What is web3?
An English computer scientist born in 1980, a guy named Gavin Wood, coined the term "Web 3.0" in 2014, a few years after the last Web 2.0 Summit that had ran from 2004 - 2011. The term morphed into web3 and spread like a California wildfire. As it spread it's developed many meanings to many different people but the overarching theme is that it's supposed to be a new internet with protocols and technologies that eliminate middlemen and protect freedom for businesses and consumers. Bitcoin launched in 2008 as a response to the financial meltdown, web3 has risen largely in response to monopoly gatekeepers like Amazon, Google, Facebook, Apple and Microsoft that control how we interact and transact with each other in the digital realm.
Mr. Wood is credible in the web3 space because he cofounded the ethereum blockchain and served as CTO of the Ethereum Foundation for two years. He's an accomplished academic and computer scientist, with a PhD in human computer interaction and he served as a research consultant for Microsoft for four years. Wood went on to make another cryptocurrency called Polkadot which brands itself as a "multichain vision of Web3". Mr. Wood also founded an organization called the web3 foundation that provides grants and research for crypto projects. He also started a London-based business called Parity Technologies that provides consulting services and software to other businesses, especially business that consider themselves to be a part of the web3 future.
In case you really want to get in the weeds, below is a slide shared by Stanford grad Juan Benet in a conference talk called what exactly is web3 (2018) that's shared on the web3 foundation's about page. If you're new to the space most of these terms are completely meaningless but to me it's notable that the inventors of the web 3.0 view the technology they're building, Polkadot as foundational to the whole vision and ecosystem.
Mr. Benet, who founded and runs a business called Protocol Labs which claims to drive "breakthroughs in computing to push humanity forward". From the talk and Gavin Wood's original essay why we need web 3.0 it's clear that the originators view web3 in social and political terms not just technological ones.
Where did web3 come from?
Much of this will be paraphrasing from Mr. Benet's talk describing what web3 is. At the time of giving the talk Mr. Benet's company had recently gone through an Initial Coin Offering (ICO) worth nearly $8 million from institutional venture capitalists like andreessen horowitz, sequoia capital, Winklevoss Capital and union square ventures.
From the web3 perspective web 3.0 is a phase transition with the internet. Over the past eighty years our species has moved from a pre to a post computing society. We've grown up with the internet, phase transitions are happening very fast decade after decade.
Human society has moved from mainframes to personal computers to using Graphical User Interfaces (GUI) to being networked with the internet then the world wide web. Since the turn of the century there has been Web 2.0, a mobile revolution, the development of blockchains and now the latest in this series of evolutions is web 3.0. Web3 proponents assert that web3 is the most recent wave of technological progress.
One thing to note that Mr. Benet calls out in his talk is that the superpowers of technology are defined and constrained by the properties of those technologies. Properties of software systems include: how they work, how reliable, how correct, how fast, how open, how accessible, how safe, how they fail, who controls them and how they're governed. Technology isn't something that pops up out of nowhere it has properties determined by the society we live in. Only a minority of people know how to build software systems but they affect a lot of people.
Internet - wires, networks and connectivity protocols
The internet protocol (IP) was first introduced in 1974 more than a decade before the World Wide Web. This internet provided physical wiring and network protocols for machines to talk to each other. It was primarily for academic and military use and heavily backed and subsidized by American military defense spending. This innovation started in the 1960s and 1970s resulting in messaging boards, chat and email.
World Wide Web - commercial adoption and explosive growth of the internet
Internet opened for commercial use in the 1990s. This is noteworthy because it took decades for the protocols to be standardized and the technology to progress to the point where widespread commercial use was possible. Those decades of research were largely funded by the American government. Marc Andreesen built the Mosaic web browser as one of the first graphical user interfaces for the world wide web. Microsoft later killed Netscape Navigator during this "web 1.0" era by bundling Internet Explorer with their computers for free. There was huge euphoria and mania about the potential for the world wide web followed by the immensely destructive dot com crash.
Globalization as an economic and political philosophy was at it's height during the 90s and the internet was seen be ushering in a "global village". According to Tim Berners-Lee who invented the internet the democratic potential of the network was aparent right away.
During this early internet era standards and protocols were invented and/or built upon like HTTP, IP, DNS, TCP and Internet Service Providers.
The World Wide Web consortium is an organization of businesses and developers that kept the web together as one instead of fracturing or being taken over by a company or government. Tim Berners-Lee and took care of his baby and during this time.
Web 2.0 - the network is a platform: users add value
What I find most interesting about the "Web 2.0" movement is that it mostly came true. Not only that but a similar transition happened to America during the early 19th century Gilded Age too. There was a flourishing of new technologies like combustion engines, railroads and telephone lines that ended up being consolidated in the hands of a few major trusts like Standard Oil, AT&T and railroad companies being broken up by antitrust lawsuits, legislation and executive action. Capitalists consolidated using the power of network economics. When they got too big and powerful the government stepped in to decentralize power out of their hands.
Web 2.0 is shares a similar trajectory with the trusts of the previous century. In the words of Tim O'Reiley the cardinal rule of Web 2.0 is the network is a platform: users add value. Within this definition it's clear that the Web 2.0 was defined by flywheels and networks. The winners of the Web 2.0 built products that got better as more people used them. As the marketplaces got better network affects took over and we ended up with winner take all marketplaces like Amazon, Facebook, Apple, Uber and Airbnb. The speakers at the first San Francisco Web 2.0 conference in 2004 remain today's titans of industry: Jeff Bezos, Mark Cuban, John Doerr, Mary Meeker, Craig Newmark, Marc Andreessen, Cory Doctorow, Bill Gross, Lawrence Lessig, Halsey Minor, Louis Monier and Jerry Yang. Web 2.0 was defined by building platforms with network affects that ultimately consolidated power in the hands of a few companies. Web 2.0 emphasized network and platform economics.
