Blockchain Capital marketing deck outlining venture fund investments and advisory board

BLOCKCHAIN CAPITAL, LLC CCP II, LP OCTOBER 2015 ONE FERRY BUILDING, SUITE 255 SAN FRANCISCO, CA 94111 [email protected] 1 TECHNOLOGY THOUGHT-LEADERS ARE CONVINCED Bill Gates: “Bitcoin is be0er than currency…a technological tour de force.” Ben Bernanke “[Virtual Currencies] may hold long-­‐term promise, parDcularly if the innovaDons promote a faster, more secure and more efficient payment system.” Eric Schmidt “Bitcoin is a remarkable cryptographic achievement and the ability to create something that is not duplicable in the digital world has enormous value.” Milton Friedman (1999) “I think the Internet is going to be one of the major forces for reducing the role of government… The one thing that’s missing, but that will soon be developed, is a reliable e-­‐cash” Peter Thiel “I do think Bitcoin is the first encrypted money that has the potenDal to do something like change the world.” Al Gore “I’m a big fan of Bitcoin…RegulaDon of money supply needs to be depoliDcized” David Marcus (former CEO PayPal) “I really like Bitcoin. I own Bitcoins. It’s a store of value, a distributed ledger. It’s a great place to put assets." ONE FERRY BUILDING, SUITE 255 SAN FRANCISCO, CA 94111 [email protected] 2 INCUMBENTS EMBRACING THE BLOCKCHAIN NASDAQ -­‐ partnered with Chain to launch private company exchange “As blockchain technology conDnues to redefine not only how the exchange sector operates, but the global financial economy as a whole, NASDAQ aims to be at the center of this watershed development,” -­‐ Robert Greifeld, NASDAQ CEO, Ci< -­‐ launched “Ci<coin” project "Blockchain technology not only has an opportunity to transform financial services but also extend far beyond payments to new use-­‐cases and applicaDons across industries," -­‐ Debby Hopkins, Chief InnovaDon Officer at CiD Santander -­‐ published: “Fintech 2.0 Paper: Reboo<ng Financial Services” “Blockchain technologies could reduce banks' infrastructural costs by $15-­‐20bn a year by 2022” Standard Chartered "The banking industry is starDng to see the many potenDal benefits of its underlying technology. For banks, the blockchain has the potenDal to become a technology model for a low-­‐cost and transparent transacDon infrastructure.” -­‐ Anju Patwardhan, Chief InnovaDon Officer Royal Bank of Scotland -­‐ announced a $3.5 Billion technology revamp over next 3 years "I don’t know what’s going to succeed. What I'm certain of is that we are going to see blockchain soluDons, peer-­‐to-­‐peer soluDons emerging in our industry and we want to be close to that development.” -­‐ Simon McNamara, Chief AdministraDve Officer at RBS ONE FERRY BUILDING, SUITE 255 SAN FRANCISCO, CA 94111 [email protected] 3 THREE TECHNOLOGY EVOLUTIONS OF DISRUPTION 1995 2015 1975 The PC Era The Internet Era The Blockchain Era Semiconductor Technology TCP/IP Protocol Bitcoin Protocol ONE FERRY BUILDING, SUITE 255 SAN FRANCISCO, CA 94111 [email protected] 4 EXPERIENCED TEAM IN INVESTING BART STEPHENS BRAD STEPHENS BROCK PIERCE PAUL STEPHENS EXPERIENCE • Stephens Inv. Mgmt. • Ivanhoe Capital • E*Trade Group • Princeton • Stephens Inv. Mgmt. • Fidelity Ventures • CSFB • Furman Selz • Duke • Chairman of the Bitcoin Foundation Board • Founded 15x Startups • Raised > $200M • Invested in > 25x • Robertson Stephens & Co. • RS Investments • Duke Endowment • UC Berkeley Endowment Startups RECOGNITION #2 U.S. Long/Short Hedge Fund* $500 Million AUM 2.5x Venture Fund, 11.5% IRR Founded 8 crypto currency startups and often referred to as the “father of digital currency” 40 Years in Silicon Valley Investment Management and Banking Leaders in Technology Investing Incubated and Founded Dozens of Startups 100’s of Silicon Valley Investments *Absolute Return Magazine 2004 ONE FERRY BUILDING, SUITE 255 SAN FRANCISCO, CA 94111 [email protected] 5 SUCCESSFUL TRACK RECORD OF HOME