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Norway's first stablecoin backed by real estate?

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This week in fintech

September 20 · Issue #115 · View online

A weekly summary of the latest news in our world of finance, design, and technology.


Also:
  • 😬 Vipps submitting new merger application
  • 🤝 Stacc is hiring 50 in Oslo
  • 😔 Adobe buys Figma
  • 🧱 The value of friction

🏡 Norway's first stablecoin backed by real estate
Horde will help homeowners pay off debt faster and free up liquidity by becoming co-owners of homes and using their own cryptocurrency, Bustad coin, to secure the transaction. That is a mouthful.
Let us dissect this: Say you are a homeowner with high-interest debt or struggling due to the increasing cost of living. Bustad can then help you by setting a value on your home and becoming a co-owner for up to a 20 percent ownership stake. Bustad will then take over the debt on the share they own, while the homeowner will service the rest of the debt. It will not be possible to sell part of the home to get the money paid out – you need to do it to pay off debt. You can buy back the ownership from Bustad whenever you want.
The values Bustad takes over are “tokenised” through the coin Bustad Coin. Tokenization means attaching a specific value to a digital coin in a blockchain, in this case, the market value of a portfolio of homes. The price of the Bustad coin will be based on the total sum of the underlying values in the housing portfolio and liquid assets in crypto and fiat.
Still confused? Maybe this will help clear things up?
It didn’t? I’ve read the whitepaper and still have a bunch of questions:
  • How is Bustad Eiendom continually going to get funding to buy their ownership shares?
  • Is a crypto-currency really needed to make this work?
  • Why should investors invest in Bustadcoin instead of a traditional real estate fund?
  • What are the mechanisms to make people want to buy back the housing share from Bustad so that it is not just a fictitious value that never gets realized?
  • Will the target audience understand how this works?
  • How is Horde getting paid for the technology they provide? What are their kickback incentives?
  • How is Bustad Eiendom going to operate? Are they going to have any employees?
  • What running costs is Bustad expecting to cover related to the transaction?
  • How much potential upside will be lost in transaction fees, government fees, and other third-party costs?
Bustad looks like a really interesting idea that might be useful for a lot of people, at least on paper – I just wish that (white) paper was a little bit more detailed.
😬 Vipps submitting new merger application
The merger between the three Nordic wallets, Vipps, Mobile Pay, and Pivo, didn’t go through at the EU commission. Vipps and Mobile Pay have been the dominant players in Norway and Denmark for a long time. In Finland, on the other hand, Mobile Pay has approximately two million users and Pivo 1.2 million. Thus, the Commission believed that the merger would create a market concentration in the wallet market that was far too high. Vipps and MobilePay have therefore sent in a new application without Pivo.
This week Vipps also got in the spotlight for being easy to use for harassment. IT consultant Cecilie Wian reacts to Vipps doing too little to protect users from harassment: Vipps allows online shops to use Vipps as a payment method, but there is no control over whether you enter your own telephone number. This way, Vipps users can receive push messages and messages to accept a payment they have never requested. Vipps, on their side, believes that the extent of harassment is small and that they have introduced measures against abuse.
It is always hard to balance the best possible user experience while thinking of every edge case, but Wian’s advice to everyone designing products is excellent:
“What would the world’s worst person do with this app?”
🤝 Stacc is hiring 50 in Oslo
This week the news broke that we are looking for 50 technologists / project managers / designers / business developers at once – most of them in Oslo. The reason is that we have a lot of customer demand daily. If this sounds interesting to you, you can apply here. (I promise to tell the story behind the image if you come to an interview)
😔 Adobe buys Figma
The news of Adobe buying Figma came as a shock in the design community last week. Figma has always been positioned as a challenger to the behemoth Adobe. But when you come to think of it, it all makes sense: 
  • Figma is a venture-backed company valued at 10 Billion dollars last year. Venture companies get their returns either by the company IPOing or getting acquired. The IPO market hasn’t been great lately.
  • Figma has grown its sales yearly, surpassing $400 million in annual recurring revenue this year. They are on the path to a Billion dollars a year in a few years. Not many SaaS companies reach that level.
  • Adobe is their greatest competitor, with a market cap of ~ $140 billion. From Adobe’s standpoint, taking a 12% dilution to eat their largest competitor seems cheap, even though they paid a 50x ARR multiple for Figma. 
If you ask me, this is also a clear case that competition authorities should stop, so I wouldn’t be too surprised if the sale got canceled. If the deal goes through, however, I think this acquisition in time will be compared with Facebook buying Instagram or Google buying YouTube
( I’m also betting that Figma won’t be operating autonomously anymore in two years)
🧱 The value of friction
We often strive for the best possible user experience, so-called frictionless design. But friction can be very valuable – some friction can improve the experience. This article explains how IKEA, Facebook, and Amazon actually added friction to their experiences to make them better.
The Value of Inconvenient Design The Value of Inconvenient Design
That's it for this week 👋
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Marius Hauken, partner Stacc X
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