Tim Draper Outlines Three Key Areas Of Interest

Second Generation Venture Capitalist Tim Draper has a raft of successful investments under his management, including Skype, Overture, Baidu, Tesla, Theranos, Parametric Technology, Hotmail, Digidesign, and Twitch.tv. As Founding Partner of leading venture capital firms Draper Associates and Draper Fisher Jurvetson (DFJ) he has over $4Billion USD under management, and is well known in the Bitcoin Industry.

Draper is probably best know, in Bitcoin circles, for his purchase of the Silkroad Bitcoins. On June 27, 2014, Draper purchased nearly 30,000 Bitcoins which had been seized by the US Marshals service. With his experience for recognising the potential in business ideas, and resources in the Billions, turning his sights on the Bitcoin Industry could indicate a bright future for the disruptive technology.

“There are so many inefficient forms of money. This will be the most efficient available. Finance and banking are changing. Bitcoin, electronic shares, networked accounting, crowdfunding, and second market trading are all going to change the finance fields,”
— – Draper

Draper is clearly pro Bitcoin, with investments in a range of companies. “Draper Associates is making some interesting advances to drive the new world of finance forward. Bitcoin is now the best way to send money overseas, to store value, to cover a credit payment, and to pay out a large group of people when there is an event. All media (including journalists) will most certainly be using Bitcoin to be paid (or tipped) for their content,” says Draper.

From his list of industry sectors Draper picked out three key areas that are likely to be disrupted by bitcoin over the next 24 months. Being a Venture Capitalist, Draper has backed his predictions with investments in companies within each sector.

The first sector Draper names is Payments, and the company he’s focused on is Coinbase. Draper Fisher Jurvetson invested early with coinbase, going on to lead The Series C funding round, raising $75 million. At the time it was the single largest venture-capital fundraising by a bitcoin-related startup.

Founded in 2012 and based out of California, Coinbase aims to make it easier for non-technical users to send and receive Bitcoin payments by offering an online wallet service for storing, sending, and receiving bitcoins. The company also provides merchant services that enable businesses to accept bitcoin payments online. They currently have over 2,500,000 wallets, are supported in over 24 countries, with 38,000 merchants onboard and 6,000 developer applications. They have raised over $106 million USD from the investors.

“Finally, bitcoin is being recognized as a great vehicle for banking. It is clear that not only can bitcoin be used for remittances and stored value, but also for banking efficiency and credit-card transactions.”
— – Draper said at the time.

The second sector Draper has focused on is stored value and commodity trading, having invested in Vaurum, which was incubated by Tim Drapers son Adam Draper, through Boost VC.

Vaurum, recently rebranded as MirrorX, describes itself as “akin to a 21st century clearinghouse with a core mission to provide trustworthy settlement of assets […] combining the best of traditional institutional finance with emerging crypto finance.” Mirror works with U.S. based escrow accounts to ensure that trades are settled and cleared through licensed escrow attorneys. The company also provides over the counter sales of Bitcoin, for larger clients.

"With the help of Vaurum […], we expect to be able to create new services that can provide liquidity and confidence to markets that have been hamstrung by weak currencies,"
— – Draper said in the statement.

The third industry sector Draper believes is poised for Bitcoin disruption is contracts. Draper is invested in Hedgy, again through Boost VC. Hedgy is a smart contract platform built on top of the Bitcoin block chain. They sell commercial hedging tools that help eliminate one of Bitcoin’s most significant problems, volatility.

“We believe the future of finance is more open, accountable and distributed, which is why we are committed to building Hedgy right on top of the Bitcoin block chain.”
— – Hedgy

Drapers wide range of investments in Bitcoin enterprises has shown he is bullish on Bitcoins future, but he firmly believes that innovation has just started. We asked if there were any specific tools he feels are missing from the ecosphere he replied, “Yes. Many, and some I haven’t thought of yet, but entrepreneurs will. One obvious one is the ability to have media talent payments become automatic. Another is in transparency. Another in insurance. So many possibilities.”

“ Some of the brightest people in the world are working to develop this new financial system. It doesn’t happen overnight, but it is happening even faster than I originally imagined.”
— – Draper