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spectiv Rating Review

Investment Rating

Expiry date : Expired 28 Mar 2018

Ratings

We assign a "Risky+" rating to the Spectiv VR project.

The Spectiv team is developing a platform that allows users around the world to share unique VR content with each other. Viewers can find, share, and experience VR without leaving the house. At the same time, the writers are also creating the Signal Token — an advertising protocol that enables its users to optimize interaction between advertisers, publishers, viewers, and other participants of the process.

We consider both industries promising. The company's documentation and site are well executed, but there is a lack of information on development scenarios at various levels of potential funding collected during the ICO, on the parameters for technical development, and there are a number of serious investment risks.

Given that the development of both Spectiv products has only just commenced, the number of competitors is continually growing, and we have not found strong advantages for the project compared to other similar services. As a result we have not been able to assign a higher rating to the project.

General information about the Project and ICO

Spectiv is a project that combines two separate products. The first is a decentralized advertising system, the Signal Token protocol, which is designed to exclude intermediaries in interactions between advertisers, content creators, viewers, and curators; the second is a platform for streaming Spectiv VR videos. At the same time, the VR platform will be the launchpad for a decentralized advertising protocol.

The Spectiv team is staging an ICO to raise funds for the development of their products, as well as the products' promotion and advertising. To this end, investors are encouraged to purchase SIG utility tokens which will play a key role in the advertising protocol.

At the end of the summer of 2017, the Spectiv team conducted a presale of tokens. The received sum was raised in accordance with the Know Your Customer (KYC) process under the SAFT contract and was audited by the global firm Baker Tilly Ltd. Participants in the presale were able to purchase SIG tokens at a 50% discount. During the presale, the following sums were received: 3547.7 ETH, 31.6 BTC and 57922.5 USD, equivalent to slightly less than 1.3 million dollars at the time the presale was completed.

Profits collected during this stage were used to create an alpha version of the platform and to raise awareness of the project in the community.

For the ICO, the project also requires buyers to comply with an Anti-Money Laundering Policy ("AML"), which, in addition to KYC, includes relevant government checks on individuals on lists of excluded persons such as OFAC. A registration process (whitelist) is also used to determine the order of token distribution at the time of the public sale, based on a "first come, first served" principle.

Website

Whitepaper

Slack

Twitter

Telegram

Facebook

Bitcointalk

GitHub

Reddit: not available

Medium

YouTube

Steemit

LinkedIn

ICO Start: December 8th 2017 2:00PM (GMT -5)

ICO End: December 29th 2017 2:00PM (GMT -5)

Token: SIG

Hard cap: US $40 million

Soft Cap: US $2 million

ICO Price: 1 ETH = 950 SIGs

Minimum Buying Transaction: No data available

Minimum Buying Transaction: No data available

Bonuses:

  • 60% (buy 1, 0.6 free) - Dec 5th to Dec 8th (with access code)

  • 40% (buy 1, 0.4 free) - Dec 8th – Dec 11th

  • 25% (buy 1, 0.25 free) Dec 11th-18th

  • 10% (buy 1, 0.1 free) Dec 18th-Dec 22nd

  • 0% (buy 1, 0 free) Dec 22nd-Dec 28th

Accepted currencies: ЕТН

Total issuance:

The number of SIGs sold will determine the total number of SIGs created. The project involves selling 60% of generated tokens. The remaining 40% will be used for platform reserves (20%), the team (13%), escrow and advisors (4%), rewards and bounty (3%):

Allocation of funds:

  • 40% - platform development

  • 15% - marketing and sales

  • 15% - content licenses

  • 10% - payouts for contributors

  • 8% - equipment

  • 7% - general and administrative

  • 5% - legal fees

Token Issue Date: SIGs will be distributed to user-provided ETH addresses through the smart contract 30 days after the end of the sale to account for the audit process.

Vesting:  No data available

Escrow:

  1. ATM CoinVault
  2. Sutton Stone LTD
  3. Spectiv LLC

In order to slowly transfer SIGs to purchasers, Spectiv will release SIGs as follows (for everyone):

Description of the services and scope of the Project

Spectiv VR is a streaming platform whose users can watch, download, and share unique VR content. Three content categories will be presented on the platform: Public-oriented, commercial activities and exclusive collaborations of the project with different types of activity.

Thanks to the public-oriented VR content, Spectiv will allow users to upload content with their VR equipment. This content can vary from professionally-recorded to amateur level.

