Fred Ehrsam, Coinbase co-founder, has said at Y Combinator Demo Day 2017, an annual event held by one of the most prominent and leading venture capital firms, that only two startups out of 130 are building Blockchain-inspired products.
YC Demo Day 2017:— Fred Ehrsam (@FEhrsam) August 20, 2017
~70 based on network effects
2 built on a blockchain
It has become quite evident that demand towards Blockchain technology and Blockchain-based applications from the global technology industry has increased significantly over the past two years.
Multi-billion dollar technology conglomerates and financial institutions including Visa, Microsoft and IBM are actively hiring Blockchain developers to successfully deploy decentralized infrastructures in their existing networks.
A shortage of Blockchain talents
However, there is a shortage of Blockchain developers and experts within the technology space because as Luis Cuende, the co-founder of Aragon, an Ethereum startup that raised over $30 mln in 1.5 minutes through its initial coin offering (ICO), noted, there aren’t many Blockchain developers that are not millionaires yet.
Through ICOs, Blockchain startups and developers can easily raise money in a transparent and open market from a wider range of investors in a shorter period of time with fewer conditions.
“I don't know any good Ethereum developer that isn't a millionaire, and it's only a matter of time before it will become a gold rush among developers to learn the technology,” said Cuende.
Ethereum price can reach $1,000
More to that, in consideration of the rapid rise in popularity of ICOs, Cuende explained that he sees Ether price, the native token of Ethereum, rising to $1,000 in the mid-term.
“I thought it was expensive one year ago when it was at 13 dollars, but today when I see the possibilities created by the technology, I think it's cheap. I believe Ethereum will be worth $1,000 in a couple of years,” he added.
Conceptually, an ICO is a phenomenal, efficient and practical method for startups and developers to use in raising capital to fund their projects.
Not only do ICOs allow startups to secure investment in shorter timeframes, but it also provides a real-time valuation to the software being developed.
For instance, the market cap of Blockchain startups that successfully conducted their ICOs including EOS, TenX and IOTA can be publicly accessed on cryptocurrency market data and analytics platforms such as CoinMarketCap.
It is significantly easier and simpler for Blockchain developers and projects to test the open market rather than collaborating with a small group of venture capital firms and angel investors that will inevitably pressure Blockchain projects for lack of high-profit margins and stable revenues.