"The Bitcoin Startup Ecosystem is Frail: Beware of the Next Crash"

http://startupmanagement.org/2015/02/07/the-bitcoin-startup-ecosystem-is-frail-beware-of-the-next-crash/

Very interesting article.

Since I regard Nu as the first decentralized startup ever, I d like to ask the Nu team, its business partners and its community the following questions:

  • What is the value proposition? (easy :smile: )
  • What are the business models to generate revenues?
  • How are we going to acquire users and customers?
  • How are we going to resist competition?

If we are no able to answers these questions now, we need to roll up our sleeves and work hard. :man_with_gua_pi_mao:

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I think right now our job as shareholders is to make sure Nu has a solid foundation. This means doing things that we’re already doing right now, advancing NuBot technology to ensure higher amounts of liquidity, making the LPC an attractive and profitable role, improving the protocol with better voting mechanisms and features that help protect our customers like NuBits burning. We’re basically building Nu to ensure that 1 NuBit will always equal $1, that it’s safe, secure and that it has the highest amount of liquidity possible, all with the advanced features of crypto technology.

This is the product we’ve created and once it’s rock solid, I believe people with more business experience will most likely be attracted to Nu and shareholders will start to divert their attention to figuring out how to make more dividends with it. I posted something similar in another thread, but I believe there are limitless possibilities here to make money. Earning profit from the network through transaction fees and selling currency to people is basic at best. Cryptog brought up good points in his quote below.

Once our currency has a solid foundation, Nu could expand to working with custodians that run lending banks and even investment banks, earning a percentage of all profits. I think this is where the real money is at. Only relying on profit from NuBit sales is a dead end long-term. Creating business in the real world through loaning and investment opens up shareholders to huge potential profits and dividends. If we can figure out how to increase dividends through real business like this, then the NuShare price will no longer be dependent on how much currency we sell. It would create an even stronger backing for NuBits.

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Thanks @cryptog for bringing this very interesting post.
That post brings up a very relevant point to Nu.

"The Risks of Crowd-sales

At the heart of this increased risk is the self-booted, crypto-enabled, crowd-sale phenomenon which is gaining popularity. It is a powerful feature of the cryptocurrency platforms and protocols, but we should be careful in how we manipulate this type of an instrument.

The pre-mines, pre-sales and crowd-sales are just promises to deliver. Founders get money to develop stuff. This is like a big angel/seed round, but with no strings attached and loose diligence. These crowd-sales come with promises of self-accountability and transparency, but at much lower standards of scrutiny than in a traditional venture capital process.

The initial ramp-up often depends on how many people they can dupe into the crowd-sale itself.

Although some of these crowd-sales have shown some transparency, it is not near the required levels.

Many of the Distributed Autonomous Organizations, platforms and protocols are fairly theoretical at their inception. But will they work in reality? As I outlined previously, the operational framework around DAO’s must not be under-estimated. And there are no standards of reporting practices for DAO’s or early crowd-sales companies."

Which makes me come down to that question: is Nu a serious business? or a mere crowd-funded experiment?

Some Guidelines to Dampen the Risks and have in mind for our Systematic DUE DILIGENCE, as NuShareholders funding NuFork projects:

Startups

Don’t hype what you are doing; under-promise and over-deliver
Think about how you’ll get users and customers, not just how you’ll develop the technology
Educate and teach what you have learned to others; we need more crypto-tech developers
Investors

Don’t speculate
Do your diligence
Be inquisitive
Fund dreams, not lies
Consumers

Get educated
Ask questions
Follow others who have done diligence
If you have money, it doesn’t make you smart
Be patient before investing; we’re still passing the hors d’oeuvres
Media Editors and Writers

Don’t just publish anything
Mention other players in a given space when describing what a company does
Do comparisons, research and analysis
Investigate and check facts
Everybody

If it sounds unreal, or if there are more questions than answers, run away.
If the entrepreneur is dreaming of euphoria and quick gains, run away.
If it looks like a ponzi scheme, run away.
If you see slick presentations with 12 advisors and board members, and no product yet, run away.
If the company can’t explain their potential business model, or can’t articulate how different they are from other players, run away.
If they want to get funded before developing a line of code, run away.
Do we need experimentation and lots of investments in order to find gems and big ideas? Of course, we do.

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Still a good read.