Funding small businesses through blockchain technology is the focus in this edition of Business Day Spotlight. Entrepreneurs in SA have long lamented the difficulty of raising capital to start a business. This is especially true for tech start-ups that are in the growth phase, looking to raise millions needed to fund expansion.Cotterell and his team are looking to change how this through blockchain — the digital ledger and technology that underpins cryptocurrencies such as bitcoin.
Reality describes itself as a global blockchain-based tech start-up founded by fintech entrepreneurs. Cotterell says the SA-founded company is “the world’s first digital decentralised blockchain-based stock exchange. This platform will enable small to medium-sized companies to list and tokenise their equity at a reduced cost, opening up a previously inaccessible path to raise capital from markets.”
In essence, the company is looking to become a stock exchange for small businesses. Such enterprises are normally too small for admission on a public exchange. The stock market is a huge source of funding for businesses. Reality managed to raise the total required investment of $1.8m in one day from 16 individuals and decided not to open for further investment, what would typically be a “B” or “C” round of investment. Topics of discussion include Reality Company’s business model; the rationale for starting the business; the problem being addressed; and performance since launch.