Index Ventures makes first foray into Bitcoin sector
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Richard Branson and Ashton Kutcher-backed BitPay has now raised more institutional capital than any other start-up in the space following a latest round worth $30 million.
The London, San Francisco and Geneva-based venture capital firm has waited until now to make a play in the Bitcoin market, having spent the last year backing businesses in the education, consumer product and enterprise software sectors.
Headquartered in Atlanta, US, BitPay processes a reported $1 million of Bitcoin payments daily for some 30,000 merchants. Amongst its customers are gaming venture Zynga and British entrepreneur Richard Branson through his Virgin Galactic commercial space travel division.
Alongside using the platform for his own activities, Branson is joining Horizon Ventures, Founders Fund, Felicis Ventures, RRE Ventures, TTV Capital and AME Cloud Ventures in the fundraising. BitPay has now raised $32.7 million since founding in 2011, with actor and investor Ashton Kutcher one of its earliest supporters.
Tony Gallippi, co-founder of BitPay, says, 'Bitcoin is a borderless and frictionless payment system, which is nearing a tipping-point moment in terms of merchant adoption.
'Unlike existing payment technologies such as credit cards, with their high fees and risk of fraud and chargebacks, Bitcoin was designed for the internet age, offering companies a lower-cost, lower-risk alternative.'
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Having secured other customers including WordPress and Shopify, BitPay plans to use the $30 million to create 70 new jobs and triple its staff count comprised by teams in Atlanta, San Francisco, Buenos Aires and Amsterdam. The start-up reveals that most new hires will be developers.
Index Ventures partner Jan Hammer adds, 'By enabling thousands of merchants to accept payment in Bitcoins quickly, safely and seamlessly, BitPay is already the proven and trusted winner in this space.
'Tony, Stephen [Stephen Pair, co-founder] and the team have achieved a fantastic amount with scant resources, and the combination of the huge market opportunity, the quality of the talent and this fresh injection of capital, will surely propel them to success on a global scale.'
To supplement the growing of its team, BitPay is also building open source projects such as Bitcore, Insight and Copay to sit alongside its merchant acquiring projects.
Joining the board of BitPay are Index's Hammer and Jimmy Furland, who represents the original investor group.
Global investor Index Ventures has had a busy 2014 so fair, with British companies including digital health company Big Health, mapping start-up Citymapper and cycling products venture Blaze securing funds.