Odaily Exclusive Interview with Jarsy: How does "Pre-IPO's Robinhood" Break the Private Sale Investment Threshold with $10?

Original | Odaily Daily Report (@OdailyChina)

Author | Ethan (@ethanzhang_web3)

Currently, the RWA track is accelerating its evolution with vigor, and the level of industry compliance has also seen significant improvement. Notably, last night Robinhood officially announced that it will offer US stock and ETF trading services based on its own Layer 2 blockchain to EU users. These assets, referred to as "Robinhood Stock Tokens," will enjoy zero commissions, and holders can also receive dividends within the broker's application.

The active exploration of the European and American markets by Robinhood has brought more positive signals to the RWA industry. Similarly, Jarsy, which is also focusing on global deployment, is making great strides in the innovative direction of Pre-IPO tokenization. What differentiated advantages are contained in its unique Pre-IPO tokenization layout? What unknown entrepreneurial narratives are hidden behind it? The breakthrough path of this emerging track is provoking deep thinking in the market about the digital transformation of real assets.

In the traditional financial system, Pre-IPO investment was once an exclusive field for high-net-worth individuals, with a funding threshold often reaching hundreds of thousands of dollars, effectively excluding ordinary investors. Against this backdrop, Jarsy emerged with the mission of "making investments accessible to the masses, allowing participation in Pre-IPO investments for as low as $10 and high-growth value company investment opportunities." By tokenizing shares of previously high-growth private companies like xAI, Anthropic, and Stripe, it enables both ordinary investors with little knowledge of cryptocurrency and seasoned players in the crypto space to participate and enjoy the potential returns of equity investments.

Recently, Odaily contacted Jarsy CEO Han Qin and had an in-depth conversation with him to analyze the competitive advantages, operational mechanisms, risk management, business model, and entrepreneurial philosophy of the Jarsy project. Below is the record of the interview, with some content omitted.

Odaily: I heard you just completed your seed round, congratulations! Could you briefly introduce your funding background and project advantages?

Han Qin: Thank you for your attention. Yes, this seed round financing is 5 million USD, led by Breyer Capital, and also includes notable angel investors such as Karman Venture, Nathan McCauley (CEO of Anchorage), and Evan Cheng (CEO of Mysten Labs). We chose Breyer because we value their early investments in exceptional companies, such as leading the A rounds of Facebook and Circle; since our team comes from Uber, we chose Karman because it is a boutique VC funded by Uber founder Travis Kalanick and executives from Palantir, OpenAI, Anduril, ScaleAI, Anthropic, and others.

At the same time, we adhere to a customer-oriented approach. In order to provide users with a more simplified user interaction method and reduce the learning costs for non-expert users, our team redefines and addresses the complex issues in blockchain technology, ensuring a seamless transition from login to order placement. Jarsy will charge local cryptocurrency users with stablecoin USDC and cash USD for non-cryptocurrency users, achieving a seamless cross-industry flow of funds.

In addition, Jarsy asset-backed tokens are secured by 1:1 real company equity held by a limited liability company registered in Delaware, USA, managed by the platform. The platform also regularly publicly discloses equity proof documents to minimize credit risk.

Odaily: What are the screening criteria and listing process for Jarsy regarding unlisted or listed companies to ensure the quality and potential of the companies being screened and listed?

Han Qin: This is a very good question and a topic that users are very concerned about. Our screening logic is divided into three levels: First, in terms of industry and growth potential, we will focus more on high-growth sectors such as AI, aerospace, and fintech, for example SpaceX, xAI, Anthropic, etc.; second, in terms of valuation health, we will prioritize later-stage unicorns, such as Stripe, which has maintained over 25% revenue growth for 8 consecutive years; third, we will conduct our own due diligence loop. The Jarsy team, leveraging Silicon Valley resources, can easily interview company executives and early investors to verify the stability of the equity structure, ensuring the reliability and growth potential of the investment targets.

Additionally, in terms of project listing, Jarsy will clearly define the economic interest tokens, which are backed by underlying assets (such as company shares), and publish economic rights agreements for equity ownership, ensuring that the entire process complies with U.S. laws and regulations, protecting investor rights.

Odaily: What is the asset value anchoring mechanism and how does it ensure investment value?

Han Qin: Jarsy works closely with private equity firms, venture capital funds, and brokers to acquire shares in selected private companies. Once shares are obtained, Jarsy will hold these shares through our independent limited liability company registered in Delaware (LLC), and then issue asset-backed tokens that correspond exactly to the number of shares held.

For the value anchoring of asset-backed tokens on these platforms, we base it on the latest tender offers made by the company in each round, and on this basis, there may be slight premiums or discounts in the secondary market due to supply and demand dynamics. This mechanism ensures that the token value is closely linked to the company's latest valuation dynamics, while investors can also gain real-time benefits from market valuation changes. Of course, if the company performs particularly poorly in the private secondary market after completing a financing round, our repurchase price will also be adjusted downward accordingly.

Additionally, it is worth mentioning that we have also issued the presale tokens for Jarsy, which allow holders to have priority in purchasing asset-backed tokens from specific companies on the platform. Each presale token is backed by 1 USD, similar to our own stablecoin. Once Jarsy acquires the corresponding company shares and issues the asset-backed tokens, these tokens will be allocated first to presale token holders on a first-come, first-served basis.

During the allocation process, the presale tokens are converted into asset-backed tokens at the current price of the asset-backed tokens plus conversion cost fees. After all presale tokens have been allocated, the remaining asset-backed tokens will be offered to other investors.

