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The Evolution of Private Securities is Just Beginning

I am proud to share that iownit is open for business!  

It has been 2.5 years since we started working on iownit. Shortly after embarking on this journey we established iownit Capital and Markets, Inc. and our wholly-owned broker-dealer subsidiary IOI Capital and Markets, LLC.

I am excited to now share that IOI Capital and Markets, LLC. has become a registered broker-dealer with an Alternative Trading System (ATS)  license. We are believed to be the first such broker-dealer in the U.S. to operate a blockchain-based platform for the digital issuance of private securities and secondary trading of private placement securities.1

In light of this milestone, I would like to take a few moments to reflect on why we launched this business and how we will proceed. It has been a team effort, and I’d like to thank all of our employees and advisors for their continued efforts and support.

Our mission is an ambitious one. We want to leverage technology to digitize private securities and radically improve the functioning of the private markets. This digitization will optimize the flow of capital thereby enabling capital seekers, investors and their advisors to engage and transact in the market with confidence.

From day one we focused on three key themes:

1. Private placement securities markets are ripe for digital innovation
Capital flows and access are critical for every business and the economy, while the ability to make investments in private enterprises historically has been able to generate wealth for investors. U.S. public capital markets are the envy of the world – deep, liquid and transparent, generating returns while driving the global economy forward.

The difference between public and private markets is that public securities transact in a completely digital format, while private securities still transact on paper.  As a result of this inefficiency in private markets, many entrepreneurs struggle to find sources of funding while other “trendy” companies drown in capital. Many investors also suffer from market inefficiency by not having access to a broad range of investment opportunities.

However, technological advancements have made it possible to digitize private securities and reshape capital flows in this market. The impact of this change can be significant for all market participants. We believe digitizing private securities opens up opportunities for a broader market in which companies and investors can engage, transact and potentially grow wealth. Digitization of private securities can lead to a more liquid secondary market, broader participation by accredited investors, better risk management, diversification and other benefits that public markets provide investors today.  

But the first step in making all of this possible is to create a platform on which digital private securities can be issued.

2. The right technology can have a profound impact on our target market
Perhaps more so than any other sector of the economy, the evolution in the financial services industry over the past 50 years has been tightly connected to its adoption of technology. Whether in equity markets, retail banking, wealth management or any other sub-segment, technology plays a key role in making financial services more accessible and easier to use. Indeed, the very core of finance is now digital.

However, technology must be developed and leveraged in compliance with the appropriate regulations to benefit the market participants. Blockchain is an enabling technology to digitize securities such as equity, convertible notes, and debt. We are digitizing private securities on our platform to allow investors and issuers to transact efficiently. It is entirely possible to use the full power of blockchain technology without resorting to the creation of new types of financial instruments such as coins or tokens. In fact, we believe that the tokenization of existing assets is a dangerous endeavor.

3. We must build an open platform if we want to change investor behavior
The word “platform” is very popular with businesses of all types, but it means different things to different people. When we speak of the iownit.us platform, we mean a set of services and capabilities that focus on regulatory compliance. We have invested in building these capabilities to allow our platform to be in compliance with current applicable laws and regulations, and we are committed to continuing to invest in iownit’s compliance infrastructure. We believe compliance is important because technology will allow us to support a significant number of users, so that we can achieve economies of scale and minimize costs of compliance for all market participants.  

We built the iownit.us platform to be an open system. It is not only for investors and businesses seeking investments, but it is also an opportunity for most financial services intermediaries who wants to use our technology to provide private security investments to their clients. We envision that as we move private placement securities to a fully digital format and build a broader market, new service providers and business models will emerge. 

After all, we have already seen this phenomenon in other parts of the industry – for example, the evolution of online-only banks and robo-advisors. I believe we are in the early innings of this game and, in a few years, we will see a completely different marketplace for private capital. Our goal is to be the company that powers that marketplace.

We are now open for business. But for us, being open for business means more than just onboarding users and focusing on revenue. We will continue to build our platform and invest in tools and services for our users. We’ve built a talented team of finance professionals and technologists to continue development of the iownit.us platform. We are open to partnering with organizations whose goals are to improve the flow of capital, increase market efficiency, create investment opportunities for investors and promote the development of entrepreneurship across the country. If any of these goals resonate with you, please get in touch: https://iownit.us/contact-us/ 

And if you’re interested in what we’re doing, please watch this space – as we have many more updates on the way.

IOI Capital and Markets, LLC (“IOICM”) does not provide investment advice, endorse, analyze or recommend any securities. All securities listed on our platform are offered by, and all information included on this site is the responsibility of the issuer of such securities. All brokerage-related activity is conducted by IOICM. IOICM makes no communication that is to be construed as a recommendation for any security offered on the iownit.us investment platform. Investments in private placements, and start-up investments in particular, are speculative and involve a high degree of risk. Those investors who cannot afford to lose their entire investment should not invest in start-ups. Companies seeking startup investments through private equity issuance tend to be in earlier stages of development and their business model, products and services may not yet be fully developed, operational or tested in the public marketplace. Member FINRA/SIPC. 

1. Private Placement Securities are securities offered and sold pursuant to certain exemptions from registration with SEC. For more detailed overview of Private Placements see here: http://www.finra.org/investors/private-placements-explained

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