dcg bitcoin and blockchain tech summit - opening remarks
TRANSCRIPT
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BY THE NUMBERS
• 120 attendees representing 62 portfolio companies and DCG subsidiaries
• 180 investors representing 120 VC’s, Family offices, funds, and corporate strategic partners
• 65 presentations and a total of 900 slides
• 992 one on one meetings with 2,200 individual agenda bookings via Guidebook
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We believe that digital currency and blockchain technology is going to transform our financial markets and will drive positive
economic and social change globally
OUR MISSION
It is our mission to accelerate the development of a better financial system
We do this by building and supporting bitcoin and blockchain companies and leveraging our insights, network
and access to capital
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DCG TODAY
• Three wholly-owned subsidiaries:
• Grayscale Investments
• Genesis Global Trading
• CoinDesk
• 28 employees at DCG and our wholly-owned subsidiaries
• Launching “DCG Corporate Network” in Q1 2017
Subsidiaries Portfolio
• Investments in 88 companies
• Adding ~2 companies per month
• Global network spanning 25 countries; largest in industry
• Over 1,000 employees in DCG family
Digital Currency • Own BTC, XRP, ETC, ZEC
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• C-Corp structure provides us with:
• Flexibility
• Opportunity to build a new investing/operating model
• Permanent capital
• Ability to raise money from strategic investors
• Potential to take DCG public
WE ARE NOT A VC FUND
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• Target 2-5% ownership at seed stage (invest up to $200k)
• Focus on strategic life cycle investments (invest up to $500k in Series A, $1 mm in Series B)
• Join syndicates with other professional investors
• Back the very best teams in our target markets
• Minimize conflicts of interest
OUR INVESTING STRATEGY
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• DCG portfolio has been the industry’s early VC pipeline
• Continued success à continuing to build symbiotic relationship with professional investors
DCG FUNDING ANALYSIS
Announced Industry Deals $1.3 billion
Mining Operators $234 million
Non-Mining Deals $1.1 billion
DCG Companies $755 million
DCG companies raised
~70% of industry funding to date
DCG INVESTING SUCCESS
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1. Blockchain Registry
2. Core Infrastructure
3. Enterprise Blockchain Solutions
4. Identity & Compliance
5. Payments 2.0
6. Smart Contracts
7. Trading & Tools
KEY INVESTMENT AREAS
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DCG PORTFOLIO IDENTITY
ENTERPRISE BLOCKCHAIN
SMART CONTRACTS ASSET REGISTRY
PAYMENTS 2.0 TRADING & TOOLS
CORE INFRASTRUCTURE
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2016 PORTFOLIO ADDITIONS
Blockchain Registry
Core Infrastructure
Enterprise Blockchain
Identity & Compliance
Payments 2.0
Smart Contracts
Trading & Tools
Bitmark Blockstream Bloq Chainalysis 4G Capital Lighting BitOasis
Everledger Jiko Services Enigma Civic Bitwala Rootstock Crypto
Facilities
Fluent Netki Gem Cloudwear Brave SurBTC
Skuchain Snapcard Revelator Custos Joystream
Tierion Elliptic Streami
Token Yours
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• Supply chain
• Trade finance
• Identity & verification
• Cross border payments
• Digital currency as a speculative investment
WE ARE EXCITED ABOUT
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CROSS BORDERS PAYMENTS VIA BITCOIN
$0
$20
$40
Oct-15 Jan-16 Apr-16 Jul-16
Mill
ions
$0
$50
$100
$150
Oct-15 Jan-16 Apr-16 Jul-16 M
illio
ns
Source: Align Commerce, BitPesa, Korbit (Hyphen), Snapcard (MassPay)
Monthly Volume Cumulative Volume
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• Holds ~1% of all bitcoin
BITCOIN INVESTMENT TRUST
$0
$70
$140
9/25/13 3/25/14 9/25/14 3/25/15 9/25/15 3/25/16 9/25/16
Mill
ions
Assets Under Management
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• Ethereum
• “Smart” Smart Contracts
• Decentralized autonomous organizations
• Initial Coin Offerings
WE ARE NOT EXCITED ABOUT…YET
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• Blockchain, blockchain, blockchain -- hundreds of POCs
• Business model for certain “blockchain” companies continues to be challenging; venture investing slowing
• Growing number of companies hitting profitability
• Bitcoin scaling debate rages on…and solutions being developed
• Massive bitcoin transaction volume growth in India, Middle East, Nigeria, Russia, Venezuela
• Digital currency becoming recognized as a new investable asset class, but little institutional investor interest beyond bitcoin
• Central bank exploration into fiat digital currency; quiet on regulatory front
INDUSTRY STATE OF AFFAIRS
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TOP TEN PREDICTIONS FOR 2017 1. Bitcoin as a store of value re-emerges as key theme
2. Bitcoin becomes more accessible to retail and institutional investors via ETF(s)
3. Cross border payments/remittance using bitcoin hits a $1 billion run rate
4. Exponential bitcoin transactional growth in India, Japan & Middle East
5. Explosion of blockchain POCs focusing on supply chain
6. Identity solution competition heats up…but no leader emerges
7. SEC comes down hard on ICOs
8. First >$50 mm M&A transaction
9. Micropayment models materialize
10. Bitcoin price on 12/31/17 = higher
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PORTFOLIO DEVELOPMENT
We connect our portfolio companies with our broad network to help fuel collaboration, growth, and development of this industry
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THE DCG NETWORK
Portfolio (88)
Academia Policy
Co-Investors (700) Corporate Partners (200)
Family Offices & Funds (100)
Institutions
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KEY PORTFOLIO INITIATIVES
In storage and compute credits to DCG portfolio companies, infrastructure partner for experimentation $2M
>1,000 Introductions to potential partners both within the DCG portfolio and the DCG network
In the last 12 months…
40 Events for our portfolio and partners, including workshops, working groups, and webinars, both in the US and abroad
150 New relationships with corporate partners developed – including presentations to boards, executives, and technology groups
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THE NEXT EVOLUTION
Insights on Every Startup and Consortium
Partnerships & POC Matching
Events & Exclusive Network
Announcing…
DCG Corporate Network