Opportunities
One of the advisors has strong experience in the telecommunications space and may help DENT to bring partners on board.
Network effect exists for this project – if the project reaches a critical scale, value of DENT should appreciate substantially.
Concerns
I see many holes in the business model:
If this model actually works and the price is competitive, I imagine people can just use DENT all the time – not just for traveling but for their home country as well – this is not something the telcos want.
The cost of mobile data on the DENT exchange has to be lower than the same package directly from telcos, otherwise arbitrage opportunities exist. For example, if a telco package for 5 GB is $50 a month, then the price for the same package listed on DENT has to be cheaper, otherwise people can just buy the plans from telcos and sell them on DENT for instant profit. Hence, people can just rely solely on using DENT to buy data plans without using a plan from telco. Telcos are not going to be ok with that.
Because larger plans are cheaper on a per GB basis, people can just buy the largest plan that’s offered by telcos and then sell it piecemeal on DENT – telcos won’t allow this to happen because no one would buy smaller plans from them anymore.
Telcos might not want to join the DENT platform because it is going to reduce customer loyalty. Users can use different service providers easily on DENT.
For this project to work out, it is imperative to acquire a large base of users. This is a huge task but the whitepaper didn’t address how it will do it other than saying “we invite and unite users in the DENT community”. The whitepaper then says “assuming a start with even just a few million customers … reaching quickly billions of USD at stake for a telco”.
It looks to me they skim on the most important part of the game plan. Moreover, even if they can acquire a few million users, if those users are scattered across different countries, it is probably not large enough for the telcos to do anything.
I’m also not sure how user-to-user data transfer works. If a user is using mobile data provided by company A, can he/she can just transfer their spare data to someone on another network? Seems like it is very difficult to function technically.
DENT’s plans include “lobby[ing] with public bodies such as EU regulation and governments of key countries”. This seems like too ambitious a goal to me.
The project is nothing but an idea now. They don’t even have a timeline for its development roadmap so we really don’t know when the project will start generating revenue.
I don’t see the benefits of using blockchain technology for this project. DENT can use a centralized service to do the exact same thing. Hence I don’t really see the point of issuing tokens on blockchain.
The fundraising goal of $46 million is on the high side. This increases the chance that the project would not attract enough funding. This is not good for the short-term potential.
From the LinkedIn pages, it looks like all the co-founders are working part time on this project. It doesn’t give too much comfort as to their commitment to this venture.
Conclusion
Overall, I don’t like this ICO. The idea sounds exciting and that’s the reason why I decided to analyze the ICO. However, after looking deeper into it, I have serious doubt that this project can succeed.
Our thoughts of the tokens for short term and long term are as follows:
For short-term holding
Not good because of the large fundraising amount of $46 million assuming ETH price is $300. The high fundraising amount makes it harder for the project to be filled quickly, leaving no unmet demand.
For long-term holding
Not good. As mentioned above, I just see too many problems with the business model and doubt this can work out.
