Most experts believe that the share of banks in the global financial ecosystem will constantly decline, and their place will be occupied by various fintech start-ups. The question is how successfully Raison will be able to compete with major projects that attracted tens of millions of venture capital investments.
Currently, there is no product - launch is planning on May 2018. The automated forecasting system uses neural networks and machine learning technologies; to confirm the performance of their algorithms, the company should present results of forecasting, to allow users to check their accuracy.
Most of the decisions vital to the operation of Raison will be launched only in 2018-2019. Question of collaboration with European regulators is still open.
In WP is written: “The main expenditure items for RAISON will be the operating costs, namely licensing, office rent, personnel and IT development. A more detailed breakdown is provided in the full financial model, which is available separately”. The point is that structure of costs and, therefore, forecast of EBITDA are not provided initially. > 20% in revenue structure of 2020, and ~ 30% of revenue in 2021 accounted for a commission from transactions, but currently there are no guarantees that Raison will receive a banking license. “A portion of the collected funds, but not more than 20 million EUR, will be equally distributed between the Element ONE and Element Blockchain” - without any guarantees for the owners of tokens; investment strategy is also not disclosed. The main revenue channels, which in 2020 and 2021 will provide more than 50% of its total volume, will be margin loans for the purchase of classic (shares, bonds) and crypto-assets. The rate of yield on loans for buying classic assets, specified in the WP, is 1.2%; revenue in 2020 is € 33.6M, in 2021 - € 82.2M, so Raison needs to raise € 2.8bn in 2020 and € 6.85bn in 2021 - and so far, there are no guarantees, that large financial organizations will be ready to provide such funds.
The lack of advisory from large companies working in the financial sector - banks, fintech-projects. For the CEO and COO there are no links to their LinkedIn. It is possible that the current employment in Threesixty Elements will prevent some key employees from fully focusing on working in Raison.
Most of the developed countries, the monetary policies are best characterized by ultra-low interest rates making people think about protecting their savings after realizing that the bank deposit rates fail quite often to keep up with inflation. According to McKinsey Report, «A brave new world for global banking», developed-market banks are most affected, with $90 billion, or 25 percent, of profits at risk, but emerging-market banks are also vulnerable, especially to the credit cycle. In March 2016, Citi presented a large study on impact of fintech start-ups on the livelihoods of banks. In it is indicated that in 2023 banks may lose up to 17% of their revenues ($ 204 billion) because of the impact of new digital solutions. The most promising for the introduction of new technologies are segments related to loans (personal & SMB), payments (digital payments), as well as wealth management. In 2016, online lenders lent less than $10 billion to their SMB customers, which was very small compared to the $300 billion that were issued in US banks. However, the current modest market share held by online lenders hides a huge potential: in mid-2015, Morgan Stanley estimated that the potential market for online SMB creditors is $280 billion, and it is projected that the industry will grow by 47% per year, and by 2020, such companies will account for almost a fifth of the entire SMB lending market. The world's largest robo-advisory platform for trading stocks - Betterment - can not be used outside the United States: "Customers must have a permanent U.S. address, a U.S. Social Security Number, and a checking account from a U.S. bank.". It is likely that all other US companies are subject to similar regulatory restrictions.
