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AN INVESTORS VIEW ON BLOCKCHAIN
The document discusses the potential and challenges of blockchain technology from an investor's perspective, emphasizing a shift from traditional web models to decentralized collaborative economies. It outlines opportunities in fixing legacy systems and innovating in emerging markets while highlighting risks such as scalability and regulatory uncertainties. Key insights include the growing importance of peer-to-peer markets and the financial activities in the blockchain VC space, alongside the unique role of ICOs in fundraising.
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AN INVESTORS VIEW ON BLOCKCHAIN
- 1. AN INVESTORS VIEWON BLOCKCHAIN
- 2. Jamie Burke OutlierVentures.io +BlockchainAngels.eu @jamie247
- 3. Paradigm Shift 1. Nextphase of The Web 2. Decentralises centralisation of Web 2.0 3. Outdated rentier / platform models 4. Collaborative economies at scale 5. Core function likely not business 6. Not about owning code its about creating markets
- 4. What is thevalue they can bring? Provenance P2P Exchange Digital Trust Supply Chains Task Automation Distributed Database Auditability B2B Marketplaces Identity Paperless Security Transparency GovernanceRedundancyReduce Fraud Sharing Economy B2C Marketplaces M2M Liquidity Asset Integrity Back Office
- 5. 3 x Opportunities 1.Tryingto fix legacy systems 2.Disrupting disruptors 3.Real innovation in emerging markets
- 6. Risks & Challenges 1.Timing. Being first not always best. 2. Tech Infrastructure Building Blocks 3. Scalability & Costs 4. Barriers to entry lower 5. Race to free (leaves with regulated services)
- 7. What I sayto investors / startups 1. Even riskier than normal early stage 2. More than ever investing in people / teams 3. No idea is unique.. For long 4. Stealing advance in a general direction 5. Blockchain 10% practice 90% planning 6. Borrow more than you build
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- 9. Bitcoin Experiment BaaS ‘Open Ledger’ Standards MainstreamEarly Market Crossingthe chasm Widening of vertical use cases Use-case Crossover Aligned markets
- 10. Trough of disillusionment= Good 1. DAO & Split 2. Stop corp. brain drain 3. Consulting distraction 4. Sense check 5. Professionalisation 6. Learn on others money
- 11. 8 x BuildingBlocks 1. Bridges / Interoperability 2. Identity 3. Reputation 4. Clear Roles & Responsibilities 5. Usable Security 6. Governance 7. User Friendly Security 8. Stable Tokens of Exchange 9. Economically Viable Tokens of Exchange
- 12. Most Excites Me 1.True P2P markets 2. Accelerator: Ability to securely scale macro trends 3. Combinator: allows macro trends to combine
- 13. 1. AI 2. IoT 3.Drones 4. VR / AR 5. 3D Printing
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- 15. $1.1bn Silicon Seed(50 VCs & 30 Angels) Specialist Generalist
- 16. Driven by handfulsof deals
- 17. Q1 Blockchain VCInvestment Overtakes Bitcoin
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- 19. Fundraising Overview Coindesk tracking138 VC-backed total BCA Tracker has 1,000 VC and non-VC backed Biggest deals in Q2 Circle Series D @ $60m Quione @ $16m Bit Flyer @ $27m Elliptic @ $5.0m Fluent @ 1.65m Mediachain @ 1.5m Tierion @ $1m If you exclude theDAO
- 20. ICO – InitialCoin Offering • ICO the new ‘pre seed’ • Unique to blockchain. Self funding mechanism • Still only 0.05% of global crowdfunding • Unclear regulatory position (SEC, tokens as securities) • Positioned as ‘future access to a network’ • Small pool of ‘buyers’ (Razormind: $1.9m from 290 individuals)
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Editor's Notes
- #10 We moving from Bitcoin early adopters; libertarian, academic to Commercial BaaS And open standards Needs re different
- #12 15.8% of startups are building products categorized as ‘infrastructure’. This is down from 18% from February. Bridges - interoperability between blockchains and extending the bitcoin blockchain functionality. BTCRelay, Rootstock, Blockstream, and Interledger On / Off Ramps With 28%, startups with ‘no HQ’ constitute the second largest ‘location’ of blockchain startups and projects after the United States. This could either be explained by the nascency of the industry or the blockchain industry could have the potential to be a stateless market that doesn’t necessarily require on/off ramps. That said, 1.4% of startups are based in Hong Kong and another 1.9% in Switzerland. This suggests that blockchain startups are very much aware of friendly regulatory environments & tax laws. ROLES & RESPONSIBILITIES Identity 3.3% of startups are focusing on ‘identity and reputation’. There is a real need for a standard or clear winner in the space, that can be deployed easily by startups. It is impossible to pick a winner because success will be more about geopolitics than technical superiority. Identity is a problem that permeates the global economy broadly, but ShoCard, Airbitz, and Blockstack Reputation: There are 33 companies building identity and reputation services, that is a duplication of effort and not sustainable, we expect to see consolidation in the market very soon. 3.6% of startups engaging in ‘governance and transparency’ activities which covers things like decentralized voting, new company and governance structures, and third-sector structures. 7. USABLE SECURITY - Airbitz
- #14 Trent of Big Chain DB Filament, Slock.it, Chimera and TilePay VARcrypt / 2% tracker are gaming Pokeman promise ‘Distributed Manufacturing’ CubeSpawn, 3D Plex, Creative Barcode (Manufacturing Design)
- #16 Generally Early VCs from US filling gap specialist act ing as lead to Silicon although activity in Asia is hotting up About 50 VC firms & 30 tech angels Netscape web browser
- #19 A number of corporate venturing Cisco here is this building want 20% of startups target 20% of Barclays last batch were blockchain Expect to see more thatTaking VERY simple use cases. We had one
- #20 Biggest VC deals in Q2 mainly B2B Eliptic – illict behaviour Tierion – data files Circle now $136 mainly China overtaking 21 Inc at $121m Bitflyer now biggest Asian startup at $33.94m
- #24 We know of at least 200 Ethereum based POCs. We estimate 1/3 of are beyond POC and at MVP (minimum viable product), with varying levels of customer traction with modest professional funding. software or communications including mining companies, wallet, most infrastructure finance and insurance is more the payment processors, exchanges and trading The areas getting the most level of funding and progress, beyond Capital Markets, seem to be around provenance / chain of custody, governance (corporate, public and NGO), Health, Energy, Insurance and IoT.
- #25 We know of at least 200 Ethereum based POCs. We estimate 1/3 of are beyond POC and at MVP The areas getting the most level of funding and progress, beyond Capital Markets, seem to be around provenance / chain of custody, governance (corporate, public and NGO), Health, Energy, Insurance and IoT.
- #26 UK is home for blockchain fintech – Brexit When asked 28% said without HQ Statelessness or nascent But 4.7% Switzerland & Singapore