GAMB Rating Review

Risky-

Investment Rating

Expire date : 30.10.2018


Based on the analysis performed and issues identified we have assigned the Gamb project a “Risky-” rating. However, we would like to note that without an existing MVP, it is difficult to fully assess the project’s true potential.

The project has the following notable strengths:

  • A significant and promising market niche.

  • Highly skilled and vastly experienced founders, team and advisors.

  • A detailed description of the technical features and business strategy for the project in the whitepaper.

  • An ambitious idea.

  • The economic potential of the token is notable.

However, there are also a number of risks still associated with this ICO project:

Absence of an MVP. At the time of analysis (June 2018), the team has not yet released an MVP. The absence of an MVP seriously compromises the ability to assess the team’s competencies, the capabilities of the suggested product, the level/degree of product development and other crucial factors that investors in an ICO must consider before making any decision to invest. Once the MVP/alpha is released, and the team’s progress is made clearer, the level of risk may go down.

Team does not provide smart contract for review upon request. We inquired the ICO smart contract from the team for review, they said that technical support will respond, however, we received no response from the team since then. Subsequent requests to the team have been ignored.

Commercial risks. The space that the Gamb project targets is very difficult to penetrate. Not only there is a close competitor in Storiqa, but also traditional players like Amazon and Aliexpress may be indirect competitors if they decide to develop their own blockchain for their own business purposes.

Unavailable public GitHub. The smart contract code on GitHub is unavailable for public review. This makes it impossible to track the development stage of the project according to the roadmap or assess the quality of the product.

Absence of partnerships. The foundation have not yet announced any partnerships, but as of June 2018 Gamb have placed Google, Pay Pal, DHL, Klarna and Sofort banking as Gamb shopping cart partners on the official website (without any official announcements). Additionally, according to the roadmap the team plans to onboard merchants from Europe in 2020.

Team and advisory board composition and expertise. The team has ambitious plans in terms of product complexity and very experienced advisors to match this. But at the time of analysis (June 2018), it is not possible to confirm their participation in the project, due to the absence of the relevant confirming information on their LinkedIn pages. Moreover, according to the information provided, team members do not have previous job experience in the blockchain industry. The absence of relevant experience seriously reduces transparency for the project and increases the level of risk for potential investors.

Lack of clear ICO justification. Gamb presents itself as the leader in the German e-commerce software market, with more than 25,000 active merchants and annual store revenues exceeding 2.3 billion euros. Therefore, it is not obvious why Gamb needs US$30 mln for developing this project. This could cause a risk of the misuse of funds or concealment of information about the development of the project.

Non-comprehensive whitepaper.  We believe that the whitepaper has the following issues:

  • The whitepaper does not present an analysis of competitors.

  • It does not discuss any change in the use of funds in the event that the hard cap is not reached.

  • Planned marketing activities and product promotion are not covered in the whitepaper, so it is impossible to analyze or draw relevant conclusions regarding potential market exposure.

Based on the analysis performed and taking into consideration all the risks associated with the Gamb project as of June 2018, we assign it a “Risky+” rating. This rating may need to be reassessed once the MVP is released and feedback on the first testnet is received, as well as when more publicly available information regarding token metrics become available.

Gamb is a self-governed, decentralized ecosystem for e-commerce. It is driven by smart contracts, enhanced by open source development and empowered by merchants. Gamb is the market leader in German e-commerce software, and has a long history in the industry. The company has built a thriving ecosystem for businesses that enables industry-leading e-commerce core service integration.

Website

Whitepaper

Medium

Telegram

Twitter

As mentioned, Gamb does not provide a public GitHub. This makes it impossible to track the development stage of the project according to the roadmap or assess the quality of the product.

Available information regarding Gamb’s token distribution can be found in the table below.

