co-founder and President of Securitize joined us at the recent Start Engine Summit in LA to share his thoughts on digital securities and the mission of Securitize. Jamie has an impressive record of managing and spotting innovative trends in tech. Prior to founding Securitize, he ran innovation and data for numerous large global Telco’s and led acquisition of several companies for Sequoia Israel.
His track record led him to work with a global advertising mobile network. The nature of the advertising business is such that you are exposed to new businesses coming to market and looking to reach new audiences. He noticed that blockchain was becoming a huge phenomenon and many blockchain companies were looking to reach new audiences through the advertising platform. Completely intrigued by this new technology and buzz around bitcoin, he purchased the three cryptocurrencies (bitcoin, ethereum, litecoin) available on Coinbase at the end of 2016.
While his interest in investing in cryptocurrency soon dwindled, he remained fascinated by the underlying blockchain technology. Another thing that was fascinating at the time was the hype around ICO’s, which were initially portrayed as great investments, when in reality many were over-hyped and lacking the basic tech foundations of even an MVP. Jamie strongly believes that ICO's aren't a great investment opportunity because they are not backed by actual assets, thus, investors are purchasing the future use of a network. He argues that this is senseless and the opposite of what investing should be. He also points out that executing an ICO is very expensive in and of itself, which also doesn't make sense if the product may never exist. He, therefore, concludes that ICO offers zero recourse and investors have no rights to anything.
Instead of dabbling in ICO’s, Jamie saw that it was better to use blockchain technology to help fuel securitized asset funding and build new technologies. Together with his partner Carlos Domingo, he co-founded Securitize. Running on the Ethereum platform, Securitize is the compliance platform for digitizing securities on the Blockchain, helping organizations who want to issue these digital securities, commonly known as STOs (Security Token Offerings). Securitize is a primary issuance platform that helps companies with the formal requirements that make up STOs such as the on-boarding process of investors, KYCs (Know your Customer) and aids in writing smart contracts that represent the security in the company. In addition, they also offer lifecycle management products that will help companies as their securities mature, for liquidity or dividend payments and compliance.
Securitize sees three major categories of customers who are seeking their services:
Venture funds: More and more venture funds are becoming tokenized and taking advantage of the early liquidity opportunities STOs offer
Real estate: this offers a fractional ownership opportunities as well as shared revenues from leases and and increases in property value.
Operating businesses: these are offerings for companies that are actually in market already, such as Bitcoin mining companies or equity in really hot startups that are looking to raise money in a different way.
Early in the development of Securitize, Jamie noticed that many people in digital securities are not traditional crypto lovers. He urges people to think of digital securities more in the context of a public market, with real returns and with people looking to invest in real companies that they understand vs. investing in super complicated financial instruments. Jamie is confident that this model is one that provides actual solutions and returns for their customers.
This was a particularly educational conversation with Jamie Finn, who taught us so much about the STO markets in such a short period of time. Listen to the conversation and check out their website here. We look forward to seeing their development and leadership in the blockchain space.