"Barbarians" enter the digital currency market, entrepreneurs face multiple challenges
In 2017, the block chain wave swept the world. Aiming at the subversion of traditional VC investment, entrepreneurship, and secondary market financing in the field of block chain, Jiang Yameng (Alex), the founding partner of Alpha Commune, was jointly organized by Alpha Commune and CMU Summit. At the Sino-US Innovation and Entrepreneurship Summit - the first blockchain forum, he shared his views.
Hello everyone, I am Alex Jiang Yameng. Richard (Xu Siqing, the founding partner of Alpha Commune) and I founded this angel investment fund three years ago. The base is in Beijing, and we also invest in Silicon Valley and other places in the United States. Alpha Commune primarily focuses on technology-driven technology companies.
The first challenge for the development of digital currency and blockchain technology is to bring huge competitive pressure to VC, especially for VC investing in round A, round B and subsequent rounds, the challenge is even greater, because the founders have a new financing option.
In China, there are many blockchain-related WeChat groups, such as the "three o'clock sleepless group". These groups are full of investors and blockchain entrepreneurs, and they often chat until 3 o'clock in the morning without going to bed. These people don’t sleep. On the one hand, it is because of the globalization of the blockchain. Digital currencies are traded 24 hours a day, which reflects the huge challenges that the blockchain brings to VCs and Internet entrepreneurs.
The second challenge is for founders. You will not see high-frequency quantitative traders from Goldman Sachs among the guests on the entrepreneurship and financing panel before, nor will you see the founders of secondary market hedge funds like Meng Yao (founder of Trade Terminal).
Some funds with huge scale and highly speculative strategies were once called "barbarians" in the traditional financial secondary market, because they used the most advanced financial means and complex algorithms to create a huge increase in the company's value in a very short period of time. Volatility creates the perfect financial storm. Back then, Soros's fund successfully shorted the British pound and the Thai baht, and British Airways and the Thai government failed to resist the bailout. Now, the $26 billion Soros Fund is reportedly also trading in cryptocurrencies, according to media reports.
When your company is only two or three months old, powerful secondary market hedge funds are already trading your tokens, can the founders cope? When your technology is still very backward, when you need a lot of resources and teams to develop the underlying technology of the blockchain, you will have to face the secondary market transactions that usually occur after 7-10 years. To maintain and stabilize the price of the token.
As the founder of a blockchain company, you need to learn to deal with all this within 3-4 months: technology development, user community operations, and dealing with complex financial markets with high liquidity. These are great challenges for would-be blockchain entrepreneurs.
As a young early-stage investment fund, we believe that these challenges to traditional VCs and entrepreneurs are our opportunities. The technology, community building, and capital market mentioned above are all places where our fund can help entrepreneurs. The philosophy of Alpha Commune is to help entrepreneurial teams win in the market. So Richard and I built a team of professional technical advisors to guide our startups and help them establish a leading position in technology.
Blockchain technology is still in its early stages, and entrepreneurs need to spend a lot of time to overcome many technical challenges from the theoretical and engineering aspects. At the same time, there are roadshows everywhere to promote their products, just like Robert (the founder of ArcBlock), he flies around the world. If you ask Robert where he was in the past month, he will tell you that he went to Beijing, Hong Kong, Singapore, New York, Boston and Philadelphia, etc., promoting his products and developing his user community around the world. Therefore, in addition to technology, Alpha Commune helps entrepreneurs build and maintain their own communities.
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On April 15, 2018, the Sino-US Innovation and Entrepreneurship Summit jointly organized by Alpha Commune and CMU Summit - the first blockchain forum was held at Carnegie Mellon University in Pittsburgh. In this forum, Lenore Blum, Distinguished Professor of CMU School of Computer Science , CMU professor and Turing Award winner Manuel Blum, AroBlock founder Robert Mao, Qokka.ai founder Aaron Li, Trade Terminal founder Meng Yao, Crypto Matrix summer, QuakChain founder Zhou Qi, CyberMiles co-founder Michael Yuan, an investment partner of SIG, and Vipul Goyal, a professor of the School of Computer Science at CMU, attended the summit.