A central feature to dominate a market via networks and a platform is predatory or below cost pricing. One suprising feature of the Web 2.0 era is the government stood idly by or even assisted monopolists in rolling up their industries. The government bank bailouts of 2008 are the most well known example of government propping up the powerful but there are other tech examples too. For instance Amazon used its market power in the e-reader market to price below cost and chase out rivals like Apple, Sony, Barnes & Noble and Google. During the Bush administration there were exactly zero antitrust cases and no blocked mergers. This allowed winners in one area to win in other areas simply by buying competitors or companies that could emerge as competitors.
For example, Facebook won in desktop social networking and then they were able to win in mobile social networking buy buying Instagram. After winning in those sectors they were able to buy Occulus the leader in virtual reality. The Federal Trade Commission (FTC) miraculously managed to rule that these market forming plays were not threats to competition in America. Without innovating Facebook was able to gobble up multiple markets.
This phenomenon of companies buying their competition, therefore not having to innovate or compete was a central feature of Web 2.0 and is by no means unique to Facebook.
Amazon won in online book sales and has then was able to acquire hundreds of companies, consolidating dozens of markets. How Amazon did this and escaped government scrutiny is outlined in great detail by current FTC commissioner Lina Khan's detailed work Amazon’s Antitrust Paradox. If you're interested in learning more about the current state of the web and corporate consolidation in the internet era I highly recommend it!
Google won in online search and then was able to acquire Android and YouTube to win market-share in mobile and video, in addition to buying DoubleClick consolidating the online advertising industry.
Microsoft bought LinkedIn and GitHub among dozens of other startups that could have emerged as threats.
In all of the above cases an enfeebeled FTC and American government stood by to let capitalists consolidate our once competitive markets. A central feature of the web3 movement is around building an alternative to this paradigm in conjunction with a lack of faith in government to solve structural market problems.
Problems with Web 2.0
A clear reason for a web3 is to address problems that Web 2.0 has created. While reasonable minds can disagree on the solutions laying out the problems with the current internet economy should be pretty easy: Many industries are controlled by a small handful of corporations. Those corporations are able to buy hundreds of lobbyists to influence government on any action that might hurt them. Users suffer from data lock in and lack of privacy. There are structural incentives for companies to monopolize data and "rent seek" instead of creating new value. Our internet economy is largely controlled by middlemen. The advertising model exists to keep people engaged and keep them on sites, anger drives some of the best engagement so companies are incentived to keep us angrily looking at our phones. We live in a fantastic time and technology makes our lives pretty awesome but there is, shall we say, room for improvement in the current system. In the words of Mr. Gavin Wood in his post about why we need web3 he says the internet today is "broken by design".
With so much of the world’s data channelled through so few cables, the inconvenient truth is that unless we put in place open software protocols, our increasingly digital society will continue to be at risk from malicious “authorities” both within society and (as in the case Russian tampering of our elections) from outside.
Here Mr. Wood outlines that corporate consolidation is a problem, though he defines the solution as open software protocols, leading us to...
Web 3.0 - turning centralized apps into decentralized protocols
Instead of relying on government antitrust enforcement, common carrier laws or the courts, Web3 seeks to solve the internet economy's problems by changing technology itself. Mr. Wood argues "Centralization is not socially tenable long-term, and government is too clumsy to fix things". We have centralized corporate power and controlling our lives and Mr. Wood does not believe govenment is capable of standing up to these powers and setting things right. Instead the web3 movement is built around the idea that new technology, apps and protocols can be built with verifiability, peer to peer connectivity and no centralized powers.
Some common themes and terms you'll hear with web3 projects revolve around trust. Rather than simply trust that Amazon Web Services (AWS) isn't going to cannabilize your business web3 companies aim to depend on protocols and technologies that everyone can depend on but no one needs to trust anyone. I'm not entirely sure when fear of trusting people became such a huge motivator of technological progress but here we are. These are come central tenets of web3:
trustless and decentralized infrastructure: In a web3 world adherents want to be able to use and trust things without worrying businesses or technologies might turn against you. AWS using your data to undermine your business or gain unfair advantage is a current fear many Web 2.0 companies share. One way web3 is looking to mitigate this in through decentralized computing and trustless interoperability. Decentralized computing in the context of web3 means no one entirely owns the servers your applications run on. Instead new technologies and protocol allocate server space based on proof of stake or proof of work models. Trustless interoperability comes from new network protocols like Polkadot that provide a system where theoretically anyone can plug into them. A key piece that makes decentralized computing and new protocols possible is the rise of "fully autonomous applications". These are technologies that run whether or not you're there to run them in the future. No system in the past has had this property. All systems in the past had to be maintained by some organization, some group of people that cared about continuing to run this thing. The reason it is possible now is through "very strong economic incentives" where computers collect and mine tokens for running.
removing intermediaries: Related to lack of trust is removing middlemen from our economic systems. In economic terms middlemen are often called "rent seekers" and generally can extract value from those that produce or supply goods that people need. Not having to trust that some party is not going to become a rent seeker is a driving force in the development of web3. Many web3 companies will talk about peer to peer (P2P) connectivity, which ironically enough was a central feature of web 1.0 where people connected directly through sites like Napster, Kazaa and Craigslist.
giving users power and ownership over their identity, security and transactions: This focus on verifiability, transactions and immutability comes from blockchain transactions. NFTs are an offshoot of this. I think a lot of it is in response to Facebook and Google routinely mining their users for data. Web3 as a concept aims to give individuals more control of and visibility into their data so that if a company claims to not be sharing your data you can verify that using blockchain technology. Bitcoin is a completely separate technology from the internet but it reminded people about the power of peer to peer connectivity. Web3 adherents believe that web3 is taking what bitcoin did to money and performing the same transformation to other segments of our society.
