Vimba - NEM Ventures First Portfolio Investment


#1

It gives us great pleasure to announce that NEM Ventures has now made its first investment in a portfolio company - Vimba.

We would like to thank the community for the patience and support to get to this position and the team at Vimba for working collaboratively while NEM Ventures was incorporated in parallel.

Vimba are an innovative and established company that provide three primary services:

  • Regular monthly savings allow customers to automatically save FIAT from a bank account and have crypto delivered to their wallet.

  • Instant Buy & Instant Sell allows customers to purchase crypto via ad-hoc bank transfer of FIAT into crypto using integration with banking networks and crypto exchanges

“NEM is a quality community driven project, run by the people for the people, which aligns with the ethos at Vimba. The investment is going to enable Vimba to grow into new regions, develop the platform further, providing a safe and trusted gateway to the new economy.”,
Sam Blackmore , Founder and CEO of Vimba.

Sam has provided a video for the community with a short overview of who Vimba are, where they have come from and where they are going:

These two services are the beginning of a larger vision to build a crypto-first banking model which is able to offer all the services you expect from a FIAT bank, in the crypto world. That could encompass earning interest on savings, collateralized debt, stable coins, loans etc.

Based in Auckland, New Zealand, they have ~6k customers and recently expanded into the UK as the first service to allow immediate FIAT to Crypto deposits via the core UK banking network; beating even Coinbase. Vimba have partnerships and plans in place to enter the Australian market in 2019, followed by other European markets shortly after.

Vimba already offers a unique and proven FIAT on/off ramp for BTC and ETH right now, with existing monthly revenues and a platform that is ready to scale. They are well advanced with integrating XEM into the platform and expect to launch this by the end of Q2 2019. Integrations are already present with Binance and the dev team are working through the automated creation of NEM wallets to which customers hold their own keys, along with the final stages of the UK banking network integration.

Vimba started in 2014 and has weathered both Bull and Bear markets, even outperforming some of the larger services in the market during the current Crypto Winter. This investment represents NEM Ventures recognition of the vision and value Vimba brings to providing a FIAT on/off ramp for the NEM community and a commercially viable enterprise. The investment provides sufficient runway to enable those scaling plans to really kick in.

The growth of Vimba to date has been a combination of investment from the founder, backing from the New Zealand government and seed investment + capital market guidance from Techemy Capital. These partnerships provide further depth and credibility upon what is already a solid foundation built by Sam and the team.

NEM Ventures have invested $0.5m as a convertible note, the funds will be released in 2 tranches over the next 4-6 months. Vimba will hold ~10% of the investment as XEM in their treasury to support ongoing operations, alongside their existing ETH and BTC holdings. This approach was taken to give Vimba the certainty required for runway whilst scaling and manage the flow of funds over a period of time. The convertible note manages the investor protections and conversion points to coincide with planned scaling and subsequent investment rounds.

NEM Ventures encourage everyone in the community to check out Vimba, and for those in the markets they are already operating in - why not open an account and see how it works? For those in the other markets - they will be with you as soon as they can!

We are organising the translation of this information in the next few days and will share additional updates wherever possible. We are also co-ordinating with Vimba and Techemy to publicise these announcements beyond the NEM Community so look out for further PR in the coming days

Japanese: https://nemjapan.jp/nemventures-first-investment/


NEM Ventures - next steps
Vimba – NEM Ventures First Portfolio Investment
#2

(Updated with some more links and non-english ones)

The PR work is starting to bear some fruit, below is where this article has been picked up so far:

NEM Flash
Vimba – NEM Ventures First Portfolio Investment

Yahoo News
Investment arm of NEM Ecosystem makes first portfolio investment in Vimba
https://finance.yahoo.com/news/investment-arm-nem-ecosystem-makes-090048249.html

Finance Magnates
NEM Ventures Debuts Portfolio Investment with Vimba

CryptoNinjas
NEM blockchain venture arm invests in crypto savings platform Vimba

Finextra
NEM Ventures invests in New Zealand crypto savings platform Vimba

TokenPost
NEM Ventures invests in crypto savings platform Vimba

The News Asia
NEM Ventures invests in crypto savings platform Vimba

Bankless Times
NEM Ventures investment fuels Vimba expansion

CryptoBriefing
NEM Ventures Unveils New Investment In Vimba
NEM Ventures announces a new investment in crypto banking platform Vimba.

BTC Manager
NEM (XEM) Venture Capital Arm Makes First Portfolio Investment
https://btcmanager.com/nem-xem-venture-capital-arm-makes-first-portfolio-investment

Bitcoin Exchange Guide
NEM’s Venture Capital Wing Invests In Vimba, A “Cryptocurrency Bank
https://bitcoinexchangeguide.com/nem-blockchain-makes-investment-move-into-vimba-crypto-savings-platform/

SludgeFeed
NEM (XEM) Announces Its First Venture Capital Investment

Bitcoins Channel
NEM (XEM) Venture Capital Arm Makes First Portfolio Investment - BTCManager
https://bitcoinschannel.com/nem-xem-venture-capital-arm-makes-first-portfolio-investment-btcmanager

