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Dear Rigor Community:
It's with a heavy heart that I write to you to let you know I’m shutting down the Rigor project. We'll be distributing back remaining investment funds to investors, to whom we are deeply grateful: Agya Ventures, Bain Capital Ventures, Flow Ventures, Fortified Ventures, and Third Prime. We're equally grateful to our angel investors and the broader community. We want you to know that we expended every effort to build Rigor's success and to create lasting value and utility.
Please permit a short obituary.
We were super passionate about this opportunity and felt strongly that we were addressing big, systemic and important problems that would also create an awesome business. For starters, inside and outside of construction, payment dynamics between businesses is bananas. Vendors complete work and then wait forever to get paid. This causes real pain — financial and emotional — up and down supply chains. It forces prices higher. So much needless energy and expense is devoted to chasing money that’s fairly owed. For small businesses, especially, the AP/AR mismatch is torture. Some die. We heard it from our customers.
Meanwhile, why isn't it easier to invest in the construction of homes? Why do only special people get to do that? After all, there aren't enough homes for people and the financial returns are great! Why not a simple marketplace where investors can get strong returns in a short time frame by building a house for someone… during a housing crisis? Why not decentralized finance to rectify a historical imbalance?
Our hunch was that pairing these capabilities would create a superhero: an easy to buy, high yield, short term financial product financing vital infrastructure with pristine accounting. One powered by transparent payment delivery in lockstep with work. Lenders get unprecedented control over their underwriting criteria; small businesses get paid as they bear expenses, not months later (or never). Finally, decentralize ownership of the whole thing, offering it up to the world as low-cost, open source community-owned financial infrastructure. Make a mint for ourselves and investors. “The electric grid for construction finance.” Let’s build more homes!
Admittedly, the macro did make things challenging over the past two years. We sought to build a crypto protocol for housing while each of these markets experienced dramatic volatility. Yeesh. Crypto markets cratered spectacularly, drying up potential liquidity for construction projects that we'd anticipated. It also saw critical technical and financial partners of Rigor go out of business — suddenly and suspiciously. A hostile legal landscape made tokenization far too risky for the team and our investors. Meanwhile, in housing, a shocking and historic rise in interest rates added uncertainty for investors regarding the future sales prices of the homes we were fundraising to build. Some of this may have been headlines for you; these were our day-to-day realities.
Undeterred, we persevered through these conditions and fought on! It is our nature. Observing a deteriorating market for tokens, we decided to postpone our token plans and reign in big related expenses quickly. Our goal was to save up through the “winter” to enable us to revisit those plans when markets were more favorable to such strategies.
When that happened, we knew we wanted to meet that opportunity with unambiguous evidence that the protocol did what we said it did. Show not tell. So, we built more than a dozen real homes for real people using crypto networks and cryptocurrency — bleeding edge stuff and, to our knowledge, a world first. Really. In an effort to catalyze investor interest and create momentum, Isaac funded many of those homes himself. We developed a thoughtful narrative and achieved a respectable following, on X, in crypto trades and national press. We went on to experiment with an all-equity investment product that enabled participation in the profits from a home sale, which increased returns for investors versus prevailing lending rates. "Find your capital a home." Homes sold at great returns. All the while, contractors were paid more fairly.
Looking back, our original sin was to diverge from tokenization and the economy we imagined would govern the protocol and expand its utility. We failed to gather and inspire a decentralized community. We gave up on memetic devices. We didn’t pivot to digitally native use cases for Rigor quickly enough when it was becoming clear that the real world infrastructure we thought we’d have to bridge blockchain-native finance with real world payments crumbled around us. In our quest to create proof points of the protocol’s utility for later use, we found ourselves building a centralized financial services business whose product could only be bought by accredited investors, which skyrocketed customer acquisition costs. The result: we weren’t crypto enough for crypto investors and audiences; while being too crypto and blockchain for mainstream investors. Pincered.
I must honor our team: Isaac Lidsky, visionary, polymath and able leader. Julia Wasserman, thoughtful partner, loving sister, moral compass, utterly brilliant operator. Elliott Conway, superstar product leader. "Dan13," pseudonymous and talented lead developer. Rob Leonhard, redoubtable lawyer and vigilant protector of the realm. Joe Tennant, controller and analytics extraordinaire.
Thank you, team; great effort!
Thank you again for your support. We're grateful for it.
Sincerely,
Erich
Erich Wasserman
Founder & CEO
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