Commercial VR content will consist of live/pre-recorded VR streams of sports competitions, concerts, etc. This will enable viewers not only to watch popular events from home but also to immerse themselves fully in the atmosphere of an event using VR equipment. For this type of event, Spectiv will enter into broadcast/general partnership agreements with relevant organizations.

Finally, Spectiv will participate in the co-production of exclusive VR content based on a decentralized community vote. The project plans to create this content in partnership with leading VR content manufacturers. This will be implemented on the platform once the public and commercial components are fully installed.

The second development from the team, the Signal token protocol, will be able to be used as a starting point for direct interaction between advertisers, content creators, viewers, and curators during the placement of advertising materials. It is open in nature and is also intended for use by other media platforms.

By using this protocol, advertisers will be able to use SIG tokens via smart contracts that are associated with their target content. Thus, publishers, viewers and curators can interact with an advertiser through a smart contract and receive rewards in SIG tokens for drawing attention to this content.

In fact this protocol minimizes the cost of using online advertising, excluding intermediaries such as Google, Facebook etc. By using the Signal Token protocol, advertisers can work directly with producers, providers, and other users, so-called "influencers of attention".

In the smart contract, the advertiser himself details all the terms and conditions of an advertising campaign, in addition to information about the advertised product/service and the general advertising budget. The level of payment for advertising services is determined, for example at 0.1 SIG per ad view, etc.

Engineering features of the project

Interaction between the products being developed will appear as follows:

According to the team, the platform will be functionally similar to YouTube’s services, except that it specializes in VR content.

All 360° data are placed on AWS S3. After being uploaded by a user, video is reencoded to lower resolution for viewing using different devices and connections. The project uses an AWS Elastic Transcoder to make this possible. For application data, SQL Postgres is used. In particular, Compose.io, an IBM product, provides/protects the Spectiv databases. The system uses Reddis DB to store sessions. This process is also protected by Compose.io.

Currently the team is also developing the Signal Token protocol architecture and its MVP. The authors promise that the infrastructure of the protocol will be fully operational by December 2017 and that functional advertising campaigns using smart contracts will be integrated into the Spectiv VR platform by February 2018.

The team recently shared the code components of the Signal token protocol on its GitHub account, which enables testing of this development from the team.

Unfortunately, no more detailed information on technical parameters of the developments is available in the documentation.

Market review

The VR industry is growing rapidly, and its capabilities are expanding for both users and businesses. The revenues from virtual reality hardware and software are projected to increase from $3.7 billion in 2016 to more than $40 billion by 2020 [Statista]. In addition, virtual and augmented reality global market revenues will reach around $215 billion by 2021.

Forecasted augmented (AR) and virtual reality (VR) market size worldwide from 2016 to 2021 (in billion U.S. dollars)

By then, the number of mobile virtual reality users worldwide is expected to exceed 130 million.

The VR content market is divided into six or more industry segments including games and entertainment, marketing and advertising, retail, industry, public health and wellness, etc [BusinessWire].

At present, such content is increasingly being used in advertising, in particular in the automobile and tourist industries.

According to surveys, users are most interested in viewing VR in the travel industry as well as when watching movies and live events:

The same survey showed that 71% of respondents rated the up-to-dateness of advertisers using VR content in their advertising campaign, and this increased their loyalty to the relevant brand.

Currently, the major players in the VR market are Google, Sony, Samsung, and Facebook. They create technical capabilities through which VR content is created and delivered to end users.

In addition to VR solutions, the project aims to create an ad protocol that will help companies save money on advertising campaigns, excluding intermediaries' services. According to some reports, about 95% of Google’s revenue comes from online ads:

The source predicts that the global costs for digital advertising in 2017 will be 229.25 billion; by 2020 they will rise to 335.5 billion:

Digital advertising spending worldwide from 2015 to 2020 (in billions of U.S. dollars)

As a result, we assess both industries as very promising in terms of investment both in the medium and long term.

Competitors and competitive advantages of the project

The VR market is at a very early stage of development, and there is already a number of platforms in this field that offer immersion in virtual reality content. Here are just a few of them:

VIBEHub is the world's first decentralized market for virtual and augmented reality, including streaming concerts in a special VR app, as well as planned educational flows, social events and games to be launched in the near future as well as virtual dating. The platform is designed for up to 1 billion users.

PROSENSE – a VR-streaming company. Currently this is a working business outside of blockchain, a unique production studio that specializes in the creation of high-quality VR videos. The main product is a platform for real-time broadcasts of sporting and entertainment events.

