Future Capital Bitcoin Fund (FCBF) investor presentation
-
date post
17-Oct-2014 -
Category
Investor Relations
-
view
1.834 -
download
2
description
Transcript of Future Capital Bitcoin Fund (FCBF) investor presentation
1
Investor PresentationJuly 2014
“Bitcoin represents something fundamental and powerful”
– Fred Wilson, Union Square Ventures
2
Future Capital Bitcoin Fund
$30m Fund Equity Investments
Bitcoin and digital
currency ecosystem
Experienced investment
management team
Registered in Australia
Tax Free returns *
Accepting investments
globally including in
Bitcoin
Sourcing opportunities
globally
*The Fund is pre-registered as an Early Stage Venture Capital Limited Partnership (ESVCLP) under the Australian Venture Capital Act.Provides investors fully tax free returns (whether on income or capital account) including dividends.Potential investors should always obtain their own independent financial and taxation advice.
3
Overview
1. The Bitcoin Investment Opportunity
2. Price and Takeup
3. Future Capital Bitcoin Fund
Appendix
4
Why Bitcoin?
1. The Bitcoin Investment Opportunity
2. Price and Takeup
3. Future Capital Bitcoin Fund
Appendix
5
What VCs are saying about Bitcoin
Fred Wilson Union Square Ventures
• “We believe that bitcoin represents something fundamental and powerful, an open and distributed peer to peer protocol for transferring purchasing power. “
Tim Draper Draper Fisher Jurvetson
• “Bitcoin has the potential to transform the world the way the Internet did … All finance / commerce can be transformed by Bitcoin.”
Mark Andressen Andreesen Horowitz
• “Personal computers in 1975, the Internet in 1993, and – I believe – Bitcoin in 2014.”
Chris Dixon Andressen Horowitz
• “Bitcoin is the first plausible proposal for an economic protocol for the Internet.”
Jim Breyer Accel Partners
• “I’m confident you’ll see major worldwide retailers adopting …Bitcoin.”
6
…and they are putting their money in…
High profile Bitcoin
investments from past 18 months
$160M:
Total VC funding reported in more than 30 Bitcoin deals
$50M: Amount invested by Andreessen Horowitz into Bitcoin startups
$40M: Investment in Xapo - The largest total investment into a Bitcoin company
$30M: Investment in Bitpay – A Richard Branson backed Bitcoin company
$25M: Funding of Coinbase – A Sillicon Valley backed Bitcoin company
$15M: Liberty City Ventures own “Digital Currency Fund” $11M: Winklevoss Capital investment directly into Bitcoin$2M: Peter Thiel (Paypal) personal contribution to a Bitcoin fund
60 Number of investors in “BitAngels”, a Bitcoin angel investment network
Bitcoin startups present a high potential investment option
7
…and accelerating
$40MSeries BJuly 2014
$30MSeries B
March 2014
2014 run rate of US$284m, almost 3x the 2013 total investment of $99.5m
Q1$64.5
m
2013 Total
$99.5m
Note: *Includes first sequence venture deals but excludes late-stage 1995 internet investments ($257.6m). For additional disclosure on methodology see http://www.coindesk.com/following-money-trends-bitcoin-venture-capital-investment/
8
Financial Institutions are watching
Type ActivityInvestment
Bank Report
Investment Bank Report
Investment Bank Report
Investment Bank Report
Ratings Agency ReportAsset
Management Investment
Consultancy Report
“We believe Bitcoin can become a major
means of payment for e-commerce and may emerge as a serious
competitor to traditional money transfer options.”
