Can NXT be a real Crowdfunding Platform?

[lordoliver]

A friend of mine came with the idea, to fund a movie via nxt:
https://bitcointalk.org/index.php?topic=802883.0

The market cap should be sufficent for crowdfunding like that. Don't you think?
I mean. Not only funding crypto coins and more cryptocoins but also other real business.
I think, that could really give a boost to NXT, if we put some placed advertisement in a movie.

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[TaunSew]

I think so.  At least one Cafe in England and then a bar in Budapest was crowd funded that way.

[EvilDave]

Not to mention much of SuperNet and a load of other projects.

NXT is a brilliant crowdfunding platform, the only real problem that we have with this aspect is dodgy project/asset developers running off with the raised funds.
So, always do your due diligence before investing in any project.
The film looks interesting, posted on the above thread.....

As a CF example, I've helped out with fundraising for a project to put an unmanned private rocket/plane into near space, launching from the Spaceport America site in Nevada, home of Virgin Galactic:
https://nxtforum.org/nxt-promotion/nxt-in-space!/
http://www.theregister.co.uk/2014/09/26/lohan_test/

I managed to raise £1000 (60,000 NXT) within about 48 hours, based on not much more work than the forum post.
NXT to the moon!

But seriously: NXT is good for crowd funding.

[vuduchyld]

Hard to say.  There are certainly some examples of that working.  But there is a selection bias in favor of reporting successful examples.  Who knows how many have been unsuccessful?

In my view--an experienced one, I might add, as I have worked with about 250 start-up entrepreneurs in the last 6 years, generating about $60 million in start-up capital--it's a LOT harder than most people think to raise capital.  When you choose to limit the type of capital you raise, it enhances your focus, which is good.  But it also reduces the available capital for the project.  This project will require about 5% of all the NXT coins.  That's kind of a lot. Raising $1.35 mil with any crowdfund is, in my estimation, not an easy task.  YMMV.

I also get nervous when I see something that says 90% of the revenues will be paid out.  I don't know much about film-making as an industry, so I'd have to do a lot more research to write anything that I'd stand behind, but I will say that it sounds like a lot. Let's say he spends a million on the film.  Let's say he only sells it for $3 million.  Or $5 million.  Either way, he has to go into a massive deficit, or use debt finance, to pay out $2.7 mil or $4.5 mil.  It just doesn't really work at all.  

It also means investors aren't likely to be made whole on the first movie.  They look a LOT, in this deal, like equity investors in UMOS.  They look enough like it that, at least in the US, the SEC would almost certainly consider this to be a violation of Reg D if anybody ever looked into it...certainly a possibility if any investor raises a stink.  And they might, based on the lack of clarity in this prospectus.  

Crowdfunding for project-based stuff seems to be OK.  Crowdfunding as a source of equity still is very much NOT OK, even after the Jobs Act of 2012.  

Again, I don't know much about film or film finance, but my understanding is that many big film investors get involved due to tax credits that are pretty favorable for rich folks.   Are there examples, like Blair Witch, where low budget productions make a big splash?  Sure.  But this feels like a situation where the business plan is not based on probability, but rather on the possibility of being an exception to norms in terms of ability to raise capital, production costs, and revenue potential.

[Nxtblg]

A friend of mine came with the idea, to fund a movie via nxt:
https://bitcointalk.org/index.php?topic=802883.0

The market cap should be sufficent for crowdfunding like that. Don't you think?
I mean. Not only funding crypto coins and more cryptocoins but also other real business.
I think, that could really give a boost to NXT, if we put some placed advertisement in a movie.

It should be, in and of itself, but Supernet has already swallowed up a lot of Nxt. Ideally, a great crowdfunding project should induce people to buy more Nxt - so in this sense, the market cap is not a hard cap...

[identtitentti]

Crowdfunding for project-based stuff seems to be OK.  Crowdfunding as a source of equity still is very much NOT OK, even after the Jobs Act of 2012.  

Swarm disagrees. Yes, legal teams scream to high heaven and shit their pants when they are asked about something like Swarm, and best advise is to kick the legal teams out and just do (and if necessary, move to Isle of Man or some other place where legal teams are less vocal or best case, don't exist).

[identtitentti]

It should be, in and of itself, but Supernet has already swallowed up a lot of Nxt. Ideally, a great crowdfunding project should induce people to buy more Nxt - so in this sense, the market cap is not a hard cap...

To my limited understanding, SuperNET is (huge) extension of NXT, not a third party project. And much or most of what SuperNET and related asset investments spend, doesn't leave NXT ecosystem or comes back to NXT. So it does not much effect the liquidity of NXT, and especially if it succeeds, it will greatly increase NXT liquidity.

