Otonomos allows companies to be formed, funded and governed on the blockchain

otonomos

Geographical coverage: Singapore, Hong Kong
Year: 2015

  • Otonomos allows companies to incorporate online on the blockchain – company shares are written as digital tokens on the blockchain, held in a cryptographic wallet, transferable peer-to-peer and programmable similar to software. 
  • The firm’s services are available in Singapore and Hong Kong, with plans to expand to the U.K.

Value Proposition

  • Ease of Incorporation: Companies can be incorporated easily on the blockchain – business owners simply fill in an online form that allows Otonomos to incorporate the company as a new legal entity in Singapore or Hong Kong and register its shares on the Bitcoin blockchain
  • Ease of raising funds: Otonomos’ blockchain technology allows owners to
    • keep an automatically updated register of people who own shares in their companies
    • transfer shares easily, for instance in an equity crowdfunding campaign
  • Ease of governance: Regardless of how dispersed is the company’s share ownership, Otonomos’ technology automatically updates the cap table and allows companies to be governed efficiently using self-enforceable, smart contracts.
  • Within the financial services industry, Otonomos’ services could be of potential interest to venture capitalists, financing vehicles and special purposes vehicles. The reason being, these financial market players tend to incur huge governance costs due to the involvement of hundreds of shareholders, often geographically dispersed
  • Other potential users of Otonomos’ services could be equity crowd funding platforms, for whom Otonomos’ blockchain solution could make peer-to-peer transfer of shares as easy as sending an email

How it works?

how it works

The example given below illustrates an online dashboard of a blockchain-chartered company

dashboard

Revenue Model

  • Otonomos derives its revenues from incorporation fees and optional add-ons such as registered offices and opening of international bank accounts
    • US$500 – Incorporation fees for a Hong Kong/ Singapore registered private limited company
    • US$1200 p.a – Otonomos as Company Director
    • US$500 p.a – Corporate Secretary

Key Figures

  • Funding [2015]
    • Total: S$165,900 in two rounds
    • Key investors: Han Verstraete, Startupbootcamp FinTech Singapore 2015

Key Takeaways

  • Otonomos dematerialises a company’s share certificates and makes them digital
  • Companies incorporated through Otonomos have full legal status and shares represent genuine equity as in a real world chartered company
  • Companies can IPO from day 1 with Otonomos as it enables P2P exchange of private company shares