AWeb3VC - Funding Round Up #4

🗓️ Week of: January 22-28, 2023

Web3 Funding Snapshot

The Highlights

🚀 This week saw $255M+ in total funding across 21 announced rounds, although this was largely skewed by Blocksteam's $125M in debt financing. 2 new funds were also announced, totaling $158M in capital, including a Web3 incubator and an ecosystem fund for the Injective network. As expected, the infrastructure segment once again led Web3 venture funding, accounting for ~90% of this week's funding rounds.

🏆Largest Funding Round ➡️ Blocksteam, a leading blockchain infrastructure provider specializing in the Bitcoin network, raised $125M in debt financing via a convertible note and secured loan, led by Kingsway Capital and other investors including Fulgur Ventures. The funds will be utilized to expand Blockstream's institutional bitcoin mining hosting services, which have become increasingly popular among miners as they offer a way to earn bitcoin rewards without having to make a large investment in building out their own infrastructure. While the valuation of Blockstream was not mentioned in its recent funding round, reports from December indicate that the company was seeking to raise funds at a 70% lower valuation compared to its previous round that valued the company at $3.2 billion in 2021. Crypto winter has been challenging for miners. In December, Argo Blockchain was rescued from bankruptcy via a package from Galaxy Digital, and Core Scientific, one of the industry's largest bitcoin miners, filed for bankruptcy protection.

😎 Other Noteworthy Rounds ➡️ QuickNode, a blockchain development platform and provider of node hosting solutions, raised $60M in Series B funding, valuing the company at $800M. 10T Holdings led the funding round, with participation from Protocol Labs, QED Investors, Seven Seven Six, and Tiger Global Management. QuickNode had previously raised $35M in Series A funding in October 2021, led by Tiger Global. Over the past year, the company saw over 400% growth in its user base and expanded its team to over 90 members. QuickNode's platform now supports 16 blockchains and offers API's for token and NFT data. It has also received SOC2 security certification.

Hosted blockchain node and tooling solutions, like QuickNode, are seeing continued growth and funding despite the crypto winter. These solutions provide an efficient and cost-effective way for decentralized app developers to interact with the blockchain without the need to run their own node, similar to how cloud computing platforms such as AWS revolutionized web application development and hosting in the Web2 era. Not to mention, node hosting services are also one of the most profitable areas in the industry, with around 42% of Web3 companies citing it as their biggest expenditure category after payroll and legal fees. If we see any Web3 IPO's in 2023 or 2024, it will likely come from this category!

👀 Observations & Trends ➡️ Web3 Wallet Wars! The Web3 wallet and custody landscape continues to evolve as numerous startups and companies battle to become the primary entry point into the Web3 ecosystem, reminiscent of the browser wars of the 1990s. Despite billions of dollars in funding already, investors continue to pour in, with over $33M in funding going into 8 companies in just this month alone. However, it remains to be seen what customer acquisition costs will look in seemingly crowded space and which wallets will survive. At the same time, for a frame of reference, I personally use over 10 different wallet/custody solutions for specific personal and enterprise use-cases. Thus, maybe its not unreasonable for 100's of wallets to exist at least in the near-term 🤔

For more insights surrounding the "Web3 Wallet Opportunity," check out this post from Collab+Currency 👇

Funding Rounds

Top 15 Rounds

Want access to our complete dataset or propose an update? Contact: [email protected]

All Rounds

Gifto - Strategic ($2.5M) | Protocol to create, store, and gift virtual items and digital assets: https://www.gifto.io/

Tribes - Seed ($3.3M) | Web3 native messaging and group wallet app: https://www.tribes.xyz/

Calimero Network - Seed ($8.5M) | Secure private shard infrastructure for enterprises: https://www.calimero.network/

Blockstream - Debt ($125M) | Blockchain technology company specializing in the development of products and services aimed at improving the security, scalability, and privacy of the Bitcoin network: https://blockstream.com/

Fractal - Strategic (Not Disclosed) | Marketplace for gaming NFTs and game play platform: https://www.fractal.is/

Asset Reality - Seed ($4.9M) | End-to-end solution for digital assets investigations, recovery and managing & selling seized assets: https://www.assetreality.com/

QuickNode - Series B ($60M) | Blockchain development platform and infrastructure provider of node hosting solutions: https://www.quicknode.com/

Brave Group - Strategic ($2.3M) | Developer of multifaceted metaverse businesses focused on IP development and incubation specializing in anime: https://bravegroup.co.jp/

Tholos - Seed ($1.5M) | Multiparty computation (MPC) based self-custody wallet and treasury management platform: https://www.tholos.app/

StoryCo - Seed ($6M) | Platform for fans to connect, co-create, and co-own story franchise IP through memberships and NFTs: https://story.co/

ValuesCo - Seed ($2.7M) | Web3 social token used to promote ESG-friendly public interest campaigns: https://www.values.co/

Emperia - Series A ($10M) | Platform that powers the creation of immersive virtual experiences for brands across multiple retail sectors including enabling e-commerce within the metaverse: https://emperiavr.com/

Spatial Labs - Seed ($10M) | Software and hardware developer of augmented reality for consumer brands using blockchain technology to authenticate products and creating virtual copies of physical products: https://www.slabs.one/

PlanetWatch - Seed ($3.2M) | Developer of air-quality monitoring networks built on the Alogrand blockchain network: https://www.planetwatch.io/

Ethos - Seed ($4.2M) | Web3 wallet focused on the Sui blockchain ecosystem: https://ethoswallet.xyz/

EZ Swap - Private Sale ($1M) | Decentralized exchange (DEX) and automated market maker (AMM) for NFTs: https://ezswap.io

Senken - Seed ($7.5M) | Marketplace for tokenized carbon credits and forward contracts on-chain along other climate related assets: https://senken.io/

ForChain Labs - Seed ($2M) | Developer of Fortune Unicorn Club NFT collection that enables DIY-minting: https://fortuneunicorn.club/

EdgeIn - Seed ($400K) | Web3 focused database of startups, enterprises, and investors: https://edgein.io/

Presail - Strategic ($150K) | Token presale management platform including investors screening, token distribution, and reporting: https://presail.com/

Vest Exchange - Seed (Not Disclosed) | Decentralized exchange (DEX) protocol on Arbitrum that empowers users to trade perpetual futures on almost any asset: https://www.vest.exchange/

New Funds

Injective Labs - Injective Ecosystem Venture Group ($150M)

Tané - Tané Crypto Builders Incubator ($8M)

Cool Resources

Check out these two awesome Substacks I've recently signed up for providing further insights in trends across Web3 and venture overall from Cryptechie & Mostly metrics👇

About

AWeb3VC is a source for venture funding news, emerging startups and trends across Web3. I've been closely following cryptocurrencies and digital assets since 2013 and started working in space since 2018. Now I'm on a mission to build the most extensive venture ecosystem for BUIDLERS in Web3, starting first by tracking those BUIDLERS.