ICO Analysis: Pledgecamp

Imagine that someone named Alice has this groundbreaking idea for a new hoverboard. Because she lacks sufficient funds to start developing the product, she needs others to fund her. She can present her idea along with a viable business plan and a prototype to some angel investors, just as in BBC Two’s infamous TV show Dragons’ Den. But since she has neither at the moment, she can ask ordinary people to chip in by promising them some benefits, like a discount when the product is ready or the product itself depending on how much the person has contributed.

This is a quite accepted method of funding in the modern world and is called crowdfunding. Although many crowdfunding platforms already exist, the two most known platforms are Kickstarter and Indiegogo. All kinds of people ask others to fund their projects in these sites, yet once the product creator has obtained the required funds when the funding is completed, he or she has no further incentive to start or keep up the development. In fact, studies show that around 85% of projects on Kickstarter have delayed the product delivery and 14% did not deliver at all.

Pledgecamp provides an alternative solution to the problems which crowdfunding platforms face. Blockchain technology enables the team to develop several features such as Backer Insurance which can be taken as the primary property distinguishing the project from its non-blockchain rivals. Thanks to Backer Insurance, project backers can protect their funds from misuse. By keeping a determined percentage of the collected funds in an escrow smart contract and releasing them when milestones are met and approved by backers, project owners are now strongly incentivized to deliver milestones and at the end, the promised product itself.

Token

In the Pledgecamp platform, a dual currency system is implemented. Pledge Coins (PLG) are used to list and back crowdfunding campaigns, store value in Backer Insurance, buy and sell services on the platform, and more. On the other hand, Camp Share Tokens (CS) are used to reward users for their contributions to the platform such as removing offensive or unlawful campaigns or enforcing terms of service. It is possible to trade CS tokens with PLG tokens on a 1-1 basis.

The total supply of PLG is 10,000,000,000 tokens with the following token distribution:

  1. 45% community reserve
  2. 5% creator acquisition fund
  3. 5% moderator acquisition fund
  4. 10% company, team, advisors
  5. 15% platform fund
  6. 20% public distribution

How the team is planning to use the token sale proceeds is not stated at the time of writing.

Team

CEO Jae Choi: Choi is a successful angel investor who has made investments in Robinhood, Circle, Wish and Talkdesk and the former product manager at Ustream.

Thomas Leupp: Leupp was the movies editor at Hollywood.com.

Advisors

Randi Zuckerberg: Zuckerberg is the founder of Zuckerberg Media. Previously she has worked at Facebook and Ogilvy. She is also the sister of Facebook CEO and Founder Mark Zuckerberg.

Jim Augustine: Augustine is the COO at Zuckerberg Media.

Matt Curcio: Curcio is the vice-president of data at Ripple. Previously he has worked as the chief data scientist at Neustar, Inc.

Alan Chang: Chang is the operations lead at Airbnb.

Keith Teare: Teare is a founding shareholder at TechCrunch.

Partners

Meta Lab: Meta Lab is a company specializing in interface design. Its previous clients include Google, Disney, CBS, Coinbase and Slack.

Verdict

Below is a breakdown of the risks and growth potential of Pledgecamp.

Risks

  • Although the use of smart contracts can solve centralized crowdfunding platforms’ problems, a decentralized crowdfunding platform is bound to appeal to a smaller crowd for now. (-2)
  • It is not exactly clear why the platform needs a dual currency system of PLG and CS tokens. (-2)

Growth Potential

  • Backed by all-star advisors. (+3)
  • The use of the blockchain technology along with smart contracts has a high chance of solving the problems which crowdfunding platforms such as Kickstarter and Indiegogo face. (+4)
  • The partnership with Meta Lab is praiseworthy. (+2)

Disposition

The existing crowdfunding platforms such as Kickstarter and Indiegogo suffer from problems of trust and misuse of funds by project owners. Studies show that around 85% of campaign starts delay the delivery and 14% do not deliver at all. This is mainly due to that once the project owner has obtained the funds, he or she has no incentive to develop the product by the promised deadline. Pledgecamp provides a viable solution to these problems by using smart contracts and blockchain technology. The project is backed by all-star advisors such as Randi Zuckerberg and Matt Curcio. Meta Lab is going to develop the user interface, and this is definitely praiseworthy as their former clients include Google, Disney, and Coinbase. Still, as main-stream adoption of blockchain-based platforms is far from here, the platform will likely appeal to a niche crowd for now. Also, it is not extremely clear why the team is going with a dual currency system of PLG and CS tokens. Pledgecamp receives a 5/10.

Investment Details

Type: ERC20 – Utility

Symbol: PLG

Platform: Ethereum

Crowdsale: December 3rd

Minimum Investment: $50

Price: $0.01

Hard Cap: $20,000,000

Payments Accepted: Unspecified

Restricted from Participating: China, and The United States

For More Information

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