David Wood Bank of America/Merrill
Lynch
9
…and thought leaders are seeing promise
“I’m a big fan of Bitcoin … Regulation of money supply needs to be
depoliticized”
Al GoreFormer US Vice
President
“Bitcoin may hold long-term
promise”
Ben BernankeFormer US Fed Reserve
Chairman
“Bitcoin is a technological tour de force”
Bill GatesMicrosoft Co-founder
“We have elected to put our money and
faith in a mathematical
framework that is free of
politics and human error”
Tyler WinklevossEntrepreneur
10
Opportunity AreasBitcoin Aiming to Disrupt $457bn+ Total Market Cap
Payment Processor
s: e.g. Visa,
Amex, Mastercard$381BN
Payment Hardware:
e.g. NCR, Micros, Verifone
$25BN
Money Transfer /
ATM Outsourci
ng: e.g. Western
Union, Money Gram$14BN
Bank Software: e.g. Fidelity,
Fiserv$37BN
Total$457B
N+
Source: CoinDesk, Wedbush Securities – As at 8 April 2014
11
… offering large potential transaction cost savingsPotential annual net savings with Bitcoin based on 2013 volumes
2013 Market Size ($bn) Retail Ecommerce Remittances
$ volume by market 10,383 609 549
Prevailing average pricing 2.5% 2.9% 8.9%Bitcoin pricing 1.0% 1.0% 1.0%
Prevailing transaction fees 259.6 17.8 48.9Bitcoin transaction fees 103.8 6.1 5.5
Potential Savings with Bitcoin ($bn) 155.7 11.8 43.4
Source: Goldman Sachs Global Investment Research
12
13
Opportunity AreasBitcoin Companies can be grouped into 6 categories
Payment processors
Mining hardware
Financial services
Exchange
Wallets
Universal
Exchange
14
Bitcoin Penetration
1. The Bitcoin Investment Opportunity
2. Price and Takeup
3. Future Capital Bitcoin Fund
Appendix
15
As a “currency”, the price has recovered
Source: CoinDesk Bitcoin Price Index daily closing price (taken at 00:00 UTC)
16
… opinions vary on where it could be
Sound economic models developed
by senior bank officials…“Our current view
implies a maximum fair
value of bitcoin = US$1,300”
David Wood Bank of America/Merrill Lynch
…To those that are “true believers”
“We believe Bitcoin could
reach $US $10,000”
Tyler WinklevossHigh profile Bitcoin advocate/Facebook
17
While Bitcoin as money is small
US Australia Guatemala Bitcoin0
500
1,000
1,500
2,000
2,500
3,000 2,705
2558 7
M1
Mon
ey S
uppl
y (U
S$BN
)
Rank Country Money Supply ($BN)
90 Bitcoin 6.1591 Afghanistan 5.9292 Sudan 5.8593 Macau 5.8494 Uzbekistan 5.8495 Serbia 5.7996 Ghana 5.7797 Uruguay 5.3298 Papua New Guinea 5.3099 Malta 5.27100 Yemen 5.14
Bitcoin is small compared to US, Australian currencies
… but there are 100 countries that have a smaller currency supply than Bitcoin
18
Its use in commerce is growing
Region Businesses
North America 1,563
Europe 1,478South Asia / Australia 227
South America 167India 94
Africa 24
Approx. 60,000 merchants accept Bitcoin ... mostly online Physical businesses accepting Bitcoin
19
Bitcoin advancing on other networks
Bitcoin Western Discover Paypal Discover Amex Union Pay Master Card VisaAver
age
Daily
Tra
nsac
tion
Volu
me
(US$
)
(Pulse)
$100M
$1BN
$10BN
$20BN
$41M
$216M$299M $397M $438M
$2.4BN
$7.5BN$9.8BN
$16.5BN
Source: Coinometrics.com, 30 April 2014
20
Bitcoin access by merchants and customers is becoming easierPoint of Sale By Internet By Mobile Bitcoin ATMs
21
The Opportunity
1. The Bitcoin Investment Opportunity
2. Price and Takeup
3. Future Capital Bitcoin Fund
Appendix
22
Investment Highlights
$30m Fund Equity Investments
Bitcoin and digital
currency ecosystem
Experienced investment
management team
Registered in Australia
Tax Free returns *
Accepting investments
globally including in
Bitcoin
Sourcing opportunities
globally
*The Fund is pre-registered as an Early Stage Venture Capital Limited Partnership (ESVCLP) under the Australian Venture Capital Act.Provides investors fully tax free returns (whether on income or capital account) including dividends.Potential investors should always obtain their own independent financial and taxation advice.