And yes, a great crowdfunding project can bring investors to join the crowdfunding platform. A very important question to ask when crowdfunding: will this project be good for the ecosystem as a whole? For example, if the project says the funds will used for salaries, investors should ask: will the NXT received be immediately dumbed into fiats, or will the salaries be payed in NXT? (Is the project about cutting trees and leaving a desert or planting a food forest?!!!)

A question to those more familiar with NXT, are there NXT clients with special crowdfunding features/plug ins (paying dividends etc.)?

[TheProf]

It should be.

[Zer0Sum]

Yes... and it's continually being enhanced.

Basically anyone can raise NXT on NXT AE for an interesting venture...
There are already > 300 assets and growing at 2-3/day...
But you will need some connections within the NXT inner circle...
Or at least be a known figure on Crypto Forums...
And you may have to give away 5-10% of equity to a well known NXT figure.

That NXT figure, say jl777, acts as an advisor and puts his reputation on the line...
It's well worth 5-10%... and it's why a guy like jl777 owns a piece of just about everything.

You can pretty much buy a fund of all the important pieces on NXT AE by buying JLH on Polo or NXT.

Eventually more mature businesses will list on NXT AE with real names, address, phone, accountants, lawyers...
That's when you will see explosive growth.

[lordoliver]

This project will require about 5% of all the NXT coins.  That's kind of a lot. Raising $1.35 mil with any crowdfund is, in my estimation, not an easy task.

We don't need the full amount. That is just the maximum.

I also get nervous when I see something that says 90% of the revenues will be paid out.  I don't know much about film-making as an industry, so I'd have to do a lot more research to write anything that I'd stand behind, but I will say that it sounds like a lot. Let's say he spends a million on the film.  Let's say he only sells it for $3 million.  Or $5 million.  Either way, he has to go into a massive deficit, or use debt finance, to pay out $2.7 mil or $4.5 mil.  It just doesn't really work at all.  

Sorry I don't understand your calculation. We only talk about UMOS's revenues.
Lets say we raise 1 Million and pay our movie with that. Lets say we sell for 3 Million. So why can't we pay out 2.7 Million, if we have them? We have 300 thousand left for the company. We also have to pay only tax on 300 thousand. Why should we take more?
Or do you have problems with the conversion to NXT? The revenues won't come all at the same time. So there may be even monthly payments and the price of NXT will pushed of course... I don't find that bad.

[identtitentti]

Yes... and it's continually being enhanced.

Basically anyone can raise NXT on NXT AE for an interesting venture...
There are already > 300 assets and growing at 2-3/day...
But you will need some connections within the NXT inner circle...
Or at least be a known figure on Crypto Forums...
And you may have to give away 5-10% of equity to a well known NXT figure.

That NXT figure, say jl777, acts as an advisor and puts his reputation on the line...
It's well worth 5-10%... and it's why a guy like jl777 owns a piece of just about everything.

You can pretty much buy a fund of all the important pieces on NXT AE by buying JLH on Polo or NXT.

Eventually more mature businesses will list on NXT AE with real names, address, phone, accountants, lawyers...
That's when you will see explosive growth.

Fun fact from http://coinmarketcap.com/:
NXT market cap: about 26 million bucks
Market cap of jl777 assets combined: about 11 million bucks

Personally I wouldn't touch any of those assets, simply because I don't understand them, how they (and especially the promised products) affect each other, and no one I've asked understands either. The learning curve is overwhelming.

[vuduchyld]

This project will require about 5% of all the NXT coins.  That's kind of a lot. Raising $1.35 mil with any crowdfund is, in my estimation, not an easy task.

We don't need the full amount. That is just the maximum.

I also get nervous when I see something that says 90% of the revenues will be paid out.  I don't know much about film-making as an industry, so I'd have to do a lot more research to write anything that I'd stand behind, but I will say that it sounds like a lot. Let's say he spends a million on the film.  Let's say he only sells it for $3 million.  Or $5 million.  Either way, he has to go into a massive deficit, or use debt finance, to pay out $2.7 mil or $4.5 mil.  It just doesn't really work at all.  

Sorry I don't understand your calculation. We only talk about UMOS's revenues.
Lets say we raise 1 Million and pay our movie with that. Lets say we sell for 3 Million. So why can't we pay out 2.7 Million, if we have them? We have 300 thousand left for the company. We also have to pay only tax on 300 thousand. Why should we take more?
Or do you have problems with the conversion to NXT? The revenues won't come all at the same time. So there may be even monthly payments and the price of NXT will pushed of course... I don't find that bad.

