There is an old Hindi saying that goes “money begets money,” which in English usually translates to “it takes money to make money.” This seems to be holding very true for Blockstream according to recently filed SEC documents. According to these documents, Reid Hoffman now sits on the company’s board of directors.
Hoffman is a well know internet entrepreneur and venture capitalist, which might explain the fact that Blockchain has now raised more than US$15 million in equity funding, which is more than 90% of its stated goal of US$16,204,995.
According to Forbes Magazine, Reid Hoffman is one of the most connected people in Silicon Valley. Hoffman, chairman and co-founder of LinkedIn has an estimated net worth of US$3.8 billion. Hoffman was also a member of the Board of Directors during the founding of the payment giant PayPal and was instrumental in that company’s business development for such ventures as eBay and Intuit.
PayPal even had a nickname for him: Firefighter-in-Chief. While at PayPal Hoffman became one of Silicon Valley’s most prolific angel investors. According to Venture Capitalist David Sze, Hoffman "is arguably the most successful angel investor in the past decade." Hoffman has also been credited with introducing Mark Zuckerberg and Peter Thiel, which led to Thiel’s investment of US$500,000.
But now, with the recent release of Blockstreams white paper on its sidechain technology, it will now require funding to bring the projects to fruition. Sidechains certainly look very promising and can potentially help bring altcoins up to the same level as Bitcoin as far as acceptance and use, but there are still a number of issues to be resolved before it becomes market ready. If Hoffman can bring to the table the same resources that he has become known for this could very well be the opportunity that Blockstream is looking for to advance to the next level.
Hoffman is also a partner at Greylock Partners, one of the most successful Silicon Valley-based venture capitalist firms in the world and this connection can probably be counted as one of the main reasons for the huge success of Blockstreams recent funding effort.
Greylock currently has 42 US venture partners and the firm is associated with the success of such giants as Facebook, Pandora, Drop Box and Redhat. The company focuses on understanding the evolution of technology before they take investment risks and this practice has led them to successful results.
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