Their ProsenseLive platform can be used for both professional and amateur VR content: online streaming of sporting events, concerts, shows, conferences, amateur events, or adult content. Thus, Prosense is basically a platform for streaming particular activities and/or entertainment content, which to some extent differentiates it from Spectiv.

According to the developers, the main competitive advantage for Spectiv before other VR streaming platforms is its focus on content provided by users themselves.

With regard to the development of the advertising protocol, the project also has major competitors who have long completed their ICOs and are in the process of developing similar services.

Basic Attention Token (BAT) increases the effectiveness of digital advertising and is used for sharing between publishers, advertisers, and users on the Ethereum system.

BAT can be used to access a variety of advertising services on the Brave platform. The usefulness of the token is based on a user's attention, which means the focused state of a person when new and/or interesting material is viewed/studied.

AdEx is a decentralized advertising exchange based on blockchain. The project aims to change the existing business landscape for online advertising and solve its main problems: Advertising fraud, privacy issues, and issues of user consent to receive advertisements, etc.

QChain is a project that aims to create a smart contract for publishers and advertisers using a simple web interface. Users will interact with each other in the market in the course of realizing advertising deals. The project assumes that some transactions can be automatically approved. However, QChain does not provide tools for supporting high transaction rates.

The team assures us that a competitive map of advertising services on blockchain is still in the formative stages; It is expected that by 2018-2019 many platforms similar to those under consideration will emerge. So in their opinion, the Spectiv advertising protocol also has every chance of becoming a successful media platform.

Risks

The main risk according to the creators is that companies wishing to advertise their goods/services will not want to use innovative platforms to conduct their advertising campaigns, instead continuing to work with Facebook or Google.

In addition, the VR industry has not yet become mainstream, so far only a small portion of internet users are interested; even fewer have the specialized equipment needed to immerse oneself in virtual reality. For this reason, there is a significant risk that wider adaptation of this technology will occur later than the project currently intends.

However, these risks are essentially industry-specific. In our view, the project has other equally important ones. They include:

  • developing two products that have different orientations.

  • strong competition in the market for optimizing digital advertising.

  • the team's lack of experience in the VR industry.

  • high implementation costs and a potential risk of shortfall during the token sales.

All of these points are very serious threats to the project and could prevent it from being successful in its chosen industries.

Team

The team includes 11 members as well as 3 advisors.

Co-founder and CEO is Dylan Senter, who graduated from University of Houston C.T. Bauer College of Business with a major in Marketing and Entrepreneurship in 2016. This university is considered to be one of the best in the United States and is also on the list of top 60 universities worldwide. His core experience was obtained through online sales business support — Dylan owns a store that has the right to sell on Amazon. According to his LinkedIn page, the store generated more than $500,000 of income in the first year (2015). The store operates to this day with a current stocklist of 54 products (accessories) [amazon].

Nick Ravabakhsh is the second founding member and also holds the position of COO. Nick is currently studying Accounting (graduating in 2018) and Entrepreneurship (graduated in 2017) at the University of Houston. Together with Dylan he has already implemented a project called Sensytec, which provides IT services through proprietary Smart Cement System technology. Unfortunately, it had not been possible to evaluate the success of this project and the official site is not functioning.

Chris Pena — CTO of the project. Has programming experience. Is the CEO of Effortless Online Solutions, where Nick Ravabakhsh holds the position of CFO. This company is involved in developing and designing applications. He also has a Youtube channel where he shows the basics of programming to interested users. The channel has more than 14,000 subscribers.

As can be seen the core team members have already established working relationships.

The Spectiv staff also includes:

  • Ramon Hernandez (UI developer).

  • Bryn Bellomy (ETH developer).

  • Justin Wood (Software Architect).

  • Jasmine Nguyen (UX developer).

  • Mirza Baig (Business strategy).

  • Jin Chung (Web developer).

  • Ildefonso Prieto (Growth hacker).

  • Mike Mackey (External CFO).

Almost the entire team is based in Houston, United States. Most of them do not indicate Spective as their main place of work on LinkedIn.

The project advisors are:

  • Sheldon Weisfeld, the founder of COINVAULT ATM, a project that provides opportunities for adopting cryptocurrency in real life.

  • Adam Richard, Director of Sutton Stone (Venture Building & Investment Network).

  • James Duchenne, CEO of Sutton Stone.

In addition to those listed, the creators of the project are in contact with the creators of LiveTourLab, Joakim & Anders, who, in turn, are project advisors to Vibehub and Cappasity.