 

Pre-sale

ICO (public sale)

Start date

July 4th 2018

TBA

End date

July 31st 2018 (On-going)

No data

Stage cap

No data

No data

Ticker

GMB

 

Token

ERC-20

 

Token supply (for sale/total)

No data / 5,000,000,000 GMB

 

Soft cap

USD 5,000,000

 

Hard cap

USD 30,000,000

Estimated valuation as at ICO date at ICO price

Circa USD 85,700,000

Token price

No data

1 GMB = 0.0002 ETH

Bonus

15%

15.00%

Lock-ups

No data

No data

Minimum investment

No data

0.1 ETH

Maximum investment

No data

No data

Currencies accepted

ETH

Restricted list

ALGERIA, BANGLADESH, BOLIVIA, CHINA, ECUADOR, ETHIOPIA, HONG KONG, INDONESIA, IRAN, IRAQ, JORDAN, KYRGYZSTAN, MACAU, MOROCCO, NEPAL, NORTH KOREA, SERBIA, SRI LANKA, SYRIA, TAIWAN, TRINIDAD AND TOBAGO, TUNISIA, UNITED STATES, VANUATU, YEMEN

KYC/AML procedures

Yes/No data

Country of legislation

Malta

 

Gamb is selling tokens valued at USD 30,000,000; all tokens that do not sell will be shared by all contributors. Moreover, Gamb proposes a bonus program of 15% for the pre-sale stage (from 4th to 31st of July, 2018; there is no data about lockup periods for bonus tokens). Once the hardcap of 30 million USD is reached, any unsold tokens will be distributed among the investors.

All generated tokens will be distributed among the following categories of participant. Tokens reserved for the team and advisors are vested for a period of two years.

We note here that a hardcap of USD 30,000,000 is quite large for the proposed portion of tokens (35%).  This provides an additional risk factor of not achieving the desired sum of money for further development of the project, and could be a question for investors to raise before making any decision about this project.


The team intends the use of proceeds from the ICO to be as follows:

A significant part of the proceeds is intended to be used for marketing, which seems reasonable based on the fact that the platform is intended to focus on e-commerce.

Gamb is based on open-source software powered by blockchain technology (Ethereum) and aims to create what it refers to as a Global Alliance of Merchants.

Blockchain technology will be utilised for merchant alliance membership as well as the governance structure of the marketplace in the Gamb project, and will be implemented for the following functions:

  • Profiles (merchant profile, customer profile, investors/token holder profile).

  • Membership (of the merchant alliance, of the council).

  • Proposal handling and execution of decisions.

Profiles. There will be different profiles which a set of attributes linked to them, enabling unique classifications for participants in the ecosystem.

Membership. Blockchain technology enables the creation of  a transparent, fully accessible register of members.

Proposal handling and execution of decisions are based on blockchain which protects participants against double voting or falsified counting, therefore building trust in such results.

Features

Gamb intends to present the following features enabling the use of an industry-leading integration of e-commerce core services such as:

  • Payment

  • Marketing

  • Logistics

  • Legal

  • Content Creation

The Gamb marketplace will focus on generating traffic through the following components:

  • Search engine optimization (SEO) to draw more traffic through search engines.

  • Search engine advertising (Pay per Click) such as Google Adwords.

  • Advertisements on websites through services such as Google.

  • Adsense.

  • Social Media Campaigns.

  • API.

The system of rating for buyers and merchants will involve rewards in tokens, and the average weight of their rating will be based on credibility and past ratings for these participants.

Roles

The structure of fully decentralized Gamb market place consists of (as shown in the figure below):

  • The merchant alliance.

  • The council.

  • The merchant alliance service provider.


The merchant alliance is responsible for appointing temporary members to the marketplace council, submitting proposals and participating in voting on future marketplace development. To become a member of this alliance, a merchant acquires and holds network tokens.

 

The council includes the initiators of the project, merchants, consumer advisors and crypto experts as such as key stakeholders who are ultimately responsible for the successful development, maintenance and future development of the marketplace.  The council is responsible for:

• Monitoring the global e-commerce market.

• Defining and monitoring marketplace strategy.

• Definition of initial rules of the merchant alliance (as part of the marketplace launch).

• Being a partner to the merchant alliance.

• Recommending new marketplace features and enhancements.

