Ruminations on tech, the digital media, and some golf thrown in for good measure.

Archive for the ‘venture capital’ Category

Turning Up the Heat on Crypto

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The cryptocurrency juggernaut continues to build momentum. It seems as though there’s a new initial coin offering every day now.

Multicoin Capital is looking to raise $250 million in capital by the end of June, and Reuters is reporting that Marc Andreessen and a “slew of big individual and institutional investors” have invested thus far.

Multicoin views cryptocurrencies as a long-term investment (three to four years), as opposed to the short-termism we’ve been seeing in recent weeks.

Other investors include PayPay’s first COO, David Sacks, and Elad Gil, co-founder of genomic testing company Color Genomics. 

In related news, Bitcoin’s price has now settled down to around $9,000, and this as Japan suspended trading on two cryptocurrencies on Thursday following a reported $530 million cyber heist at Coincheck, one of the country’s largest crypto platforms.

According to a story in Fortune, Japan’s Financial Services Agency has ordered Bitstation and FSHO to suspend business for at least one month, the first due to an executive using customer funds for personal transactions, and the second for allegedly failing to shore up customer protection.

And finally, in the better cryptocurrency mousetrap category, French startup Qarnot has unveiled a new computing heater made specifically for cryptocurrency mining.

A heater. With a computer. Just for mining bitcoins. And heating you.

Three words, people: Picks and shovels.

Addendum: Check out Paul Ford’s Bloomberg story, “Bitcoin is Ridiculous, Blockchain is Dangerous” where he compares to the emerging crypto tulip-mania to the early days of the WWW. 

Written by turbotodd

March 9, 2018 at 9:34 am

WeChat, We Invest

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Building on last week’s post about the overinflux of venture capital money into the Chinese tech market, China Money Network is reporting that China’s Baidu, Inc. has teamed up with China Life Insurance Co., Ltd. to jointly launch a RMB 14 billion (U.S. $2.12 billiion) investment fund to back companies in the mobile Internet, AI, fintech, and other tech sectors.

Chinese insurers were permitted by regulators in 2014 to invest in venture capital.

The Baidu-China Life fund is to be managed by Baidu Capital, Baidu’s private investment arm. It will focus on making middle and late-stage investments in areas surrounding Internet and its applications in traditional sectors, in addition to AI, fintech and consumer upgrade.
– via China Money Network

In unrelated Chinese Internet play news, Tencent Holdings Ltd said on Monday it would lead an $863 million investment in apparel platform Vipshop Holdings.

The deal extends a recent push by Tencent into Alibaba’s home turf of retail, where the firm hopes to leverage its messaging service WeChat and its online payment systems to drive shopping demand.
– via U.S.

Tencent’s WeChat has nearly a billion users, and the app has become a lifeline for both mainland Chinese and the Chinese diaspora around the globe.

The app provides everything from text messaging to video games and conferencing to sharing photographs to apps that allow users to pay for municipal utility services.

Written by turbotodd

December 18, 2017 at 9:24 am

Chinese Unicorns

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The VC market in China has become hotter than hot, with some even suggesting it’s in bubble territory.

According to a report from The Wall Street Journal, in the first 11 months of this year, 3,418 new venture-capital and private-equity funds in China raised 1.6 trillion yuan (some $241B U.S.), which was more than double the amount of 2015 and more than 10 times that of 2006.

The data, which comes from Zero2IPO Group, estimates about 12,000 investment firms manage 8.5 trillion yuan in capital.

When it comes to so-called “unicorns,” or those startups valued at over $1B U.S., 59 of the 221 around the world come from China (the U.S. has 127, the U.K. 12, and India, 9).


The financing bonanza has also seen startups wage expensive subsidy wars as they try to grab market share before worrying about profits. Nothing exemplifies the trend as much as the bike-sharing apps. First praised for the convenience they brought, bike-sharing apps such as Ofo and Mobike are now scorned for clogging cities with millions of bikes.
– via WSJ


As in the U.S., easy access to capital in China allows startups to stay private longer. For venture capitalists, that means their shares in those startups get diluted and returns dwindle with each successive funding round. By the time of an IPO, the returns can be much lower than initially expected.
– via WSJ

The inevitable conclusion, the “b” word (“b” for “bubble”) is starting to get thrown around in China.

On the other hand, there are 1.4 billion people living in China, some 18.67% of the population. Meaning, there’s lots of opportunity, and plenty of both red and black on the Chinese entrepreneur roulette wheel for VC and angel investors to place their bets.

Written by turbotodd

December 15, 2017 at 9:30 am

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