ICO Analysis: The Abyss



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Cool Cousin is a traveling recommendation app for busy travelers to use to learn from locals about the best spots at their destination. Instead of having to rely on a stranger’s Yelp review or an out-of-touch travel agent, you just ping your “Cousin”, a like-minded local who’ll give you the inside scoop on the city.

Cool Cousin began in Tel Aviv, Israel in 2016 but has quickly spread to over 65 cities housing more than 1000 Cousins on their platform. With a successful app already in place, the team is going to incorporate a cryptocurrency, CUZ, this year to improve the app’s processes and foster the growth of the Cool Cousin community.

The Ecosystem

The Cool Cousin ecosystem is split into two separate entities: Company and Community. Transaction fees on the platform are split between these two groups.

The Company is in charge of technical advancement and business development with the goal of supporting the Community. Starting out, the Company sets the guidelines for the Community; however, over time this will shift to Community self-governance.

The Community basically operates everything within the app. Community members oversee the content and services as well as provide quality control and dispute settlement. While the Company receives their half of the fees directly, Community members receive their half through a Rewards Engine. Eventually, the Community will be completely self-governing.

The Board of Representatives contains both Company and Community members. The goal of the Board is to bridge the two groups together and make sure that their incentives are aligned. Voting power is split 35% to the Company and 65% to the Community.

Community Members

The Community contains several different players who are instrumental in the app’s ecosystem.

As mentioned earlier, Cousins are the backbone of the platform. These locals create guides, answer questions, and provide suggestions for travelers. They also perform governance actions like resolving conflicts, evaluating new Cousins, and reviewing content. As a Cousin, you can additionally provide customized services to travelers for additional payment and Pro-Cousin status.

Users are simply people that use the Cool Cousin app. You get a variety of travel information for free, but you can purchase premium services as well. As an active User, you have the opportunity to become a Contributor and earn CUZ tokens. To do so, you need to do things that improve the app experience: update bad photos, onboard new Users, review recommendations, etc… Once you’ve completed a significant amount of contributions, you become an Editor. With this, you earn additional CUZ by approving/rejecting the content corrections of Contributors.

Finally, Business Owners can manage their review pages on the app and pay to promote their company.

Token

CUZ tokens are the exclusive currency on the Cool Cousin app. A variety of services require you to pay CUZ tokens. These include, but are not limited to:

  • Concierge Services
  • Travel Agent Services
  • Contributions (Tips)
  • Affiliate Link

Community members receive payments from the Community Pool according to the Rewards Engine. The Community Pool is funded with CUZ from transaction fees. The Rewards Engine uses smart contracts to distribute payments to the Contributors according to the quantity and quality of their contributions.

Cool Cousin includes an in-app wallet in which you can easily exchange fiat currency for CUZ and vice versa.

Tokens and Distribution

The CUZ ICO begins in March 2018, although the team hasn’t yet set an exact date. The whitepaper is not entirely clear on how long the ICO will last, but it appears that it’ll conclude after three weeks.

There will be a public pre-sale in which you receive tokens at a discount based on the number that you purchase. The normal exchange rate for the ICO is 1 ETH for 3770 CUZ; however, the pre-sale discounts range from 20% to 50%. Tokens bought during this time also have a vesting period from 3 to 9 months.

The normal public sale also offers bonuses ranging from 5% to 20% depending on when you contribute to the ICO.

The ICO has a hard cap of 17,500 ETH (~$15 million at the time of this writing) and soft cap of 4,500 ETH (~$4 million). You can participate in the ICO by contributing either Bitcoin, Ethereum, or U.S. dollars.

The team will mint 300,000,000 CUZ tokens during the ICO and no more after that. The distribution is as follows:

  • 33% – ICO contributors
  • 25% – Community pool
  • 24% – Future operations
  • 10% – Team
  • 8% – ICO advisors, early supporters, bounty program

Dedicating almost one-quarter of tokens towards future operations seems a little steep considering that a large part of what’s raised is going towards development and half the fees are dedicated to the same thing.

Team

The seventeen-member Cool Cousin team includes some impressive resumes; however, blockchain experience is lacking. Almost the entire founding team previously worked together on the Victory 2015 (V15) campaign, a grassroots political movement in Israel. CEO Itay Nagler co-founded and ran Dtales, a digital agency working with international brands like Nestle and HBO. Gil Azrielant, Cool Cousin CTO, was a team leader in the Israeli Intelligence Corps running cyber research and development.

The advisory board consists of the former head of national sales at Yelp, the director of global growth at Automattic, and the co-founder of Digital Asset Partners.

The Verdict

Cool Cousin is a VC-backed, community-focused travel app that will soon be adding blockchain technology to its platform. The app has some impressive growth numbers:

  • 220% total user growth in the past 6 months
  • 250% growth in the number of Cousins in the past 6 months
  • 310% growth in Cousin-traveler interaction over 6 months
  • Although Cool Cousin has seen some success, the question still looms on whether or not the project needs its own token and ICO.

Risks

  • Limited blockchain experience. No one on the team has other significant blockchain projects under their belt. (-2)
  • Narrow use-case. CUZ tokens have limited value in a niche ecosystem. Unless Cool Cousin expands, there’s a low ceiling to the value that they’ll have. (-2)
  • Misaligned incentive risk. Internal conflict could arise if the Company can’t agree with the Community, harming the growth of the project. (-1)

Growth Potential

  • Established product + growth. Getting a product off the ground with happy users is 90% of the battle. Cool Cousin has already accomplished this. (+5)
  • Large market. The travel industry is worth $2.3 trillion giving Cool Cousin the opportunity to expand their offerings to capture more of this market. (+4)
  • Solid team. Although not the strongest technical team, many of the members are expert marketers with years of success behind them. (+2)

Disposition

Cool Cousin earns a 6 out of 10. Crowdsourcing travel recommendations from locals is a great idea, and clearly, others agree as shown by the growth of the company. However, as an ICO investment, the opportunity seems limited. The data provided by the team doesn’t show how many users are actually paying for premium services, so it’s tough to judge the value of CUZ tokens.

All that said, many predicted that Airbnb would never reach the size that it is now. Travel is more popular than ever and Cool Cousin could find their golden ticket somewhere in the ever-growing industry.

Investment Details

No announcements have been made about the exact date of the ICO, but it’s scheduled to occur in March 2018. Check out the official token sale page for more information.

  • Token Type: Utility
  • Platform: Ethereum
  • Symbol: CUZ
  • Initial Value: 1 ETH = 3,770 CUZ
  • Public Sale: March 2018
  • Minimum Investment: 0.1 ETH
  • Hard Cap: 17,500 ETH
  • Jurisdictions Barred from Participating: China, Singapore, Israel
  • Websitehere
  • Whitepaperhere

Featured image courtesy of Shutterstock.


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