• Token management, including token allocation, collection and distribution.

• Re-adjusting the overall strategy to achieve the long term sustainability of the project.

• Making sure that all decisions are taken in a democratic manner.

 

The service provider develops, updates and services the marketplace software and infrastructure; selects partners, qualifying and onboarding in accordance with alliance statutes; and finances and controls (as organizational function).

We would like to make a note that the Gamb has presented a tidy and professional whitepaper. It might convince e-commerce professionals, VCs, and institutional investors to pay attention to this project. The technical features of the platform are quite detailed and comprehensive in the whitepaper. At the time of analysis (June 2018), the team has not yet released an MVP. The absence of an MVP seriously compromises the ability to assess the team’s competencies, the capabilities of the suggested product, the level/degree of product development or other crucial factors that investors in an ICO must consider before making any decision to invest.

Unfortunately, we consider that the whitepaper has the following problems:

  • It does not present any analysis of the competition.

  • The whitepaper does not discuss any change in the use of funds in the event that the hard cap is not reached.

  • Planned marketing activities and intended product promotion are not covered in the whitepaper, so it is impossible to analyze or draw relevant conclusions regarding potential market exposure.

The team provides the following project roadmap:


The absence of an MVP before an ICO increases risk for potential investors. We note that the beta is scheduled for Q4 2018, after the ICO starts; there is quite a long time between the ICO and the launch of the first MVP, clearly a potential risk for investors.According to the analysis, the Gamb roadmap is well-planned until 2021;  can be found on their website. The roadmap states that the team plans to launch an alpha version of Gamb, a product search engine MVP in Q4 2018, and a market place MVP beta version in Q2 2019. At the time of writing (June 2018) no MVP was available.

Market size estimation

The world is witnessing an unprecedented centralization of economic power by leading tech companies such as Google, Amazon, Facebook and Apple (GAFA). Currently 83% of all product searches start with either Amazon or Google.  Amazon controls the e-commerce infrastructure: Globally, more than 4 million merchants use the Amazon marketplace and its underlying services as a sales channel.  For online and offline merchants alike, the market position of Amazon is a real threat as long as the dependence of merchants on Amazon remains unchanged. Merchants selling via Amazon can be blocked and driven out of business, successful products can be sold directly by Amazon and prices for advertising to drive traffic to one’s products can be dictated. Whilst the online share for retail trade is constantly growing, the power of Amazon will increase along with the trend. From a merchant perspective (third party sellers), Amazon has consistently raised fees on warehousing and storage costs, as well as shipping fees. These increases typically occur twice a year, and have had a tremendously negative effect on margins for third-party sellers by continually transferring additional expenses onto them, while more margins are achieved by Amazon. In Germany for example, the share of online sales has increased from 11.6% in 2015 to 15.1% in 2017 and a continuation of this trend is expected. With its growing merchant base of more than 25,000 active online stores, Gamb is in a unique position to lead the industry into a sustainable alternative to Amazon, based on open-source software powered by blockchain technology.

Gamb is the leader in the German e-commerce software market, with more than 25,000 active merchants and annual store revenues exceeding 2.3 billion euros (2.7 billion U.S. dollars). The company’s global network of strategic partners covers a wide range of areas, including Google and Klarna, as well as DHL and other logistics giants.

 

Competitive landscape

We will use Porter’s Five Forces framework to perform an initial competition assessment for the Gamb Protocol project.

Threat of new entrants - High

The overall threat of new entrants is high, as new infrastructure projects in blockchain are launched very often and the market is not yet saturated.

Threat of substitutes - Medium

Threat of substitutes is medium, as the developers of Gamb propose the idea with some significant unique points, and ecosystem participants are likely to prefer to work with a company that provides higher quality, faster services and support for a reasonable cost.

Bargaining power of customersLow

One of the key factors for any ecosystem is its popularity with both users and specialists. We assess the bargaining power of customers as low, as the marketing aspect is a strong side of the project, and Gamb is the German market leader for e-commerce software.

