Demystifying Balaji Srinivasan: The Encryption Investment Logic of Genius Investors

特邀专栏作者

2023-01-16 11:20

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Who exactly is Balaji Srinivasan? What legendary experience does he have? What are his core ideas and contributions to the crypto industry?

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Who exactly is Balaji Srinivasan? What legendary experience does he have? What are his core ideas and contributions to the crypto industry?

Original author: Runsheng, ChainCatcher

If you haven’t heard of Balaji Srinivasan, you must have used the word “BUIDL” to express your vision and support for the encrypted world. In fact, this hot word came from Srinivasan, and it has been widely spread since then, becoming a familiar industry term in the circle. Srinivasan's better-known title is the former general partner of a16z and the first chief technology officer of Coinbase. In addition, he often discusses encryption issues with Vitalik, the founder of Ethereum, and was selected by many media as one of the most influential people in the encryption industry.

Meanwhile, Srinivasan is arguably the most active angel investor in the crypto industry. Rootdata, an encrypted data platform, shows that as of the end of 2022, Srinivasan has invested in 85 projects in the encrypted field, and participated in a total of 86 rounds of investment, ranking first among investors. And most of his investments are in the early stages of high-quality encryption projects such as Opensea, Avalanche, Dapper Labs, NEAR Protocol, Celestia, and Farcaste.

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1. Inspirational Indian-American immigrant

According to public information, Srinivasan was born in May 1980 in the Long Island area of New York, USA. His parents were immigrants from Chennai, India. From 1997 to 2006, Srinivasan received his BS, MS, and PhD degrees in electrical engineering from Stanford University, and during his Ph.D., Srinivasan earned his MS in chemical engineering from Stanford University as a part-time student. After graduating from his Ph.D., Srinivasan stayed on to teach at the school, teaching computer science and other courses until 2018.

It can be said that until 2006, when he graduated with a Ph.D. and stayed to teach at the school, Srinivasan had gone through a difficult road to achieve a leap in the new immigrant class through education. As he revealed on the Reason podcast in 2018, one of his biggest influences was the Indian mathematician Srinivasa Ramanujan, who, despite coming from a poor Indian family, became a famous mathematician at Cambridge University through sheer talent.

However, teaching and research in an ivory tower is not Srinivasan's main passion. He firmly believes that technology can improve human well-being, and chose to create a technology company to practice this idea, which eventually became a big success. In 2007, in his Stanford dorm room, Srinivasan co-founded genetic testing company Counsyl with friend Ramji Srinivasan. Counsyl aims to improve the identification and treatment of genetic diseases by pre-pregnancy screening for couples who are planning to conceive in order to predict and avoid the risks of a series of genetic diseases.

Speaking to the media, Srinivasan is proud of Counsyl's value and sees himself as a social entrepreneur working on home pregnancy tests. Unlike business entrepreneurs who aim to make a profit, social entrepreneurs usually place more emphasis on social responsibility. The determination to improve human society may explain Srinivasan's series of behaviors since then. In 2017, former U.S. President Trump once considered Srinivasan as one of the candidates for the head of the U.S. Food and Drug Administration (FDA).

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2. Serial Entrepreneurs in the Encryption Field

Srinivasan's exposure to the encryption field originated from Bitcoin, and he participated in the creation of a Bitcoin interest group and taught blockchain courses at Stanford University very early. Since then, the teachers and students of Stanford University have maintained a strong enthusiasm for discussions on the encryption industry and have sent a large number of talents to the industry.

In 2013, Srinivasan co-founded the Bitcoin mining company 21 e 6 (later renamed 21 Inc) in Silicon Valley, and received a16z's participation in the early days of its establishment. Srinivasan hopes to integrate blockchain into existing PCs and other smart devices, and even as part of the future Internet of Things (IoT). Later, 21 Inc transformed into Earn.com. Earn.com is a paid information company. Users can log their own information on the website, and others can pay to obtain the user's information and get in touch with them. Earn enables users to obtain digital currency by forwarding emails or completing some tasks.

At the end of 2013 when Srinivasan founded 21 Inc, he also joined a16z as the eighth general partner and the youngest general partner of the company. According to Techcrunch, it took a16z half a year to recruit Srinivasan.

In April 2018, Coinbase acquired Earn.com for US$100 million and turned it into Coinbase Earn. Srinivasan also joined Coinbase as the first chief technology officer. There are rumors that Coinbase's acquisition of the drunkard is not about drinking, but the main purpose is to recruit Srinivasan.

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3. Srinivasan's investment logic and thinking

Since 2019, Srinivasan has become one of the most active crypto angel investors. He has participated in the early stages of investing in star projects such as NFT trading market Opensea, public chain Avalanche and NEAR Protocol.

Encrypted Data PlatformRootdata display, as of the end of 2022, Srinivasan has invested in 85 projects in the encryption field. In 2022 alone, Srinivasan has invested in 49 encryption projects, of which 5 projects have raised more than US$20 million, namely modular blockchain Celestia ($50 million), Web3 data index Nxyz ($40 million) , decentralized social Farcaster ($30 million), decentralized trading platform Hashflow ($26 million).

