How blockchain equity financing will evolve in 2021

Over the past year, the blockchain industry's capital has exploded and it is unique in the tech industry. In 2021, the best organizations such as A16z, Sequoia, Tiger Fund, etc. will extend DeFi, NFT, Metaverse and other functions for free in the blockchain industry. I have applied and worked for many affiliate organizations.

We hope that everyone will be able to make informed decisions on future business improvements. Can you see any trends and changes in the data indicating that this VC is spending $ 17 billion in real money? This article by Joel of Decentralised.co examines 1,278 financial fairs this year and presents a few examples. All texts translated by Rhythm BlockBeats.

In today's article, I want to take a closer look at how financial justice has changed in the blockchain ecosystem over the past year. Among them, the funds from the sale of tokens, loans and donations are separated so that everyone can better understand the behavior of long-term investors. Before I start this article, I want to say a word. I'm writing this from the perspective of a fundraiser involved and helping the fundraiser. Therefore, all the numbers you see in this article are taken more into account compared to other marketing campaigns. Without further ado, let's get started.

$ 17 billion in blockchain ecological financial justice this year

It collected $ 3.7 billion in financial justice in 2018 compared to $ 1.3 billion in financial justice in 2017. The increase in income was mainly due to a lack of funds due to a weak IC0 economy. The net income is around $ 2.7 billion in 2019 and 2020. If so, you can get an idea of ​​all the income so far this year. The answer is $ 17 billion, that is, the company involved in blockchain could raise an average of $ 20 million per day. The impact of these investments is a clear reason why the number of advertisements in stadiums and colleges such as football has increased. But, ironically, more capital has poured into the field, but as a result, the market capitalization has not increased further.

By special funds in the year 2018, 1289 times, 1278 times in 2021, 1278 times. This means that the business has become more companies, but the financial companies in the year is rich. The 2017 and 2018 block chain industry has been in the baby, so many seeds invested. Since the size of the dangerous danger is smaller, it has been decided to the first development organization, and in 2021, we have chosen to deduct due to the early fire has been successful. Large-hour companies have access to fields of business, and the initial investment has financial resources that can make a significant amount of money. However, since the new resources are different from the new work, there is a difference in the new capital and early investment. Therefore, if this number has an essential amount of the early stage of the second quarter of 2022. However, the signal comes from the most likely is the first of the firms that are hard as before. In order to understand the result of this dispensation, we have been distributed to the distribution of the publishers and the company results in recent years.

water loss effect

The charts below show the number of revenues and investments that have increased over the years in the ecosystem. While this indicates that funding for all funding levels has increased significantly in 2021, Grants B and C are considered the most important, of which funding B has increased from $ 695 million to $ 6,692. dollars, an increase of almost 10%; Series C revenue saw similar gains, rising from $ 421 million to $ 3.1 billion. Most of the capital went to the post-tour, but the Seed and Series A tours were up to a 5-fold increase from last year's revenue.

There are a lot of numbers involved here, so let's write down the impact they could have.

1. Large investment firms such as Tiger Fund and Sequoia Capital and long term income have seen investment growth lately. Instead of engaging in small businesses, we build our data by investing large sums of money in projects that have high quality products.

2. Past investments and open crypto markets have returned to financial seed. So when the financial environment is maintained as described above, the companies in the seed economy have grown significantly.

3. The first stage of financing is also as agreed, as producers will allocate small amounts of money to each different budget to create a profitable balance of investments. So what we can see is that more capital is involved in JVs, preferring more money in seed capital. The average seed-level revenue volume has increased from $ 1.5 million in 2020 to $ 3.3 million this year, which is part of the reason for this.

You can check out this link if you want to better understand the size of finances at different levels of investment in recent years.

This huge investment replaces the practices of existing business enterprises. The founders quickly realized that their employees could benefit from the opening of the company. This causes our employees to seek higher wages, which in turn leads to our wages peaking. As more schools begin to support seed capital, these schools can make significant additional investments to achieve growth. Therefore, they only focus on finding the best skills at a higher price, regardless of opening a business. Most startups in the early stages of business are required to give new employees stock or tokens as gifts. At the same time, the developer should educate their employees that these business ventures can bring in millions of dollars in future income, which is crucial for the development team. The impact of these resources on developers can also be applied to service providers such as research and information companies.

Faced with growing demand, regulators for services will find that they cannot increase their working hours equally without diluting their capital. In addition, as the integration and training of new employees takes time, as more and more entrepreneurs seek these services, the asking price will increase. In this business environment, the cost of hiring the best talent is too high for self-employed entrepreneurs to avoid relying on too many salaries to compete with their friends and explain the company's vision to employees. Good choice. At the same time, you can choose to spend more time developing the skills of your early members so that you don't have to hire the more advanced skills. If manufacturers devote their time to training personnel, there is no shortage of personnel in the market looking to enter this space. (I really wanted to talk about the role of DAOs in this one, but this article a long time ago was talking about DAOs for the meaning of this article.)

We'll dig deeper into where the investment goes, but before that, let's take a look at the total increase in investment at different levels throughout the year.

where to go

In 2021, nearly 50 companies will raise more than $ 100 million. In comparison, in 2018 there are only eight VC firms with over $ 100 million in the financial line, and in 2019 there will be only five. One of the reasons this happens is that starting a business takes many years to mature. For example, manufacturing companies in 2015 are only a small fraction of manufacturers in 2018. After three years of product comparison, many organizations will be raising more money in 2021. Interestingly, many of these companies are focusing on retail.