RUNS PRIVATE PUBLIC 2014 25.0x 2014 77.0x 2004 8.1x 2009 39.0x 2008 6.9x 2010 4.6x 2008 5.0x 2011 5.1x 2014 TBD 2007 3.4x ( 7 IPOs and 13 Acquisitions ) ( 17 Public Acquisitions ) Private and Public Exits through Multiple Market Cycles ONE FERRY BUILDING, SUITE 255 SAN FRANCISCO, CA 94111 [email protected] 6 BROCK PIERCE - CHAIR OF THE BITCOIN FOUNDATION INDUSTRY LEADER AND SPOKESPERSON SERIAL ENTREPRENEUR IGE (2001-2007) - Merged with ItemBay Zam (2004-2012) - Sold to TenCent Singularity University IMI Exchange (2004-Present) Xfire 2.0 (2011-Present) Playsino (2011-Present) GoCoin (payment processor) Blade Financial (Bitcoin debit card) Coin Congress (conference) Repeat Entrepreneur and Digital Currency Visionary ONE FERRY BUILDING, SUITE 255 SAN FRANCISCO, CA 94111 [email protected] 7 PARTNERS AND ADVISORY BOARD ALISON DAVIS* | Director: Royal Bank of Scotland, XOOM, Fiserv and First Data MARY CRANSTON | Director: VISA, ex-CEO and Chair of Pillsbury Winthrop TERRY SCHWAKOPF | EVP: Federal Reserve Bank of San Francisco, banking supervision MICHAEL MCADAM | CFO: Union Bank (Mitsubishi UFJ Financial Group) SIMON MCNAMARA | CTO: RBS, ex-CIO of Standard Chartered, BNP and Deutsche Bank VINNY LINGHAM | CEO: Gyft (acquired by First Data) BOBBY LEE | CEO: BTC China NICCOLO DE MASI | CEO: Glu Mobile STEVE BEAUREGARD | CEO: GoCoin CHRIS PALLOTTA | Special Advisor: MIT Media Lab, Partner: Raptor Capital MATT OCKO | Partner: Data Collective WILL O’BRIEN | Co-founder: BitGo CHARLIE LEE | Coinbase, Founder of Litecoin * Chairman of the Advisory Board Built a robust team of Advisors and LPs from the Blockchain ecosystem ONE FERRY BUILDING, SUITE 255 SAN FRANCISCO, CA 94111 [email protected] 8 CRYPTO CURRENCY PARTNERS I, LP The First Dedicated Bitcoin Venture Fund - 30 Investments, Fully Deployed ONE FERRY BUILDING, SUITE 255 SAN FRANCISCO, CA 94111 [email protected] 9 CRYPTO CURRENCY PARTNERS II, LP Current portfolio - both contributed and new investments ONE FERRY BUILDING, SUITE 255 SAN FRANCISCO, CA 94111 [email protected] 10 PIPELINE & PROCESS 600+ Business Plans CONSUMER 200+ Meetings • Exchanges • Remittance • Digital Wallets • Deep Global Domain Knowledge 37 Portfolio Companies INFRASTRUCTURE • Side Chains • Blockchain Apps • Mining ENTERPRISE • Multi-sig workflow • Extensive Networks • Proprietary Deal Flow • Primary Investigative Due Diligence • Exhaustive Management/Industry Interaction • Recruiting • Business Development • Capital Introduction • M&A HISTORIC VENTURE RETURNS • Payment Gateways • Financial Tools ONE FERRY BUILDING, SUITE 255 SAN FRANCISCO, CA 94111 [email protected] 11 ACTIVE BLOCKCHAIN VENTURE INVESTORS Blockchain Capital has co-invested with these leading VCs ONE FERRY BUILDING, SUITE 255 SAN FRANCISCO, CA 94111 [email protected] 12 CCP II - 8 CONTRIBUTED INVESTMENTS DATE INVESTED $ AMOUNT DETAILS BitGo June ’14 $75,000 Series A preferred Coinsetter December ’13 $50,000 Converted to Series A at 1.5x expresscoin November ’13 $25,000 Convert to Series A, $2.5m Cap GoCoin October ’13 $100,000 Converted to Series A at 4.5x Kraken April ’14 $70,000 Series A preferred LedgerX July ’14 $50,000 Series A preferred BitAccess September ‘14 $25,000 Note discounted to Series A preferred BitNet October ‘14 $75,000 Series A Preferred TOTAL $470,000 (current value ~ $815,000… 1.7x) General Partners contributed co-investments at cost to CCP II ONE FERRY BUILDING, SUITE 255 SAN FRANCISCO, CA 94111 [email protected] 13 CCP II - 12 NEW INVESTMENTS MADE DATE INVESTED $ AMOUNT DETAILS PeerNova September ’14 $50,000 Converted to Series A preferred BlockStream October’14 $100,000 Series A preferred ChangeTip November ’14 $250,000 Series A preferred Bonafide November’14 $50,000 Note discounted to Series A preferred BitPesa December ’14 $100,000 Note discounted to Series A preferred Coinbase December ’14 $200,000 Series C preferred itBit January ’15 $250,000 Series B preferred