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06 AUGUST 2018

WEMARK SUMMARY

06 AUGUST 2018 | WEMARK SUMMARY03 AUGUST 2018 | WEMARK TOKEN PURCHASE REPORT

COMPANY NAME

Wemark

STAGE PARTICIPATED

Pre-Sale

STAGE OF PROJECT DEVELOPMENT

MVP Released and available to test at www.wemark.com

HYPERION FUND INVESTMENT

USD $ 250,000

DATES

Public Sale Q3 2018

WEMARK SUMMARY

ABOUT THE COMPANY

FOUNDED 2015 Registered as Wemark WEB DOMAIN www.wemark.com

FOUNDERS

Tai Kaish CEOInvolved with digital marketing for over a decade. Founder and former CEO of Underline.

Pavel Elkind CTOOver a decade of software engineering and management experience. Former R&D Director of Linkury.

Roy Meiro VP Business Development

Roy is a serial entrepreneur with years of experience in building strategic partnerships and business development strategies.

KEY TECHNICAL MEMBERS

Tomer Gabbai Lead Front-End Extensive experience from top-tier companies like SAP and Wix.com.

Barak Simon Lead Back-End10 years experience in development of server-side technologies, databases and cybersecurity.

Adam Wolski Full-Stack Developer

Full-stack web developer with more than 7 years of experience.

Chen Feldman Full-Stack Developer

Full-Stack Developer with more than 12 years of web and mobile development experience.

Ohad Peled UX/UI Lead Ohad is focused on UX/UI design and worked at various Israeli design studios.

Shenhav Yehuda Marketing Director Experience with product marketing and branding for companies such as Intel.

Or Twig Crypto Marketing Specialist

Or worked as an art director and animator for fi nancial enterprises, including VISA.

06 AUGUST 2018 | WEMARK SUMMARY

THE WEMARK TOKEN

WEMARK SUMMARY

THE PROBLEM WEMARK AIMS TO SOLVEThe amount of digital content, such as photos, music, and video has exploded in recent years. However, it has become a highly centralized market with a small number of companies controlling the majority of the distribution. This means that creators must sign away rights and control over their content, along with a large percentage of the revenue their content is generating, to participate.

Network effects have made Shutterstock and Getty Images much more powerful than any individual photographer. These effects occur predominantly with tech companies and their products when the size of their user base grows, allowing users to derive more benefits. A positive feedback cycle, therefore, kicks in whereby the tech product’s value increases exponentially and becomes hard to dislodge by competitors. Over the past 15 years, this has enabled them to consistently increase the fees they charge for distribution, which are now the highest among all types of digital content. These agencies now charge photographers up to 85% of their photos’ sale price, even though they produce no content themselves.

Unfortunately, as there isn’t enough competition, these platforms have formed an oligopoly in the marketplace giving them significant leverage over content creators, resulting in them not realizing a fair share of the revenue.

TOKEN TYPE: Wemark Token (WMK) - ERC20 Token

WHAT IS WEMARK?Wemark is a distributed marketplace that allows content creators to license their content directly to customers, keeping them in full control of the rights to their content.

Ideally, content creators would prefer to license their content directly to customers for several reasons.

It allows for full revenue and rights, ensures control, and prevents manipulated data from third parties. In reality, this is hard to achieve as it is far too expensive and difficult for individual creators to reach potential buyers, as they are competing with large agencies/marketplaces with significant marketing budgets. Customers are attracted to these oligopolistic marketplaces as they offer content from a wide array of creators, making it far easier to find the content they are looking for due to the massive stock these platforms have on offer.

