The ICO model is disrupting Silicon Valley, Union Square’s Fred Wilson said in a tweeter exchange with Jason Calacanis, another venture capitalist that has invested in 150 companies, including four multi-billion dollar unicorns.
The exchange centered around the performance of VC backed start-ups outside of Silicon Valley, with Calacanis saying you’d be lucky if you can do “meh to OK,” but the investor couldn’t name any VC backed company outside of SV that had managed more than $10 billion or $100 billion.
“The two greatest and most disruptive startups of the last ten years (BTC $40bn & ETH $20bn) did not emanate from the Silicon Valley, they represent the future,” Wilson said, before adding that the primary case for ethereum is tokens which are disrupting Silicon Valley.
Calacanis stated that regulators would get involved, but Wilson said tokens are “global offerings, global buyers, global teams. Entirely new set of issues to deal with,” and if SEC implements stringent guidelines, it would:
“Lead to a wave of jurisdictional competition to replace the US/SV as the hub of innovation,” with Switzerland’s Crypto Valley pointed out as a contender because many blockchain companies, including the Ethereum Foundation, are based there.
Fred Wilson has been a strong proponent of digital currencies, apparently observing this space since 2011, with the VC recently stating that his bold prediction would be ethereum surpassing bitcoin’s market cap by the end of the year.
That nearly happened a few weeks ago, but ethereum was unable to pass the finishing line as a spate of new ICO tokens launched, raising nearly a billion dollars in just one month, with many more launched since then.
In the process, they have seemingly created a new business model, with innovative projects funded in a decentralized manner by anyone who wishes to take part and can manage to get in within the allocated time-frame or before the cap is reached.
That new funding model might even rival VCs as ethereum based ICOs have raised significantly more than VC funded start-ups, even all the way back in April. Around that time, John Lilic, an ethereum developer and member of ConsenSys, stated:
“Many of us in the Ethereum community remember how arrogant, dismissive and douchey VCs were to us in the very early days. I remember a meeting in London with a bunch of “high power VCs” at DevCon1, Jeffrey Wilcke was there. I couldn’t believe how shitty VCs were to him.
Co-founder, major contributor, very bright and good dude and they didn’t even stop for a moment talking about themselves to let Jeff speak. So to all the ICO skeptics, while some of what you say is valid, please understand we made our own way because many VCs just suck.”
That indicates significant discontent with the VC backed model, potentially opening the way for ethereum, but whether the token model will indeed rise to disrupt Silicon Valley itself, building projects and companies worth billions, remains to be seen.