AWeb3VC - Funding Round Up #40

🗓️ Week of: Oct 1-7, 2023

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(See "Funding Rounds" section for the complete list of deals)

$121M+ was raised across 21 funding rounds in Web3. It's certainly an improvement. However, industry headlines have been overshadowed by coverage of SBF's trial which has commenced. Any savvy founder or venture firm would be hesitant to announce a funding round now, as there's a strong possibility it would go unnoticed. Therefore, I wouldn't be surprised if we see a dip in funding announcements for most of October until the SBF news cycle subsides. However, this doesn't mean that deal-making will come to halt.

In the wake of Q3's close, it seems like everyone is joining the chorus of opinions on the state of Web3 venture. While there's no denying that venture funding in 2023 has seen a dip, the key question is, compared to what? We are certainly past the euphoria of 2021 and early 2022 – the era of $100M seed rounds is behind us (except, perhaps, for AI startups). With rising interest rates and a cooling of the crypto markets, we've returned to the Web3 venture landscape of 2019 and early 2020, which wasn’t bad. With valuations now grounded in reality, businesses are streamlining, and many are showcasing genuine product-market fit before seeking additional funding. Arguably, this is an opportune moment for Web3 venture. The industry has shed its excesses, and what remains are the truly committed founders and the most viable use-cases. Just imagine for what TVPI and DPI will look like for any funds launched in 2023 vs their predecessors from 2021. There's all the more reason to tune out the general tech media buzz and stay dialed into AWeb3VC!

🏆 Largest Funding Round

➡️ Multichainz announced $35M in funding from GEM Digital. The investment was facilitated through a structured Token Subscription Agreement for the Multichainz utility token, Chainz.

Multichainz is a decentralized lending protocol tailored for both individuals and institutions. It offers broadened access to lending instruments via multi-chain offerings. The protocol is also integrated with leading custodians and tokenization partners, ensuring enhanced liquidity and security for lenders. Furthermore, the protocol has initiated plans to enable collateralized lending against real-world assets (RWA).

Why this matters?👉Lending ranks as the second most popular use-case in DeFi, with over $14B in total value locked (TVL). Given the lessons from the crypto credit crisis of 2022, there's been a surge in the development of decentralized lending protocols, with Multichainz being one of the 48 that secured funding this year so far. Now, with the rise of tokenization of real-world assets, every protocol is vying to become the premier platform for collateralized lending against these assets – and Multichainz is no exception. In the end, the protocol with the deepest liquidity and the most robust credit risk management mechanisms will prevail.

😎 Noteworthy Company

➡️ Blackbird is a loyalty and rewards app tailored to the restaurant and hospitality industry. Like other loyalty programs, the app provides restaurants with a method to increase revenues by effectively creating repeat customers. Each partner restaurant under Blackbird issues a unique membership card to the guest. This card contains the guest's complete visit history, preferences, and membership tier. With every use, the card updates dynamically, offering more rewards and elevating the guest's loyalty status.

At its core, the app operates on the Blackbird protocol. This introduces the $FLY fungible token, which is developed on Coinbase’s Base. Both guests and restaurants earn $FLY for their contributions, mainly stemming from an opt-in data provision program. The more guests patronize a restaurant and utilize Blackbird, the more $FLY they accumulate. Moreover, membership cards linked to each restaurant are represented as NFTs. The app also simplifies the complex Web3 user experience by providing custodial wallets through a partnership with Privy.

The company was founded by Ben Leventhal, who previously founded popular restaurant reservation app, Resy, as well as the food blog, Eater. Since its inception, Blackbird has onboarded approximately 80 restaurants, with David Chang’s Momofuku chain being a notable inclusion. Recently the company raised $24M in Series A funding led by a16z, with participation from QED, Union Square Ventures, Shine Capital, Variant and restaurant groups including Quality Branded, Rustic Canyon Group, Soulva and Brooks Reitz.

