Dan Primack of Fortune recently tweeted from a breakfast attended by VCs about what appeared to be their nonexistent interest in bitcoin startups.
At VC breakfast (90 attendees), I asked how many would invest in Bitcoin startup (not general blockchain). Zero hands. #FortuneTech
— Dan Primack (@danprimack) July 14, 2015
But the data tells a different story, and appears to indicate plenty of VC interest. Bitcoin and digital-currency startup deal flow rose 63% in the first half of 2015 year-over-year, according to CB Insights data. Investor-backed bitcoin startups have raised $375M in the 6 months, already 11% higher than the funding raised in full-year 2014.
Funding pace continues despite bitcoin’s price drop
Big financings to bitcoin startups continue despite the price of bitcoin dropping to new lows in early 2015 from its record high in November 2013. The chart below contrasts bitcoin price data from Coinbase with cumulative funding flowing to bitcoin startups over time. Aggregate funding to bitcoin startups from the start of 2011 to the first half of 2015 totals $807M.
Top bitcoin startup rounds in 2015
The top 5 rounds to bitcoin or digital currency startups in 2015 year-to-date are listed below. The largest single funding round in the space was 21‘s $116M round, which included big-name investors including Cisco, Andreessen Horowitz, and Qualcomm Ventures. Coinbase‘s $75M Series C from investors including DFJ Growth, USAA, NYSE Euronext, and others came in second. As the large deals indicate below, strategic investors and financial services firms are playing a bigger role in funding the bitcoin ecosystem.
|Company||Amount ($M)||Select Investors|
|116||Andreessen Horowitz, Cisco Investments, Qualcomm Ventures, RRE Ventures, Khosla Ventures|
|75||Andreessen Horowitz, BBVA Ventures, DFJ Growth, NTT DoCoMo Ventures, NYSE Euronext, Ribbit Capital, Union Square Ventures, USAA, Vikram Pandit|
|50||Accel Partners, Breyer Capital, Digital Currency Group, General Catalyst Partners, Goldman Sachs, IDG Capital Partners, Oak Investment Partners, Pantera Capital|
|28||IDG Capital Partners, Liquidity Ventures, Seagate Technology, AME Cloud Ventures, China Growth Capital, Wicklow Capital|
|25||RRE Ventures, Liberty City Ventures, James Pallotta, Jay Jordan II|
Analyze the most comprehensive bitcoin financing and exit data as part of CB Insights Private Company Financing Database. Sign up free below.
This report was created with data from CB Insights’ emerging technology insights platform, which offers clarity into emerging tech and new business strategies through tools like:
- Earnings Transcripts Search Engine & Analytics to get an information edge on competitors’ and incumbents’ strategies
- Patent Analytics to see where innovation is happening next
- Company Mosaic Scores to evaluate startup health, based on our National Science Foundation-backed algorithm
- Business Relationships to quickly see a company’s competitors, partners, and more
- Market Sizing Tools to visualize market growth and spot the next big opportunity