Combined these tenets: 1) trustless, decentralized web infrastructure 2) immutable transactions via blockchain and 3) removing rent seeking middlemen ake up the core of what web3 aspires to be. In the words of Mr. Wood and Mr. Benet Web 3.0 is "turning centralized apps into decentralized protocols". They see web3 as building verifiability and trustless computing into the core layer of the internet, opening new possibilities for societies and business.
Now that we've covered the theory about what web3 is let's examine the businesses building web3 today.
What are web3 companies?
Web3 companies are businesses or organizations that are working towards the tenets outlined above. Often they're building protocols, currencies or services that aim to allow people to interact in different ways. Many web3 companies are exchanges or marketplaces that provide easy to use UIs for people to interact with blockchains and/or tokens. NFT, standing for Non Fungible Token is a buzzword we will see a lot.
Number of web3 companies
In the Employbl database we currently have 333 Web3 companies that are headquartered in the United States, though in coming weeks we'll be adding more. On this site we focus on U.S. based companies so don't exclude foreign web3 companies like FTX even though it's founded by an American that's spending billions of dollars to influence American politics it's still headquartered overseas.
Top funded web3 companies
From our list, these are the top web3 and top crypto companies that have raised the most money from financiers. This includes traditional venture funding rounds like Seed and Series A but also money raised from Initial Coin Offerings. We only list companies that are not public and haven't been acquired by other companies at the time of publication.
|Company Name||HQ City||HQ State||Year Founded||Total Investment Amount||Company Description|
|NYDIG||New York||NY||2017||$1,404,999,936||NYDIG is a technology and financial services firm dedicated to Bitcoin for institutions, private clients, and banks. The firm offers asset management, derivatives, financing, custody, and execution services. NYDIG's platform satisfies the highest regulatory, audit, and governance standards.|
|Digital Currency Group||New York||NY||2015||$1,300,000,000||We build and support bitcoin and blockchain companies by leveraging our insights, network, and access to capital.|
|BlockFi||Jersey City||NJ||2017||$1,256,181,632||BlockFi provides the wealth management products crypto investors need, all powered by blockchain technology.|
|Circle||Boston||MA||2013||$1,111,000,064||Circle helps businesses and developers harness the power of stablecoins for payments and internet commerce worldwide.|
|Fireblocks||New York||NY||2018||$1,039,000,000||Securing digital assets in motion. Helping 180+ of the biggest financial institutions securely transfer digital assets.|
|ConsenSys||New York||NY||2014||$725,000,000||ConsenSys is a blockchain software technology company founded by Joseph Lubin with headquarters in Brooklyn, New York and additional United States offices in Washington, D.C. and San Francisco.|
|MoonPay||Miami||FL||2018||$642,000,000||MoonPay is a financial technology company that builds payments infrastructure for crypto. Our on-and-off-ramp suite of products provides a seamless experience for converting between fiat currencies and cryptocurrencies using all major payment methods including debit and credit card, local bank transfers, Apple Pay, Google Pay, and Samsung Pay. MoonPay is active in more than 160 countries and is trusted by 250+ leading wallets, websites, and applications to accept payments and defeat fraud.|
|Alchemy||San Francisco||CA||2017||$563,903,680||Alchemy provides the leading blockchain development platform powering millions of users in 197 countries worldwide.|
|Paxos||New York||NY||2012||$538,477,888||Paxos is a regulated financial institution building infrastructure to enable movement between physical and digital assets. The company takes a two-pronged approach of establishing regulatory designations that give it access to the current financial infrastructure and the ability to develop innovative products. This allows Paxos to operate as a gateway between traditional finance and the digital future. Paxos was founded in 2012 and headquartered in New York, United States.|
|Chainalysis||New York||NY||2014||$536,600,000||About Chainalysis provides blockchain data and analysis to government agencies, banks, and businesses around the world. Our compliance and investigation tools, education, and support help our customers understand what’s happening on blockchains.|
|Blockchain.com||Miami||FL||2011||$490,000,000||Blockchain.com is connecting the world to the future of finance. We are the most trusted and fastest growing crypto company, helping millions across the globe - from single individuals to the largest institutions - have an easy and safe way to buy, sell and store cryptocurrency.|
|Anchorage Digital||San Francisco||CA||2017||$487,000,000||Anchorage Digital is a digital asset platform and infrastructure provider that deals in the holding, investing, and infrastructure for cryptocurrency and cryptocurrency products. It has the first federally chartered cryptocurrency bank, receiving approval from the Office of the Comptroller of the Currency in 2021.|
|FalconX||San Mateo||CA||2018||$476,999,936||FalconX is a cryptocurrency brokerage and digital asset trading platform. It specializes in the fields of blockchain, cryptocurrency, and fintech. Its platform provides reliable execution using data science to eliminate slippage and hidden fees. It was founded in 2018 and is based in San Mateo, California.|
