Connecting some macro dots

With MOIJ.co, we observe changes in the current technology landscape, and we see a lot of changes in the way businesses get funded these days. Three main events accelerated this:

  1. There is a lot of demand.
  2. New technology.
  3. And a trend we've written about before, Individuals break free from the pack.

Let's connect these macro events, shall we?

Supply and demand

There is a lot of money circulating in the world right now, with the result that people spend more money on assets. Those who have the means to invest spend their savings mainly on real estate, stocks, and crypto.


Technology

Apps like Robinhood or Degiro make it easy to invest in stocks, with the result that Gen-Z and Millenials started investing, and they do this in a totally different way.

For example, the new generations take more risks. Thanks to the internet you can follow people with many years of experience who share their knowledge online for free.

Besides stocks, there is also a completely new technology, the blockchain, which creates a whole new asset class where apps like Coinbase, FTX, and Uniswap (Defi) make it easy to buy crypto-assets.

In general technology and startups will solve various problems the world is currently facing. But investing in new technology, startups is still not as convenient as buying stocks or crypto. The retail investors in the stock market are responsible for as much capital as all hedge funds combined. When this money flows into the private market on a larger scale, exciting things will happen.

When we start to allocate money to those, we solve problems, the future will look even better.

Republic is an example of a startup that is trying to solve this issue; they make it possible for every individual to invest in startups. Gumroad founder and investor  Sahil Lavingia raised 5 million dollars from 9,353 people in less than 12 hours.

He describes it as an IPO. This development is also in line with the growth and shift we see in the stock/crypto market. People want to allocate their money for further profits and to make an impact on the world, not simply put it into index funds and wait - because it's boring.

Apps with excellent user experience enable the new generation to participate in games that in the past were not accessible because of the gatekeepers.

For companies, there are also marketplaces - such as Pipe - where you can sell your annual revenue to generate more (growth) capital. This means you can raise money without selling any of your shares. Let's say your annual revenue is 500k; you can raise 500k today to grow your company faster.


The individual who collaborates

Thanks to more demand and new technology, individuals can do things themselves, instead of with a company.

Ten years ago, you needed a journalist from a newspaper to broadcast your story. Today, all you need is an internet connection, and you can share the story yourself!

In the United States, if you would like to invest in startups, you need more capital than if you would like to buy stocks, and there are more rules involved for this type of investing that makes it difficult or impossible for the individual to invest in startups.

The rules are slowly changing, though; on March 15, 2020, companies in the United States can raise 5 million in a crowdfunding campaign instead of 1 million.

More money, new technology, and possibilities to do things according to your own rules make certain companies (gatekeepers) obsolute.


A shift in the venture capital world

If you are not bootstrapping your company, the 'traditional' way to fund your startup is to raise some pre-seed money from angels, build your product, and grow the company via series - a, b, c (etc.). All shareholders, especially the founders, need to sell more shares to make this possible; this is called dilution.

After the pre-seed round, the check size grows, which means larger organizations (venture capital firms) are involved.

But thanks to marketplaces like Pipe, you can raise money without selling any shares. Now, you can raise a pre-seed round from individuals, raise a series from a strategic partner, or raise capital from your users via a crowdfunding campaign after growing the company via pipe deals without any dilution, which gives you more freedom.

All these macro events could enable a better distribution of capital; thus, money can work for more people to solve problems.

That more people - individuals - can get shares in companies is also great to generate future wealth, which is not possible with only renting out your time.


Creativity is scarce, all the rest is not.

We all know that the future contains many obstacles, but the whole idea that 'things' - for example, money - are scarce is a myth, and if something is scarce, it is creativity and ideas; all the rest is not.

The acceleration in innovation that is happening right now makes it easier for everyone to work on things they think are essential.

We hope that we as a society celebrate solutions more often, are proud of the things we achieve, and trust that no problem can't be solved when we work together.

Do you want to collaborate?

We like to work with people who have skin in the game, on ideas that have a positive impact, and with people who enjoy what they do.

Ready for your next adventure?

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Life is either a daring adventure or nothing at all - Helen Keller