Fundraise
As a startup with significant potential for growth, XBorg is utilizing its utility token, XBG, to secure additional funding. In addition to relying solely on traditional investors such as venture capitalists and business angels, XBorg is opening up investment opportunities to a limited number of community members early. This approach ensures a strong foundation for XBorg and secures the longevity of its DAO.
What is your fundraising strategy?
Our objective in raising capital is to facilitate growth and cover the team's monthly expenses. We are mindful of not over-raising and instead prioritize value over quantity of capital. At present, XBorg has a robust financial position, with a 20-month runway, and thus, there is no pressing need to raise additional funds.
Strategic round
Date: Summer 2022
Amount raised: $1m
Valuation: $25m
Seed round
Date: April-September 2023
Amount: $5m
Valuation: $45-55m
As we prepare to launch our token, our current plan does not include raising any additional funding rounds. However, we remain open to adjusting our strategy based on the traction we observe with the protocol and any potential needs for additional hires. Ultimately, we will decide based on what is best for the long-term growth and success of XBorg.\
What are the locking and vesting terms for private investors?
Private investors will have 10% of their tokens unlocked at the Token Generation Event (TGE), followed by a lock-in period of 3 months. After the lock-in period, the remaining tokens will vest over the course of 18 months.
It is important to remember that our approach may be subject to change based on the specific requirements of the exchanges we engage with. It's not uncommon for tier 1 exchanges to have a say in the tokenomics and vesting/locking schedule of a given token, and we may need to adjust our strategy to meet their standards.
Who are your investors? on which criteria were they selected?
We've been meticulous in selecting our investors for the initial funding round, prioritizing those who bring more than just financial capital but also add value to XBorg in other significant ways. Our investors come from a variety of backgrounds, including:
Aave and Lens Protocol: Professionals from these companies bring deep expertise in blockchain technology and cryptocurrency.
Yield Guild Games: Experience in virtual economies and blockchain gaming.
ESL/Face it, Faze, G2: These represent some of the biggest names in the esports industry, offering insights and networks into competitive gaming.
Ethereum France, Consensys: These contributors have extensive knowledge of Ethereum and blockchain development.
French Esports: Brings a strong understanding of the esports landscape in France.
Savvy Games: Experts in game development and strategy.
How is the cap table distributed?
For the strategic round, we implemented a cap of $50,000 per investment ticket to ensure a fair distribution on the cap table.
What kind of value added do you expect from an investor?
An investor can add significant value to XBorg by bringing strategic guidance, mentorship, and financial support beyond the initial investment. Investors can offer insights into the competitive landscape, industry trends, and potential growth opportunities that may not be immediately apparent to the XBorg team. They can also provide access to their networks and resources, including introductions to potential partners, advisors, and customers. This can help XBorg build its user base, establish partnerships, and expand its reach in the market.
Beyond financial support, investors can also bring credibility and validation to XBorg, which can be critical in a competitive and rapidly evolving industry. This can help XBorg stand out among its peers, attract additional investment, and build a strong brand reputation.
Overall, investors can offer a wealth of knowledge, expertise, and resources to help XBorg succeed in the long term. They can provide value beyond just capital and help XBorg navigate the challenges of a dynamic and constantly evolving industry.
Are you selling shares or tokens?
To date, XBorg has only sold tokens without any shares being offered for sale. Currently, the company's sole shareholders are SwissBorg and the founder of XBorg. This approach was deliberately chosen to ensure a streamlined focus on value accrual for the company without diluting attention or resources by distributing shares.
How are raised funds used?
We are raising a $5m seed round. The raised funds will be allocated as follows and will be spent over three years.
Technical developments: 60% ($3'000'000) of the funds will be allocated to technical developments and infrastructure costs. This represents the cost of 10 FTE engineers for three years at an average market salary of $7'000 per month.
Marketing: 20% ($1'000'000) of the fund will be allocated to marketing expenditures, influencer campaigns, PR, sponsorship opportunities, and events.
Liquidity and exchange listings: 10% ($500'000) of the fund will be allocated to exchange listing payments and liquidity provision.
Operating costs: 10% ($500'000) of the funds will be allocated to office rent, legal fees, and software subscriptions.
The current treasury covers the non-technical HR costs.
What is the anticipated financial runway resulting from this fundraising round?
The funds raised from this round are expected to provide XBorg with a financial runway of approximately three years. This means we anticipate the resources obtained will sustain our operations and growth strategies for this period.
As a private investor, am I eligible to invest early in XBorg?
XBorg extends early investment opportunities primarily to strategic investors with extensive experience in gaming, esports, and/or the entertainment industry. Apart from the community raise, if you do not meet these qualifications, early investment might not be possible. However, once we reach the public round stage, it will be open to all interested investors, regardless of their background or expertise.
Given the current market conditions, are you confident about your ability to raise?
To date, XBorg has generated significant interest from venture capitalists and business angels, resulting in approximately $1.5 million in potential funding for the seed round. Our team recognizes that our ability to attract investors is contingent upon demonstrating progress in executing our roadmap and gaining traction in the market. While we remain committed to securing funding, our approach prioritizes attracting high-quality investors over accumulating a large investment.
How did you compute your valuation?
At this stage of our company's development, utilizing traditional valuation methods based on earning multiples, discounted cash flows, book value, or liquidation value would not provide a comprehensive or accurate picture of XBorg's valuation. As a nascent startup operating in the highly dynamic and rapidly evolving field of GameFi and SocialFi, our value is largely determined by more intangible factors such as our technology, team expertise, and market potential. Therefore, our team is taking a more holistic approach to valuation that incorporates various metrics and considers the unique characteristics of our industry and company.
As part of our due diligence process, our team analyzed comparable projects within the GameFi and SocialFi spaces, taking into account the current trading value of similar tokens and the results of the latest investment rounds. While these factors played a role in determining our overall strategy, we also recognize that other variables, such as current traction in the market, can influence investor appetite. Ultimately, we determined that a valuation of $45 million represented the best trade-off between attracting high-quality investors and generating sufficient overall investment interest.
What is the anticipated price of the token at the Token Generation Event (TGE)?
The public fundraising is set to be facilitated through a Balancer Liquidity Bootstrapping Pool, with the starting price for tokens established at $0.5. The pool will begin with a weight ratio of 96:4 and gradually balance out to a 50:50 ratio over a 72-hour period. However, it's important to note that this initial pricing and weighting structure may be subject to change, in accordance with the specific conditions and requirements of any future exchanges that XBorg collaborates with.
Which protocol is utilised for the Liquidity Bootstrapping Pool during the Initial Token Offering (ITO)?
The Liquidity Bootstrapping Pool for our Initial Token Offering employs the Balancer protocol.
What mechanism does XBorg use to determine the starting price and valuation, given that the Liquidity Bootstrapping Pool (LBP) greatly influences future price sentiment and movement?
What can I expect in terms of return on investment?
Although the XBG tokens are expected to be offered at a higher price post the seed round, it's crucial to understand that investments inherently come with risks, and we cannot provide a guarantee of a positive return on investment. Like any investment, the performance of XBG tokens is subject to market conditions and other factors that may influence their value.
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