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Another VC new comer into the space, Blockdaemon getting seeded

in blockchain •  7 months ago

Happy Sunday All,

You know I like to post about money flows and mass adoption of blockchain. Not just the utilization of the technology to improve current business model (i call that "improvement"), but also money going towards projects creating new business models (i call that "innovation").

vc-funding-now-what-600x337.jpg

Comcast's venture fund is the lead on a $3.3 million seed investment in Blockdaemon. According to their site, Blockdaemon (https://blockdaemon.com/about) is a Nodes as a Service platform that empowers businesses to simply and efficiently manage blockchain applications.

Their business model is "blockchain as a service". Will it be abbreviated to BAS or or BCAS?

"Not only are more enterprises looking ethereum as a blockchain to build on, but Blockdaemon's CEO and founder, Konstantin Richter, pointed to another public blockchain, Stellar, as well. In October, IBM revealed the results of a partnership with Stellar that had the chip-maker using Stellar's custom cryptocurrency to settle real transactions."

It is good to see that they wont be solely focused on one protocol!

Now, what i'd like to hear people's thoughts on is why did they decided to go with a traditional VC funding route as opposed to launching their own token and doing a crowdsale. Otherwise said, doing an ICO. Granted their token would be a security likely linked to the revenue of the firm which would clearly be a security.

Story by CoinDesk.

https://www.coindesk.com/meet-blockdaemon-comcasts-first-big-bet-multi-blockchain-future/

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It’s always great to hear that money flow in to blockchain especially when it comes from institutions such as IBM or Comcast. Regarding your question, I think that traditional or institutional investors know Venture Capitol, it has a history unlike ICO and also because ICO’s are extremely high risk investment so they prefer to go with VC. However, It doesn’t end here. VC provides not only the capital, but professional management  and advisory which could allow the company grow at faster rate. To me, the best solution would be combination of VC and ICO. But that’s my opinion.

why did they decided to go with a traditional VC funding route as opposed to launching their own token...

Because VC firms investing in startups with the potential getting very high returns have a much more established track record than ICO’s. There is also better chance of the startups raising funds through VC ending up getting the money for which they are looking oppose to ICO’s since there is so many of them. With ICO all you need is a cryptocurrency wallet. This means anyone from anywhere across the world can create its own ICO. Most ICO’s require very minimal investment for begin with, as little as single token and their misuse has ended in many scams and projects that have already failed. Also ICO’s sales are mostly unregulated, generating an air of uncertainty for potential investors. Investors know this, and will likely think of any firm that has secured VC funding as having met a certain standard. In other words VC is more secure for traditional investors.

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Very much agree. Too much regulatory uncertainty with ICOs. If a firm can get VC money it’s undoubtedly preferable.
Also, with VCs as partners the founders get strategic advice and professional networks which are helpful when it comes to scaling.

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Another interesting piece of info I read today:

"... growth investors like venture capitalists typically require a higher rate of return to compensate them for the risk. According to CB Insights, only 0.91 percent of startups make it from seed stage to greater than $1 billion in value.

Thus, seed valuations need to be less than $10 million ($1 billion multiplied by 1 percent) and returns need to be higher than 100x for the bet to be expected value positive at that failure rate (100x multiplied by .$01 = 1x money). (This is a slight oversimplification but helpful for purposes of this analysis).

The bottom line is that the initial valuation matters and needs to compensate you for the risk."

With that said, ICOs are extremely favorable to companies and founders. VC funding is much stricter and gets closer to reasonable valuations.

source: https://www.coindesk.com/making-sense-crypto-asset-valuation-insanity/

Quite interesting news @liotap. Good size fund for seed which will likely grow. Just another major company jumping on board the BC train. Clearly further legitimizing not only the space but the use-case.