23
Experienced Investment Team
Domenic CarosaOver 20 years of
experience in Technology, StartUps,
Corporate Finance and Funds
Management ASX listed companies incl
growing destra to revenues of over
$100M
Tony Stephen25 years PwC. Fellow
Tax Institute Australia. Dealt with major corporations,
billion dollar transactions and high
growth tech companies
Leon-Gerard Vandenberg
Deep technology and commercialisation
experience in defence,
authentication, mobile and card
payment systems incl CTO for US Navy smartcard Company
Remco MarcelisCFO/COO for
technology/cleantech businesses for 10
years, preceded by 4 years in venture
capital. Raised and invested nearly $40
million
Holger AriansHolger last worked in the German Defence
Industry. He is an Alumni from Harvard Business School and did an Executive MBA
in Germany and France.
24
Previous Investment Experience
25
Tax Free Returns* Pre-registered as an Early Stage Venture Capital
Limited Partnership (ESVCLP) under the Australian Venture Capital Act 2002.
Provides investors fully tax free returns (whether on income or capital account) including dividends.
* Potential investors should always obtain their own independent financial and taxation advice.
Refer: http://www.ausindustry.gov.au/programs/venture-capital/esvclp/Pages/default.aspx
26
Fund Investment AllocationExample of investment allocation amounts over successive
funding rounds
StageNo of
InvestmentsA$ investment per company A$ invested
Seed 20 $250k $5MSeries A 8 $500k $4MSeries B 4 $1.5M $6MSeries C 2 $3M $6MTotal $21MNote: Series A,B,C represent successive follow-on funding roundsExample based on a $30m raising
27
Sample Opportunities
bitSIM Mobile-to-Mobile transfer of Bitcoin
bitPOS Point of Sale solutions for merchants
CoinJar Cloud based WalletMonetas Digital Finance PlatformBitcoincloudmining Cloud-based Bitcoin mining
28
Open for Investment
Information Memorandum available
Investors welcome globally - AUD, USD, EUR,
YuanInvestment via bitcoin
welcome
29
Next StepsParticipate in the global Bitcoin phenomenon
Contact:Domenic Carosa
+61 411 19 69 79Holger Arians
+61 439 716 110www.futurecapital.com.au/
bitcoinfund
30
Overview
1. The Bitcoin Investment Opportunity
2. Price and Takeup
3. Future Capital Bitcoin Fund
Appendix
31
What is Bitcoin?A quick introduction
Digital Currency:
• The world’s first decentralised digital currency
Peer-to-Peer:• Can be transferred from person to
person through the internet without an intermediate financial institution
Open Source:
• A secure, consensus-guided payment network that is powered by its users with no central authority or middlemen
Fast-growing:• Grown from $0 to $7.7BN market cap
in 5 years with millions of dollars transacted daily
Bitcoin
(BTC)
32
Getting StartedHow do I get Bitcoins?
Receive Bitcoins as payment for goods or services
Purchase Bitcoins at a Bitcoin exchangeExchange Bitcoins with anyone in the worldEarn Bitcoins
through competitive ‘mining’
33
Bitcoin for usersSimple, frictionless transactions
A mobile Bitcoin wallet allows a user to send and receive Bitcoins
Send and receive any amount of money,
instantly anywhere in the world, at any time
No merchant account needed
Bitcoin payments are easier to make than debit or credit card
purchasesPayments can be
made via unique ID, QR code or tapping
phones
Private with no customer personal information at risk
Convenient, low cost,
instant
34
Bitcoin for BusinessEnabling new markets, reducing admin costs
Bitcoin transactions are secure and irreversible protecting merchants from fraudulent chargebacks
Bitcoin eWallets and terminals are encrypted and do not expose sensitive or personal information Merchants can use Bitcoin payment where either credit cards are not available or costs unacceptably high
Higher trust is created as unwanted or unnoticed charges can’t be made as can happen with other payment methods
No volatility if the merchant decides to retain funds in Bitcoin
35
36
Attachments BTC Criticism and History BTC Mining Explained
37
38
39
Bitcoin MiningCreating Bitcoins by managing the network
Traditional mining
Bitcoin mining
Bitcoin mining
snapshot:
1. The process of co-managing the network by processing transactions, providing encryption and
synchronising the system
2. ‘Miners’ operate in all countries and no individual has control over the network
3. This secures the entire network and ‘miners’ receive Bitcoins in exchange
5. New coins are created annually until 21M coins are in circulation
6. Once all coins are in circulation the miners are supported by transaction fees