ConsenSys plans to invest $ 200 million – Ledger Insights

New York-based ConsenSys, the 900-strong Ethereum development studio, plans to raise $ 200 million from investors, according to a report by The Information. The article revealed that the startup had $ 21 million in revenue in 2018, primarily from its management consulting business.

In December last year, the company cut 13% of its workforce when the value of ether fell below $ 100. ConsenSys founder Joe Lubin was also an Ethereum founder and early funder and is believed to have used the profits from Ether to fund ConsenSys. Today, the price of Ether rose again at $ 164, but still far from its high of nearly $ 1,400.

The information also alleged that the company is targeting a valuation of at least $ 1 billion and has been turned down by some potential investors. With $ 21 million in sales, that could be a challenge. The problem could be that ConsenSys is a mini-conglomerate.

One part is a development agency for enterprise blockchain. The company has some very high profile clients including the European Union Blockchain Observatory & Forum and the trade finance consortium komgo. If companies are considering Ethereum, there’s a good chance ConsenSys will be asked for a pitch. This part can be viewed as less “sexy” from a multiple rating perspective. However, it indicates that ConsenSys has its own brand value.

The other significant segment of ConsenSys is the Venture Production Studio, which would be valued differently. The portfolio includes high profile companies like Metamask, which enables users to run Ethereum dApps in a web browser, and Kaleido, the blockchain-as-a-service offering.

ConsenSys is also closely linked to the success of Ethereum. There have been many newcomers to the protocol space over the past 18 months, so Ethereum is no longer considered sacrosanct. Significant technical changes are being made to the protocol, which will take time to implement. Performance and scalability are two of the biggest issues that are being addressed.

ConsenSys is therefore valued for combining the essential elements of its business as well as assessing whether Ethereum can maintain its position as the platform of choice for public blockchain applications.

Ethereum could be dwarfed on a technological level. Provided that performance issues don’t become an obstacle, blockchain could be one of the areas where the best technology might not be the winner. First movers have greater advantages when it comes to network effects.

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