What Was the Acorn Collective?
The Acorn Collective was an attempt to build a blockchain crowdfunding platform with a native cryptocurrency, OAK. The cryptocurrency project was founded by Moritz Kurtz and Peter-Andreas Kurtz in 2017. The project was active until March 2019, when it ceased operations: shorty after receiving funding in the first round of its initial coin offering, the project failed to get the financial support it needed to continue development when the Initial Coin Offering market collapsed, and had to shut down.
- The Acorn Collective was a blockchain startup based in Bristol, England, active from 2017 to 2019.
- Its goal was to reduce the costs to companies and individuals seeking crowdfunding through a cryptocurrency-powered platform.
- The Acorn Collective collapsed with the broader Initial Coin Offering market collapse in 2018 and 2019 and never recovered.
Understanding the Acorn Collective
To get to the scale necessary to implement their plan, the Acorn Collective raised $400,000 in Series A funding in July of 2017. This money funded the startup until it launched a pre-sale of coins called OAK tokens in 2018 that netted $4,000,000. The maximum number of tokens available—seven million tokens—was sold at a 50% discount. The pre-sale lasted from Jan. 29 through Feb. 19, 2018.
Kurtz released a video on Feb. 23, 2018, to announce Acorn Collective had sold out its pre-sale of tokens. In the video, he acknowledged some technical problems but appeared confident the Collective was securely on its way to an ICO.
The Collective planned to have its public ICO in 2019, the proceeds from which would fund the project to avoid charging fees on the crowdfunding platform. The OAK token was designed to be used within the Acorn Marketplace to facilitate payments for goods and services. Also, funds from the ICO were to be used to create a point-of-sale payments app–or software application—to facilitate payments electronically.
At the time, the ICO marketplace was crowded with projects looking for funding. Many were legitimate, and some were scams, but the sheer number of ICOs and market collapse likely led to the downfall of many with good intentions.
The Collective planned the ICO to sell 35 million OAK tokens, with the main ICO sale price of $1.40 per 1 OAK. Management had planned a total public sale of 72 million OAK for the ICO with a maximum supply of 90 million OAK.
The distribution of tokens was to be allocated following this system: 80% for the public ICO sale, 16.66% to the company itself, and 3.33% to "bounty and community rewards." OAK tokens were proof-of-stake only, and the Collective promised no new OAK would be generated at a later time.
By mid-2018, the Acorn team released the designated token growth and stability mechanisms and other technology necessary for the business. In a video released on Nov. 16, 2018, Ed Lobbett, the Chief Operating Officer at Acorn Collective, announced that the team had discovered that creating a crowdfunding platform was more complex than just creating a token and system of exchange.
The Collapse of ICOs and Acorn Collective
Although the Collective had invested in some highly polished marketing videos, the complexity of setting up a business that didn’t mesh with the mechanics of cryptocurrency and blockchain on top of a collapse of the ICO market spelled the end for Acorn Collective.
In a Medium piece published on Mar. 18, 2019, the co-founders (who did not sign their names to the article) told the public, “The main-sale did not go well. We expended a great deal of time and resources into making our [main sale] a success; unfortunately, the [ICO] market crashed.” These events led to the collapse of the company.
The founders also discovered they were financially tied to a money-losing venture:
Almost immediately, two-thirds of our team had to be laid off with the rest taking significant pay cuts; focused solely on delivering the platform as promised. We, as co-founders, injected more of our own capital to ensure we delivered the platform.
Goals of the Acorn Collective
The Acorn Collective was designed as a decentralized platform where individuals could raise funds or money from investors. Acorn was to connect investors with entrepreneurs who want to launch a new product or service. Often, new companies or startups look to the private sector to raise funds because they're usually too new or have little-to-no financial history.
As a result, startups usually can't get approved for credit or funding from traditional sources, such as banks. In exchange for donations, Acorn allowed those who invested to receive discounted products and services from the companies.
Acorn collective published its pitchbook in 2017 outlining how the blockchain-based crowdfunding platform would work. The pitchbook also outlined the objectives of the project, which included the following:
- Create a free crowdfunding platform that allowed nearly any legal project to be listed from almost any country in the world
- Democratize access to capital for funding, particularly for developing and emerging economies
- Create a crowdfunding hub and a secondary marketplace where goods and services that had been funded in the past could be sold
- Create the Acorn token (OAK) through an initial coin offering (ICO) to facilitate the transactions within the ecosystem, which was designed to connect the investors, founders, and consumers
Is the Acorn Collective Also Acorns?
The Acorn Collective was an attempt to raise funds to create a blockchain-driven crowdfunding application; Acorns Advisers, LLC, is a financial advisory service with a mobile app.
Why Did Acorn Shutdown?
The Association of Community Organizations for Reform Now (ACORN) is an international advocacy group for lower-income families. It is not associated with the Acorn Collective, which shut down due to a lack of funding.
Who Is the Acorn Collective?
The Acorn Collective (for blockchain, cryptocurrency, and crowdfunding) was a group attempting to raise funds through an ICO to develop a blockchain crowdfunding project.
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