|Yuga Labs||Miami||FL||2021||$450,000,000||Yuga Labs is a blockchain technology company that develops NFTs and digital collectibles. It specializes in the fields of blockchain, cryptocurrency, and digital media. Yuga Labs was founded in 2021 by Wylie Aronow and Greg Solano and headquartered in Miami, Florida.|
|Gemini||New York||NY||2014||$423,903,072||Gemini is a next generation cryptocurrency exchange and custodian that allows customers to buy, sell, and store crypto.|
|Blockdaemon||Los Angeles||CA||2017||$398,230,016||Blockdaemon Inc. provides solutions. The Company offers multi-chain multi-cloud network management tool for public and private organization, mining algorithm, and contract customization. Blockdaemon serves customers in the United States.|
|Public.com||New York||NY||2019||$308,500,000||Public makes the stock market social. Discover companies to believe in and invest with any amount of money.|
|Ripple||San Francisco||CA||2012||$293,800,000||Ripple Labs, Inc. is an American technology company which develops the Ripple payment protocol and exchange network. Originally named Opencoin and renamed Ripple Labs in 2015, the company was founded in 2012 and is based in San Francisco, California.|
|AVA Labs||Brooklyn||NY||2018||$290,049,984||Building Avalanche. We are empowering people to build an open, simple, and democratic internet of finance.|
|TaxBit||Draper||UT||2018||$235,750,000||TaxBit is a cryptocurrency tax and accounting software that automates tax calculations and reporting on cryptocurrency transactions. With TaxBit, users can link their exchanges and wallets to seamlessly pull their transactions through their tax engine and auto-generate tax forms. Aside from automating taxes, TaxBit provides crypto enthusiasts real-time portfolio tracking and tax optimization visibility so that they can make tax-optimized crypto trades throughout the year. TaxBit connects the consumer and enterprise cryptocurrency tax experiences.|
|Republic||New York||NY||2016||$214,024,992||Republic's mission is to democratize investing. Irrespective of your net worth, making an investment is casting a vote for the technology or change you want to see in the future. Angel investing - hunting for a unicorn - was previously available to only the wealthiest 3% of the US population. With Republic, everyone can invest in private startups for a chance to earn a return.|
|Lukka||New York||NY||2014||$201,300,000||Lukka is a team of top-performing data experts that are transforming post-trade blockchain data into easy-to-use information for business operations. Lukka is the first back-office crypto-focused technology company to receive AICPA SOC 1 Type 2 and SOC 2 Type 2 certifications. Lukka has built software for managing crypto assets that is built on infrastructure made for the complexities of an ecosystem consisting of thousands of blockchains.|
|Binance Exchange||San Francisco||CA||2019||$200,000,000||Buy & sell over 50 cryptocurrencies with low fees, dedicated support, and top-ranked security. #EducateDontIntimidate|
|TERAWULF||Easton||MD||2021||$200,000,000||TeraWulf promises a new paradigm for crypto mining in the future, producing domestic bitcoin using over 90% zero-carbon energy.|
|1inch||Moon||VA||2020||$189,800,000||Biggest and best DeFi liquidity & lending aggregation protocol.|
|Zero Hash||Chicago||IL||2015||$169,850,000||Post-trade settlement, risk management, and regulatory compliance for digital assets|
|HashCash Consultants||Palo Alto||CA||2015||$150,000,000||About HashCash enables enterprises to move assets and settle payments across borders in real-time using Blockchain technology. HashCash has 100+ enterprises using its products in 26 countries. HashCash enables enterprises to move assets and settle payments across borders in real-time using Blockchain technology. HashCash has 100+ enterprises using its products in 26 countries. Products HC Remit, HC Corporate Payment, HC Market Maker, HC Commerce, PayBito, Billbitcoins, ICO, Utility Coin Offering, White Label Crryptocurrency Exchange Software and more.|
|ITrustCapital||Los Angeles||CA||2018||$128,000,000||Helping investors access their favorite Crypto Assets within their IRA|
|Algorand||Boston||MA||2017||$126,000,000||Algorand, LLC provides software solutions. The Company designs and develops digital currency and transactions platform to address the blockchain scaling challenges. Algorand offers its services in the United States.|
|Braintrust||San Francisco||CA||2018||$123,500,000||Braintrust is the first user-controlled talent network which aligns the interests of both talent and enterprises.|
|CoinList||San Francisco||CA||2017||$119,200,000||Where early adopters invest in and trade the best digital assets|
|Phantom||San Francisco||CA||2021||$118,000,000||Phantom is a digital wallet reimagined for DeFi and NFTs. Phantom makes it safe & easy for you to store, send, receive, stake, and swap tokens on the Solana blockchain. It was founded in 2021 and is based in San Francisco, California.|
|0x||San Francisco||CA||2016||$108,999,960||0x is an open protocol that facilitates low friction peer-to-peer exchange of tokens on the Ethereum blockchain.|
|MobileCoin||San Francisco||CA||2018||$107,350,000||MobileCoin is the first carbon-negative cryptocurrency. It's designed to be used as digital cash on your phone. Our secure payment system is easy to use with near-instantaneous transactions. Our team holds a wealth of expertise in cryptography, mobile, and telecom, with the founder of Signal as an advisor.|
new web3 companies
These are the most recently founded, venture backed web3 companies on our list. They're all headquartered in the United States. To explore all the data with company logos, investment information and more feel free to log in to the Employbl dashboard. It don't cost a thing.
