Startup: Republic Core
Security type: Profit-sharing token
Cap: $8 million
Price per note: $0.12
Minimum investment: $100
Where to invest: Republic
Deadline: Today (The $8 million cap is almost sold out. Anyone with a serious interest should invest immediately.)
I’ve come across dozens of digital tokens built on the promise of huge profits from future services provided to future customers.
The only “real” thing about these coins were the current problems that they wanted to address. That and the high degree of risk investors in these coins were taking on.
I’m perfectly fine with that — as long as investors understand the risk involved. But I prefer the digital coins based on real present day revenue — like the ones the startup portal Republic recently created.
Republic offered $8 million worth of these coins – called “Republic Notes” – to everyday investors for the first time last Thursday.
Within 48 hours they were nearly sold out.
We had planned to send you our recommendation to buy these coins this Thursday. But there’s no time. If you don’t invest today, you’ll probably be left out. Even if you do, there’s no guarantee you’ll be allowed in.
I fully expected Republic to sell out all of its coins. But the huge and immediate demand took even me by surprise.
I get it, though. The Republic Note offers instant diversification at scale, and they’re backed by real operations. Republic has helped companies raise $125 million.
And as a Note holder, you get a cut of the profits when any of those companies cash out (including those raising only from accredited investors)… and from any future startup that cashes out after raising on Republic.
This year, Republic expects up to 140 companies will crowdfund (and 90% of them will be successful given Republic’s historic track record). Next year, it expects 200 companies will launch crowdfunding campaigns on its site.
Startups pay Republic for its services through a combination of cash and shares. Republic owns 2% of the shares of the hundreds of companies that have done successful crowdfunds. At the moment, they’re worth $4 million. Dozens of these companies will cash out down the road – either via an IPO or buyout. When they do, all of those proceeds will go directly to noteholders.
Republic also makes from 1% to 16% (carried) interest from syndicated investments made by accredited investors on its site. A quarter of that money will also go to Note investors (only when those companies cash out). Republic describes its future disbursements this way (emphasis mine)…
Republic’s crowdfunding platform and private capital platform receive cash and an upside potential in every company they raise money for, in the form of equity, carried interest, tokens, etc. If and when those positions succeed some or all of those earnings will be paid back to us and ultimately to Republic Note holders.
“If and when.” That sums up the risk startup investors take in three words. Who knows how much the early-stage shares investors buy will be worth by the time of a liquidity event. Or, for that matter, if there will be a liquidity event.
Anything from 5X to 100X or more is possible. Many variables determine the ultimate return to startup investors. But at least some of Republic’s top-caliber startups should provide triple-digit returns. The trick is picking the winners.
Republic’s Notes neatly solve this problem by giving you a piece of… well, everything — including future revenue. There’s no catch. But you need to understand that these Notes were not designed to make investors triple-digit gains.
Here’s how it works. You pay a minimum of $100. At 12 cents each, you get 833 digital coins (or Republic Notes). The tokenomics are structured so that there will never be more than 400 million of these coins in circulation at any one time.
Republic can disburse profits to noteholders whenever it wants. Disbursements are also automatically triggered whenever Republic accumulates $2 million or more of revenue from its companies cashing out through IPOs or buyouts. Several big IPOs could happen as soon as next year.
So let’s use that $2 million figure to do some quick math…
A $2 million disbursement spread among 400 million Notes amounts to a half cent per note. Noteholders get roughly a 4% dividend every time Republic makes a disbursement.
That’s one way to realize value from your Notes. Here’s another. The more successful exits from startups, the more dividend disbursements Republic makes, and the more income you’ll earn from your Notes. And that should raise the value of your Notes — which will eventually be listed for trading on crypto exchanges.
Time is on your side. Republic is expanding. It just started offering investors real estate deals through its collaboration with Compound in addition to video game deals through its partnership with Fig. As Republic continues to grow and expand its startup services (and the number of investors and startups it serves), its value should increase.
The Note is a low risk way for investors to get a steady stream of income. By sharing in Republic’s success and the success of the companies it helped raise capital for, investors will be in line for big profits from the increasing price of its Notes over time.
Investing in the early-stage companies we’ve recommended to you through the years has given you plenty of big upside opportunities. But the reality is that can take years. The Republic Note should give you a steady stream of income (beginning as soon as next year) with very little risk. And meaningful appreciation is still on the table!
I think it’s the perfect combination for First Stage Investors.
How to Invest
Republic Core is raising up to $8 million on its site. If you don’t already have a Republic account, you can sign up for one here.
Once you verify your account and are logged in to Republic, visit the Republic deal page.
Then click the blue “Invest in Republic Note” button. Enter the amount you want to invest, starting as low as $100, and proceed through the required steps. Be sure your investment is confirmed, then you’re good to go.
This opportunity, unlike most other early-stage investments, is not very risky. Individual early-stage investments often fail. The Republic Note derives its worth from the totality of early-stage investments made on the Republic site. So risk is substantially (but not completely) reduced.
If Republic executes well, risk shouldn’t be a problem. The investment you’re making is only liquid If and when the Republic Note is listed on an exchange. You may be able to sell them there. Over time Republic may also facilitate peer to peer trading of its Republic Note.
All that said, I believe the Republic Note offers an attractive risk-reward ratio.