In 2015 and 2016 many nascent technology startups financed themselves by issuing unique cryptocurrencies tied to their projects.
These financing projects were very successful, but for various reasons the level of financing via issuing cryptocurrencies slowed down a bit in recent years.
Many prominent venture capitalists like Marc Andreessen and Ben Horowitz and many others have embraced buying cryptocurrencies.
Cryptocurrencies could actually partially displace venture capital funds and investment banks in providing financing for technology startups. I say only partially because cryoptocurrencies are used in either for pre seed, very early stage or seed capital which either venture capital funds, VC, do not provide or provide only to a limited extent. Since venture capital funds' assets under management grew substantially in recent years seed capital is only a small portion, somewhere at 10 % of overall startup financing volumes provided by VC or private equity funds.
Issuing cryptocurrencies is a huge business opportunity for startups, because they can so tap into the growth of capital potential that an Initial Public Offering and the public stock market provides without actually being in the late stage of development for the Securities and Exchange Commission to approve an IPO.
What is more, since cryptocurrencies are very volatile, more volatile than technology stocks even, the prices of cryptocurrencies issued by startups could rise a lot thus providing plentiful and much needed financing for very young technology companies trying to develop innovative products and build break through technologies.
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