Bargaining power of suppliers Medium

Since the whole ecosystem depends on industry participants and existing partnerships, the bargaining power of suppliers can be assessed as medium, as Gamb still plans to onboard merchants from Europe in 2020, and as of June 2018 Gamb had not announced any partnerships. However, it was founded in 2005, has offices in Germany and Switzerland and is the leading retail software house in Germany.

Industry rivalry - High

Currently Gamb has competitors in both the blockchain and traditional markets. Please refer to the summary table below:

 

Gamb

Storiqa

Amazon

Ticker

GMB

STQ

n/a

Key functions/features

Self-governed and decentralized ecosystem for e-commerce based on blockchain technology.

Platform created for buyers and sellers using blockchain technology

International e-commerce company offering online retail, computing services, consumer electronics, digital content as well as other local services such as daily deals and groceries.

Key users

Buyers and sellers

Buyers and sellers

Buyers and sellers

Key products

Decentralized marketplace with no decision making unit other than the owners of the marketplace themselves.

Marketplace with a wide range of functions for effective sales.

Platform for e-retail sales of electronics and other products.

Consensus

PoW

Сurrently PoW, will be PoS later on

n/a

Development stage

First version of whitepaper released, pre-sale is on-going.

The earliest version of the product

Working product

ICO status

Pre-sale round on-going

Ended

n/a

Funds raised/hardcap)

n/a/ USD 30 million

USD 25 million/ USD 25 million

n/a

Tokens sold, %

35%

60%

n/a

Project valuation (100% of tokens at ICO price)

USD 85.7 million

USD 41.7 million

n/a

Market capitalization

n/a

USD 45 million

n/a

Product launch

Q4 2018

Q2 2017

1995

 

As of June 2018, the market for Gamb is relatively competitive. Competitors are focused on creating the marketplaces for buyers and sellers using the blockchain technology. We believe that these market players can coexist and became the competitors for the such global market player, as Amazon.

The capability of the team to deliver such a complex project will be easier to assess once the MVP/beta is released. Without the actual product, it is hard to assess the concept. If the testnet hadn’t yet been released, we would have doubted the sufficiency of the project team’s experience, which is illustrated in the table below:

 

Name

Position

Total experience

Relevant experience

Professional achievements

LinkedIn

Connections

Endorsements/ Recommendations

Team

 

Luis Krug

CEO

10+ years

Yes

Founder of Redcoon. Since 2003 he has run the technological incubator INCUBOUT.

Yes

500+

Yes

Andre Münnich

CFO

7 years

Yes (Business accounting and development)

CFO of Gamb Holdings, co-founder and CEO of Fayteq AG

Yes

500+

Yes

Emrah Hizarci

CTO

10+ years

Yes (business administration and IT)

Partner in technological incubator and framework builder INCUBOUT.

Yes

500+

Yes

Daniel Schnadt

Managing Director Gamb GmbH

10+ years

Yes (e-commerce)

Certificate in Ethereum: Decentralized Application Design & Development – License UC-TUoAEG7X.

Yes

183

Yes

Nonito Capuno

Managing Director Gamb GmbH

10+ years

Yes (e-commerce and IT)

Co-founder of “brille24.de”

Yes

78

No

Denis Scheller

Business Development Gamb Services AG

4+ years

Yes (IT and Fintech industry)

Co-founder of FinanzABC GmbH

Yes

500+

 

Yes

Key project’s advisors

 

Eric G. Sarasin

Private equity investor

30+ years

30+ years (Banking experience. Eric was president of the German-Swiss Chamber of Commerce for 12 years, until 2014. He supports numerous philanthropic foundations in Switzerland and abroad. )

President of the German-Swiss Chamber of Commerce for 12 years

Yes

476

No

Katalin Tischhauser

CEO at tokenivision

20+ years

Yes (investment banking)

Director of Monetas AG and is CEO of TokenVision

Yes

309

Yes

Dr. Luka Müller

Founding partner at Mme Legal AG

15+ years

Yes (regulatory compliance, anti-money laundering, anti-corruption and judicial assistance )

Founder of KYC Spider AG, Founding Partner of Mme Legal

Yes

500+

Yes

Frank Bodin

Former chairman and CEO at HAVAS

20+ years

Yes

Chairman & CEO of Havas, Chairman of the Global Creative Council of Havas , President of the ADC Switzerland and Board Member of Communications Switzerland  He has received innumerable awards and has been advertiser of the year.

