DeFi Startup The Graph has closed a US$5M investment round

The Graph was launched in June 2018 by founders Yaniv Tal, Jannis Pohlmann, and Brandon Ramirez. The three founders previously worked together in several startups including Workflo, TapSavvy, and Mulesoft.

According to a blog post by Tal, the three founders started diving into Ethereum in early 2017. “It was apparent that the tooling and lack of mature protocols made it difficult to build dApps,” Tal said. “The idea of making open data more accessible became an obsession of ours and The Graph was born.”

According to Tal, by using The Graph, developers can query a peer-to-peer network of indexing nodes using GraphQL and verify the results on the client. This will allow teams to focus on their dApps’ core functionality. They will be able to deploy to trustworthy public infrastructure that they don’t have to manage, while also benefiting from economies of scale.

The team built the first prototype in late 2017, and wanted to find a productive developer experience for writing indexing logic that could be securely operated on a decentralized network.

In August 2018 the team announced that The Graph was open source, and released a Developer Preview that represented four months of work conducted by their engineering team.

In late January 2019, Multicoin Capital announced that they had led a US$2.5M seed round. Other participating investors in the round include Compound VC, CoinFund, DTC Capital, Kilowatt, Reciprocal Ventures, SPC and others

Multicoin Capital is a crypto-focused venture fund started by Kyle Samani and Tushar Jain in mid-2017. The fund has a portfolio that includes notable companies such as Algorand, Bakkt, KEEP Protocol, Tagomi, and others. Limited Partners in the fund include Marc Andreessen and Chris Dixon of Andreessen Horowitz, David Sacks of Craft Ventures, Elad Gil and others.

“I’ve had a chance to work with The Graph team for almost a year now, and they’ve been nothing short of exceptional,” stated Samani. “We couldn’t be more excited to support The Graph, and are looking forward to seeing all of the amazing applications that developers build on it.”

Following the funding announcement, the company announced the launch of the Graph Explorer. According to the team, “Graph Explorer makes it easy for developers to discover all the data being indexed on The Graph and easily pull it into their dApps.”

The explorer was launched with seven initial partners who consisted of Dharma, Compound, Uniswap, ENS, Origin, Decentraland, and Livepeer. These seven protocols were the first to be available on the explorer for third-party developers to access.

To date, over 1,500 subgraphs have been deployed for dApps like Uniswap, Synthetix, Aragon, Gnosis, Balancer, Livepeer, DAOstack, AAVE, and Decentraland. Following the first round of funding and growth in the usage of the platform, the company announced that they have recently closed a US$5M investment round.

This investment round was conducted as a Simple Agreement for Future Tokens (SAFT) and saw participation from a range of strategic crypto funds including Framework Ventures, ParaFi Capital, Coinbase Ventures, Digital Currency Group, Tally Capital, CoinIX, Collider Ventures, Lemniscap, and Sustany, with continued participation from Multicoin Capital and DTC Capital.

“The Graph has done a remarkable job of getting developers to use the product in a completely grassroots way,” stated Larry Sukernik an Investment Associate at Digital Currency Group. “If you asked a sample of blockchain developers what they use to index and query blockchain data, many would tell you they use The Graph. It’s a joy for us to back a market leader in what is a rapidly growing market.”

The total funding The Graph has received to date is US$7.5M and the company will be using the new funds raised to build and launch The Graph’s decentralized network.

The Graph decentralized network will be operated by independent Indexers who run nodes and process queries in an open marketplace. Curators will be able to join the network to organize data and signal which subgraphs are useful and accurate.

These new roles have been introduced to ensure that the “decentralised applications are built on a serverless foundation with no point of failure, that applications can receive the best service at the lowest price, and that network fees are earned by members of a distributed community.”

In reference to the decentralized network the team is working towards, Tal stated, “Web3 is about building new ways for people to collaborate and organize. The Graph’s decentralised network is going to make sure that the crypto economy has a reliable open data layer for building novel applications on a trustworthy foundation.”