In the past, blockchain funding was typically regulated by fintechs, exchanges, or service providers, but the phenomenon still exists today. Moonpay, Forte, and Dapper Labs all want to bring an additional 1 billion users to their digital wallets. For the designer, this is an important inflection point. Over the past three years, most of the investment has gone to the financial sector, and in the future, every investor involved with consumers will have to go through the transition from an existing business to a Web3 unicorn. The operator enters the space in a circle. The next cycle will bring together musicians, artists and players. If you look at the companies involved in some of the bigger contests, you can see that the transition has been fantastic.

The following table describes the options for venture capital fund managers investing in this space. In each project, the funds mentioned are the main investors in this competition.

As you can see, the main investors in the biggest digital real estate market are not the money of the "crypto race" of the past, but some high-end companies, which usually involves investing in equity after the phases. I want to leave the IPO. For me, this is clear proof of the evolution of this ecosystem. These funds do not involve large investments and are intended to be closed immediately with tokens only. Although this happens occasionally, there is now a slow and significant flow of ideas in the market. This allows growing companies to add time and capital to keep pace with their existing business partners going forward, which may explain why this year's ecosystem is different from the 2017 cycle. Many have pointed out that the thousands of dollars that have been raised over the past few months could provide solid “support” for real estate in a recession.

In my opinion, this test is not valid. Because these big funds can run the business in three ways:

1. Engage in referrals by buying groceries at the store instead of spending money on discounts (like sushi). In this case, the investment is greater than the personal investment.

2. If you want to invest in Layer 1, you can add capital by supporting the application design for Layer 1. In this case, most of the new resources have played the role that Consensys plays in Ethereum. It is not an easy task without large groups and deep pockets.

3. The company will not publish its own tokens and will carry out financial transactions directly, knowing that big budgets are different. But financial justice must not only be patient, but also potentially risky and involving access to business information. OpenSea is one of the funds that has experimented with new developers who have invested heavily in operations meeting product requirements and are ready to exit IPOs.

If a profitable business venture has emerged from management, these investments can be made in sports, trade relations, or other areas that investors have invested in over the past ten years, including mobile apps and shipping. They may not be in a rush to buy yours in store.

altcoin. We have also looked at the finances of several cities over the past few years. I have found that places in the region like Singapore and London attract a lot of capital, but are actually halfway between San Francisco and New York. Big Indian cities like Mumbai and Bangalore are rare, as Indian blockchain companies have only grown by $ 400 million so far.

I wonder why San Francisco and New York can attract so much investment if they have so much potential in business investment and technology. However, the global success of unicorns in the blockchain industry has yet to arrive. Given the delay in capital investments in the capital markets, there is reason to believe that in the future, thousands of dollars of funding from companies involved in blockchain could occur in East Asia. and in Europe. Markets will seek lower investments as US investors pull out (partly from IPOs) and traditional companies in Europe and Southeast Asia become more willing to invest. As a result, funding for other ecosystems will increase accordingly.

to follow

Then I will write the details of the text and image above.

1. Although the frequency of start-ups has not increased, the size of start-ups has almost doubled. The signs of the early supporters were even more important today.

2. This year 75% of the investment will be invested in 5% of the company, and the electricity distribution policy will be further strengthened.

3. The cryptocurrency you see on Twitter cannot determine the future of this market in the next phase. Power companies have increased their market share with human capital and the capital needs to invest millions of dollars.

4. We are entering a period of great use of blockchain applications in the retail industry, and the blockchain industry financial market has become a reality in recent years or, laying the foundation for buying and selling. marketing of assets such as: NFT. Today we also want users to sign up.

For financial managers and ecosystem developers, their world has changed dramatically. In the past, it was enough to understand the principles of improving token trading and the basics of marketing, trade registration and community building. At that time, there weren't a lot of competitors in the initial phase as there were still a lot of unknown risks in the area.

Access to Web3 has now become “trusted” and is both seen as a movement, just as the Internet developed at the start of the 21st century. In other words, when behavior shifts from risk to acceptance, the whole picture is different. From a financial point of view, this is a good idea. The start-up competition will increase exponentially and the investment they receive will increase further. Major controversies often crop up among employees and newcomers to discussions on Twitter about the role of venture capital in digital assets. The biggest difference is whether to withdraw the venture capital after the initial investment or whether to keep investing more and make the final investment higher than the investor. When a financial company like Tiger Global spends $ 4 million on P2E games, it's time to recognize the transformation in this industry and make a difference.

In my article on the size of the financial ecosystem in the first quarter of 2021, I hinted that the development of intelligence will lead to an annual return on investment, and it is a fact.

The funds are distributed as follows:

1. Gain Development and Management Experience - 1kx is a prime example.

2. Enter the special area

3. Business knowledge (eg to help establish and measure DeFi foundations)

I think in the future early VC contributors will be able to do all of the above. For example, venture capital firms may not be the best investment in India, but they have the best understanding of measuring DeFi primitives in a controlled area. Instead of blindly finding each startup's accomplishment, you should draw a Venn diagram to find the one that's right for you. Indeed, the survival rate of companies involved in the blockchain is lower or worse than that of traditional start-ups.

(Note: we will post information about this as soon as possible)

So what should entrepreneurs do? The continued influx of capital will lead to more competitive markets. In the economic bubble of 2021, "on chain" may help more money, but things will easily change when phobias and unsatisfactory work for the next year. If people are not worried about losing their capital, capital will be lost and business costs will rise further due to poor performance. We are now entering a period where the elites of several disciplines have changed some of their members in the community, Uniswap and ENS being the best examples. Next year, we need to make the most of the growth potential by creating a community improvement platform so that all involved can build wealth. If you don't believe it, it will be worth considering why Axie Infinity will be the most popular P2E gaming brand in 2021.

In my next article on imitation theory, I will explain how this theory forms the basis of Web3.