It is worth mentioning that when users are optimistic about a certain pre-sale investment target, after purchasing the pre-sale tokens of a specific company, if the platform does not complete the settlement within a specific time, that is, does not timely procure the company's Pre-IPO shares, then the Jarsy platform will refund the full amount to the users, so users will not incur any losses in case of a transaction failure.

Odaily: How is Jarsy's business model set up?

Han Qin: We do not charge management fees; Jarsy's main profit model relies on one-time transaction fees, which is also our superiority compared to competitors. All fees incurred by users during the investment period are publicly transparent. However, similar to traditional investments, there may be rare Carry fees, but this fee is not part of Jarsy's profit; rather, it is the holding cost for some large funds regarding popular companies. For example, for the popular investment project xAI on the platform, investors only incur transaction fees for single transactions, with no other hidden fees, allowing users to retain the maximum investment returns.

Odaily: Are there any restrictions for users participating in Jarsy investment?

Han Qin: Combining our global market positioning, Jarsy currently has global accessibility covering users in the United States, China, Singapore, Japan, South Korea, North America, and more regions in the future. Jarsy is committed to serving market users who meet regulatory requirements, requiring investors to qualify as accredited investors. Users in different regions need to go through the corresponding KYC certification to ensure compliance with local regulatory requirements. Additionally, for the sake of KYC control, the platform will not open DeFi trading or external secondary markets to ensure compliance and investment security.

Odaily: As an equity tokenization project, what regulatory risks will Jarsy face? How will the platform respond?

Han Qin: This issue is crucial for most companies in the cryptocurrency industry. The development of the cryptocurrency sector, including a series of recent conferences by Robinhood, is driving the U.S. to provide clear policy legislation (such as stablecoin legislation). Therefore, this is both a challenge and a once-in-a-lifetime opportunity to tokenize private investing. As a company registered in the U.S., Jarsy faces regulatory challenges such as the U.S. SEC and EU MiCA regulations. However, because our team is rooted in Silicon Valley and has participated in the growth of Silicon Valley giants like Uber, we are very familiar with and skilled at complying with regulations before they become clear. We will actively embrace and cooperate with regulations, strictly implementing compliance measures such as qualifying investor reviews for U.S. users and clarifying definitions of token economic rights to ensure long-term stable operations.

We believe that only by showing the regulatory authorities our proactive cooperation with laws and regulations can the platform continue to operate for a long time, and a platform that can stand the test of time can gain the trust of investors.

Odaily: What are the liquidity and exit rules for Jarsy's asset tokens? What are the regulations on the holding period?

Han Qin: This is the key to reflecting our credit value. We currently offer two exit mechanisms:

The first option is that if a Pre-IPO company has already gone public, users can choose to sell the corresponding assets through the Jarsy platform to obtain an equivalent amount of cash.

The second option is that regardless of whether it is listed or not, you can sell the tokens back to the Jarsy platform, but whether this can be sold smoothly or priced needs to be based on supply and demand.

Jarsy's asset-backed tokens provide holders with economic benefits related to company stocks. If the value of the tokens fluctuates, users can buy or sell the tokens at the new price. Jarsy will pay users the corresponding amount in USD or USDC as economic benefits based on the corresponding face value. Of course, users need to conduct due diligence to choose which company to invest in. For compliance and simplification reasons, the corresponding asset-backed tokens cannot be exchanged for equivalent stocks; they can only be used to extract amounts. Even if the underlying asset company goes public, users cannot withdraw stocks from Jarsy.

Odaily: According to the investment process, how long does it take for investors to receive tokens from placing an order?

Han Qin: Jarsy has two main models. One is the spot model, where it usually takes 1 working day from placing the order to receiving the tokens. The second model is the presale model, which refers to the method of preselling tokens mentioned earlier. From placing the order to receiving the tokens, there will be a waiting period, as the order is placed after the project funds are raised. Of course, it won't be an indefinite wait; a clear timeline will be communicated in advance before placing the order.

Odaily: Finally, can we talk about Jarsy's entrepreneurial philosophy? How did the team come together to launch the project?

Han Qin: Our team has conducted research and deeply understands the challenges faced by the younger generation in accessing quality assets amidst high housing prices, high employment difficulties, and a traditional stock market with slowing returns. In response to these issues, there is still a need for innovation in the industry. We believe we should create quality investment opportunities for young people, and through technological innovation, open up pathways for the general public to access quality investment opportunities, achieving true financial freedom.

The team has worked with successful entrepreneurs like Zuckerberg and Travis Kalanick, and influenced by these entrepreneurs, our team aims to create a fundamentally innovative product that addresses people's pain points, rather than seeking high returns through token issuance in the short term. This is the reason our founders share the same vision of building a long-term platform that serves the general public.

Of course, we are also well aware that the road is not smooth. In the past, there have been competitors doing the same business, but they only handle on-chain assets without truly pledging Pre-IPO shares as assets; they are merely betting on valuations. This is not sustainable and can easily lead to a blow-up due to issues with price discovery and the lack of transparency in pricing, as well as the potential decoupling from the underlying assets. We hope to align with Circle, as Circle's stablecoin is fully backed by the US dollar, and its reserve proof and status as a US company make it more compliant. Therefore, if we want to operate in the long term, we have many operational and regulatory issues to overcome. This is not a project that can generate quick money, but once scaled, it is a significant story, and we are looking forward to it.