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Source: Encrypted Data PlatformRootdata

It can be said that since the birth of Bitcoin, Srinivasan has accurately captured and invested in many popular opportunities in the encryption industry. Due to the limited disclosure of Srinivasan's personal investment information, ChainCatcher has not yet inquired about his specific investment yield. But as a well-known angel investor in Silicon Valley, Srinivasan's reputation is obviously not entirely dependent on investment returns. Several people in Silicon Valley who are familiar with Srinivasan have publicly praised him as a lively mind, with new ideas bursting out every minute. It is precisely because of Srinivasan's deep thinking about encryption and human society, which is different from purely profit-making purposes, that makes him unique.

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Balaji Srinivasan

1. Indian Encryption Entrepreneurship Project

Srinivasan has focused on India's relationship with Crypto and India's huge potential in the future in the field of encryption in a series of articles. In his Twitter, he has been commenting on and advocating India's political status, diplomatic relations, and economic prospects, but he also criticized the encryption ban policy implemented by the Indian government. It is reported that the Indian government imposes a high tax of 30% on all cryptocurrency transaction income, and intends to make cryptocurrency regulation a key issue during its presidency of the G20.

Srinivasan believes that India's encryption ban may cost the country trillions of dollars in potential profits. Based on this, he is "moderately optimistic about India and extremely optimistic about Indians." Srinivasan has a special preference for Indian entrepreneurial teams. According to incomplete statistics from ChainCatcher, Srinivasan has invested in 12 Indian encryption projects (with at least one Indian joint venture in the team), including permanent file storage protocol Lighthouse.Storage, Web3 privacy foundation Facilities Socket, DAO management platform Samudai, DeFi lending protocol Timeswap, DAO structure optimization tool DAOLens, DeFi protocol MoHash, game infrastructure protocol Lysto, Web3 data index Nxyz, new public chain Shardeum, Web3 privacy infrastructure Arcana, Web3 communication protocol Push Protocol , Decentralized social graph Farcaster.

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2. Decentralized social media

In July 2020, in view of frequent hacking incidents on Twitter and problems with authentication and distribution, Srinivasan publicly called on network users to gradually withdraw from Twitter and build decentralized media. To this end, he published the article "How to Gradually Exit Twitter" (How to Gradually Exit Twitter) on his personal website, suggesting to buy a domain name and start his own newsletter Newsletter, and use decentralized tools to build a personal social network.

Srinivasan's interest in social networking dates even earlier. In 2017, Srinivasan rebranded 21 Inc as Earn.com, calling it "the first commercial social network." Users can simply set up a verified public profile where senders can message them and earn bitcoins for replies.

The decentralized social projects invested by Srinivasan include: Farcaster, a decentralized social graph, Blogchain, a Web3 content publishing platform, Mash, a Web3 content platform, Roll, a social token infrastructure for creator economy, Mem Protocol, a social question-and-answer application, Showtime, a NFT social platform, and Web3 Communication protocol XMTP and more than ten projects.

However, Srinivasan also realizes that Twitter will continue to be an important Internet battleground for quite some time due to Twitter's current convenient user experience, and that exiting Twitter and building decentralized media will be a long-term project that is not even guaranteed. will succeed. Srinivasan remains one of Twitter's most active users to this day, with 740,000 followers.

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3. Network Country/City Practice Project

In July 2022, Srinivasan published the book "The Network State", vigorously promoting the concept of "network state", proposing the establishment of decentralized digital communities, and concentrating resources to build new autonomous cities and countries. In Srinivasan's vision, a cyber-state is a highly coherent online community with the ability to act collectively, crowdfunding globally and eventually gaining diplomatic recognition from pre-existing states.

Specifically, this network country is a group from different countries that will be built using blockchain technology with the common goal of using cryptocurrency. Srinivasan believes that with the help of the oracle network and the Ethereum Name Service (ENS), reliable mechanisms can be established to prove its population and off-chain territory for diplomatic recognition.

Under the guidance of the above concepts, Srinivasan has successively invested in the encrypted city community Praxis, the emerging network city project Cabin, and the African community-as-a-service company Afropolitan. In addition to these 3 crypto projects, Srinivasan has also invested in libertarian Patri Friedman to build autonomous "charter cities" in developing countries.

Take Afropolitan as an example. Afropolitan is highly compatible with the concept of "network country" in terms of social and political ideals. The project's vision is to create a networked nation that provides the best of the best in arts, finance, technology, health, energy, sports and media for locals and diasporas in Africa so that all Africans can live a life of abundance .

In fact, Srinivasan has been thinking about the network country for a long time. As early as 2013, Srinivasan delivered a speech entitled "Silicon Valley's Ultimate Exit" (Silicon Valley's Ultimate Retreat) at Y Combinator's Startup School, and published "Software Is Reorganizing the World" on Wired (software is reorganizing the world ), advocating the digitalization of the technology industry to exit the United States and transfer abroad. Network Nation is the product of his ten years of systematic thinking.

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Four. Conclusion

Born in an Indian immigrant family, through personal efforts, he studied at Stanford University, a world-renowned university, and stayed at the school to teach. Later, he founded Counsyl and other technology companies in Silicon Valley, and seized the opportunity of encryption to enter industry leaders such as a16z and Coinbase. Finally, through investment in his personal capacity Practicing his socio-political ideals, Balaji Srinivasan has had a rich life.

At the same time, there are many labels and controversies surrounding Srinivasan. In the eyes of others, he is an encryption evangelist, serial entrepreneur, erudite, and genius investor. At the same time, he frequently fires at the technology industry and the media circle, and continues to output quite fierce political views. Srinivasan, on the other hand, positions himself as a pragmatist, a technologist, and rejects any kind of political or ideological label.