You're right.

There would be $1mm in equity capital coming in.  That's what you spend on the film.

Then if you sell for $5mm, it's revenue on top of the equity capital.  You are absolutely correct.

[lordoliver]

Fun fact from http://coinmarketcap.com/:
NXT market cap: about 26 million bucks
Market cap of jl777 assets combined: about 11 million bucks

Personally I wouldn't touch any of those assets, simply because I don't understand them, how they (and especially the promised products) affect each other, and no one I've asked understands either. The learning curve is overwhelming.

If there are assets, that are sold in a currency and their value is too high to be able to sell, does not mean, that the asset has a problem.
The opposite is the case. The currency has a problem: Its heavily undervalued. And that will change hopefully soon.

[identtitentti]

Fun fact from http://coinmarketcap.com/:
NXT market cap: about 26 million bucks
Market cap of jl777 assets combined: about 11 million bucks

Personally I wouldn't touch any of those assets, simply because I don't understand them, how they (and especially the promised products) affect each other, and no one I've asked understands either. The learning curve is overwhelming.

If there are assets, that are sold in a currency and their value is too high to be able to sell, does not mean, that the asset has a problem.
The opposite is the case. The currency has a problem: Its heavily undervalued. And that will change hopefully soon.

I like the SuperNET idea (the very little I understand of it) very much and hope nothing but success and showing awesome. But as I said, I don't understand enough to get involved. And too much on shoulders of just one guy is always a bad sign. And with this level of involvement there is a risk that if jl777 crashes for some reason or other, whole NXT community may end up crashing with him.

[swartzfeger]

A group of crypto fans here at BCT (myself included) started to plan a fantasy MMO back in February; we issued assets via Nxt's Asset Exchange on June 23. We've done quite well and are already prototyping our first client.

http://nxtreporting.com/?a=DORCS&c=USD

We approached the Nxt community with our prospectus and the support we've received has been overwhelming (and inspiring). Some communities talk about mining; Nxt talks about building things.

https://nxtforum.org/index.php

[futurist]

I think there are a lot of people that invest in NXT and just leave it on a centralized exchange.  I am guilty of this. The problem is they do not visit the NXT forum or try out the decentralized NXT asset exchange. You have to actually use the service and stay up to date on the progress taking place in the NXT community (which is quite a lot to keep up with ). Piece of mind comes with having my funds on a decentralized exhchange that actually works...and works fast.

[kingscrown]

A group of crypto fans here at BCT (myself included) started to plan a fantasy MMO back in February; we issued assets via Nxt's Asset Exchange on June 23. We've done quite well and are already prototyping our first client.

http://nxtreporting.com/?a=DORCS&c=USD

We approached the Nxt community with our prospectus and the support we've received has been overwhelming (and inspiring). Some communities talk about mining; Nxt talks about building things.

https://nxtforum.org/index.php

looks really cool!

[Spoetnik]

Crowdfunding = pretty word for IPO

i would never get involved with any Crowdfunding / Kickstarter type of crap !

and in crypto it's a way to get Bitcoin to pad your bank account and don't tell me otherwise lol
when you have 400 grand in your bank account and your movie needs 200 grand trust me you will keep taking donations
money.
corrupts.

take the recent BFL FTC court case for example.. they could so they did because people will.
staff asked BFL management why they don't do burn in's on the test-net and the boss said "because that doesn't make them any money"
the FTC has frozen their business operations and they have admitted their guilt.. the mined for coins with IPO'd asics.
because they could..

you want something ? get a job and pay for it.. don't ask me to pay for it for you .

[identtitentti]

Slightly OT, but my main gripe with NXT is the high transaction fee (1 NXT).

[futurist]

Crowdfunding = pretty word for IPO

i would never get involved with any Crowdfunding / Kickstarter type of crap !

and in crypto it's a way to get Bitcoin to pad your bank account and don't tell me otherwise lol
when you have 400 grand in your bank account and your movie needs 200 grand trust me you will keep taking donations
money.
corrupts.

take the recent BFL FTC court case for example.. they could so they did because people will.
staff asked BFL management why they don't do burn in's on the test-net and the boss said "because that doesn't make them any money"
the FTC has frozen their business operations and they have admitted their guilt.. the mined for coins with IPO'd asics.
because they could..

you want something ? get a job and pay for it.. don't ask me to pay for it for you .

Let us say Crowdfunding = pretty word for IPO. The average IPO costs around $500,000...creating a NXT asset or ("Crowdfunding" as you say) currently costs $28.40=1,000 NXT.