Spending $100 million a year, can the $200 million financing that ConsenSys seeks be completed?

According to the technology media The Information reported on April 15, New York-based blockchain company ConsenSys is seeking to raise $200 million.

Piggy-bank-2889042_1280_copy

Image source: unsplash

However, according to an investor data obtained by CoinDesk, ConsenSys expects spending of $152 million in 2019, with revenue of $52 million, and is expected to consume $100 million in cash.

According to people familiar with the matter, ConsenSys is trying to attract outside investors to raise $200 million. According to reports, the company's executives talked with investors from Hong Kong and South Korea, but as of early April, it was reported that ConsenSys had not found a lead.

The Information cited financing documents showing that as of 2018, ConsenSys received only $21 million in revenue, most of which came from corporate consulting. According to these documents, ConsenSys plans to generate more than $50 million in revenue in 2019, of which approximately $40 million comes from the service business.

According to reports, these documents show that ConsenSys has a considerable stake in the various blockchain companies it incubates. According to reports, ConsenSys has been seeking a valuation of at least $1 billion, which is considered too high considering the company's revenue and investors.

In December last year, anonymous sources said that with the intense competition and “crowding” in the blockchain sector, ConsenSys could cut up to 60% of its employees. According to reports, the company is splitting up start-ups that were previously supported, some of which have no financial support.

Later in January, Vanessa Grellet, executive director of corporate and social impact at ConsenSys, said the layoffs were no more than 13%. The company is said to have reassessed all teams, including technicians and non-technical personnel.

When asked about the signs of crisis in the blockchain industry and criticism of ConsenSys's failure to deliver on its promises, Grellet said she still believes there is a huge interest in blockchain technology.

The company is introducing its three key asset portfolios to investors: about 134 projects or company equity , some ICO project token assets , and an internal business with huge long-term revenue potential .

With additional financing, ConsenSys expects to do the following work by 2020: launching at least 10 blockchain networks, increasing annual revenues to $100 million, and achieving 30% of its so-called project "mesh" activities Representing tokens and helping the Ethereum community achieve its 2.0 upgrade.

ConsenSys 2.0.1

As CoinDesk reported last year, the company has undergone a major restructuring to focus more on revenue-generating businesses. This year's company slide presentation gave some clarification on the company's current development priorities.

The first page of the slide writes:

“ConsenSys is building products, platforms and companies to enable the $80 trillion global economy to be tokenized.”

According to ConsenSys' product description, its product strategy includes four “interconnect layers”: “ open platform , future of work , decentralized finance (DeFi) and Web 3.0 .

The company also highlighted some companies at each level, including Grid+ and Gnosis at the open platform level; OpenLaw and Gitcoin at the future level of work; Trustology and ConsenSys Digital Securities at the DeFi level; and Kaleido at the Web 3.0 level And uPort.

In addition, the document shows that ConsenSys Labs has incubated 82 projects, its accelerator has worked with 27 projects, and ConsenSys has directly invested in 35 companies.