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With respect to VC funding route vs. ICO. I see many reasons why they utilized a VC. First, Comcast is a multi-billion dollar publicly traded US based company thus financial resources are not an issue, especial he small raise. Second, as you are likely aware, there is the risk associated with an ICO, which is relatively a new mechanism and under heavy scrutiny globally with no defined parameters from a regulatory standpoint (recent SEC subpoenas have been served to ETH based ICOs in the US), a public company like Comcast has little benefit and material risk in using an ICO.

Comcast seems to be creating something just to be able to compete with everyone else it can be hard to tell which projects are worth an investors time and which are not...

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yes certainly fomo at the VC level. Not only in terms of deals but I am sure there is a big lack of talent and relevant knowledge ont he investment teams. That said, VCs do some valuation work whereas ICOs are the wild west.

Very good post @liotap, this is very useful for everyone, and especially for myself. Blockchain can always create the best for all. With the application of Blockdaemon, this might help many people to be able to invest for each of their businesses. Therefore, Blockdaemon can be a flagship. I will try to learn about Blockdaemon. Through the link you share. Because this is a new science for me.I already resteem your post, let the people who are friends with me, can learn about Blockdaemon, maybe there are among those who do not know about this all. Thank you for sharing and hopefully you will be more successful to work ... :)

Honestly I've been dealing with Stellar before and I couldn't imagine that the project would go and improve this much as it is right now. Its interesting how they are taking Stellar as an option. Personally I think that they go through VC only because of the amount of risk involved. They just want to profit without "actually" risking.

Thank you for contributing to the Steemit Community.Keep up the great work and I'm looking forward to your next posts.

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I like stellar as well and was surprised to see it quoted alongside Ethereum which is why i highlighted. Consensys will remain focused on ethereum for years it seems like. Creates room for others.

Thank you @liotap. This is important news as the more Dow industrial/Fortune 500 not only accept but financially embrace BC, the greater acceptance there will be for new investors in crypto.

@liotap I would like to review your publications. Still blockchain at first. More and more will be developed, and there is always a new science to learn.
#restem your post

Extraordinary size save for seed which will likely create. Essentially one all the more genuine association bouncing on board the BC get ready. Clearly further legitimizing the space and additionally the use case.

extremely like your post I truly bolster you. The data is extremely significant to everybody. Much thanks to you @liotap thank you from me

If any crypto solely depends on one protocol then it creates problem. Very happy to hear there won’t be focused on one protocol.

I've tried to open the link you shared about Blockdaemon. But I am still confused about it all, because I have never seen this before. But I will try to learn about Blockdaemon. Because this is a new knowledge for me. I will try to join it first, and understand it gradually. Thank you for sharing this very useful science @liotap.

Very good post,
Imformation is very useful for me
About the project project that you live
I want to learn from each of your posts
thanks for sharing @liotap

New advancements keep on being produced in the blockchain and there is dependably another science to learn it, any individual who extends the universe of blockchain would be beneficial, how to foresee it, should by course study will be another science, and in addition new pay.

New innovations continue to be developed in the blockchain and there is always a new science to learn it, anyone who deepens the world of blockchain would be profitable, how to predict it, must by course study will be a new science, as well as new income,
I like to read your post because it can add new knowledge for me,
Thanks for sharing @liotap

Ivery good post really like your post I really support you. The information is very valuable to everyone. Thank you @liotap thank you from me

Good to know. Thanks @loitap. I always like ethereum, now I add Stellar to my lists. Glad to see big companies like Comcast and IBM join in the crypto world.
There are many good coins nowadays but only few will be adopted and widely accepted in the future . so I will stick to what I know plus listen to your experts advice. Buy coins with good quality and hold it for long term
Currently the prices of crypto come down, I am preparing to buy more eth, steem, etc, hold them for long term....probably in few months there will be another hype and massive buy of everything, we will see..
I upvote and resteem your post, let the people who follow me knowing about this good info.
Thanks again.

Thank you @liotap. This is important news as the more Dow industrial/Fortune 500 not only accept but financially embrace BC, the greater acceptance there will be for new investors in crypto.
Quite interesting news @liotap
tnanks for sharing sir..........

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