ADVISORSLars Perkins CEO of Picasa Amir Feder NWU

Karen Sachs Shutterstock Dr. Raphael Yahalom MIT

Lee Torrens Canva Dr. Dov Greenbaum Yale

Miguel Forbes Co-founder of Forbes Philippe Bouaziz Sorona Ventures

Gilon Miller GuruShots Yan Pritzker Reverb

James Currier Lyft, Doordash Ari Shpanya Wiser

Michael C. Lesser Shutterstock Ram Avissar Matchpool

Gigi Levy Playtika, Plarium James Waugh Blue Rock

Lior Prosor Elevator Ran Oz Wochit


TECHNOLOGY At the heart of the project’s strategy is the Wemark Protocol, which utilizes blockchain via the Ethereum platform to enable the creation of distributed marketplaces across all types of digital content, and connects them in a decentralized network, creating an alternative distribution system without intermediaries.

Creators license their content directly to users, keeping the rights to their content, know who has usage rights and control its price. Distribution terms and fees are transparent, and the platform will receive a mandate to distribute content by signing a digital distribution contract with creators. This contract will include a price range for licensing the content, the license to be issued to users, and the distribution fee paid to the platform. Once digitally signed, the contract and its terms are locked and can only be changed with the consent of all parties. With automatic payment processing and distribution, the Wemark protocol allows for multiple parties to be rewarded for each sale without involving any intermediaries.

PROCESSMike Muizebelt, wildlife photographer, and Invictus Capital community member advised Wemark to reach out to the Hyperion Fund. Roy Meirom, co-founder of Wemark, first made contact on 28 June and Tai Kaish, CEO, and co-founder, then followed up on 3 July, giving additional detail and proposing further discussions. Invictus performed a brief analysis and consulted with media professionals in the space as to whether the problem that Wemark aims to solve in the market truly exists. After their positive feedback and further analysis, Invictus agreed to have a call with Wemark on 13 July. We were impressed with the project and following our due diligence process, agreed to form a partnership with Wemark. A SAFT agreement finalizing the investment by the Invictus Hyperion fund was signed on 17 July 2018 after legal formalities were carried out by Invictus’s legal counsel, the Decentra Group.

INVICTUS ANALYSIS

Wemark offers an online platform built especially for the content creators themselves. By removing fees that can sometimes top out at 85% on centralized solutions, it means they can make more money even if they charge less for the image. This creates a win-win situation for both sides. For customers, the Wemark platform has the ability to provide the same amount of stock selection as the centralized solutions, at a cheaper rate, without compromising on stock selection or quality.

PRODUCT AND TOKENWemark is introducing a dedicated token to power a direct economy for digital content. As their first use-case, Wemark Tokens (WMK) will be used to license and access photos on Wemark’s marketplace (wemark.com). As all the transactions on Wemark.com will be done through the Wemark protocol, licensing photos on the marketplace will require the use of Wemark Tokens. The tokens will enable direct transactions between photographers and customers


COMMUNITYHaving a strong community presence is essential for gaining traction during an ICO and post-listing. The Wemark team have actively engaged with the community and helped grow its presence across all crucial channels to share their vision effectively. The Telegram community is nearly 12k followers, and Facebook is not far behind at 11k. An important point to note is that a significant portion of the community is already signed up as users of the platform with over 3000 photographers already contributing stock to the alpha release. This user base is incentivized to spread the word and grow the community. Through network effects, the Wemark platform can grow its stock which will ultimately draw in customers, increasing profitability for the content creators.

Along with their strong online presence aimed at providing regular and relevant updates on the project’s progress, Wemark has featured positively on multiple ICO rating websites with stellar reviews. Apart from assisting with an online presence, the Wemark community will support through referral programs that help creators and marketplaces reach broader audiences. The community will be rewarded for sharing content and growing the number of users and adoption of distributed content marketplaces.

while using Wemark’s protocol to reward the platform for distributing the photo and other parties that helped to promote the content (referrals) if applicable. Blockchain will facilitate the trustless transfer of ownership rights and content licensing on behalf of the content creator. The token complies with the ERC20 standard, which allows for easy listing on most exchanges.

Wemark currently has the Alpha version of their platform available for public testing on their website, with over 1 million photographs and 3,000 photographers already signed up. The team is currently in talks in respect of numerous potential partnership deals that could see the platform grow significantly before their official launch.