Ripple March ’15 $250,000 Series A preferred ABRA July ’15 $100,000 Series A preferred Stem August ’15 $250,000 Note discounted to Series A preferred Chain September ’15 $250,000 Series C preferred Gem September ’15 $250,000 Series A preferred TOTAL $2,100,000 ONE FERRY BUILDING, SUITE 255 SAN FRANCISCO, CA 94111 [email protected] 14 CCP II - STRATEGY AND MAKE-UP EXPOSURE Diversified Sector-specific FUND POSITION ALLOCATION 50% 30% 20% New CCP II investments Reserves for CCP II follow-on rounds Option to use CCP I’s follow-on rights INVESTMENT STRATEGY Leverage our network and industry expertise to find investments that utilize Blockchain technologies and help these portfolio companies disrupt legacy industries. Access to CCP’s early seed deals as well as future deals ONE FERRY BUILDING, SUITE 255 SAN FRANCISCO, CA 94111 [email protected] 15 CCP II - SUMMARY OF TERMS FUND TARGET $10-15M TERM 6-8 Years FEE/INCENTIVE 2.5% / 25% GP CONTRIBUTION +5% Fund or +$1m INVESTMENTS 25 ($100k - $500k per deal) STRUCTURE 4 x 25% capital calls, BTC Accepted ONE FERRY BUILDING, SUITE 255 SAN FRANCISCO, CA 94111 [email protected] 16 CCP II - SERVICE PROVIDERS ADMINISTRATION / CFO Kranz & Associates LEGAL Sidley Austin TAX / AUDIT Crawford Pimintel BANK Silicon Valley Bank CUSTODIAN Merrill Lynch BTC VAULT Xapo & BitGo ONE FERRY BUILDING, SUITE 255 SAN FRANCISCO, CA 94111 [email protected] 17 USE CASES FOR BLOCKCHAIN TECHNOLOGY Financial and Records Legal / Health / Education Bitcoin Private Equities Bonds Public Equities Smart Contracts Signatures/identity Degrees Shareholder Voting Remittance Crowd-funding Wills Genome data Trusts Licensing Spending Records Micro-payments Commodities Medical Records Escrows Delivery records Trading Records Derivatives Mortgage/loan records Arbitration Grades Patents Copyrights Digital Coupons Servicing records Micro-charity Certifications Academic Credits Public Records Commercial / Media Land titles Birth certificates Vehicle registries Business license Business Incorporation/dissolution HR Records Supply chain mgmt Business transaction records Accounting records Software licenses Business Ownership records Regulatory records Trademarks Spam Filters Hotel room keys Criminal records Passports Death certificates Voter IDs Building permits Health/safety inspections Non-profit records Court records Gun permits Voting Global trade network Loyalty Points Vouchers Domain names Betting records Movie Tickets DRM: Music/movie/book license GPS network identity ONE FERRY BUILDING, SUITE 255 SAN FRANCISCO, CA 94111 [email protected] 18 OPPORTUNITES FOR BLOCKCHAIN ADOPTION Micro-Transactions All Global Media Companies Financial Settlement Stock, Bonds, Derivatives, etc Remittance Hot Spots USA, UAE -> India, Mexico, Philip. Early-Adopt Millennials USA, EU, AU Currency Controlled Markets Korea, S. Africa, China, India Unstable Markets Africa, Venezuela, Argentina ONE FERRY BUILDING, SUITE 255 SAN FRANCISCO, CA 94111 [email protected] 19 INDUSTRY GROWTH: 2014 to 2015 ONE FERRY BUILDING, SUITE 255 SAN FRANCISCO, CA 94111 [email protected] 20 CASE STUDY: ChangeTip ChangeTip enables a “tipping” feature using Bitcoin on other companies’ websites. It has built a Bitcoin micropayment platform that is currently integrated with Twitter, GitHub, Reddit, Google+, Tumblr, and YouTube. We believe that ChangeTip’s micro transaction platform is poised to be the financial equivalent of the “Like” button, and enabling new mechanisms for premium online constant to be monetized. ONE FERRY BUILDING, SUITE 255 SAN FRANCISCO, CA 94111 [email protected] 21 HYPER-GROWTH- 2013 to 2015 ONE FERRY BUILDING, SUITE 255 SAN FRANCISCO, CA 94111 [email protected] 22 SUMMARY FIRST DEDICATED BITCOIN VENTURE FUND UNPARALLELED ACCESS TO DEAL-FLOW PROVEN TRACK RECORDS Building the Future Leaders in the Blockchain Economy ONE FERRY BUILDING, SUITE 255 SAN FRANCISCO, CA 94111 [email protected] 23