Industry Influencer Q&A #17: Oscar Jofre
This blog series is dedicated to sharing the thoughts of industry influencers from across the payments and e-commerce sectors. Over the coming months, we will continue to ask experts to comment on the key issues and trends affecting the industry, and share their thoughts with you here.
Our latest industry influencer is entrepreneur and technology specialist Oscar Jofre (@Oscarjofre). He is co-founder, president and CEO of KoreConX, which offers a free all-in-one solution that helps companies navigate the process of raising equity capital, as well as simplifying shareholder communications to reduce risk.
How large is the market for equity crowdfunding at this point? And what are the main pros and cons of this fundraising method?
It’s hard to quantify the equity crowdfunding market globally, since even the world’s best researchers are still working on it, and equity crowdfunding is so new that it grows exponentially year over year. The Alternative Finance sector in North America is $36.49Billion according to the Cambridge Alternative Finance Report April 2016, but this includes more than just equity crowdfunding. We have a long way to go before we see the true impact of equity crowdfunding.
The pros are many from a company perspective. If I’m using equity crowdfunding to raise funds for my company, I can reach a larger audience. From an investor perspective, when I view these opportunities I’m being given an opportunity to participate in the market in a way that I couldn’t before. For portal operators, they have the chance to do more deals, reach a wider audience, and manage their investors in a more effective way.
The biggest issue the industry is facing at the moment is in regards to education. Companies don’t really understand yet how to prepare for this new way of capital raising, and the level of transparency that’s required of them. Investors need to be educated as well, so they can grasp the fundamentals of early stage investing, and so that they understand the fine points, such as who the operators of equity portals are, and who to trust.
As has been the case every year since equity crowdfunding began, the market will continue to grow year over year, as more and more portals launch. More regulators like the SEC and FCA are being proactive in educating the market to make this happen, and happen smoothly.
What do you view as the most exciting potential applications for blockchain?
The most exciting potential application for blockchain to me would be the ledger capabilities it has, as this has a larger impact on global businesses. Capital markets, private markets, real estate and government will all be feeling the effects.
With all the data that is being created and managed daily, the blockchain ledger technology is the breakthrough that is going to transform the inefficiencies we currently have globally. A great example of this is capital markets where we have companies issuing share certificates, and investors receiving copies or originals.
What do you feel have been the most important fintech developments of 2016?
Regtech is hugely exciting to me, because without regtech, there really is no fintech. Fintech companies can’t operate without it, and I’d go so far as to say that regtech is the engine that keeps it all running smoothly.
As we approach the end of the year, do you have any 2017 fintech predictions that you’d like to share?
2017 is the year of global expansion, and global domination, for fintech companies. With regtech backing them, it’s a lot easier to stay compliant across regions, now that the tools are in place to do so. Beyond that, I think that blockchain is about to take a big step outside of the “fintech” universe, and into real businesses in diverse industries using blockchain as their backbone.