ReserveFunding Investors Close First DeFi <> CeFi Bridge Loan!
Recall that in December 2021 the first ReserveFunding offer was listed. It was filled, almost immediately, by our ReserveFunding community participants. We’re pleased to announce that the Atipana loan principal and interest (APY) has been fully distributed! Atipana Capital is a merchant cash advance provider and likely one of the first, large-scale fund participants coming to ReserveFunding in Fall of ‘22.
U.S.-based, accredited investors from the unFederalReserve community supplied their $USDC or USD, depending on preference, to a special vault in order to earn an 8% return for the 90 days following the deal’s closing date.
In today’s article, we’ll be going over:
- What is ReserveFunding?
- The story, ideation and interest behind ReserveFunding
- ReserveFunding x Atipana Capital vault (Credit Opportunity Fund I, LP)
- What it means for $eRSDL token holders
What is ReserveFunding?
ReserveFunding is a product suite for U.S.-based, retail digital asset holders who would like to diversify out of crypto correlated returns. ReserveFunding is also for new RIAs and crypto hodler-users looking to store money in traditional alternative investments while they explore the world of possible crypto yield generating options.
ReserveFunding is a software as a service (SaaS) platform that bridges DeFi (decentralized finance) into CeFi (centralized finance). This allows crypto/DeFi users to:
- Keep their funds in the crypto ecosystem without having to convert to fiat.
- Generate yield without relying on the price of Ethereum, Bitcoin etc.
For more information about the ReserveFunding product and ecosystem, click here.
The story, ideation and interest behind ReserveFunding
Private equity, tribal lending, merchant cash advance, and other funds are always looking for new sources of capital, and easy-to-use, regulatory-compliant fundraising rails, ReserveFunding offers an investor acquisition and execution speed competitive advantage, without taking on incremental risk. And not to mention, users can use $USDC and soon other supported stablecoins. No more wires and transfers built on the TradFi (traditional finance) rails that take hours if not days to arrive.
Step 1 was ideating the product
Here is our early product lean canvas. Apologies if some of the colloquialisms in the chart are insensitive, but it is the best short-hand we could come up with to summarize the details.
Our amazing community of over 40,000 unique individuals across multiple social media channels are excited to find a home for its digital assets that performs independent of crypto market sentiment. With our team’s unique blend of blockchain and traditional investment, we were able to couple those two ideas together.
Step 2 — Measure Interest
After creating the lean canvas, we then devised ways to test the hypothesis. unFederalReserve leveraged Twitter analytics, Google Analytics, Hubspot and our vendors to trace the reception and survey the market. We wanted to know what the acquisition funnel would look like for our product, but also provide a marketing tool to funds to demonstrate that the next $1 Trillion is coming from X type of investor looking for Y type of investment.
This table highlights those data collection efforts over a period of 30 days ending December 31, 2022. The data told us a lot of interesting information.
First of all, our engagement on social is very high by industry standards. We‘ve observed around 4% to 6% engagement rates in a market where anything north of 1% is considered excellent. These patterns emerge from the data and train us to distribute information at key times for maximal effect.
Other data told a good story.17,000 people saw us tweet a call-to-action (CTA) for ReserveFunding (ex: https://unfed.info/3GEA6uM) and 10% or 1,600 clicked the link. That 10% engagement rate is huge considering anything north of 1% is a victory for most folks. One-quarter of those that clicked the link then went on to join the waitlist. The psychology of that crossing cannot be understated. 500 people out of an original population of 17,000 divulged their identity and provided answers to important survey questions.
For instance, we learned that at least 10% of the respondents invest more than $100k at a time and typically hold investments for at least 1yr and in some cases as long as 3yrs. We also learned, importantly, that about 25% of the respondents were self-identified as U.S.-based and accredited. For 506(c) raises, those two points are a must have, and prove to be the most marketable statistic from the whole discovery process. There are folks willing and able to invest through this channel, and the funds need simply to sign up to partake.
We are most impressed with the results of our efforts related to the specific Atipana deal. We selected, at random, half the U.S.-based, accredited investors and drafted a new CTA email. In that CTA, we asked them to set up time with me on my calendar. We observed a 70% open rate of that email, also a significant positive indication, and about 20% of the recipients scheduled that meeting. All of them wanted to invest, and in the end we selected about half-a-dozen to participate based on their true eligibility and interest.
ReserveFunding x Atipana Capital vault
Atipana Capital was the first fund to test the rails of ReserveFunding to fill up a vault for their credit opportunity fund. For more info on the vault and specific fund, click here.
Investors were pointed to not only KYC themselves but to prove accreditation. This was all done through our relationship with Securitize. Users filled out the application with the requisite materials, and once approved, were provided subscription documents to complete.
This is where the process becomes more procedural. Investors were approved based on their KYC results and the information in the subscription document. They were then offered the manner in which they preferred to invest. Even though our primary objective was to test the handling and transmutation of USDC from investor to investment, we did allow some participants to wire funds directly into the investment account. ReserveFunding can accept BOTH fiat and crypto investments with the help of our partnership with Circle and its foundation.
All the necessary legal and regulatory filings were completed as per established under existing U.S. law, and Atipana was able to put the funds to work immediately. 90-days later, at the maturity of the investment, the process was reversed. This time the mix of who wanted funds directly wired into their provided bank account, and ones that wanted USDC back was different. Even so, there were no issues and investors were paid back, in most cases, within hours of the funds being made available by Atipana.
What does this mean for $eRSDL token holders?
This is the super simple part. Atipana paid us a licensing and management services fee expressed as a percentage of the amount raised for the amount of time the investment was outstanding. A portion of that income will go to purchase eRSDL out of the market. We did not charge transaction fees to investors this time around, but going forward we will. A portion of those fees will also go towards open market purchases.
So, what did we learn from all this? First off, funds want to be exposed to new investors in a way that is safe to both parties and effective. Getting the funds’ information into ReserveFunding, setting up secure wallets through our Fireblocks integration, using Docusign for subscription agreements and NDAs easily flowed along with our Securitize-based KYC process. Sending funds between various banks, wallets and Circle could not have been more intuitive. Our ability to control transactions with multi-sig authentication and shared screens all sums up to a robust product for investors and funds alike.
Special thanks to all those who participated in our first fund and here’s to many more to come! ⛴️
Stay connected with unFederalReserve ⚓ https://linktr.ee/unfederalreserve
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