‘AWS for blockchain’ Alchemy boosts valuation to $3.5B with $250M increase • TechCrunch

Precisely six months after raising $80 million at a $505 million valuation, blockchain and Web3 growth SaaS startup Alchemy has raised $250 million in a Sequence C funding spherical that values the corporate at $3.5 billion.

Andreessen Horowitz (a16z) led the financing, which was extraordinarily aggressive with various massive enterprise corporations clamoring to not solely again the corporate, however lead the funding, in response to sources acquainted with the transaction. 

In addition to the truth that Alchemy elevated its valuation by a staggering 7x over a six-month interval (that’s a achieve of greater than $500 million in worth per thirty days), the spherical is notable for a number of different causes. For one, it represents one in every of a16z’s largest Web3/blockchain investments so far. In June, the agency revealed its $2.2 billion crypto fund, illustrating its severe dedication to the house. (For the unacquainted, Web3 refers to a set of protocols led by blockchain, that intends to reinvent how the Web is wired within the backend).

What’s additionally fascinating is that Alchemy has managed to realize one thing that is still elusive for many startups: profitability.

In response to CEO and co-founder Nikil Viswanathan, the corporate is in truth “very worthwhile.” It turned that nook over the previous few months, he mentioned, as demand for its providing has exploded and income grew 15x since its final increase in April. The startup has been doing so properly that it hasn’t even touched the $80 million it raised in its Sequence B, in response to Alchemy CTO and co-founder Joe Lau.

“All that cash continues to be within the financial institution,” he mentioned. “We didn’t want the cash however we noticed the worth in bringing on nice companions, resembling Andreessen, which has an unbelievable group with deep technical experience within the blockchain house.”

Put merely, Alchemy desires to do for blockchain and Web3 what AWS (Amazon Internet Providers) did for the web. ​​The startup’s aim is to be the beginning place for builders contemplating constructing a product on high of a blockchain or mainstream blockchain purposes. Its developer device goals to take away the complexity and prices of constructing infrastructure whereas enhancing purposes via “vital” developer instruments. It launched its providing in August of 2020.

Right this moment, Alchemy powers a variety of transactions throughout practically each blockchain vertical, together with monetary establishments, exchanges, billion-dollar decentralized finance tasks and multinational organizations resembling UNICEF. It has additionally rapidly turn into the know-how behind each main NFT platform, together with MakersPlace, OpenSea, Nifty Gateway, SuperRare and CryptoPunks. Different prospects embrace Dapper Labs, Axie Infinity, Fortune 500s constructing on blockchain such because the not too long ago signed Adobe, PricewaterhouseCoopers. It additionally serves “nearly all of DeFi.”

Alchemy powers over $45 billion in transaction quantity for firms across the globe. That’s up from $30 billion on the time of its April increase. Since then, the corporate has additionally expanded the variety of blockchains that it powers. 

“Our platform was kind of on Ethereum, however we’ve seen a variety of demand and have since expanded to incorporate Polygon, Arbitrum, Optimism and Move,” Lau mentioned. 

Picture Credit: Alchemy

Alchemy has additionally seen a variety of new builders, famous Viswanathan

“We’ve had many extra groups and corporations be part of Alchemy, and extra builders per group or per firm are utilizing our platform,” he added. “So we’re seeing development throughout all axes.”

Regardless of its explosive development, Alchemy stays a lean group. It at present has 27 staff. It’s primarily based in San Francisco, with an workplace in New York and distant staff globally.

The corporate plans to make use of its new capital largely to put money into constructing a group round blockchain. Alchemy began on the proper time, within the execs’ view — in 2017 when the market was tiny and plenty of nonetheless doubted the chance within the house.

“Our final aim is to convey the promise of blockchain to life,” Lau mentioned. “We wish to fulfill its potential by creating extra assets for builders to return into the house and extra successfully and extra rapidly construct blockchain merchandise.”

Viswanathan believes Alchemy is taking part in a vital function within the latest surge and recognition of blockchain.

“As blockchain has been rising, not solely has Alchemy grown, however we have now helped the blockchain ecosystem develop as a result of,” he advised TechCrunch. “It’s this type of virtuous cycle — the extra we offer higher tooling, the better it’s for builders to construct merchandise, after which extra customers come, so then extra builders come and we make the tooling higher, and so forth and so forth. So we like to consider ourselves as serving to spin that flywheel.”

Picture Credit: Alchemy

Ali Yahya, basic companion at Andreessen Horowitz (16z), described Alchemy as “a key driver” of the expansion of blockchain and Web3, and mentioned the startup is already “the de facto developer platform” for Web3.

“Simply as Microsoft and AWS constructed platforms that powered the pc and web industries, Alchemy’s platform permits builders to construct blockchain merchandise utilized by tens of millions globally,” he wrote by way of electronic mail, including that Alchemy’s development throughout all related metrics has been “staggering.”

Google chairman and former Stanford College President John L. Hennessy — who invested within the firm’s final spherical — echoed Yahya’s sentiments. However he additionally made one other, noteworthy comparability:

“Alchemy is powering the expansion of the blockchain business the identical approach Amazon Internet Providers did for the cloud,” he wrote by way of e-mail. “The joy about their know-how jogs my memory of the early days of Google.”

The Sequence C financing additionally included participation from new traders Lightspeed Enterprise Companions and Redpoint. Current backers Coatue, Lee Fixel’s Addition, DFJ and Pantera Capital doubled down on their investments in Alchemy, which has now raised about $345 million in complete since its 2017 inception.

Different earlier traders within the firm include the Chainsmokers’ Mantis, actor Jared Leto and the Glazer household (homeowners of the Tampa Bay Buccaneers and Manchester United), Yahoo co-founder and former CEO Jerry Yang, Coinbase, SignalFire, Samsung, Stanford College, Charles Schwab, LinkedIn co-founder Reid Hoffman and others.

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