ConsenSys believes it can become a valuable company, provided it can get through the next year.
As The Information first reported Monday, the company is seeking approximately $200 million in new investment. However, ConsenSys also projects $152 million in expenses in 2019, with $52 million in revenue, for an estimated $100 million cash burn, according to an investor deck obtained by CoinDesk.
The company is pitching itself to investors as a combination of three significant assets: equity in roughly 134 projects or companies, token holdings from major initial coin offerings and internal operations with significant long-term revenue potential.
With additional funding, ConsenSys expects to do the following through 2020: launch at least 10 blockchain networks, grow revenue to $100 million per year, tokenize 30 percent of activities in its so-called “mesh” of projects and help the ethereum community deliver its 2.0 upgrade.
ConsenSys 2.0.1
As CoinDesk reported last year, the company went through a major restructuring in order to focus more on businesses with revenue potential. This year’s slide deck gives some clarity about what the company is currently emphasizing.
“ConsenSys is building the products, platforms and companies to enable the tokenization of the $80 trillion global economy,” the slide deck reports in its first pages.
The deck describes the ConsenSys product strategy as comprising four “interconnected layers:” open platforms, the future of work, decentralized finance (DeFi) and Web 3.0.
It highlights several companies at each layer, including Grid+ and Gnosis, as open platforms; OpenLaw and Gitcoin, as the future of work; Trustology and ConsenSys Digital Securities, as decentralized finance (DeFi); and Kaleido and uPort, as Web 3.0.
A slide from the ConsenSys pitch deck.Beyond those, the document says ConsenSys Labs has incubated 82 projects, its accelerator has worked with 27 and the company has directly invested in 35 companies between ConsenSys Ventures and ConsenSys AG.
Of all the projects, the deck places the most emphasis on four: PegaSys, Truffle, Infura and MetaMask.
It describes PegaSys as infrastructure for enterprise ethereum and ethereum 2.0, with a team size of 60 people. Infura is infrastructure-as-a-service for ethereum, with a team size of 18. Truffle is described as the ethereum development environment, with a team size of 20. Finally, MetaMask is a simple browser extension for using ethereum, with a team size of 17.
Meanwhile, the company holds large stakes (both in the form of equity and tokens) in companies that came up during the ICO boom. It represents its stakes in Gnosis, Grid+ and AirSwap as the most valuable while promising future token launches.
While acknowledging the tokens for these projects have lost a great deal of value, the document argues:
“We have conviction that our projects are focused on cryptoeconomic networks that will be essential and dominant in Web3 and have long term value.”
Revenue pipeline
The deck saves its strongest argument for last, perhaps suspecting that only real revenue will convince investors at this stage.
“After building the market and commercial engagement appetite, we refocused our business development efforts to build a broad enterprise and government pipeline across key verticals,” the deck contends.
The company earned $6.5 million in 2017, $21 million in 2018 and projects $52.3 million for 2019. Most of that revenue has come through services, primarily ascribed to the Solutions division.
Meanwhile, ConsenSys argues its deal pipeline (that is, contracts under discussion) has been growing rapidly, with $125 million in potential deals as of mid-March, and $10 million secured that month.
“We are shifting from smaller (~$200,000) advisory and proof-of-concept work to large (~$10 million ) product and platform development engagements,” the deck reports.
A request for comment was not returned by ConsenSys as of press time.
ConsenSys lanyards photo via CoinDesk archives