** Rating Has Been Edited **
I will not edit my review content below as I want anyone to see my initial concerns and how the project addressed them. --See Comment Section.
All my concerns were addressed and answered, allowing me to move this from a 3 to a 5 rating.
I particularly like the ideas of...
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Standardizing the vesting of the fund to 5 years from TGE regardless of the underlying vesting schedules. This should also help the speculation value of the NFT in the open market.
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The potential "liquidity outlook" feature that can give investors an idea of the time required or projected for the revenue returns.
-------- The Original Review --------
When I spotlighted this I was still thrilled to be the analyst covering all the exciting aspects of the project, including tokenomics and the unique features of the NFTs. Unfortunately, things didn't go as planned... lol
One of our fellow analysts, Jeppopo, decided to cover the project, and I think he did a fantastic job.
As analysts, we try not to duplicate another analyst's perspective as it adds little value to the project. Therefore, I commend Jeppopo for delving so deeply into the project and articulating his reviews so well. If you need a comprehensive understanding of how things work and why we are both excited about this project, I recommend reading his work.
There is only one concern I can think of that hasn't been covered, and it's my only worry. It's a complex issue to explain, so I hope it makes sense to those who are not as familiar with presale and OTC.
While the funds can encompass any type of investment, the primary use case is to provide the 99% (all Streeters) with investment opportunities in early presale rounds, particularly Seed or even Pre-Seed rounds.
This is fantastic, but based on my experience in hundreds of presale rounds, the incubation period from when you fund these rounds to the Token Generation Event (TGE), where the token goes live, can be years (especially in current market conditions). I have investments at much later rounds (private stages) dating back to 2021, and I'm still awaiting their launches.
Furthermore, the earlier the funding round:
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The fewer tokens you receive at TGE.
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The longer the Cliff (the time from TGE to when vesting starts).
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The longer the vesting period (the time it takes to receive all of the tokens).
They have ingeniously mitigated most of my concerns by offering NFTs representing your contribution to the fund. These NFTs can be sold speculatively on any NFT marketplace. However, based on my extensive experience with presale OTC (Over-The-Counter) transactions, these NFTs will likely lose some value, as potential buyers often pay less than the full price when sellers want to exit their positions. Yes, in some cases, they sell for more than face value, but not in most transactions.
Also, I realize this is not true presale OTC as the NFT is an On-Chain asset, but the principle is the same here.
Let's set that aside for a moment and address the core of my real concern. The money contributed to funds is used to purchase investments, and there is no revenue earned or real return for the Common Wealth community until these projects launch and generate revenue. Adding to this challenge is that they have generously offered to make investors whole before the heavier "carry fee" comes into effect, which is the real value capture in the tokenomics.
I am genuinely concerned that it will take a considerable amount of time to get this amazing project off the ground, and I hope that somehow the revenue from the NFT sales and the sale of the $WLTH token can provide enough runway for lift-off.
Median Time Between Funding Rounds (Source: Carta data)
"Without controlling for right-hand censoring, the naive approach provides estimates that range from 14 to 19 months between funding rounds. Only once we include all data points do we get estimates closer to the two-year timeframe. The data also indicates that CEOs need to plan for a longer runway with later funding rounds, as the time span between rounds increases. The differences between series Seed-to-A, A-to-B, and B-to-C are statistically significant at 5%." Show Less
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