CODE41 shake things up (again) with a unique form of fundraisingLuke Benedictus
CODE41 is the watch brand that dares to do things differently. While most others operate behind a veil of secrecy and marketing hype, Claudio D’Amore, the CEO of CODE41, prefers radical candour.
Take their transparency over prices. When the Swiss brand makes a watch they happily share a breakdown of the cost of each component and its place of origin, right down to the deployment clasp and the caseback. These figures are set against the total sum they plan to sell the watch for. “We have a mark-up of 2.3 or 2.5 sometimes,” D’Amore once told me. “It’s still a mark-up, but we can explain it.” (To put that into perspective, the New York Times once reported that Rolex has a 40 per cent retail markup.)
CODE41’s unique approach also extends to their collaborative approach to the design process that invites feedback from the public before a watch is released. When it came to the case design of the X41, for example, the brand offered images of different options with clean, hollow or faceted lugs, providing buttons for consumers to register their preference. It’s testament to D’Amore’s insistence that CODE41 is less of a brand and “more of a community project”.
Now the brand is taking that desire to involve the consumer one step further. Today, in another bold move – which the brand claims is a world first in watchmaking – they’re opening up part of CODE41’s capital to the community.
“We’ve always put our community at the centre of our projects,” the brand explains on their website. “That’s why, for the very first time in watchmaking, we’re offering our members the chance to acquire shares in CODE41’s social capital in the form of participation certificates.”
A participation certificate is essentially a share in the company, but it comes without the right to vote or some of the other associated rights. You can find out more about the specifics here or ask questions at CODE41’s live webinar on February 15, at 6pm CET. Crucially, however, buyers will still get the right to dividends if the company distributes a profit.
In line with the brand’s relentlessly innovative spirit, the participation certificates will be digitised via a “tokenisation” process. A token is the digital equivalent of a physical asset that can be issued or exchanged on a blockchain network. CODE41 explain the concept a bit more in this video.
The purpose of the fundraising is to finance the brand’s development strategy over the next four years, shorten delivery times, increase the size of the R&D department to enable more innovation and develop their physical sales channels. True to form, you can peruse the brand’s full business plan right here.
The brand’s investment packages start at CHF 540. The only issue is that as every country has strict financial regulations on these forms of transactions, for legal reasons the offer will only be open to CODE41 members who live in Switzerland or in France.
It’s another creative initiative from CODE41, who’ve always insisted they want to shake up the concept of how a Swiss watch brand operates. This fundraising proves once again that this intriguing brand is willing to put its money where its mouth is.
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