RAISON helps to maintain an optimal investment portfolio of cryptocurrencies, shares, bonds and funds based on the customer risk profile and investment expectations. RAISON pools all user accounts, analyses cash flows and offers recommendations on how to improve the customer’s financial position. The application enables utilization of familiar financial services (IBAN, cards, and payments) on a single platform. Ultimately, we have formulated a clear-cut goal for the new platform — to make a person’s life easier when working with crypto-currencies and conventional investment products and raise the customers’ living standards by efficiently handling their finances. The platform includes five levels, each offering its own functionality both for fiat environment and blockchain economy: • Investments – cryptocurrencies, mining and ICO funds, umbrella services for professional (blockchain); p2p-insurance and lending, equity, bonds, ETF (fiat). • Advisory – for cryptocurrencies and ICO, financial ratings (blockchain); for all accounts and recommendation for financial life (fiat). • Custody services – bitcoins and major altcoins, tokens (blockchain); current accounts in €, $ and investments accounts (fiat). • Transfer & Payments – for cryptocurrencies and payment in crypto by cards (blockchain); sepa-transfers, apple and android pay, abroad payments with real exchange rates (fiat). • Everyday Life - remote onboarding, debit and credit cards, fast and cheap FX exchanges, split bills (both). As of today, we forecast 1 year ahead, therefore the data processing time window is from -1 year to +1 year from the given moment. The system will probably be changed during the RND process into a sequential comparison of two time windows year-over-year to identify annual cycles and improve the long-term forecast accuracy.
A brief market study made by company indicated to the advanced European legal framework regulating the cryptocurrency transactions with a relatively low penetration of mobile financial institutions and robotized capital management solutions in the region. This combination allows Raison to consider Western Europe as a product development platform, which, after making allowance for several functional parameters, will be able to take the leading position in the global market. The product specifically targets the Western European market as the most legally-transparent region with positive attitudes towards cryptocurrencies and excellent investment prospects in a zero interest rate environment. Further market development prioritizes Eastern Europe, the UK and the USA. Raison’s IT-platform allows: • Users — to monitor transactions, keep track of personal investment assets and its value on the reporting date, dynamics of base assets consisting of structured notes. Within our mining fund we provide our customers with the information reflecting the total power of miners and currencies on all purses in real time. • Personnel — to receive automatically generated contracts for customers, rapidly conduct compliance procedures, monitor progress in plan performance, work effectively with information and avoid communication problems. • Managers — to calculate remuneration for agents and issue invoices to the accounting program for automated payment. Road map: • November 2017 - Launch of registration process of Investment firm (MiFID). • December 2017 - Carrying out a crowd-funding campaign with distribution of RSN tokens. • February 2018 - Launch of a local office in Europe (Luxembourg, Estonia). Submission of documents for the Electronic Money Institution license. • May 2018 - The first product version with the ability to aggregate personal financial data on a single platform and offer recommendations on how to improve the financial efficiency using AI. • August 2018 - Receipt of all permits from the regulatory authorities, ensuring the possibility of buying investment products and cryptocurrency. Card product issuing. • September 2018 - Launch of AI trading advisory. • December 2018 - Launch of P2P Lending platform. • February 2019 - Application for a banking license. • December 2019 - Launch of P2P Insurance.
Raison provide revenue’s forecasts (for 4-year period) and triggers for growth in their WP; structure of costs and more detailed figures can be received after request. The token value increase will be due to the growing capitalization of the financial institution and coupon yields.
RAISON platform is built by a team of professionals from “Threesixty Elements S.A.” specializing in wealth management services and financial advice, and AKILIO project team, successfully implementing machine learning and AI-integrated systems across many industries. The Raison team is divided into two categories: "board" and "executive team": LinkedIn links are available for one member of the board - technical director Vladimir Shabanov - and four representatives of the executive team: • Shabanov Vladimir – CTO; currently, he is of COO Threesixty Elements; prior to that, during the year he was a partner of a private equity fund and more than 2 years - a system administrator in Saint-Gobain; • Kirill Kovalenko – Director of the department of strategies of multi-assets, structured products; currently is Head of Trading Threesixty Elements; before that, about 10 years also specialized in trading - in HSBC, TRUST, Promsvyazbank, etc; • Victor Mishin - Head of department for relocation and subsequent strategies; he is currently CEO of Huho Labs and Senior Trader in Devado Management; • Oleg Berezin – Director of Marketing Department; until April 2017 for almost 2 years he held the position of Social Media Manager Russia & CIS in Viber; • Aleksandra Stroganova - Director of Business Development Department; before Raison for 7,5 years was engaged in Sales team in the Mediterranean Shipping Company.