In our view, the team for the developed project is not an indisputable key to the further success of the Spectiv platform. None of the members have experience in implementing virtual reality projects.

Development strategy and Roadmap

At the end of November 2017, an alpha version of the VR platform was released, in which potential users can immerse themselves in the world of virtual reality via a web browser. Alpha V1 is a functional VR streaming platform that allows users to download content, view it, create channels/accounts, subscribe to other users' channels and more. This version is technologically advanced according to the creators, and supports Rift/Vive VR viewing directly through a web browser. In addition, one can use the desktop and mobile headset features.

The team promises to release the MVP and the architecture of the Signal Token protocol in early 2018, and will launch a full-fledged version of the decentralized VR platform by the end of 2018.

The complete roadmap of the project is presented below:

2017, Q4:

  • Hire additional developers

    • Bring on two full-time platform developers and an additional Solidity developer.

  • Develop and release Signal Token protocol

    • The initial token contract for the Signal Token protocol will be written, audited, and ready for the SIG sale.

  • Release Spectiv platform alpha V1

    • 360°-video upload

    • 360°-video viewing for mobile/desktop

    • user account hosting/dashboard

    • channel management

    • one 360°-video livestream event hosted by Spectiv

    • user-to-user Signal Token reward/tip functionality

  • Secure content contributions with existing VR enthusiasts

    • Drive VR content contributions to the platform from users around the world.

  • Launch SIG token

    • The official Signal Token crowdsale will be held on December 8th, 2017.

2018, Q1:

  • Optimize and update Signal Token protocol

    • Major focus on abuse-mitigating mechanisms.

  • Integrate Signal Token advertising protocol into Spectiv platform

  • Build primary Spectiv user base and support/incentivize user-driven contributions

  • Update Spectiv platform

    • Gather feedback and resolve kinks found in alpha V1.

  • Release Spectiv alpha V2

  • Open discussions

    • Licensing deals and partnerships with commercial organizations for Spectiv live streaming.

2018, Q2:

  • Update Spectiv platform

    • Gather feedback and resolve kinks found in alpha V2.

  • Update Signal Token advertising protocol based on performance in alpha V2

    • Develop support for open-source use by outside media platforms.

  • Release official Spectiv beta platform

    • Beta-level functionality: 360°-video upload, viewing, user accounts, user-generated VR live streaming, Signal Token integration for payments, rewards, tipping, and ad campaign smart contract engagements (test ads).

2018, Q3:

  • Apply final-round updates to Signal Token protocol and open up to integration/optimization by outside media platforms

  • Make pointed efforts to establish a wide selection of VR experiences

    • Focusing specifically on varied user-driven content and popular commercial events.

  • Contingent on meeting all milestone expectations

    • Begin plans for Spectiv Original VR content.

  • Official launch of Spectiv platform and online marketing campaign

It should be noted that, in addition to launching the platform itself, one of the main tasks for the project is to actively engage its audience. In 2018-2019, the platform will make extensive use of advertising, SMM and other tools to engage the public in the VR platform.

Marketing strategy

Currently, the community's response to the project is objectively low; only 88 people subscribed to the Medium blog, and the Spectiv Telegram channel has 374 users. The project's Twitter account has more than 2000 followers, with the number of likes and retweets for a tweet not exceeding 90-100 in most cases. The project's Facebook has about 7000 likes, but there is no activity on the page. The main thread on Bitcointalk gathered 734 posts, most of which were written by users involved in the project's bounty program. Online, in addition to a few articles with general phrases taken from the white paper, we did not find any news articles, interviews with the team or other useful information.

Thus in our view there is a lack of attention on the part of the community, no activity on social media and, as a result, no hype on the tokens currently being sold.

After the ICO the team plans to actively use SMM to attract users to the platform as part of its marketing strategy.

The creators of the project are in negotiations with content creators such as TycerX [YouTube], which creates 360 videos. It has more than 150,000 subscribed users, and it is intended that Arran will create 4-series content: The first part will be published on its YouTube channel, while the remaining series will be available only on the Spectiv platform.

In addition to TycerX, the project currently has partnership agreements with Jeremy Sciarappa [YouTube] (61 subscribers to YouTube), G Rated Family Gaming [YouTube] (11K subscribers on YouTube), Hyperdimensional Hub [YouTube], 360 VR-Adventure Studios [YouTube] (19K subscribers on YouTube), etc.

In addition to SMM, the project intends to use exclusive rights for displaying certain content based on partnership agreements (sports and musical activities in the form of VR and so on).