Why this matters?👉When an entrepreneur with two successful exits launches something new within an industry where they possess clear domain authority, it certainly merits attention. Although Web3-enabled rewards and loyalty programs aren't novel, Blackbird approaches the market with a specific focus on high-end restaurants, offering a more realistic obtainable market. This strategy already seems to demonstrate some indications of product-market fit, which could also be attributed to Leventhal's deep industry connections. If the app successfully gains traction within the restaurant sector, Blackbird could potentially set the standard for loyalty programs across the broader hospitality industry. Lastly also worth noting the role of the company Privy, which powers the wallets for Blackbird users, as well as the popular Web3 social platform, Friends.tech.

💸 Funding Rounds

Top 15 Rounds

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All Rounds

Fableborne (aka. Pixiion Games) - Private Sale ($7.8M) | Isometric play-to-own multiplayer game: https://fableborne.com/

Tokenize.it - Seed ($2.1M) | Corporate tokenization platform: https://www.tokenize.it/

ParaX (fka. Parallel Finance) - Strategic (Not Disclosed) | Web3 super app and DeFi platform powered by account abstraction and zkVM: https://parax.ai/

Accumulated Finance - Private Sale (Not Disclosed) | Liquid staking and DeFi platform for the Accumulate protocol and ACME/WACME token: https://accumulated.finance/

AirDAO - Private Sale ($7.5M) | Community-governed layer 1 blockchain and ecosystem of web3 dApps, powered by AMB: https://airdao.io/

DigitShares - Seed+ ($1.2M) | White-label platform for end-to-end tokenization: https://digishares.io/

Fountain - Private Sale (Not Disclosed) | Blockchain-based over the counter (OTC) brokerage platform for NFTs and art: https://fountaindigital.xyz/

WonderfulDay - Strategic (Not Disclosed) | Crypto culture-driven NFT collection of 10,000 unique, diverse tigers: https://www.wonderfulday.io/#/

Blackbird Labs - Series A ($24M) | Web3 restaurant loyalty and rewards platform: https://www.blackbird.xyz/

ParaFinance - Seed ($5M) | Decentralized lending platform built on Arbitrum: https://www.parafinance.network/

The Open Network (aka. TON) - Private Sale (Not Disclosed) | Proof-of-stake blockchain designed by Telegram and led by an open community of developers: https://ton.org/

Convergence - Seed ($2.4M) | On-chain request for quote (RFQ) and liquidity network for market makers and protocols: https://www.convergence.so/

Cicada Partners - Seed ($9.7M) | Credit risk management tools for non-custodial lending products on-chain: https://www.cicada.partners/

L1 Advisors - Seed ($1.6M) | Self-custody wealth management platform for crypto-native individuals and institutions: https://l1advisors.com/

Multichainz - Private Sale ($35M) | Web3 lending platform geared to both individuals and institutions: https://www.multichainz.com/

Burnt (aka. XION) - Strategic (Not Disclosed) | Web3 foundry and developer of XION, a layer 1 blockchain network purpose-built for consumer adoption: https://burnt.com/

Phaver - Seed ($7M) | Web3 social app purpose-built for the permissionless and non-custodial ecosystem supported by decentralized social graphs: https://www.phaver.com/

Hadean - Strategic ($9.7M) | AI-powered spatial computing infrastructure geared towards the metaverse: https://hadean.com/

Fairblock - Seed ($2.5M) | On-chain infrastructure that enables pre-execution privacy and conditional decryption: https://www.fairblock.network/

Ostium Labs - Seed ($3.5M) | Decentralized perpetuals futures exchange for real-world assets including commodities and forex: https://www.ostium.io/

NexGami (fka. Light eSports) - Seed ($2M) | Web3 eSports platform: https://www.nexgami.com/

New Funds

Deus X - Deus X Capital ($1B)

CMCC Global - The Titan Fund ($100M)

🙌 Cool Resources

Coinage is the first-community-owned media outlet telling the story of crypto. Recently, Coinage has become the leading news outlet covering SBF’s trail.

🐕 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.