Being the transcript of the questions and answers segment of the discussions with the founders of SCALE which was held at the GIFTEDANALYSTS WhatsApp group chat on 20th March 2021.
We’re able to spot out the founders of SCALE, Mr Justine Eboka and his co-founder, Femi BABATUNDE discussing the future of the platform.
Q: Tell us a little about you.
A: I’m Justin Eboka, Co-founder of SCALE, an economist and all round tech guy, SCALE is my newest venture and before SCALE, I founded and exited a food tech startup and I also invest in tech start-ups when I spot one I like. Also, I’m Femi Babatunde, an economist, certified accountant, finance professional and I love tech also.
Q: How did you come about SCALE? What was the problem you saw and wanted to solve?
A: well prior to SCALE, I had founded and invested in tech start-ups and seen first-hand the stress and issues founders have to go through to raise capital for their companies but as someone who has invested in tech start-ups too, I’ve also experienced how tough it is to spot start-ups that are investable and also how hard it is to participate in their rounds. SCALE is here to solve problems for both founders and investors, we like to say SCALE is the Robinhood of angel investing. Also with the influence of decentralised finance, we believe investing should be made easier for everyone interested.
SCALE is also trying to make things easier, kind of the same way everyone can now invest in publicly traded companies by buying stocks on bamboo or Robinhood app, SCALE is offering small investors who want to dabble into angel investing an opportunity to do so in a similar way with which you currently buy stocks through an app on your phone. SCALE is looking into startups, an artist, even to the extent of tokenizing real world assests, it’d make any retail investor to be able to choose startups, brands or other listed assests on the platforms.
Q: Okay, so how do you decide which startups are eligible to be on SCALE?
A: Well this includes some fundamentals I’m sure alot of people here are familiar with, other technical analysis of each start-up based on industries they are in. Non-financial parameters are also been set up to make the best Startups list or get funding through SCALE. We won’t list startups we won’t invest in ourselves.
Apart from start-ups SCALE will also offer opportunities for investors to invest in creatives and brands. See it as owning equity in things like films, albums or any other artwork, with the rise in NFTs I’d say investing in art should never be something average retail investors forgo.
Q: Do you have technical expertise in Blockchain technology?
A: Yes I do, a really wide experience I’d say. I am weeks in becoming a solidity developer also.
Q: With the uprising of digital art sales as Non Fungible Tokens (NFT), what do you think is the future for “physical Art”? Sculptures, paintings… Etc.
A: I see NFTs as a derivative, the thing about physical art is that it’s either backed by history or the physicality behind it, there could be a decline in its sales in the future but I don’t think it’s ready to go into oblivion just yet. See SCALE in the less corporate, rigid way, we don’t just want Short term success but with the believe that most of what we are investing in are in the Long run we will back the best Startups with the fundamentals of innovating or providing proper value in the long run. We are democratising Angel investing, giving eveyone a chance at investing in the next flutterwave or Paystack.
Q: What is the difference between SCALE and a typical private equity company?
A: Well as an angel investor you basically provide liquidity for startups and small business owners and get equity from it.
Q: What’s your coverage like? Is the list limited to start-ups in Nigeria or worldwide?
A: I’d say we will list Nigeria/African start-ups as a start but globalization and remote communications will allow us to bring any startups in the Long run, both start-ups built off-chain / on-chain. Also, we are not restricting ourselves to Nigeria, we’ll offer opportunities to invest in foreign start-ups and creatives too, SCALE itself is not a “Nigerian” company, so rest assured you won’t be restricted to just Nigeria.
Q: I used to think Angel investors just invest in startup for a future return but you stated they also have a share in the equity. What differentiates an Angel investor from a shareholder?
A: Well shareholders are for listed companies either privately or publicly, which is in turn also providing capital, an angel investor solely provides capital for startups or businesses not listed but with the future belief in it, also like any rational investor these beliefs are backed up by research. What it basically means is that u don’t own equity immediately but when a specified event occurs (acquisition or IPO) your investment converts into equity at a subsidized rate and at the current conpany valuation as at when the event occured.
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