Hey Redditors!
I am pretty new to the altcoins scene and have recently started looking into ICOs and Airdrops.
I was researching last week and came across this project, LEXIT. I’ve read the whitepaper and it seems pretty promising, so I thought I’d bring my thoughts here and sees what you guys think.
From what I understand LEXIT are trying to improve the Mergers & Acquisitions space by creating a platform based on the Ethereum blockchain.
What I really liked initially was the CEO, Amir Kaltak, is focused on not just the “large” business sales, but also kind-of recycling start-ups that have failed, but still have good IP. This really appeals to me because I think to myself how many amazing ideas may go completely wasted just because start-ups fail (for any NUMBER of reasons!).
M&A is a pain in the ass
So, I’ve been doing some reading about Mergers & Aquisitons outside of the LEXIT literature and it genuinely does look like a pain in the ass.
Some issues seem to be: - It’s really expensive. Corporate lawyers are involved and it can be just a nightmare. - It takes ages. Because a lot of detached parties are involved, it really can take ages for these deals to go through. Like...years. - Liquidity is an issue. There are a lot of buyers and sellers globally, but bringing these buyers and sellers together is quite an issue. There doesn’t seem to be a single platform doing this effectively that I can find.
LEXIT’s proposed solution
Upon reading the Whitepaper, I see that LEXIT want to tackle these issues by creating a unique crypto-oriented platform that allows for the seamless facilitation of M&As and IP transactions -
Marketplace: - The LEXIT marketplace puts up for sale any pre-owned contracts, company branches, and start-ups. Potential buyers can scan through the available listings and then pick the ones that they desire to invest in using an advanced.
Native Ecosystem: - LEXIT has created an exchange ecosystem so that all such sales and transactions happen seamlessly. The whitepaper mentions that they would be incentivizing their customers, via bonuses, and encourage participation on its marketplace. The co-founder, Wajid Khilji, has also spoken about how the company will also provide legal assistance to customers for the preparation of M&A and IP transactions. This is a very positive step.
The next step for me was to find out exactly how the technology is used and how the blockchain is implemented.
These are my findings - - Sellers make use of LEXIT’s web interface to create his/her listing after a thorough check to ensure the legitimacy of the person/company performing the sale. - Potential buyers can search for listings of patents, IPs, or start-ups that they would like to purchase. - The whitepaper states that when there are several offers from different buyers, sellers have the option to go through the transactional history of each buyer and choose with whom he/she would like to do business. - The LEXIT app interface guides “both parties through the necessary steps for closing a deal “and utilizes experts’ knowledge of due diligence, valuation, etc. - Finally, LEXIT finalizes the deal by creating data entries that record each aspect of every transaction.
So far so good, my next question was – who really benefits from such a dApp set-up?
There are three obvious groups who would directly be addressed -
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Sellers: These are the individuals who own a company, IP, or patent and wish to sell it in a completely decentralized manner. Through the use of the LEXIT platform, sellers can interact with potential investors, assessors, and other individuals to not only test the waters but to make sales that are profitable for both parties.
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Buyers: These are the users who are looking to purchase IP, digital/physical assets, or even companies to expand their businesses. Through the LEXIT interface, they can request information from sellers and then make an informed decision about investing or not.
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Assessors: Assessors are third-party intermediaries that provide sellers and buyers with specialized expertise as to the value of the patent, IP, or start-up. Additionally, they can also assist with the due diligence process by looking at company books, as well as help with the drafting of purchase agreements and jurisdiction-specific legal documents.
Finally, I wanted to find out some disadvantages and drawbacks to the company, so I could actively invest knowing about the risks behind it.
- All across the internet, I found that M&A deals are pretty complicated and a lot of the subtleties come up during final negotiations. This presents a major drawback for its model.
- It is also difficult to fully describe the item (placed on auction), without disclosing too much information and without knowing the sellers identity.
- There is no way to effectively compare “valuations”.
With all this in mind, I moved on to checking out their ICO details, w.r.t which token they offered and what the token did?
- Lexit shall offer the LXT token. This is to avoid using BTC/ETH and prevent the massive price fluctuations.
The LXT token is for: - Giving ratings to the buyers and sellers, based on their participation on the listed teams. - Executing payments to experts and other participants for their role in finalizing a deal. - Categorization of listed items to prevent issues related to tag vandalism. - For paying commission fees to the company on the completion of a successful deal.
That’s my analysis of Lexit, and I would be participating in the LEXIT airdrop.
They have to fix the issues with having a standardized marketplace, and this definitely needs some work from their team.
Tell me about what you all think? And let’s have a discussion about it in the comments!
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