|Company Name||Latest Funding Round||Total Investment Amount||Year Founded||HQ City||HQ State||Company Description|
|Tonic||Seed||$5,000,000||2022||Miami||FL||Tonic is building a permissionless decentralized protocol for fast and seamless trading of any asset on NEAR and Aurora. The platform will enable developers building on NEAR’s Layer 1 solution to integrate trading functionality into their applications.|
|Yuga Labs||Seed||$450,000,000||2021||Miami||FL||Yuga Labs is a blockchain technology company that develops NFTs and digital collectibles. It specializes in the fields of blockchain, cryptocurrency, and digital media. Yuga Labs was founded in 2021 by Wylie Aronow and Greg Solano and headquartered in Miami, Florida.|
|TERAWULF||Private Equity||$200,000,000||2021||Easton||MD||TeraWulf promises a new paradigm for crypto mining in the future, producing domestic bitcoin using over 90% zero-carbon energy.|
|Phantom||Series B||$118,000,000||2021||San Francisco||CA||Phantom is a digital wallet reimagined for DeFi and NFTs. Phantom makes it safe & easy for you to store, send, receive, stake, and swap tokens on the Solana blockchain. It was founded in 2021 and is based in San Francisco, California.|
|BlockMetrix||Debt Financing||$89,882,000||2021||Dallas||TX||Blockmetrix is a Bitcoin mining company that coveted direct relationships with mining equipment manufacturers. The company was founded in 2021 and is headquartered in Dallas, Texas, United States.|
|OneOf||Seed||$63,000,000||2021||Miami||FL||OneOf is a new green NFT platform built specifically for the music community.|
|Domain Money||Series Unknown||$55,000,000||2021||New York||NY||A seamless and secure platform to invest in both stocks and cryptocurrencies. Earn interest on your assets, borrow against them and spend with a cryptocurrency rewards credit card - all in one place.|
|Recur||Series A||$55,000,000||2021||Miami||FL||Recur design & develop on-chain branded experiences for fans to buy, collect, and re-sell NFTs. RECUR is chain agnostic and is fundamentally changing the NFT market by creating and setting the standard for a decentralized recurring royalty, creating the widest distribution and reach for NFTs minted on their platform. It was founded in 2021 and headquartered in Miami, Florida.|
|Mysten Labs||Series A||$36,000,000||2021||San Francisco||CA||Mysten Labs creates foundational infrastructure to accelerate the adoption of web3.|
|FlyCoin||Seed||$33,000,000||2021||Pomona||CA||FlyCoin is a cryptocurrency-based travel rewards technology company. FlyCoin represents the evolution of loyalty programs where the Company has applied the principles of cryptocurrency and blockchain to create a new kind of loyalty program that is free from the limitations of today's programs.|
|Palm NFT Studio||Series B||$27,000,000||2021||Dover||DE||Palm NFT Studio is a collective of entertainment, technology, cryptoart and art industry leaders set up to on-ramp artists, creators and rights owners who want to establish NFT marketplaces and next-generation creative works on Palm.|
|XMTP||Series A||$25,000,000||2021||Austin||TX||XMTP is an open, crypto-native communication protocol that connects communities, applications, and users. It was founded in 2021 and is based in Austin, Texas.|
|Forta Protocol||Series Unknown||$23,000,000||2021||Walnut||CA||Forta is a neat project that comes at an interesting point for the larger blockchain community. When bitcoin came to market, it attracted interest as a potential medium of exchange, or perhaps a store of value. The latter use case wound up being the key bitcoin value offering. But while bitcoin was maturing, other blockchains were built that featured more native programmability, allowing developers around the world to leverage smart (self-executing) contracts for a host of use cases.|
|ReclaimIQ||Series Unknown||$21,656,220||2021||San Francisco||CA||ReclaimIQ is an online service that helps people reclaim their money without the hassle. The company is based in San Francisco, California.|
|BetDEX||Seed||$21,000,000||2021||New York||NY||BetDEX is the decentralized sports betting protocol. BetDEX delivers high speeds and low transaction costs while eliminating counterparty risk. BetDEX is a permissionless protocol allowing anyone to build their own applications on top.|
|MineOne||Series A||$20,000,000||2021||New York||NY||MineOne is one of the first cryptocurrency mining investment company.|
|Mojito||Seed||$20,000,000||2021||Boston||MA||Mojito is an NFT studio and tech platform company that designs, powers, and operates NFT marketplaces for industry leading brands and IP holders.|
|CapiTrade Ventures||Pre Seed||$20,000,000||2021||Atlanta||GA||Capitrade Launchpad is a decentralized cross-chain fundraising platform that allows early blockchain projects to raise funds. Capitrade empowers blockchain startups projects to raise liquidity in a fair and decentralized manner.|
|Thetanuts Finance||Seed||$18,000,000||2021||Williamsburg||VA||Thetanuts Finance's DeFi structured products and its customizable vaults are the future of generating yield. The platform is designed to provide treasury management for DAOs, as well as help retail traders earn yield on their tokens. Thetanuts' vaults simplify the process of options trading, making previously complex instruments easy for any investor to access, empowering users to monetize volatility in a risk-adjusted manner.|
|Rift Finance||Series Unknown||$18,000,000||2021||New York||NY||Rift Finance is a decentralized protocol that supercharges DAO growth through restructured incentive frameworks. Rift allows DAOs to deploy governance tokens from their treasuries to deepen token liquidity without having to give up ownership.|
|Earnity||Series A||$15,000,000||2021||San Mateo||CA||Earnity is a global group of dedicated fintech veterans who believe that managing cryptocurrency should be lot easier.|
|Proof Of Learn||Seed||$15,000,000||2021||New York||NY||Proof of Learn (POL), a Web3 education platform with a mission to unlock accessible, high quality education across the world through blockchain and a learn-to-earn protocol. The company’s vision is to ensure that anyone with an internet connection can gain a world-class online education, as well as direct access to income earning opportunities and employment. With a focus on addressing the skills shortage experienced by the Web3 economy, the platform will facilitate learning in the metaverse with cryptocurrency rewards and collectible NFT credentials earned as on-chain representation of skills advancement.|
