Coin Rivet recently brought you the story of an Initial Coin Offering (ICO) project, Sponsy, which had been listed for sale on eBay for $60,000.
Coin Rivet has since got in touch with the head of Sponsy, Ivan Komar, to discuss the reasons behind the company’s eBay listing.
In a candid interview, Mr Komar also provided us with his insight into the crypto and blockchain space – revealing “the world is not ready for decentralisation”.
The birth of Sponsy
The idea behind Sponsy is simple: to create a decentralised platform which connects sponsors with sponsees.
When quizzed on the conception of Sponsy, Komar reveals it stemmed from his personal experience in trying to raise capital.
Komar was trying to raise funds for a hackathon he was organising in Minsk, Belarus. However, he found it difficult to find transparent sponsors in an industry that is full of “fraud and scam”.
He notes the sponsorship industry may contain even more scams than the blockchain industry because “every partner is trying to tell you a price that is higher than the actual price”.
He states: “The industry is definitely in need of improvement because transparency is something it lacks.”
Cue the birth of Sponsy. Interestingly, Sponsy can function in either a decentralised system or a centralised one.
Sponsy received requests to make the product work “for both those who wanted to be transparent and for those who wanted to be opaque as usual”.
“That’s when we realised the world is not ready to jump into decentralised-type businesses,” he adds.
Why build the product before raising capital?
Perhaps one of the more interesting aspects of Sponsy’s story is that the product was developed before any funds had been raised.
Speaking on this, Komar states: “We tried to market with our token sale and our lawyer famously told us not to do this because it might be considered a potentially illegal action.
“So we decided to develop the product first and only after that we tried to raise money.
“It was a pretty noble idea because at that time, in the very middle of this crypto bubble, most of the ICOs did not have an idea for products.”
Coin Rivet asked Mr Komar whether the ICO craze fizzling out contributed to the situation the company now finds itself in. He responded by informing us: “The crypto bubble has popped.”
He believes this is a product of retail investors losing a lot of money through ICOs, and while institutional investors still invest in ICOs, they only look “for great technology”.
“Just having a basic website with promises is not enough,” he adds.
The world is not ready for decentralisation
When asked if he would do anything differently, Mr Komar informed us that he would try to raise money first. Not to scam or defraud investors, but to be fair to them.
“We would raise money and then allow them to use our product with discounts or maybe for free,” he says.
However, he does not have any further plans in the cryptosphere at this time.
He states: “I realised the world is not ready for decentralisation, yet.
“The technology has some potential for sure, but for now I think we need to educate people first and then we might want to develop some products.”
Interestingly, the eBay listing came about as an entirely arbitrary decision.
He explains: “Absolutely no reason at all (to list on eBay). I thought it could be something that would attract the attention of the media – which it did!”
While the listing is for $60,000, Mr Komar believes this figure is too low – a more accurate one would be $200,000, which he believes is how much the team would have earned if they were paid a full-time salary.
The bidding ends today, and at the time of writing, it has one bid locked in.
Missed the original story about Sponsy’s listing on eBay? Discover more about the ICO project that ended up on eBay for a starting price of $60,000.