Ethereum’s powerhouse ConsenSys is looking to raise $200 million on $21 million of revenue for 2018 at a valuation of $1 billion.
ConsenSys is expecting $50 million in revenue for 2019, $40 million from its consulting and services business based on contracts with enterprises and governments. The rest mostly from software products.
Apparently ConsenSys’ executives recently pitched investors in Hong Kong and South Korea, but as of early April, they hadn’t found a lead investor according to unnamed sources.
Most of ConsenSys’ portfolio companies and subsidiaries, called spokes, don’t generate much revenue, if any.
That might change after a restructuring last year where about 300 employees were let go, bringing it to a total of 900.
The start-up arguably expanded too quickly, going from 100 employees to 1,200 in just two years, but besides the consulting revenue, they have substantial stake in a number of projects.
Gnosis is cited as an example in which ConsenSys had a stake of close to $2 billion in January 2018, at the very height of crypto prices.
Altogether, ConsenSys had investments worth $2.5 billion at the peak, including in Civil, with their value now perhaps down 70%-80%.
Joseph Lubin, the founder of ConsenSys, is believed to control the vast majority of shares, with it unclear how much he is willing to cede to Venture Capitalists.
Just as it is unclear why ConsenSys is looking to raise funds, with Lubin believed to be the biggest holder of eth.
The cited January figures also make it unclear whether whatever document was leaked is the latest version or otherwise.
At a valuation of $1 billion, then presumably at least 20% of ConsenSys would have to go to VCs for $200 million, while at the January peak it might have been far less.
What their expenses are is unclear, but one unnamed source said the valuation of $1 billion is too high given the company’s revenue and expenses.
Meaning this was leaked by VCs, with it unclear why they decided to go public save for perhaps as some sort of negotiation tactic.