|Kyro Digital||Series A||$14,417,525||2021||Woodside||NY||Kyro is the first native Web3 builder, and software-as-a-service platform for crypto marketplaces.|
|Burnt Finance||Series A||$14,000,000||2021||New York||NY||Burnt Finance is a decentralized auction protocol to enable fast and seamless auctions for a diverse array of assets. It provides an intuitive interface for minting new assets. These assets can be synthetics, NFTs, and even new digital assets. In less than a few minutes a user can mint a new asset and set up an entirely decentralized auction. Burnt allows users to customize their auctions which allows asset minting and trading to take place in a completely permissionless ecosystem. It is based in Solana Beach, California.|
|Kyve||Series Unknown||$12,800,000||2021||KYVE is an initiative to store any data stream, with built-in validation. By leveraging the Arweave blockchain. The network is powered by decentralized uploaders and validators. These nodes reside in pools, each pool focusing on archiving a specific data stream. Pools are funded by KYVE tokens.|
|AgoraLV||Seed||$12,300,000||2021||Chicago||IL||As the first collegiate athlete to launch his own NFT series in April 2021, Luka Garza demonstrated how a new asset class and income stream could be utilized to fund collegiate NIL. Since then, AGORALV was formed to redefine collegiate NIL through NFTs, prescriptive endorsements, and sponsorship while also introducing scientific wellness testing to collegiate athletic teams to optimize individual health and mental wellness.|
|Gear Technologies||Series A||$12,000,000||2021||Wilmington||DE||Gear is the most advanced L2 smart contracts, allowing for anyone to launch any dApp on Polkadot.|
|Cion Digital||Seed||$12,000,000||2021||Austin||TX||Cion Digital’s proprietary Blockchain Orchestration Platform allows institutions to build innovative finance solutions quickly, and to seamlessly connect their legacy systems with the complex and ever-changing world of decentralized finance. We help clients grow and protect revenue opportunities by expanding and integrating their existing financial systems to succeed in the rapidly evolving digital asset economy.|
|Panther Protocol||Product Crowdfunding||$11,300,000||2021||London||KY||Panther Protocol is an interoperable privacy solution focused on the needs of decentralized finance traders and investors.|
|Dinara||Series Unknown||$10,999,989||2021||Brooklyn||NY||Dinara is an enterprise financial services company that specializes in the fields of cryptocurrency and fintech.|
|Ardana||Initial Coin Offering||$10,762,500||2021||London||OH||Ardana is an on-chain asset backed stablecoin protocol and decentralized exchange stable asset liquidity pool built on Cardano. The stablecoin is overcollateralized with on-chain Cardano native assets facilitating borrowing and the decentralized exchange allows for highly capital efficient trading between stablecoins and identical assets with low risk income from fees for liquidity providers.|
|SmartFi||Initial Coin Offering||$10,000,000||2021||Orem||UT||SmartFi is a digital wealth creation platform that provides easy to use financial tools to earn, trade and lend cryptocurrencies.|
|SZNS||Seed||$10,000,000||2021||New York||NY||SZNS is the NFT fragmentation service platform for collectors, curators, and creators. The artists and curators can allow for democratic access to their NFTs, and collectors can begin to own high-value NFTs they could otherwise not afford. SZNS was founded in 2021 and is based in New York, USA.|
|DeHorizon||Seed||$8,500,000||2021||Morgan Hill||CA||With the rapid growth of crypto space, recent developments have greatly facilitated GameFi in going mainstream. ''Play to earn'' is no longer a mere slogan, but has fully come into reality. Regardless of exponential growth, a common defect in GameFi marketplace is lack of a Metaverse Game Ecosystem to develop, connect and support more and more blockchain-based games even built on different chains. We are still in the early stages of the evolution of GameFi. For the next stage, a Metaverse Game Ecosystem is essential to make GameFi go further. That is why DeHorizon comes.|
|Showtime||Seed||$7,600,000||2021||San Francisco||CA||Platform for creators to upload crypto art|
|Afterparty||Seed||$7,000,000||2021||Los Angeles||CA||Afterparty is a technology company behind the new Web3 platform enabling creators to directly monetize and manage NFT collector relationships|
|Cyber||Seed||$6,700,000||2021||New York||NY||Cyber is a metaverse company that lets artist & collectors construct & sell their 3D virtual showrooms for non-fungible tokens(NFTs).|
|Audit Sight||Seed||$6,500,000||2021||Atlanta||GA||Audit Sight uses APIs to access the client’s records, eliminating the tedious process of asking for them and waiting for a recordkeeper to compile and send them.|
|Cyber Manufacture Co||Seed||$6,000,000||2021||Los Angeles||CA||Cyber Manufacture Co is a Narrative-based Web3 platform that aims to transcend the culture by enhancing the human experience of art, fashion, & technology by uniting the physical and digital world. It is leading an NFT project Gama.|
|BENQI Finance||Private Equity||$6,000,000||2021||Newark||NJ||BENQi is built on Avalanche combining elements of defi and tradfi to create a liquidity protocol. BENQi aims to bridge Ethereum, Polkadot, and Binance Smart Chain through Avalanche's subnets by becoming a cross-chain defi.|
|Art Blocks||Series Unknown||$6,000,000||2021||Marfa||TX||Art Blocks allows digital artists to have their work react to alphanumeric figures generated by the Ethereum blockchain. The platform provides artists with an innovative system for user interaction where patrons can send funds to an art installation in order to generate unique yet repeatable reactions from the art. Art Blocks disrupts the world of interactive and generative art creating a transparent revenue source for artists and entities that host and maintain the art projects themselves.|