Yes

500+

Yes

Matthias Hunecke

Founder of Brille24 group

10+ years

Yes

Founder of Brille24 group

Yes

500+

Yes

Dr. Felix Hötzinger

CEO at Demekon Group

10+ years

Yes

Founder and co-founder of many tech companies and he supports several well known companies as a board member - including the supervisory board of BNP Paribas Cardif.

Yes

288

No

Alexander Shulgin

Founder and CEO of Gruppa Kompaniy Familia

20+ years

Yes

Founder of rASiA.com, Co-founder of 5CCG, Co-founder of iMusic TV, owner of Gruppa Kompaniy Famlia

Yes

500+

Yes

 

The Gamb team consists of more than 56 employees of various functions; over 70% of them work in development and support functions. According to our research no team members or developers have previous job experience in the blockchain industry.

Advisors include highly experienced professionals in IT, blockchain and consulting, business development, finance and investing but they do not include information about Gamb on their LinkedIn pages. Therefore, it is difficult to confirm of their affiliation with the Gamb project.

Gamb does not have partners, but as of June 2018, Gamb place Google, Pay Pal, DHL, Klarna and Sofort banking as Gamb shopping cart partners on the official website (with no official announcements to that effect).  According to the roadmap, the team plans to onboard merchants from Europe in 2020.

The initial supply of Gamb Platform (“GMB”) token is fixed at 5,000,000,000 tokens. GMB token is used inside of the ecosystem to facilitate the initiation or conclusion of a transaction for a good or service as well as a contribution on the GAMB marketplace. Each merchant can become a member of the merchant alliance, simply by acquiring and owning tokens. The token has no claim on the issuer and is targeted at the main driving forces of the decentralized organized marketplace ecosystem:

  • Merchants.
  • Customers.
  • Token holders.
  • Developer Community.

For the holders of GMB tokens it is allowed to participate in voting and proposals governance processes. The vendors of the ecosystem offer their products and services to GAMB merchants at a discount (due to Gamb’s aggregated buying power), and in return receive GMB tokens.  GMB also can be used as a payment for advertise related products within the site in order to promote cross-selling opportunities prior to check-out.

The Gamb marketplace incentivizes consumers with validated transactions to share their experience via product ratings and merchant ratings. For each rating, the consumer receives tokens, high quality reviews  receive additional tokens depending on how many consumers found a rating helpful.

One of the main GMB tokens usage is a tool of payments inside of the ecosystem. Tokens can be used by merchants and consumers. While merchants pay with GMB for marketplace and transactions fees, consumers can use tokens in the entire GAMB ecosystem to acquire goods and services with discounts.

Moreover, users of the platform can be arbitrators and receive tokens in return for rendering assistance to resolve disputes; and develop the Gamb ecosystem receiving tokens for this.

The Gamb team realizes the price control mechanism in order to limit the exposure for merchants. This is a special function which ensures stable prices within the ecosystem of the marketplace. Additionally, as soon as the marketplace generates profits, a portion of the profits can be allocated to acquire GMB tokens, in order realize the GAMB vision.

Factor

Description

Price effect

Development and release of new products according to the roadmap

According to the analysis, the Gamb roadmap is well-planned until 2021; can be found on their website. The roadmap states that the team plans to launch an alpha version of Gamb and a product search engine MVP in Q4 2018, and the market place MVP beta version in Q2 2019. At the time of writing (June 2018) no MVP was available. It is currently difficult to monitor the latest developments, as Gamb does not have any public repositories on GitHub and does not provide any information on their Medium page.

Bullish/Bearish

Demand for the platform

A self-governed and decentralized ecosystem for e-commerce based on blockchain technology. At the time of analysis (June 2018) it is hard to assess demand for the platform, as the details of the development process are not obvious; the date of the real public release of the product is unclear.

