StartEngine was founded in 2011, and is headquartered in Los Angeles, California. They are a company with lofty goals. StartEngine has indicated that their mission is to ‘empower 5000 companies to raise capital and create 1 million jobs in the next 5 years’.
Tokenizing Assets Everywhere
Wealth can be found everywhere in the world. Nearly anything can have a monetary value associated with it, whether this be a piece of art, a vehicle, company assets, real estate etc. Unfortunately, much of this wealth is completely illiquid. This means that despite someone being wealthy, per say, they may not have the ability to access their own worth.
Through the use of blockchain technology, much of this wealth can be tapped, accessed, and put to use. By digitally issuing securities, in the form of tokens, we are now able to attain fractionalized ownership of companies and assets, which would not be accessible before.
This is where StartEngine comes in. To achieve this process of tapping into wealth, we need trusted platforms that will facilitate the process of issuing digital securities, as well as provide the foundation on which these assets will be secured and traded.
This protocol was developed with a specific purpose in mind by StartEngine – facilitate digital securities in addition to the regulations associated with them. Based off of the popular ERC-20 protocol, this token standard is both open and easy to adapt. Through its use, issuers of digital securities are able to ensure adherence to regulations enforced upon the industry.
Simply put, this protocol allows for smart-contracts to be deployed, while providing users the benefits of the security offered through regulations, as well as those from a decentralized environment.
Not only is has SmartEngine utilized this new standard for the issuance of their own security tokens to shareholders, but intend for it to be used by all issuers that make use of their platform.
Security through Record Keeping
Issuers and token holders alike will benefit from increased security due to services offered by StartEngine. One of the main sources for this increased security is through the use of a registered transfer agent.
A registered transfer agent is a book-keeper that connects token issuers to holders. They facilitate the distribution process, while maintaining a record of token ownership. Through the use of a transfer agent, tokens cannot be stolen or lost. As the tokens cannot be sold or traded without going through them, any individual not documented as the official token owner cannot do anything with these tokens. If victim to a hack, the official owner simply needs to inform the transfer agent. The tokens in question will then be nullified, with new replacement tokens reissued to the true owner.
This is simply one example of the benefit of using a transfer agent for platform services. The number of benefits are, however, many.
Behind the Scenes
StartEngine is the brainchild of both Howard Marks, and Ron Miller. Under their watch, StartEngine looks like a strong bet to disrupt traditional finance.
StartEngine has already hosted one STO, and is now looking to host another. In this round of fundraising, the company will be looking to raise $10 million @ $7.50/share. This round of fundraising is limited to accredited investors only, with full details being available on their website.