The total supply of Wemark Tokens is fixed at 135,000,000, and no new tokens will be generated after the ICO, which is always a good thing as this positively influences the future token price. Any unsold tokens from the ICO will be burned, reducing the total supply of tokens. The soft and hard caps are $1.5m and $8m respectively, selling 38% of the total tokens during the Ico. A hard cap of $8m is refreshing to see and certainly limits the risk to investors of a very high diluted market cap post-Ico, which we see far too often in the crypto market. Due to the vast success of the private and presale rounds, the public round was subsequently cancelled due to sufficient funds being raised.


DOCUMENT REQUESTS AND LEGAL ENGAGEMENTDocuments were requested from Wemark and reviewed to mitigate the following risks with regard to Wemark:

• Risks to Leadership

• Risks to Business Continuity

• Risks to Intellectual Property

• Risks to Financial Standing

• Regulatory Risk

• Risks to Feasibility

These risk areas were further investigated by our legal counsel, Decentra Legal, who was engaged to review the token purchase agreement and Wemark white paper, evaluating them to ensure that the following topics pertinent to token purchases were appropriate and protected the interests of the token purchaser, the Invictus Hyperion Fund:

• Commitments in whitepaper and ICO agreement to terms described therein

• Issuers obligations to accomplish the proposed business model

• Organizational structure and founder commitment

• Coin or token attributes and benefits

• Soft and hard caps of token sale

• Information rights of token holders

• Documents were requested from Wemark and reviewed to mitigate the following risks closing mechanics if a soft cap is not reached tokens are not issued

• Disclaimers are reasonable and do not completely absolve founders of any liability

• Transfer restrictions to protect the market from being flooded with WMK tokens termination rights

Invictus, advised by it’s legal partner, has determined that Wemark is on fair legal footing and that there are no obvious legal risks in the project itself.

TEAM The founders do not have a significant amount of experience within the stock photography space. However, they have a proven track record of setting up and launching successful businesses in a variety of industries. The CEO Tai Kaish has over a decade of digital marketing and growth hacking experience, their CTO Pavel Elkind is an expert in R&D. The lead front-end developer Tomer Gabbai is amongst the former core developers of Wix’s editor, which is one of the most prominent web apps to date. It is important to note that Wemark has an excellent board of advisors, consisting of industry experts in a number of relevant areas. Some notable advisors are Lars Perkins (Former CEO & Founder at Picasa, Director at Google), Lee Torrens (Marketplace Director at Canva), Michael C. Lesser (Former General Counsel / VP at Shutterstock), Keren Sachs (Former Director of Content Development at Shutterstock).

MARKETThe Stock Photography market is a +$4 billion market with robust annual growth forecasts of 8%. The collections in existing agencies are cluttered with outdated, irrelevant photos, making the search experience for customers cumbersome and unrewarding. Customers are tired of pricey, inflexible subscription plans and expiring credits that leave an even bigger part of the value in the hands of the agencies. Wemark will allow stock photography to adopt the blockchain at scale which is part of the reason it is an excellent first use-case for the distributed marketplace. Photographers are actively looking for alternatives to the status quo and are ready to adopt any solution that will help them distribute their content on better terms, without those terms changing every few months. The stock photography market is ripe for disruption. The new applications of the emerging blockchain, AI, and Image Recognition technologies will solve many of the burning needs of photographers and their customers.


DISCLAIMERThis announcement is for information purposes only, and represents neither investment advice, nor an investment analysis or an invitation to buy or sell financial instruments. Specifically, the document does not serve as a substitute for individual investment or other advice. The statements contained in this publication are based on the knowledge as of the time of preparation and are subject to change at any time without further notice. The authors have exercised the greatest possible care in the selection of the information sources employed, however, they do not accept any responsibility for the correctness, completeness or timeliness of the information, respectively the information sources, made available, as well as any liabilities or damages, irrespective of their nature, that may result there from (including consequential or indirect damages, loss of prospective profits or the accuracy of prepared forecasts).