Bullish/Bearish

Sales of tokens by the team, advisors, etc.

10% of tokens are reserved for the team, advisory incentives (5%), marketing (10%), operations (13%) and marketplace development (27%). The team has stated that the vesting period for the team and advisors is two years.

Bearish

Fiat payments being accepted on the platform

According to the project’s whitepaper, fiat will also be accepted on the marketplace. We note that the token is not just used as a form of payment but as a governance/utility tool as well; however, acceptance of fiat will limit the token’s application.

Bearish

Limited token supply

Assuming that the company develops the ecosystem as intended, market penetration is sufficient and demand for the solution exists and increases, this will lead the price up.

Bullish

Volatility of the crypto market

to trade CTK, which may lead to token price fluctuations for the token or even speculative activities (pump & dump, etc.).

Bullish/Bearish

Based on our analysis we identified the following risks for the Gamb project:

Risk

Description

Level

Absence of MVP

At the time of analysis (June 2018), the team has not yet released an MVP. The absence of an MVP seriously compromises the ability to assess the team’s competencies, the capabilities of the suggested product, the level/degree of product development and other crucial factors that investors in an ICO must consider before making any decision to invest. Once the MVP/alpha is released, and the team’s progress is made clearer, the level of risk may go down. 

High

Commercial risks

The space that the Gamb project targets is very difficult to penetrate. Not only there is a close competitor in Storiqa, but traditional players like Amazon and Aliexpress may also be indirect competitors if they decide to develop their own blockchain for the purposes of their business.

High

Team does not provide smart contract for review upon request.

We inquired the ICO smart contract from the team for review, they said that technical support will respond, however, we received no response from the team since then. Subsequent requests to the team have been ignored

High

Lack of public GitHub

The smart contract code on GitHub is unavailable for public review. This makes impossible to track the development stage of the project according to the roadmap plan and to assess of the quality of the product.

Medium

Absence of partnerships

The foundation have not announced any partnerships yet but as of June 2018, Gamb have placed Google, Pay Pal, DHL, Klarna and Sofort Banking as Gamb shopping cart partners on the official website (without any official announcements). According to the roadmap, the team plans to onboard merchants from Europe in 2020.

High / Medium

Team and advisors’ composition and expertise

 

The team has ambitious plans in terms of product complexity and very experienced advisors for the project. But at the time of analysis (June 2018), it is not possible to confirm their participation in the project, due to the absence of such information in their LinkedIn pages. Moreover, according to provided information, team members do not have previous job experience in the blockchain industry. The absence of relevant experience seriously reduces the transparency of the project and increases the level of risk for potential investors.

Medium

Non-comprehensive whitepaper

We believe that the whitepaper has the following issues:

  • It does not present an analysis of the competition.
  • The whitepaper does not discuss any changes in the use of funds in the event that the hard cap is not reached.
  • Intended marketing activities and plans for product promotion are not covered in the whitepaper, so it is impossible to analyze or draw relevant conclusions regarding potential market exposure.

Medium

Unclear ICO justification

Gamb presents itself as the leader in the German e-commerce software market, with more than 25,000 active merchants and annual store revenues exceeding 2.3 billion Euros. Therefore, it is not obviously why Gamb needs US$30 mln for developing the project. This could imply the risk of misuse of funds or concealment of information about the development of the project.

Medium

Decrease in token price

Based on the analysis performed, there are certain indicators that the token price may face pressure in the long term.

Low

Non-comprehensive roadmap

In the roadmap there is no information about plans to participate in conferences, business development or partnerships.

Low

 

 

The information contained in the document is for informational purposes only. The views expressed in this document are solely personal stance of the ICOrating Team, based on data from open access and information that developers provided to the team through Skype, email or other means of communication.

Our goal is to increase the transparency and reliability of the young ICO market and to minimize the risk of fraud.

We appreciate feedback with constructive comments, suggestions and ideas on how to make the analysis more comprehensive and informative.