|Holaplex||Seed||$6,000,000||2021||New York||NY||Holaplex provides independent artists, musicians, and creators with simple, free tools to make and sell NFTs while providing NFT buyers and collectors with over 2,000 stores to discover up-and-coming projects and fast-rising artists. In addition to enabling creators to build their own NFT stores and marketplaces quickly, with no-code, Holaplex leverages and contributes to the NFT protocol Metaplex, which delivers fast, low-cost NFT creation on the Solana blockchain.|
|MomentRanks||Seed||$5,900,000||2021||Atlanta||GA||MomentRanks is the premier nonfungible token (NFT) resource platform, offering analytics and tracking tools for NBA Top Shot collectors. MomentRanks is committed to providing an unmatched user experience, with educational tools that allow even the most inexperienced newcomers to NFTs an opportunity to launch their collecting journey and engage with the NFT community.|
|GamerGains||Seed||$5,800,000||2021||Miami||FL||GamerGains Labs is the first-ever token and cryptocurrency-based play and earn platform serving traditional gamers – a community of hundreds of millions of people around the world that enjoy playing on PCs and consoles such as Xbox and PlayStation. Offering an easy-to-use interface, the innovative platform will allow members to earn crypto with confidence through an automated contest lifecycle, which is impartial, transparent, and features instant payout settlement.|
|Friktion Labs||Series Unknown||$5,500,000||2021||Austin||TX||Friktion Labs is a team of quantitative traders, researchers, and crypto engineers with backgrounds in commodities, treasuries, volatility products, and crypto-assets. The organization has brought on board a group of derivatives traders and market makers in Genesis Trading, Alameda Research, LedgerPrime, QCP Capital, CMS Holdings, Orthogonal Trading, and GSR.|
|MetaLend||Seed||$5,000,000||2021||Santa Monica||CA||MetaLend provider of a bank for NFT digital economy.|
|SOLminer.io||Undisclosed||$4,875,000||2021||Clearwater||FL||SOLminer is a blockchain company that manufactures large-scale modular cryptocurrency mining rigs known as SOLminer Cubes. The SOLminer Cube utilizes patent-pending airflow technology that allows for reliable operation with the only airflow, no need for air conditioning. Using the only airflow allows the system to operate more energy efficiently and allows for operating in a wider range of environments.|
|Niftory||Seed||$4,800,000||2021||Seattle||WA||Niftory develops a blockchain platform designed to support the conversion of digital content into NFTs.|
|NFT Oasis||Series A||$4,400,000||2021||San Francisco||CA||NFT Oasis is a platform for the decentralized creator economy combining non-fungible tokens (NFTs), virtual reality (VR), and decentralized finance (DeFi)|
|Mint Songs||Seed||$4,250,000||2021||Washington D.C.||Mint Songs offers digital music collectibles and helps music artists build vibrant web3 communities with NFTs.|
|HiFi Bridge||Seed||$4,000,000||2021||New York||NY||HiFi Bridge is a financial platform that allows customers to buy and sell cryptocurrencies, trade NFT's, borrow loans, and connect their bank accounts all-in-one. The startup offers equity, cryptocurrency, and options trading, as well as cash management accounts. The company provides the accessibility for traditional financial users to gain access to modern decentralized finance tools through it's mobile and web platform. Zach Walsh and Mohamed Afifi founded the company in New York City in 2021.|
|Hawku||Seed||$4,000,000||2021||San Francisco||CA||http://hawku.com is building the marketplace for utility and gaming NFTs. Currently Hawku provides listings, sales and data for Zed horses.|
|Juried Protocol Galleries||Seed||$3,800,000||2021||Lewes||DE||Juried Protocol Galleries is a registry-based protocol that focuses on NFT curation and brings collectors, curators, and artists together. The company was founded in 2021 and is headquartered in Lewes, Delaware, United States.|
|Nft42||Seed||$3,660,000||2021||Cheyenne||WY||Non-fungible tokens (NFTs) should live and entertain forever. That’s where nft42 comes in.|
|Hyype||Seed||$3,500,000||2021||Nashville||TN||Hyy.pe is an NFT display and gallery-based social network where NFT communities will find a home to connect, share stories, and collaboratively build their history.|
|Risk Harbor||Seed||$3,500,000||2021||San Francisco||CA||Risk Harbor is a risk management marketplace for decentralized finance (DeFi) that utilizes a completely automated, transparent, and impartial claims process to protect liquidity providers and stakers against smart contract hacks and attacks. Our mission is to secure the world’s transition to decentralized financial services by removing the need for trusted intermediaries, thereby creating a truly permissionless and open financial system accessible to everyone.|
|Hedgehog Markets||Seed||$3,500,000||2021||New York||NY||Hedgehog Markets is a decentralized prediction markets platform built on the Solana blockchain.|
|Mem Protocol||Seed||$3,100,000||2021||San Francisco||CA||Mem Protocol is a human-centric tool for the social layer of web3.|
|Algofi||Seed||$2,925,000||2021||New York||NY||Algofi is a blockchain-based decentralized crypto lending platform based on Algorand. The company's platform enables users to purchase cryptocurrency and earn interest without the use of a bank or centralized custodian.|
|Tinyman||Seed||$2,500,000||2021||Boston||MA||Tinyman is a decentralized trading protocol that utilizes the fast and secure framework of the Algorand blockchain, creating an open and safe marketplace for traders, liquidity providers, and developers.|
|Layer3||Seed||$2,500,000||2021||Washington D.C.||Layer3 is a crypto platform that provides tools for decentralized autonomous organizations (DAOs).|
|Sonic AI — Audio Messenger||Seed||$2,500,000||2021||Los Angeles||CA||Sonic is a company out of Stanford University specializing in Cryptography, NLP, TTS, and ASR as relating to their uses in messaging.|
|Snickerdoodle Labs||Seed||$2,400,000||2021||San Jose||CA||Snickerdoodle is using blockchain technology to build a data economy that protects user privacy and distributes value to all stakeholders, including the data owners. We are building the infrastructure to allow people to own their data and monetize it in a secure way.|