Altcoin.ist
NEM (XEM) Venture Capital Arm Makes First Portfolio Investment

Non-English publications:

ODaily

星球日报 | 媒体称网易星球无人运营并非空穴来风;星巴克否认直接使用比特币进行支付;瑞士证券交易所开始交易基于以太坊的ETP

https://www.odaily.com/post/5136317

36KR

星球日报 | 媒体称网易星球无人运营并非空穴来风;星巴克否认直接使用比特币进行支付;瑞士证券交易所开始交易基于以太坊的ETP

(Planet Daily | The media said that the unmanned operation of NetEase Planet is not unfounded; Starbucks denied direct use of Bitcoin for payment; Swiss Stock Exchange began trading ETP based on Ethereum)

Baijahao.baidu

星球日报 | 媒体称网易星球无人运营并非空穴来风;星巴克否认直接使用比特币进行支付;瑞士证券交易所开始交易基于以太坊的ETP

(Planet Daily | The media said that the unmanned operation of NetEase Planet is not unfounded; Starbucks denied direct use of Bitcoin for payment; Swiss Stock Exchange began trading ETP based on Ethereum)

https://baijiahao.baidu.com/s?id=1627213502756129474&wfr=spider&for=pc


#3

NEM Ventures Team;

Congratulations on your first investment as a VC.

There are a few questions I hope you can address:

  1. Why was the investment structured as a convertible note instead of taking equity in Vimba upfront?

What are the investor protections mentioned? If possible, could you shed some more light on the planned scaling and investment rounds of Vimba?

  1. When will the note mature?

  2. What is the coupon on the note?

  3. What was the valuation of Vimba when the transaction was entered into?
    How does this translate into the equity NEM Ventures will receive upon maturity of the note?

  4. I notice a deviation from the “Delegated Financial Authority” process, found on page 14 of the “Mandate / Public Proposal” linked on the NEM Ventures website.
    Per that process, investments between $50k and $750k “must be released and managed in at least 3 milestones, ideally more”.
    It is mentioned in your post that the note will “be released in 2 tranches”.
    Is my understanding correct that this is a deviation from the process outlined in the Mandate? If so, why is this the case?

  5. If possible, could you release the full terms of the note?
    At the very least, could it be clarified:

  • Is the conversion of the note mandatory?
  • What rights (governance & management), if any, were acquired via the investment?
  1. Are there any equity dilution protections structured into the note?

  2. Were there any other investors in this round of funding?
    If so, did they enter with terms similar to those of NEM Ventures?

I look forward to your reply.


#4

Thanks for the congratulations and questions, some answers below.

From the type of questions you clearly know the subject and likely have experience. A lot of what you are asking for is commercially sensitive information will not be shared publicly, I’ve flagged that were possible in the answers.

  1. Why was the investment structured as a convertible note instead of taking equity in Vimba upfront What are the investor protections mentioned? If possible, could you shed some more light on the planned scaling and investment rounds of Vimba?

It was selected because it best meets the needs of both NEM Ventures and Vimba. Investor protections are the standard ones you would expect in a convertible note and nope detail of the note is private.

Scaling intention through 2019 and early 2020 is to expand on the UK launch that happened late in 2018 and launch in Australia via partnerships that are already in place. In parallel the team are actively engaged with partners in European countries but as you would expect with Crypto and traditional banking, that process takes time so the exact order and country selection is being made still.

  1. When will the note mature?

Private information

  1. What is the coupon on the note?

Private information, there is a coupon in the note though and an interest rate (also private).

  1. What was the valuation of Vimba when the transaction was entered into?
    How does this translate into the equity NEM Ventures will receive upon maturity of the note?

Private information until conversion occurs

  1. I notice a deviation from the “Delegated Financial Authority” process, found on page 14 of the
    It is mentioned in your post that the note will “be released in 2 tranches”.
    Is my understanding correct that this is a deviation from the process outlined in the Mandate? If so, why is this the case?

Correct it is a deviation. We put that text in primarily to guide earlier stage companies to give control over XEM liquidation rate (in addition to intending to put it in transaction agreements). Vimba are sufficiently mature in the start up stages and their specific core business relates to management of digital assets. After discussion with the management teams of both companies we are comfortable that Vimba have these management processes already from existing business and the admin associated with additional tranches was decided not to be necessary.

  1. If possible, could you release the full terms of the note?

No, its not public domain appropriate information

At the very least, could it be clarified:

  • Is the conversion of the note mandatory?

No it is a non-mandatory

  • What rights (governance & management), if any, were acquired via the investment?

Private information

  1. Are there any equity dilution protections structured into the note?

Yes

  1. Were there any other investors in this round of funding?
    If so, did they enter with terms similar to those of NEM Ventures?

As per the PR links shared above (not in our original forum post though) Ventures was the sole investor in this round


#5

Many thanks to Rio and the NEM team up in Tokyo for translating the Vimba announcement to Japanese for us


#6

Fantastic update on Vimba and well done to NEM Ventures. We believe that this will be a big enabler to the NEM ecosystem and NEM Foundation is in full support of this announcement with more updates to come.

Personally, I look forward to have Vimba come to Australia soon as well!