In 2015 and 2016 many technology startups completed Initial Exchange Offerings or Initial Coin Offerings which are a signifcantly lighter regulated or not regulated at all version of an Initial Public Offering, IPO.
Initial Public Offering or the offering of new equity from a young firm to the public - pension funds, asset managers, hedge funds, endowments, family offices and individual investors by listing on public exchanges has been the main way via which more mature startups could fund themselves.
The issuance of cryptocurrencies via White Papers from various tech startups to finance themselves is a great innovative way for funding your companies. Thus, cryptocurrencies issued by specific technology firms are disrupting investment banking and venture capital funds. Investment banking, or the process through which an investment bank like Goldman Sachs and Morgan Stanley underwrite or buy short-term the equity offered by a tech start up to the public via IPO so the IPO can be successful has been performed by major banks.
Now this process can be done by startups also with help from investment bankers without paying too high fees, being profitable or being scrutinised by regulators. Investment banking includes mergers and acquisitions advisory, among other business lines, which can actually also be disrupted by cryptocurrencies' underlying algorithm or blockchain.
I expect financing by startups via the issuance of own cryptocurrencies to boom again. Soon.
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