Camp One Ventures invests $500,000 in Mobius Network ahead of ICO

Mobius Network announced it has received a $500,000 investment from Camp One Ventures days before its digital token sale is scheduled to begin on Nov. 22.

The San Francisco company is aiming to raise $39 million through an initial coin offering of its MOBI token to fund operations and hiring. The blockchain company provides a universal API that allows developers to build consumer-facing applications using cryptocurrencies, at a lower cost than the Google and Apple app stores, it claims.

Mobius currently offers 14 apps on its DApp store, including BitBounce, an email spam solution backed by venture capitalist and DFJ co-founder Tim Draper. BitBounce announced in August that it would use the Mobius API to scale its service.

“It’s hard for developers to use the blockchain technology to connect to the $200 billion market capitalization of cryptocurrency and its fast growing economy,” said David Gobaud, CEO and co-founder of Mobius. “Mobius is easy for consumers to use and easy for developers to use.”

Gobaud previous co-founded Yoshi, a startup that refuels cars where they are parked. That company raised $2.1 million in funding from investors like Y Combinator, Zhen Fund, and Liquid 2 Ventures.

Gobaud says the Mobius network’s app store does not charge developers who host their apps on the Mobius network, and he has no plans to charge a fee in the future. Google and Apple recently lowered the standard app store transaction fees that developers must pay to 15 percent down from 30 percent.

Since 2014, more than 220 blockchain startups have raised $3.3 billion through ICOs. The vast majority have been held on the Ethereum network.

But the Mobius ICO is one of the first to run on Stellar, another blockchain network that Gobaud says maintains faster and cheaper transaction times. Jed McCaleb, a Mobius adviser, co-founded Stellar in 2014 after co-founding the Ripple network in 2011.

Palo Alto, California-based Camp One Ventures, which makes early-stage investments in fintech companies, invested in Ripple and Stellar, as well as other blockchain companies.

Mobius previously held a token pre-sale in August, but refunded customers “because of legal and tax reasons,” said Gobaud, who spoke with VCJ from the Cayman Islands, where he and co-founder Cyrus Khajvandi moved the company’s headquarters in preparation for the network’s public sale. “I did a lot of significant legal research and wanted a very robust and compliant solution,” Gobaud added.

He says he is working with Deloitte and the international law firm Paul Hastings to ensure that its tax structure is compliant with U.S. and international law.

A second pre-sale is ongoing, which offers buyers MOBI tokens at discounts of 5 percent to 18 percent, with a minimum investment of $20,000. A number of prominent investors have bought into the pre-sale, Gobaud said. He declined to name them, but said Draper was not among the list of investors.

A total of 5 percent of the MOBI tokens will be distributed during the pre-sale, with another 30 percent sold in its ICO with a hard cap of $39 million, according to Gobaud. The company will retain 32.5 percent for its own operations and the remaining 32.5 percent will be reserved for a community pool “to incentivize network growth and reward contributors,” according to the company whitepaper.

Camp One Ventures is the only venture firm to invest in Mobius, although Gobaud said other firms approached his company hoping to invest. He declined to name those firms. Camp One’s experience in fintech and blockchain investing made the firm a good fit to work with his company, he said.

But venture firms are largely prevented from directly investing in cryptocurrency tokens due to a lack of qualified blockchain custodian banks, or financial institutions that safekeep securities.

“We really wanted to get them involved, but they couldn’t do tokens,” Gobaud said. “So we made an exception.”

“We like the focus and thoughtfulness and the care by which David and Cyrus are building the company,” said Rob Claassen, a principal at Camp One Ventures, who added that the firm assisted the fledgling startup with legal compliance.

The venture firm’s investment is akin to the Y Combinator simple agreement for future equity, or SAFE, model, Gobaud said. Camp One will not take a board seat.

Thus far in 2017, 18 blockchain companies, including Mobius, have raised $37.73 million in funding from venture investors, according to data from Thomson Reuters.

Disclosure: Kaitlyn Bartley and her husband own cryptocurrencies, including Ripple’s XRP.

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