Spanish startup raises €300k, spends €100k on domain

Decentralized Storage: €300,000 Raised and Many Doubts

With a 19-year-old founder and €300,000 in funding secured, the primary concern isn't the technology. It's the bill. According to figures circulating around the project, a substantial portion of that capital—around €100,000—was allegedly spent purchasing the business's internet domain. In the industry, this figure is not read as an investment; it is seen as a red flag.

The founder, reportedly trained at ESADE (a prestigious Spanish business school), has generated more skepticism than enthusiasm among those who have watched startups raise money for years to reinvent what already works.

What is Decentralized Storage and Why Did It Already Exist?

On paper, decentralizing storage involves breaking a file into chunks and distributing them across the hard drives of anonymous users who lend space in exchange for a tradable token. This sounds novel until one looks at the list of existing players. There are at least ten projects—IPFS, Filecoin, Siacoin, and the Internet Computer Protocol—that have been attempting exactly this for years, with concrete proposals rather than half-finished landing pages.

A recurring criticism is that the website requires registration using Google credentials. Displacing a tech giant by relying on its own access system is, at the very least, ironic. The tone doesn't help either: public presentations have been described as arrogant and childish, resembling a messiah complex more than engineering pragmatism.

There is also an overlooked market problem. As one participant summarizes, most customers do not care whether their data is decentralized. To gain market share, you must offer an advantage anyone can understand, just as Dropbox did when it gave away 20 GB while competitors offered only one. Decentralization alone does not sell.

The Domain No One Understands

This is the point that confuses anyone who has ever invested. Several participants highlight the same oddity: a .APP domain costs significantly less, certainly not €100,000. Paying such an amount would only make sense if the seller and buyer were the same person or linked entities, which could serve to extract clean cash from the project. This is a suspicion, not a proven fact, but it circulates widely.

Imagine the reaction of a venture capital fund. An auditor for any institutional investor sees a bill of that size and will not approve it, even with double signatures. That is why, once the data becomes known, many conclude where the real source of the money lies. The big profit, they say, was made by whoever sold the domain.

Where Do the €300,000 Come From?

A 19-year-old does not raise €300,000 from professional investors without prior connections. The most widespread hypothesis is the usual one: family, friends, and acquaintances. Parents with assets financing the first attempt, the second, and the fifth. In Barcelona, there is a trail of such projects capable of surviving four or five years without earning a euro while executives draw four-figure salaries.

The problem with this scheme is that no one pressures the founder. If the money comes from home, there is no board demanding accountability nor an investor cutting losses when spending spirals out of control. Venture capital, at least, brings an accountant attached to the checkbook.

It is also suggested that the news article that sparked all this attention was published by an economic outlet and interpreted by some as a paid advertorial commissioned by the interested party.

Technical Doubts: What Happens if Nodes Go Offline?

A fundamental doubt hangs over the model. In a peer-to-peer network, you download a file that many people want, so it remains available. Here, however, you are the only one interested in your copy. If the nodes storing parts of your data are private computers and some are offline when you need them, where does the copy go?

The standard answer is replication: storing the same fragment in many places to reduce risk. This fits the theory. In practice, it makes the system expensive and does not solve the underlying issue, which is incentives: no one has a clear motive to safeguard another person's file for years.

The Method: Raising Rounds and Burning Cash

The business model, if it can be called that, consists of raising funding. One round serves to announce the next; meanwhile, the product waits. It is a hot potato passed from one hand to another at increasingly higher prices, until someone gets stuck with the last one and discovers there was little substance underneath. This is not a new invention: cited examples include Gowex and WeWork.

With technology that has existed for years, funding of questionable origin, and expenses no professional investor would have approved, the project moves forward anyway. Perhaps it will work: the sector is full of absurdities that became serious businesses and serious businesses that ended up as nothing. Maybe the real question is not whether the idea will succeed, but who is paying for the party while we wait.