$75 million ICO in a new cryptocurrency

Konstantin Sheiko
February 13, 2018

It looks like yet another player is about to enter the world of cryptocurrency trading. London based Entrepreneur Michelle Mone and her billionaire partner Doug Barrowman are raising money to launch a new cryptocurrency-powered investment platform. Scottish Baroness Mone is the founder of lingerie brand Ultimo, and private equity veteran Barrowman hope to raise $75 million through a so-called "initial coin offering" (ICO), selling newly minted cryptocurrencies online. They plan to sell “Equi”, which are crypto tokens built to the same specifications as ethereum. Funds raised through the sale will be used to develop the Equi platform, an investment website that the pair hope will open up venture capital investment to ordinary people. 

While this initiative is reminiscent of of what the crowdfunding campaign is all about, Barrowman insists Equi will allow investors greater versatility as people will be able to hold the tokens and trade them on exchanges, as well as just investing. According to Barrowman, “Essentially what an Equi Token allows people to do is access our platform, have a look at the investment propositions that we are showcasing and form a view, and they can use the Equi Tokens to effectively invest in the projects in a project-by-project basis”. He continues, “If you invest in a project, we give 70% of all gains realised back to our investors in the token. The ones that just hold the tokens on the platform, we give them 5% of the profit. And then there’ll be some people that chose not to make investments but just like any other ICO, they chose to speculate on the currencies rise or fall - we hope rise”.  

Currently ICOs may be hot, but there is also growing scepticism. Over $5.6 billion was raised through ICOs last year and over 1,400 cryptocurrencies are now in circulation. But the market is facing increasing skepticism from many, due to the proliferation of scams in the market, wild price swings, and the fact that most projects have yet to launch. The January collapse of leading cryptocurrencies such as Bitcoin, Etherium and Ripple only adds to the feelings of uncertainty. Barrowman and Mone insist that they are not simply jumping on the bandwagon. Barrowman argues that he has been doing this for thirty years. According to him, “We’ve been working on this since the summer…We approached it with vision, with a concept. We’ve taken our time. We could have brought this out a lot sooner”. Barrowman is believed to own “very significant” personal cryptocurrency holdings and the pair have already launched a bitcoin property project in Dubai, demonstrating a commitment to the space. 

Mone said: "This whole cryptocurrency world is based on trust. People know who Doug is. They know who I am. They know who a lot of the people on the board are. I think that’s quite powerful. Because a lot of them [ICOs] are all smoke and mirrors. We’ve got incredible reputations. There’s no way we’re going to do anything untoward to let these people down. We will try our utmost.” 

Barrowman is the founder and CEO of private equity company Aston Ventures. He is also the founder and chairman of the Knox Group, which offers financial planning advice. He has been described as a billionaire in the press, although estimates of his net worth are hard to come by. Barrowman said deal flow for the Equi platform would not be a problem given his investment experience. Equi will focus on tech companies, biotech companies, and cryptocurrency companies. Michelle Mone, who is cofounder of Equi, will advise companies raising money, and will offer help and advice to businesses that raise money on the Equi platform. Mone founded Ultimo in 1996 and sold 80% of the business for an undisclosed sum in 2014. The Glasgow-born entrepreneur received an OBE for services to business in 2010 and was made a life peer in 2015. According to Mone, “When Doug told me about Equi last year, I was so excited to be coming and helping the team to help the entrepreneurs. I think that’s never really been done before with a whole board of seriously successful business people.”  

Mark Pearson, who is a member of the Equi board, will provide advise to entrepreneurs who use the platform. The founder of Casino Coin, another cryptocurrency project Barrowman is involved with, will also advise entrepreneurs. Mone said, “I think that we are not only helping them with funding, they’ll become probably friends of ours and the team as well because we’re working so closely together and I think that’s so special, to give that back. I mean where have you heard of that? Maybe Dragon’s Den but that’s a TV show. Every VC that I see, I don’t think they’ve got a whole board of entrepreneurs on it. They tend to be bankers and accountants”. Barrowman intends to ensure that the value of the Equi currency will actually be underpinned by the investments we make on the platform. Customers will have an option to access the platform, evaluate their choices concerning potential investments, analyse the projects that the Equi is planning to invest in looking to invest in, as a result creating a correlation between the value of the token and the projects underlying it”. 

In other words, Barrowman claims that there won’t be a single token out there not backed up by some kind of value invested in one project, or another. Nevertheless, the involvement of many existing companies in cryptocurrency and blockchain technology has raised eyebrows, with everyone from Kodak to Long Island Iced Tea, not to mention a host of lesser entities, pivoting to blockchain and crypto. Some experts argue that recent volatility in the cryptocurrency market is actually fuelled by the amount of new players entering the field, and the uncertainties associated with it. 

Equi will be headquartered and domiciled in the UK. The ICO space is as yet unregulated in the UK but the company is following the structure of crowdfunding, as per legal advice. Equi will launch a “pre-sale” for investors willing to put in a minimum of $100,000 on March 1, 2018. A public sale, with a minimum investment ticket of $100, will start on March 8. “"If we raised anywhere between $25 million to $50 million we’d be absolutely delighted”, Barrowman said. “In addition to developing the platform some more, it then gives us some scope to really put the tokens back into the investments and it kick starts the whole process - they can see that we’ve invested into the very investments that we’re promoting. If the ICO is not to be as successful as we hope, the important thing is to get it up and running because the thing will gain momentum as people get to read about what we’re promoting. And of course, the token will be traded on exchanges as well. It will be accessible”.