They are building infrastructure. My guess is that there is valuation based on what they think it might be worth but what it will cost for them to get it up and running.
If it works 21million is going to be seen as nothing.
If it works 21million is going to be seen as nothing.
I know gmaxwell at least is ridiculously smart. I get the feeling this is a powerhouse founding team, huge group of talent, huge pile of cash. Part of me wants to be in on that team.
The part about AirBnB I really enjoyed. Because at first I thought, I bet they are all working remote and doing whatever on their individual projects. It sounds like a large diverse team which really needed to get co-located if they wanted to get real... and they did. Ultimately, there is no current replacement to actually physically moving everyone to someplace.
I have no idea why SF, but I imagine someone(s) in the early group were already reasonably near there. But I would be surprised if blockstream.com needed the SF tech force. They may have just the right number of people right now. That approach would give them some incredible runway, but so many investors need faster ROI. $21M is a huge, massive commitment.
I guess the missing piece is valuation. What percentage, or implied percentage range, or whatever, of the company do you get for $21M? How do you even put together a model for a $21M seed round? Maybe a Seed Round this large is basically a long-term bet on this group to make great things. I assume there are no-strings-attached, and this is people with Bitcoin who want Bitcoin to the valuable. It takes a lot of work to keep a currency running!
What's Blockstream's revenue model Do the the investors hold any BTC? Is their goal to increase the value of BTC, or is it BTC price neutral? Blockstream succeeds with Bitcoin succeeding (the Bitcoin P2P Protocol, its infra). But the 'payment' and 'asset' portion of Bitcoin could be excess baggage which governments hate too much. There could be better uses of Blockstream's time beyond currency applications. I mean, there are many features you can build that wouldn't increase demand for units of 'satoshi'. Then again, it's a common refrain, if you own many BTC then invest in Bitcoin. Better software should result in broader adoption. But there's nothing inherent about a cryptocurrency that the bits should cost anything. So I'd assume there's some revenue model.
Another perspective: Ultimately the price of a Bitcoin will fall to the amount necessary to anti-DDoS. There can be no price beyond anti-DDoS because there is no more utility than exactly that. Bitcoin as a currency will be a ridiculously failed experiment, because why would you hold $$$ inside some bits? The scarce bits are just to prevent DDoS and properly distribute access. You shouldn't need to pay money for something like that, unless you are speculation. Speculation can exist, fine, put it on its own chain.