I recently made a post on how to start investing into blockchain in general. But in this post, I want to talk about the top venture funded blockchain companies and why you should invest in them. But don’t worry, anyone can start investing into these companies regardless of your income. There’s a stage where anybody can invest through a startup. It’s just a matter of how much money you’re spending, and what platform you’re using.
Some different ways to invest in startups is through AngelList. This is a website where people can find jobs and invest in startups. Its a great platform to use in crowd-sourcing funds together over the internet. It also gives opportunity to those who usually wouldn’t have a chance because they can’t qualify for venture capital funds. Seed investments can be as little as $5,000. But if you’re a part of a venture capital firm, investments can be as high as $1,000,000 through Series investments.
But this post isn’t about the different type of venture capital investments. It’s about the top venture-backed blockchain companies and what makes them worth investing into. We will also talk about what they share in common. Understanding how the blockchain technology is applied along with how much outside investing is taken in is important to understand because we get to see what connections the company has. So let’s start with our first company.
Our first company we should look at is Coinbase. A company found in San Francisco, Coinbase is an exchange with wallet services. In addition to those features, Coinbase also offers recurring buys. This means buyers can schedule buys either weekly, or monthly. For an investor not looking to actively manage their currency, this is an attractive option because it really makes the investment passive.
Investors look for security when looking at exchanges. Good thing for Coinbase because they definitely prioritize that. With Coinbase, you can secure storage that’s offline which mitigates hacking. You also get full control of your private keys with a multi-signature vault. And if your digital currency on their servers goes missing/stolen, they’re covered with insurance. Looks like they learned from the Mt. Gox fiasco.
With funding of $117,000,000 to date, Coinbase is just getting started. Investors such as Sequoia Capital, Y Combinator, Andreessen Horowitz, and more are investing in Coinbase. There have been multiple rounds of financing, and two acquisitions by Coinbase. I guess it’s safe to say Coinbase is beefing up to be something big.
The blockchain application for Bitcoin and all other cryptocurrencies applies to Coinbase because all the coins it trades uses blockchain. The main difference between the coins and Coinbase is the security system. Coinbase controls your coins offline, but if your coins happen to be hacked, there is nothing you can do about it after the fact. If you control your coins manually, then there is something you can do if a hack is in process. It all depends on what you’re comfortable with.
The second successful blockchain company is 21 Inc. 21 Inc. describes itself as a startup that “enables users to build, buy, and sell machine-payable apps with developers all around the world.” It also gives users an embeddable chip that can be connected to any internet-connected device so you can use digital currency and apply it to different applications. If you think about what 21 Inc. is trying to do, it’s no wonder investors are getting in on the action.
Funding for 21 Inc. is at $121,000,000. Notable investors include Sequoia Capital, Y Combinator, Menlo Ventures, Benchmark, and more. With these type of investors buying in, it’s definitely no surprise there have been multiple financing rounds. I mean, just look at what the CEO envisions for the company.
CEO Balaji Srinivasan spoke on 21’s technology and said “21’s technology could one day be used for device authentication, to enable micro payments or even subsidize the distribution of consumer smartphones to the developing world.” His vision is to develop a technology ecosystem that includes data sheets, peripheral devices, and software protocols. He encourages entrepreneurs to leverage this technology, and some great ideas are coming out.
With blockchain as the centerpiece, ideas such as selling your Wi-Fi for Bitcoin, or monetizing your social media and getting paid in Bitcoin will transform the economy. It’s allowing device holders to access more business opportunities and create a new type of economy. When a company has such as grand vision it can potentially change the way we live, ventures capitalists will want to invest. Not just for its profitability, but for the way it can shake up industries.
You’ve heard of the shape. But have you heard of the company?
Circle has positioned itself in the personal finance, finance, banking, and fintech industry. It’s mission/vision is to “transform the world economy with secure, simple, and less costly technology for storing and using money.”
Circle is using tools and protocols to try and send money anywhere, anytime, to anyone. Using the blockchain technology enables Circle to offer their service for free. In addition, they take extra precautions with your security by applying artificial intelligence algorithms to keep money safe. Leveraging technology such as blockchain, and using it to change an industry has caught the attention of major investors.
Goldman Sachs, Breyer Capital, Accel Partners, and more are all part of the group that’s investing in Circle. With an estimate of $136,000,000 in funding, Circle is on the right track to become a major player in finance.
All three companies are heavily funded by venture capitalists and apply blockchain. But what else do they have in common?
All 3 companies are actively trying to change an industry. Circle is trying to change finance, 21 Inc. is trying to change online payments, and Coinbase is trying to change the exchange environment. It’s not just about making money when venture capitalists invest, it’s about something more impactful. Even if you’re an angel investor, it’s better to seek out companies that’re trying to do something more meaningful than making a quick buck. In the long run, both you and the company you invest in will be better.