The creators also have an arrangement with the Immersv platform, the leader in the immersive advertising sector. Once the team finishes developing the ad protocol, Spectiv together with Immersv will start launching advertising campaigns for greater community involvement.

In addition, the creators have recently acquired leading technology of VR — Livetourlab. Livetourlabs is one of the most highly rated ReactVR projects on GitHub. This has the potential to give the project an additional advantage over competitive systems, and it also attracts the special attention of interested users.

Economy of the Project

The profits generated by the ICO will be locked in an escrow wallet until the audit of the Spectiv ICO is successfully completed. Once SIG tokens are distributed, participants in the escrow process will be able to determine the amount of income from the sale in US dollars. The funds will actually be distributed between two organizations — Spectiv Ltd. and Spectiv LLC.

The documentation decribes this process in more detail.

The first 1/3 of the funds will be released and made available to Spectiv immediately after the distribution of SIGs. These funds will be converted into US dollars and will be used to cover development and advertising costs — in particular, the costs of promoting the site. These tools will also be used to build the project’s infrastructure including employee searches, office leases, and so on.

The next 1/3 of the profits will be released and converted when the platform’s beta version launches. These funds will be used to start the next phase of development and for overall project expansion, including optimizing the architecture of the platform, creating a user base, and obtaining license agreements with major organizations broadcasting popular events.

Finally, the last 1/3 of the funds will be released and converted at the end of the beta test and, as a result, a formal announcement of the launch of the Spectiv platform will be made. The funds will be directed to the marketing campaign and will also cover current maintenance costs of the platform.

However, according to the Spectiv business plan, a revenue of about $2 million is expected to be available by 31/12/2018. The main income items are:

  • Income from video advertisements (55%).

  • Income from advertising banners (37%).

  • Income from the premium content (8%).

In 2019, there will be additional revenue from selling virtual tickets for VR activities.

Gross margin remains unchanged throughout the five-year planning horizon, and each direction is different:

Revenue

GM, %

Video content

15

Banner Ads

15

Premium Content

50

Virtual tickets

40

As of the year 2020, project revenue is forecast at a level of $16 million, and buy 2022 at more than $72 million. However, it is only in 2021 that Spectiv will come out of loss and show a minimum positive result, which, in our view, seems plausible if all the roadmap terms are met.

According to the team, the advertising protocol will not be used for profits, i.e. the code will be open to all applicants.

The expense aspect of the project’s business plan is not revealed; however, it would be difficult to analyze sums required for implementation of the platform in any case.

The documentation does not provide for scenarios of development and implementation of the platform at different levels of possible funding raised during the ICO. In this regard, it is not possible to assess possible results for the sales round.

In general, in our view the existence of a financial model for the Spectiv project is an undeniable plus. It gives the impression that the team is seriously preparing to launch the project, realizing that it is not possible to receive superprofit in the medium term. However, the platform's income will be directly dependent on the number of active users, and the forecast values for their growth and inclusion are not shown in the documentation.

Token investment attractiveness

SIG tokens have a utility function in the Signal protocol, so their value will only increase if the protocol is widely distributed among various media platforms, the first of which will be Spectiv VR. At the current stage, it is not possible to predict growth in user numbers for either the protocol or the platform, as they are in fact still being developed. This is why we will focus on assessing the strengths and weaknesses of the project, which will be crucial in the implementation of the founders' plan to launch and popularize their work.

We have identified the following as the main advantages:

  • The availability of a financial model.

  • A fairly well-developed marketing strategy using online personalities and bloggers in the field of virtual reality, as well as the signing of cooperation agreements with VR content manufacturers.

  • A released alpha version of the platform that gives an overview of the field of virtual reality.

Significant drawbacks for the project in our view, are the following:

  • The development of two products at once which have little relation to each other.

  • A high target cap of 40 million dollars.

  • Low current involvement of community members in the project.

  • A team that has no experience in the field of virtual reality.

All in all, the project is well developed, but it also carries too much risk to investors at present. We do not recommend participation in the ICO for speculative profit, since the purchase of SIG tokens would theoretically be justified only if demand significantly exceeds supply during the ICO, which currently looks unrealistic.

The information contained in the document is for informational purposes only. ICORating received monetary compensation in the amount of $16049 from the entity rated in this report for completing the ratings report. However, the entity rated in this report did not have the opportunity to approve this rating report before the report was published, nor did the rated entity have the opportunity to edit or remove this report once it was published. The views expressed in this document are solely those of the ICORating Team, based on data obtained 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.