Ripple, the company behind the popular cryptocurrency of the same name, has established itself as a serious investor after leading the funding round of $25 million for a startup named Omni.
What makes the news of this investment even more interesting is that the funding from Ripple will not come in the form of cash but XRP, Ripple’s native cryptocurrency.
Founded in 2015, Omni provides storage services for individuals and families that want to preserve their excess belongings at a safe place. It recently launched the idea of letting users rent out those belongings to anyone who might be interested in them, and while unconventional, the idea was seemingly so interesting to Ripple that the company ended up being the most significant investor for Omni’s Series B round of funding.
Omni also plans to hold Series C and Series D rounds in the future to expand its functionalities. The other major investor in the funding round was Highland Capital Partners, a venture capital firm that led the funding round of Omni’s Series A in 2016 for $7 million. Unsurprisingly, the company invested using U. S. Dollars.
Omni seems to be more than a storage facility
Seemingly building on the idea of people renting designer clothing and accessories for special occasions, Omni evolves that notion further and aims to expand it from clothing to bikes to any excess item that someone has stored within the facility.
The company has an app for its users where they can list the items that they are willing to lend or rent to someone. Omni then allows any users searching for similar items to see the rental listings, and if the parties agree with the specific arrangement for the item, it is provided to the borrower or renter, accordingly, for the specified period.
The company also provides pickup and delivery for said items so the customers do not have to visit the storage facility physically and can send in or receive their items from the comfort of their home.
This business model seems far from what a company like Ripple has been associated with in the past – since it is a blockchain based financial service itself – which shows that Ripple too is interested in expanding its operations.
While Omni does not have any plans to accept payments on its lending/renting platform in the form of XRP, it did explain that it might use the cryptocurrency to pay fees to freelancers and to facilitate bonuses for its employees.
The timing is strategic yet risky
Reports suggest that the investment round had closed in December 2017.
However, that would allude to the possibility of the deal being made when Ripple was on the rise, whereas it is now being traded at around $0.90 after seeing a drop of 50 percent in the last week.
The decision makers at Omni must have been aware of the fluctuation that could come with cryptocurrencies, however. It remains to be seen whether this innovative step of their acceptance of payment in XRP pays off in the long run or not.
Not the first time that Ripple has collaborated with a company
Ripple has previously partnered with over a hundred institutions on various capacities. One of the most recent and notable of those deals was made with global remittance facilitator MoneyGram, which allowed payments to be processed through XRP. This seems to be one of the first times that Ripple has invested in another company with XRP.