A Coinbase-backed start-up quietly powering the NFT boom raises new funding

0
7

In this article

ALY-AUAlchemy co-founders Nikil Viswanathan (left) and Joe Lau.Source: Alchemy

Alchemy, a start-up subtly powering the recent NFT boom, is raising another round of capital as it tries to keep up with the fast-growing industry.

The San Francisco-based company announced an $80 million series B funding round on Wednesday, led by Coatue and Addition. The new cash injection brings Alchemy’s valuation to roughly $500 million. Also participating in the round were the Glazer family, who own the Tampa Bay Buccaneers; the band The Chainsmokers; and DFJ Growth — an investor in Stripe, SpaceX and Coinbase

Alchemy is benefitting from the recent boom in digital collectibles through the companies it helps power. It’s not a blockchain. Alchemy is more of a middleman, sitting between blockchain infrastructure and apps like NBA TopShot that consumers interact with.

That building platform has been used to create Dapper Labs, which made CryptoKitties, popular platform NBA Top Shot, the largest NFT marketplace OpenSea and others. The record-breaking $69 million nonfungible token sold by digital artist Beeple, for example, was powered by Alchemy.

‘Crypto winter’ launch

The start-up was founded by Stanford classmates Nikil Viswanathan and Joe Lau four years ago at the height of the last crypto boom. By the end of that year, bitcoin’s price had shot up to nearly $20,000. But it dropped by more than three-quarters in value in the following few months.

Despite a “crypto winter” that ensued, the founders said they were still “all in” on the tech powering bitcoin and hundreds of other new cryptocurrencies. Another sign, the co-founders said, was the “smartest entrepreneurs they knew” starting companies in the blockchain space.

“When cryptocurrencies took off, we saw it and said: ‘This is the next big technology shift,'” Alchemy CEO Viswanathan said in a Zoom interview. “The huge problem was that developers didn’t have any kind of infrastructure or tools. We wanted to make it really easy for them to unlock that potential.”

Viswanathan and Lau, who previously co-founded consumer app Down to Lunch, said they hope to be compared to Amazon Web Services for blockchain. Like Amazon’s monster profit engine, Alchemy sits between the internet and companies like Netflix