Minds, a blockchain-based social network, announced on Oct. 22 that it had received $6 million in Series A funding from Medici Ventures, an Overstock.com subsidiary that focuses on crypto venture funding activities. In a reciprocal move, Patrick M. Byrne, founder, and CEO of Overstock.com, gets a seat at Minds’ board of directors.
Minds utilizes what is known as hybrid investing, a scenario where a start-up raises capital through a token sale and venture capital. It brings the benefits of both worlds as it renders the start-up less dependent on investors yet tapping their experience and expertise, which can potentially help the company to grow and achieve its goals.
Minds – A Decentralized Facebook
On its website, Minds claims:
“We are an open source and decentralized platform for Internet freedom.”
Bill Ottman, founder of Minds, simply wants to build a decentralized social network that counters the control that monolithic social media giants have on user data. Ottman said:
“The rise of an open source, encrypted and decentralized social network is crucial to combat the big-tech monopolies that have abused and ignored users for years. With systemic data breaches, shadow-banning and censorship, people over the world are demanding a digital revolution. User-safety, fair economies, and global freedom of expression depend on it — we are all in this battle together.”
The time may be ripe for a decentralized social network in which user data do not lie in the hands of a single authority prone to security breaches and data theft. Facebook, the largest social media platform with more than two billion user accounts, has had its fair share of data breaches. Early this year, it emerged that more than 87 million user accounts were compromised by Cambridge Analytica, a UK-based political consulting firm.
In short, Minds can be seen as a social media platform but without the surveillance, censorship, and abuse of data by social media giants. To support this notion, Ottman said:
“In June 2018, Minds saw an enormous uptick in new Vietnamese of hundreds of thousands users as a direct response to new laws in the country implementing an invasive ‘cybersecurity’ law which included uninhibited access to user data on social networks like Facebook and Google (who are complying so far) and the ability to censor user content.”
Overstock.com’s Dance With Blockchain Technology
Overstock, an online retailer, has invested in several blockchain start-ups through its venture arm, Medici Ventures.
Overstock made headlines at the beginning of the year when the company disclosed to the Securities and Exchange Commission that it had sold shares worth $100 million. It later emerged that George Soros had invested in the online retailer through Quantum Fund. Prior to that, Soros was critical of Bitcoin and called it a bubble.
Byrne indicated at the time that he planned to split the money between Overstock.com’s e-commerce business and blockchain ventures.
In January, the venture arm led a seed funding round in which Voatz, a blockchain voting app, raised more than $2.2 million from a lineup of investors that included Urban Innovation Fund, Joe Caruso, Oakhouse Partners, Tom Williams, and Walt Winshall.
Medici Ventures reportedly made a seven-figure investment in VinX, a start-up that trades wine futures.