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takyon [soylentnews.org] writes:

Civil unrest: How a blockchain-based journalism startup bumbled its launch [arstechnica.com]

In March 2018, Matthew Iles—the head of Civil [civil.co], an ambitious blockchain-for-journalism startup—stood in a tiny New York conference room with a few colleagues seated around him. Wearing a peach-colored sweater, Iles looked up at a mounted camera to speak to dozens of colleagues spread around the world about how the future of Civil was looking bright.

"We're feeling very bullish about the value of our tokens as it relates to the value that has been estimated in all of the agreements that we have shared with you guys so far," the CEO said in an internal video recording obtained by Ars. Civil aims to orchestrate the creation, sale, and management of an Ethereum-based crypto-token, known as CVL, meant to serve as the underpinning of a slew of recently founded ambitious news sites. "Compared to the $0.75 estimation that we made with each of you and if we do our jobs right and execute the way we would like to, it's looking like we could see a two to four X in that value by the time this token sale is complete, and I think that's exciting for everybody," Iles continued.

But even that $0.75 valuation put the tokens at more than 789 times what was actually listed in a formal filing. That document was marked as a confidential "Restricted Token Agreement" and has been provided to Ars. It cited the "fair market value" of one CVL at "$0.00095 per Token."

[...] Either way, Civil didn't even get that far [niemanlab.org]. The initial coin offering (ICO) failed [joincivil.com], badly. By October 2018, the Civil ICO raised just $1.4 million of a target $8 million. Civil's sole investor, ConsenSys, purchased [joincivil.com] the overwhelming majority of that investment: $1.1 of the $1.4 million.

[...] Now, some within the Civil community have raised significant concerns about the entire premise of the company. Notably, a co-founder, Daniel Sieberg [twitter.com], told Ars that he sees himself as a "victim of fraud" after he was fired [medium.com] in July 2018.

[...] "We're a startup that hasn't even figured out how to launch its first suite of products," Iles admitted.

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