The startup sector has been rife with activity and 2017 looks to be another banner year. A total of $69.1 billion was invested in startups in 2016 and the number is expected to be even higher for 2017. Global seed and angel deal volume touched $2.21 BLN in Q2 2017, up 16.3% from the Q2 2016 figure, with a total of 3,715 deals closed.
Despite a lot of talk of how the tech sector is disrupting established industries, no one is talking about how the tech sector is completely overdue for disruption itself. We have been researching this sector closely to give you the most promising potential investments candidates. The ones that can literally multiply your capital manifold and secure your financial future. Because startup investing is profitable. Incredibly so.
Research shows that on average angel investors make 2.5x times their money on any given seed investment. Venture Capital firms, which invest after the initial seed stage, on average make 3.8x times their investment. But what is interesting is that most of these returns are generated at the Series A stage, when startups are still young and small. Seed investments that are kept until exit generate on average a massive 644% gain.
There are a couple of problems with this picture. First of all, financing startups remains predominantly the domain of:
- Venture capital funds
- Seed funds
- Angel investors
This has partially changed as the Securities and Exchange Commission (SEC) now allows startups to raise up to $1 million in a 12-month period through crowdfunding. Crowdfunding has nevertheless failed to loosen the grip of institutional startup investing. Equity-based crowd-funding provided only 15.6% of total UK seed and venture stage equity investment in 2015.
The second problem is that seed and VC investing is almost never liquid. The only way an investor can get out with a profit is 1) by selling to another investor or 2) via an IPO. In many cases, it can take angel investors 5 years and VC investors up to 8 years to get their money out.
So why is all this important?
It’s important because this company has found a way to make startup investments liquid, as well as a way to give normal investors, not just institutional Investors the opportunity to get a slice of world’s future Ubers, Snapchats, and Facebooks – before they become billion-dollar global icons.
Our thorough research activity has helped us uncover Digital Arts Media Network (OTC Ticker: DATI), an industry game-changer.
Digital Arts Media Network (OTC Ticker: DATI) is aiming to disrupt the way investors make money with startup investing and the way startups raise funds. Its management recognized the lack of liquidity associated with investment in traditional accelerator programs and started working on a model that would help finance more startups and attract more investors. In the words of CEO Ajene Watson: “Mom-and-Pop investors, with little capital to invest or connections to leverage, should have an opportunity to participate in the same vetted startups as angel investors; fostering greater wealth through greater access.”
The resulting business model is the Public Accelerator-Incubator, also known as PAI. PAI rotates around the 3 major needs of the startup sector:
- Startups needing money
- Angels needing liquidity from their private investments
- Investors needing to invest in companies at low valuations, before series A rounds and IPOs
Digital Arts Media Network’s PAI offers:
- An insurance-wrap product to reduce investor downside risk in startup investments
- A “coupon style” product, providing investors with an annual income stream
- Liquidity to investors within 15 Months from their startup investments
- Immediate access to prestigious startup investment opportunities to the investment public
With the PAI:
- Digital Arts Media Network (OTC Ticker: DATI) aligns with leading private accelerators and incubators to form unique partnerships. These partnerships, with sector leaders like Y Combinator and 500 Startups, enhance the vetting process and expedite traction for startups.
- Digital Arts Media Network (OTC Ticker: DATI) partners with successful entrepreneurs, venture capitalists, and development teams to provide startups with general and functional mentorship from industry leaders.
- Digital Arts Media Network (OTC Ticker: DATI) provides startups with a series of capital infusions over the course of 3 months (acceleration period) to 24 months (incubation period), while taking a minimum 6% stake in the startup.
The PAI’s strong attractiveness is the fact that is it not a competitor to well-known accelerators/incubators. It is actually a complementary offering as it helps angel/seed investors get immediate money for their stakes. In exchange, DATI gets an equity stake of 6% in a portfolio of dynamic and fast-growing startups.
Normal investors can then simply buy DATI on the stock market and participate in a portfolio of companies – bought at the lowest valuations of their lifetimes. In other words, investors get their proportional share in the potential Facebooks, Snapchats, and Ubers of the future – just by buying one stock.
