Adam Chapnick:
Two weeks ago we told you about crowdfunding giant indiegogo getting involved in ICOs. Their first ICO is for the fan controlled football league. Now by the way I was a principal at Indiegogo. So why did they start doing ICOs? I asked Indiegogo company-founder Slava Rubin about their involvement, and much more. Take a look.
Hey Slava. Thanks for joining us.
Slava Rubin:
Thanks for having me.
Adam Chapnick:
Good to see you. So okay, we both know better than anybody that Indiegogo has always been at the for front of innovative services, bringing people ... disinter mediated ways to get capital. You guys were the earliest in rewards. You were first in at equity. So what drove Indiegogo to think that ICOs are the next thing?
Slava Rubin:
Yeah, I think you nailed it. We came up with the idea for Indiegogo in 2006, and launched in January of 2008. And the idea was to always democratize access to capital, to impower the entrepreneurs, and to get more people the opportunity to back, invest, or fund these ideas. At first we did it with rewards and perks, and then we were able to help change the laws in the U.S. to have equity crowdfunding. The way we see it all of this blockchain and crypto funding is just the latest innovation of what is possible to accomplish our mission, which is again to democratize access to capital and to empower more entrepreneurs. So we see ICOs as the next logical step.
Adam Chapnick:
Got it. So there was something that I saw you mention a little while ago about how important it was to be white hat. What do you think about that? Is that going to be a defining separation in the world of ICOs?
Slava Rubin:
Yeah. So what we mean by white hat is to do it legally with high integrity, making sure that we're doing everything by the book, and insuring people can trust us. We've been around since 2008, and that's always been imperative that people can trust our platform and our marketplace. Right now a lot of these ICOs are happening on an island by themselves. It's hard to know they background, it's hard to do the trust reviews, it's hard to know if this is being down with high integrity. So similarly there's places like Amazon and other amazing commerce sites. It's easier to trust them because they've been around, and they're doing things correctly. As opposed to some of these one offs that have defrauded people in the earlier parts of the commerce evolution. So we're looking to be a organization that does things as I say white hat, but by the book, high integrity, and fully trusted. As opposed to uncertainty, and gets you a little queasy feeling when you try to become a part of that marketplace.
Adam Chapnick:
Yeah, nobody likes the queasy feeling that's for sure.
Slava Rubin:
Exactly.
Adam Chapnick:
Are you guys going to help, let's call them issuers, navigate the regulatory environment in any way?
Slava Rubin:
Absolutely. I mean that's exactly what we're looking to provide. Right now the entrepreneurs are struggling to identify who should they trust. The regulators and the laws are changing, and the points of views are evolving very quickly. The investors are trying to decide am I going to go to jail if I invest in this thing, or is this a good user experience. So for us we really want to create a positive user experience for both sides of the market. So for the ICO issuers, the entrepreneurs, we're definitely going to look to use our experience to help navigate the regulatory environments, and making sure that they get the most exposure possible across the world in a compliant way. And for the investors they need to know that this is being done legally, and then they'll have a good user experience.
Adam Chapnick:
Got it. So what do you think about the regulatory environment? Is there enough guidance, is there enough regulation? Should we expect to see more? What do you think?
Slava Rubin:
You know typically regulation follows innovation. Rarely do you see regulation be the catalyst for innovation. So there's a lot of innovation that's happening with these ICOs, and I think regulators are trying to figure out where do they want to fall on this spectrum. You have different countries coming out with different points of views, and I think the U.S. ... a credit to the U.S. ... has been a little bit allowing things to evolve. Similarly like e-commerce the regulators during the e-commerce world in the 90s they could have just stepped in and said this sites allowed, this sites not allowed, these guys get a stamp, these folks don't. But that hasn't happened.
I think similarly it's allowing for a little bit of it to evolve by itself, because the entrepreneurs have reason to create a high integrity environment. But I do think that you're going to see in 2018 more regulation. You're going to see a little bit stricter on the rules. You're already starting to see some bad actors being called out, and in my opinion it's actually good. It's better to not have the complete wild, wild west, but you also want to have some regulation in place so that you can have it go in a positive direction. But I think we've been doing a good job in the U.S. where it's allowing it a little bit to evolve.
Adam Chapnick:
Yeah. It's a natural part to weed out sort of the [inaudible 00:26:06]. I think you're right.
So tell us about the first one. You've got the fan controlled football league. How's that going?
Slava Rubin:
Yeah, amazing. So we just launched our ICO offering in mid-December, which feels like an eternity now in crypto and blockchain worlds. But yeah it's about a month ago we launched our first offering. In ten days we were able to fully get it subscribed for 5 million dollars. And as you mentioned it's the fan controlled football league, which is really exciting. It's a great application of blockchain. So instead of having real life football, like in a stadium that you know, and instead of having E sports on a video game; this is actually a combination of all of them, which is fan controlled. So having real players, real teams being controlled by the fans by the plays, based on fans deciding each play for 40 seconds.
So imagine you run the play, and then the fans get to vote. So 10,000 people vote. They pick between 10 different plays. They pick play number five. And play number five, which is a sweep right, gets run by real players. The amazing thing is that this has been happening already for a couple of years, and a team which has been fan controlled actually finished third in a league of eight. The challenge is that the underlying technology was not transparent, and it was hard to track the integrity of the data. So some of the fans questioned the results. Now by putting this on a blockchain you have full transparency, full integrity, no opportunity to defraud it, and now you get to have so much more trust in the platform.
Right now football is one application, and this is what fan controlled football league is all about, but in the future this is how governments could vote and how organizations could be run. So I think it's a really interesting application of the blockchain. We're really proud of the FCFL being fully funded so quickly. We were able to help the entrepreneurs navigate it, and it was a great testament to all the media promotion and the quick funding that people came in with funding via Ether, funding in Bitcoin, and definitely funding in different currencies from around the world.
Adam Chapnick:
We have the full video of Slava posted on our YouTube channel. Be sure to check it out, and don't forget to subscribe while you're there.
