Ookami buys a piece of blockchain biz Brontech; shares double
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In a widely anticipated move, Ookami has bought a strategic stake in a blockchain company — instantly doubling the price of its shares from to 7.3c.
Ookami (ASX:OOK) paid $933,240 for a “strategic equity position” of 18.2 per cent in Sydney-based Brontech, which uses blockchain technology to give people control over their personal data.
The shares hit a record high of 7.3c before profit-takers sold down to 5.1c at Monday’s close — still up 42 per cent for the day.
Until now Ookami’s only asset was a subsidiary called Akela Capital that lets people buy shares in IPOs, backdoor listings and other capital raisings.
The business says its model is now to “develop an ecosystem of advanced technology solutions encompassing ‘smart contracts’ and blockchain technologies”, secure identity management and verification and anti-money laundering applications, data analytics, cryptocurrency solutions and security and encryption applications.
Brontech CEO Emma Poposka says there is a clear alignment between Ookami’s Akela platform and her company.
“This was a strategic investment. We will be integrating with the Akela platform and the money we are getting will support our expansion and future operations in terms of acquiring more users, and working with more tier one companies,” she told Stockhead.
Those tier one companies include banks, insurance companies and accounting firms, some local and some global with an Australian footprint.
Brontech, established in July 2016, has about 3,000 identity verified users.
“We are creating a data marketplace. Currently when a company holds your information, like Facebook or Google, they are selling your information or creating data products,” Ms Poposka said.
“So we said this information is way more valuable, why don’t we enable people to profit from their data and enable companies to access and one on one relationship with customers.”
The deal still requires shareholder approval, which will also include Ms Poposka joining the Ookami board.
Information regulation is coming
Ms Poposka says information regulation is coming and companies like hers, which behave as a middleman for individuals looking to suck their personal data from a variety of sources, will benefit.
In Europe the General Data Protection Regulation (GDPR) will come into force on May 25, 2018, which will allow any individual to pull their data from any company via an open API, be it a bank or an online shopping account.
In Australia, Ms Poposka believes the data portability initiative will be law by the end of next year.
“There is a huge oligopoly in data in the world, and the world is heading for substituting intellectual labour with AI,” she said. “The only resource companies will need in future is data, and legislators are trying to break that monopoly.
“That’s where companies like ours come in.”
Ookami director Brendan de Kauwe says they want to build an ecosystem of companies like Brontech, and they’ve been looking since relisting in February 2016.
“It takes a long time to find companies like Brontech. We’ve kissed a lot of frogs,” he told Stockhead.