The PAI business model is designed to improve as more deals are executed. This is the process:
- More startups join PAI’s portfolio, improving returns and decreasing risk through diversification
- More startups participations means better returns for investors in DATI
- More DATI investors means DATI’s market cap becomes bigger together with its trading liquidity
- More angel and VC investors see opportunity to monetize their investments by selling part of their startup stakes to DATI
- More angel and early-stage investors means more money, more frequently, and for more startups
Digital Arts Media Network (OTC Ticker: DATI) is expanding its offering of investment programs, which already includes:
Angels+ – A capital formation program that gives a startup the ability to provide angels and early-stage investors access to liquidity within 24 months.
Exchange Direct – A program designed for more mature startups, helping investors to turn their stake into cash before selling the company or floating it on the stock market.
Frankly, the profit potential of startup investing cannot be captured in full by dry statistics. To get a better idea, investors should look at the staggering results obtained by seed/angel investors in today’s top tech companies, such as Facebook.
Harvard sophomore Mark Zuckerberg started Facebook in a Harvard dorm room in early 2004. Legendary VC investor Peter Thiel invested $500,000 in September 2004 for 10% of Facebook, valuing the entire company at only $5 million. Today Facebook is worth over $500 billion or 100,000 times the 2004 valuation.
And this is just a handful of thousands of other examples of success:
- Benchmark Capital’s $12 million investment in Uber in 2011 is now worth over $7 billion, or almost 600x times more.
- Sequoia Partners and Greylock Partners invested $7.2 million in Airbnb in November 2010. That stake is currently worth more than $1 BLN.
- Benchmark Capital also invested $13.5 million in Snapchat in 2013, an investment worth $2.2 billion by the time of the Snapchat IPO in March 2017.
DATI is now doing what these top VC funds do – invest at low valuations in companies with superior technology, proven management teams and game-changing products.
Shareholders are about to share the profits from this ride. DATI is already invested in a portfolio of promising startups with unique market-product fits, experienced teams and disruptive technology. Among them:
Vezt – This blockchain-based music royalty sharing app is disrupting how music gets made and who owns it. It democratizes the way artists make and share music with fans while giving fans the ability to make money from an artist’s royalties and licensing income. CEO Steve Stewart has 25-years of experience securing artist contracts with major labels like Sony Music, Warner Bros. and Atlantic Records. Under his leadership, Vezt has acquired the rights to songs by top-level artists including Drake, Kanye West, John Legend, and others. The songs will be listed on the platform by its launch, projected for Q1 2018. Vezt has already raised more than $3 MLN in the last 12 months by the most sophisticated and savvy tech investors.
OpenVision Labs – DATI took a 10% stake in this media company in early 2017 at a valuation of $2 MLN. OpenVision is pioneering a video-streaming technology that promises to disrupt a sector whose size will balloon from $37 BLN in 2017 to $60 BLN by 2020. OpenVision has entered DATI’s mentorship program for startups and has recently been valued at $5 MLN, or 150% higher than DATI’s original investment.
Fundanna – In August DATI bought an equity stake in cannabis crowdfunding company Fundanna. Fundanna allows cannabis-related companies to raise up to $1 MLN per year from accredited and non-accredited investors, with low investment requirements. DATI is now positioned to profit from a sector that is growing exponentially. The ancillary cannabis market, which is what Fundanna specializes in, grew 161.2% in 2016, with investment/M&A up 366% and sales of consumption devices up 116%.
DATI also announced on November 8th another venture in what is currently the hottest sector in the tech universe – digital currencies. The company retains Stevan Nerayoff, co-founder of Ethereum, as an advisor for Vezt. DATI is also expanding its capital acceleration programs for those startups leveraging blockchain technology and cryptocurrency platforms.
The media keeps on saying that VCs are looking for ways to monetize over $500 billion in investments outside of the stock market. At the same time, with bond rates close to 0% and inflation starting to creep upwards, small investors are hard-pressed for high returns.
Digital Arts Media Network (OTC Ticker:DATI) is answering both dilemmas. It is pioneering a new way to raise money and democratizing investment for startups. The PAI has the potential to bring hundreds of billions of new dollars into the tech sector – while DATI accumulates valuable investments in innovative companies.
Stocks like DATI are a rarity – especially when they are still undiscovered. Remember, DATI has a first-move advantage in the sector and the share price could rise quickly as the Company garners media attention. Owning stocks like DATI is the new way to profit from the billion-dollar companies of tomorrow.
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