Analysis of ICO Bitlumens
Bitlumen is a platform for installing Solar panels in rural areas and distributing electricity from them to not electrified regions. As initial region, founders planned Latin America – Panama, Honduras, Nicaragua, and Guatemala because of high cell phone availability, low rate of electrification, high number of adults unbanked, inflation rates below 10% and high adoption rate of kerosene or other inefficient fuels used for electricity.
Current milestones are:
- Deployment of 100 Solar panels at the end of April 2018 (Guatemala)
- Addition of software for using tokens in hardware – end of May 2018
- The deployment of IoT to track carbon and black carbon mitigation.
- Solar pumps will be added to hardware ecosystem after June 2018
- Testing phase will end at October 2018.
By some undisclosed reasons, founder prefers women farmers as users of the system.
Whitepaper contains no detailed economical calculations of product, just concept – women farmers in target regions will buy machine complexes (Solar panels, LED, TV/Radio, sensors etc) as micro-loan. Interest rate will be calculated specially in each case based on personal and behavioral variables. Also, system will have a database with credit history of each client.
So, the profit of the product will be an interest paid by clients, and reward for selling nig data of villagers to governments and banks interested in micro-loaning them.
Hard cap is USD 25 million. Planned usage of the investments:
- Hardware 35%
- Software development 20%
- Wages 35%
- Marketing and PR 6%
- Legal 2%
- ICO expenses 2%.
So, 55% will be used to HW and development.
But in whitepaper there are no estimations of bad debts and expenses connected with it. We believe that any business-plan with loaning customers must have estimation of not returned loans and their influence to a business.
Bitlumen team will recruit and authorize agents in target regions. Agents will buy BLS tokens on market, sells them to clients, collects the money and receive commission. So, the basic unit for marketing in each region is Area Manager and Agents under him/her.
Team leaded by former Credit Suisse investment consultand, and has advisors with a good background in blockchain/cryptomarket activity.
The Vision of the Market
First page of website contains maximum estimation of potential system customers – 1,2 billion people without access to electricity and banking. As initial market (Panama, Nicaragua, Honduras and Guatemala), founder proposes 4 million people; as estimation of all rural regions with high quantity of cellular phones there proposed 100 mln.people.
But despite of product is essentially a system of micro-loans issuing for buying solar panels, there is no estimation and no provisions on bad (non-returnable) debts – and on this market they should be very material.
Understanding of the Target Audience
Target audience is preferably women farmers in rural regions with available cell phones, unbanked and with low electrification.
Total estimation of market volume is 100 mln. people. In initial region there are 4 million people lives.
Competitive advantage is expanding solar energetics using financial instruments like micro-loan, hi-tech instruments like secured and decentralized databases, and marketing instruments like agents using token system and smart contracts, to new markets. Looks like there are no clear competitors to the project.
Project strong sides: very original idea as a hybrid of micro-loan service and hi-tech production selling; detailed market analysis with selecting initial market; realistic marketing strategy.
Project weak sides: there is no risk analysis of bad debts, despite of micro-loaning service usually has a big provision on this.