Frankfurt/Main, May 28th, 2019 - The Frankfurt fintech start-up Cashlink, a portfolio company of FinLab AG (ISIN: DE0001218063; Ticker: A7A.GR) is currently issuing its own blockchain-based digital securities. This makes Cashlink one of the first companies in Germany to digitize securities and issue them as equity instruments. The aim is to demonstrate the functionality of their own product. The digital securities are issued in a private placement to another new business angel in addition to the four existing investors Finlab, Panta Rhei, seed & speed and Deplanis.
The digital securities reflect profit participation rights. This means that all investors who invest in the company via this instrument participate economically to the same extent as the company's shareholders - for example in exit proceeds or dividend payments. The sale of digital securities is aimed exclusively at professional investors such as venture capital funds, business angels or high-net-worth individuals.
The legal framework for the issuance of the digital securities was designed by Cashlink in collaboration with the internationally renowned law firm Ashurst in accordance with German law. Germany as a location offers a high level of legal security for all parties involved in the issuance of digital securities compared to other countries.
"By successfully issuing digital equity to venture capital investors, we have shown how start-ups can easily provide their investors with an additional form of raising capital: A completely digital investment with a very simplified investment process via indirect, virtual participation," says Michael Duttlinger, co-founder and managing director of Cashlink. He further explains: "In exchange with renowned venture capital funds and business angels, the standard market conditions of investment contracts were transferred into a digital form. The economic investment conditions are thus just as attractive as classic investments.
"The first issuance of a digital security by Cashlink in the form of a security token confirms that we have invested in a very innovative and technologically optimally positioned company. We see great potential here to be able to participate in the future form of corporate financing through digital securities with Cashlink technology," comments Stefan Schütze, Member of the Board of FinLab AG.
Standardized, digital fundraising has numerous advantages for start-ups and investors. The simplified shareholder structure and significantly lower transaction costs also make the investment of smaller amounts attractive for start-ups and investors, which means that more capital can be made available overall. By issuing the tokens, professional investors can also continuously invest in a company. So far, start-ups have bundled investments into financing rounds due to the high transactions costs involved. By investing via digital securities, young companies can now raise capital exactly when they need it. This creates additional flexibility for both: startups and professional investors. The fact that the digital securities are issued on a blockchain also makes it possible to transfer them easily and inexpensively to other investors. More transparency and the traceability of transactions are another advantage of using a blockchain solution.
Which technology is used?
The digital securities are issued on the Ethereum blockchain. Ethereum is currently the most mature technology with a large community that ensures continuous development of the technology. The Ethereum Blockchain enables simple and secure transfer of assets via digital securities that are also easy to trade.
About Cashlink Technologies GmbH:
Cashlink is a venture capital financial technology company founded in 2016. The company is headquartered in the Fintech hub of Deutsche Börse in Frankfurt am Main. The innovative team has one goal in mind: the digitization of easily transferable start-up shares. It is supported in this by renowned investors such as the listed VC FinLab AG.Through its blockchain-based infrastructure, Cashlink simplifies the fundraising process for start-ups. For professional investors, the company creates flexible, easily transferable digital start-up shares regulated under German law in the form of a so-called security tokens. Cashlink works together with numerous partners such as the Start-up Centre Startplatz Köln or the Startport start-up hub. Cashlink is a founding member of the International Token Standardization Association and the Hessian branch of the Blockchain Bundesverband.
CASHLINK Technologies GmbH
Tel: +49 69 348 752 76
About FinLab AG:
Stock market listed company FinLab AG (WKN 121806 / ISIN DE0001218063 / ticker symbol: A7A) is one of the first and largest company builders and investors focused on the Financial Services Technologies ("FinTech") sector in Europe. FinLab focuses on developing German FinTech start-ups and providing venture capital for their financial needs, whereas in each case the aim is a long-term participation and ongoing support of the investment. FinLab also invests globally, as part of venture rounds, in FinTech companies, primarily in the USA and Asia.
Phone: +49 69 719 12 80 0
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