The Elephant is introducing an emerging blockchain technological application to secondary markets. Its innovative blockchain project seeks to draw in crypto holders who want a more stable investment tied to “real” assets. It also promises to appeal to more conservative investors just beginning to dabble in cryptocurrency holdings.
With the beginning of its private sale for its PEC security token, The Elephant grants investors access to equity opportunities previously inaccessible shares of target companies. The Elephant also offers low entrance thresholds that widens the possibility of more investor opportunities.
The project is already fully functional and offers investors shares of over 20 unicorns––high-profile pre-IPO companies like BlaBlaCar and IronSource. These private companies represent $70 million in total, and The Elephant has drawn 2,000 registered investors.
Shareholders and investors alike share in benefits through The Elephant’s model. Shareholders of the private companies can access independent liquidity before the company’s IPO or exit, and crypto investors are given diversification opportunities.
Tokenization and investment
The Elephant’s goal and vision is to tokenize the equity rights of promising private, pre-IPO companies, increasing liquidity, as well as appealing to crypto holders looking for a conservative investment option.
In order to accomplish this, The Elephant targets investments in high-profile tech companies and unicorns, before their liquidation. Its unique appeal comes from its security token PrivatEquity Coin (PEC), which can be accessed by accredited investors in order to purchase shares. Unlike other platforms, The Elephant allows investors to sell and purchase shares through its blockchain-based Digital Tokens. The crypto world and private secondary market are united in The Elephant’s innovative model, enabling pre-IPO company shareholders to sell their shares legally and through dedicated partnerships.
The private secondary market is a treasure trove of opportunity for potential investors. Until more recently, blockchain technology and crypto holders rarely overlapped into the secondary market. Now, with The Elephant’s new project and private sale, investments promise to be mutually beneficial in a rapidly expanding market. Annual secondary market transactions totaled $40B in 2015 and are projected by Forbes to reach $50B in 2019. This rapid growth is directly as a result of a very high IRR and the lengthening of transitions from venture-backed company to IPO. The average timeframe has moved from 3-5 years in 2000 to 10-12 years in 2016.
With this lengthened time, shareholders––whether founders, employees, or VCs––are forced to wait far longer before being able to liquidate their shares. Then, as a result, traditional investors are unable to access significant valuation increment prior to an IPO or exit.
The Elephant platform bridges the gap between potential sellers and buyers. Rather than being trapped into waiting longer to liquidate their shares, shareholders can use The Elephant to buy or sell rights to private company shares. These rights are “Dedicated Vehicles”, represented by digital tokens.
Bringing Worlds Together
By bringing the investment and crypto world together, The Elephant eliminates two birds with one stone. Shareholders are able to liquidate their shares, and investors are able to invest in those shares through low-entry thresholds. Additionally, crypto investors are given the opportunity to jump ahead of the curve for the future of token investment: Asset-Backed Tokens. Traditional investors also get the opportunity to begin in the crypto economy with a conservative and regulated introduction. Equity-backed tokens provide access to attractive investment options and portfolio diversification.
The Elephant stands distinct, in that it enables a low entry point for both buyers and sellers, which allows investors across the board to participate. Already, over 2,000 accredited investors are registered on the platform, in which there is $70M worth of shares in various 20+ unicorn and pre-IPO tech companies. Sellers can sell as low as $100k worth of shares and investors can buy participation rights as low as $20k through a Dedicated Token. The Elephant is the first option that combines the growing pre-IPO secondary market and blockchain technology and related currencies, to solve the pressing liquidity challenge.