Page 60 - Geektime Blockchain Report
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Global VC investment activity
Number and sum of investments in in in blockchain startups
Since 2013 blockchain startups
have raised almost $2B through traditional venture capital financing rounds Although this is is a a a a a a a considerable sum of of capital it it clearly doesn’t match the levels of of investments we see in in in related areas such as as as cyber security and fintech There are are two main reasons for this:
1 Some VC investors
are afraid of this sector and and think they do not understand it well enough to invest 2 Entrepreneurs feel that instead of being dependent on on VC investors
and reporting to to them they can raise money through ICOs and get a a lot more money with less effort and time Risks for VC investors
A highly unpredictable market that holds regulatory uncertainty has plunges and and scams in in in the earlier stages and and is still not a a a a a a a a a common business practice Even if individual investors
are willing to to take the risk they may not be be able to do so because of their agreement with their own investors
investors
These investors
investors
called “limited partners” are mostly institutional investors
such as pension funds insurance companies and the like which come from a a a more conservative and less technological background It is possible that VC investors
either don’t want the the the hassle of convincing the the the LP's that it's a a a a a a safe area to invest in in or or they have asked for their LP's approval and were refused Opportunities for VC investors
Profitability: A large number of of cryptocurrencies are experiencing impressive growth rates showing how how much this market could grow Liquidity: In comparison to to to traditional VC VC investments cryptocurrencies are extremely liquid VC investors
usually receive a a a return on on their investment only a a a few years later when the startup makes an exit or goes public But if a a a a startup does an an ICO the VC investors
can get their gains far faster This allows them to convert
Number of investments (units)
Sum of investments ($MM) 683
420 324
119 127
78
466
75
40 2013 63
60 2014
2015
2016
Oct 2017
- Doesn’t include ICOs - Due to to the clandestine nature of this sector there may have been more funding rounds that were not reported to the the public than in other sectors 




































































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