|HonestRobin||Seed||$2,125,000||2021||New York||NY||HonestRobin provides financial education and access to no-interest cash advance and FDIC insured & high-interest saving accounts. Through our gamified tools and weekly rewards(upto $10 Million), We encourage users to save and invest.|
|Makara Digital||Seed||$2,085,000||2021||Seattle||WA||Makara Digital is a cryptocurrency investing platform that offers a secure proprietary trading technology that was built for digital assets. The company was founded in 2021 by Sadie Raney and Jesse Proudman and is headquartered in Seattle, Washington, United States.|
|Data Mynt||Pre Seed||$1,800,000||2021||Oakland||CA||Banking is needed. Banks are not. Data Mynt helps businesses reach their potential with web3 based financial tools.|
|Grape Network||Initial Coin Offering||$1,800,000||2021||Austin||TX||Grape Network operates as a DAO infrastructure protocol. Grape Network provides tools for decentralized autonomous organizations (DAOs) to help them manage their communities more efficiently.|
|SoundMint||Seed||$1,700,000||2021||Los Angeles||CA||SoundMint Music NFTs are the generative combination of visual layers with musical stems, combined by the SoundMint algorithm.|
|Staax||Pre Seed||$1,620,000||2021||San Francisco||CA||At Staax, we’re building a better and profitable payment system, which makes investing in stocks as easy as receiving payment from your friends. We believe that friends paying friends in fractional share stocks can be the path for unlocking the gamification behavior that we’re seeing in the stock market, but instead, with the healthy financial decisions that we believe can benefit generations. Our users are able to get paid back by turning their $10 for coffee into AAPL stock, instantly. We’re changing the way consumers access the stock market to allow the everyday person to build long term wealth, in a way they couldn't before. Our founding team has business finance, crypto, and engineering experience at companies like McKinsey & Co., KKR, The White House, Goldman Sachs, Morgan Stanley and Coinbase, and we believe we are the team to solve this problem. Miro-transactions are the future of investing! Join us on this journey as we reimagine the way payments are done for millions of people.|
|Equarion Capital||Series A||$1,200,000||2021||Los Angeles||CA||A cryptocurrency focused wealth management fund.|
|WeMeta||Seed||$1,100,000||2021||Seattle||WA||WeMeta is the go-to platform for all things, from Community Leaderboards to Activity Feeds, to buying, selling, and trading digital land.|
|Minti||Pre Seed||$1,000,000||2021||New York||NY||Minti helps creators auto-mint social posts as non-fungible tokens.|
Top Investors in web3 Companies
Examining our data of all 333 web3 companies we can look to see what investors have backed the most companies. We only really track investments from top VC firms but if you click on an individual company profile you can see all the investors that have backed the company and which round they participated. To see all of the companies that each of these investors have backed click on the investor name.
On the Employbl dashboard you can filter for "Company Collections > Web3 companies" in conjunction with "Venture Capital Firms > " to see all the web3 companies a VC firm has invested in.
Here is the list of VC firms plus how many investments they've made in web3 companies. This only looks at the 333 web3 companies that are on our list right now, but this list will expand going forward. To be up to date with the latest data check out the Employbl companies dashboad :)
|Venture Capital firm||# of web3 companies invested in|
|Tiger Global Management||14|
|Lightspeed Venture Partners||11|
|Sound Ventures LLC||8|
|Bessemer Venture Partners||5|
|Seven Seven Six||4|
|SoftBank Vision Fund||4|
|First Round Capital||3|
Honestly these numbers are pretty conservative and the totals will definitely go up as we add to our custom list of web3 companies. I do think it's representative though to see Andreessen Horowitz near the top of the list for web3 investments. YC invests in many more companies though typically at much smaller check sizes.
Criticisms of web3
I'd be remiss if I didn't mention there are a lot of shortcomings of web3. First it's worth acknowledging that it's much harder to build protocols than it is to build platforms. The internet predated the World Wide Web for several decades while protocols were worked out and agreed upon. Ony after the protocols were built and defended, often with public money, could businesses thrive.
There's also an inherent hypocrisy in some of the web3 movement where adherents preach decentralization while building centralized hubs. It's clear that institutional investors like a16z and Coinbase Ventures are backing most of the top web3 and crypto companies. Additionally some major players like ConsenSys (which owns MetaMask among other products) have built centralized hubs for accessing blockchains. OpenSea and Coinbase also provide centralized hubs for the allegedly decentralized future. This begs the question of is web3 just swapping one set of gatekeepers for a new one? Venture Capitalists make money from backing monopolists that can escape competition, which is somewhat at odds with building a decentralized economy.
There's also a constant stream of crime, robbery and failure associated with web3, as chronicled on the website web3 is going great.
Crypto companies like Coinbase and FTX are pouring millions into American politics. This could sway the market in the favor of accumulated capital. Additionally if the market continues to crash these crypto and web3 companies could take taxpayer money in the form of a bailout. Bitcoin rising out of anger and frustration from the 2008 bailout to spawning new companies that engineered a new financial crash to get a new government bailout would pretty much be the ultimately irony.
Matt Stoller of the American Economic Liberties project as also written about the scammy nature of cryptocurrencies. YouTube video Line Goes Up – The Problem With NFTs is another longform piece outlining issues and inherent problems in the web3 space.