FuturePerfect VC: Emerging Markets are Bitcoin's Best Bet
The New York-based firm has emerged as an active investor in companies in the sector, so far participating in funding rounds for Abra, BitPesa, Blockchain, Blockstream and Case, two of which are among the largest so far in the industry's history.
Going forward, Jobanputra says FuturePerfect is actively looking to invest in post-seed companies raising rounds of $1m–$5m in a bid to scale their efforts. However, it's a global focus that is compelling the $50m fund, launched in 2014 by Jobanputra following stints at RTP Ventures and the Omidyar Network, that shapes the firm's thesis on bitcoin and the blockchain.
Her interest in the technology, she explained, came early in 2013 following time spent in Africa analyzing the growth of mobile money services platform M-Pesa.
"That was the perspective I was bringing to learning more about the space," she told CoinDesk. "Large data, decentralization and analytics, [bitcoin and the blockchain] fit in nicely with where technology in general is headed. It's not only in the FinTech space, we're witnessing more decentralization as more machines and devices come online around the world."
"If you look at the efficiencies, a digital ledger just starts to look like a global opportunity. It's just such a huge technology with huge potential that I wouldn't want to even categorize it."
Of course, while those opportunities may exist, the teams that can turn these big ideas into products that thrive in the marketplace are more scarce.
"Venture is not really about funding science projects," she continued. "It's looking at applications that can serve a purpose and address pain points in the current market in the near term."
In particular, Jobanputra cited FuturePerfect portfolio company Abra as a "great example" of a company that has provided a convincing case it can create a more efficient cross-border payments system today.
“There is a huge opportunity to do something in the sector and do well, but it's important to know who else is working on what.”
Helmed by entrepreneur Bill Barhydt, Abra offers a mobile app that facilitates remittances via the blockchain, effectively outsourcing money transmission requirements to end users. Heralded as an "Uber for remittances", Jobanputra suggests that rising smartphone penetration provides a compelling case that the as-yet-unlaunched service can take off.
"The tellers are mobile and they're not fixed kiosks. That's an immediate pain point, wrapping in other elements of technology and mobile is one of them," she explained. "Smartphones are much more prevalent than they were five or six years ago."
Because of the broad applications for technology, Jobanputra says it's too early to tell if it will take off as a consumer or business-focused solution even given the increasing interest from major mainstream banks in the technology.
"We're just in the very early stages and even thinking about the use cases," Jobanputra said.
Her advice to those who want to get involved in the ecosystem? Observe the competition. "We're seeing a lot of new companies startup because there is a huge opportunity to do something in the sector and do well, but it's important to know who else is working on what."
Jobanputra also spoke out about the tendencies of the tech press to view startup funding as a measure of success, noting that some companies are simply able to operate leaner and more efficiently.
"We're in a very nascent market and we're accustomed to seeing high fundraise amounts just because the money is out there," Jobanputra said. "The smartest companies are figuring out their business model and not raising just because they can."
She further rebutted attempts to compare current investment levels in the bitcoin and blockchain ecosystem with funding from the 1990s, calling this analogy potentially "dangerous".
"There are lots of things that have changed in tech and capital," she continued. "Capital has become a lot more global and consumer and enterprise focused."
Still, Jobanputra indicated that were some trends in the sector that she currently supports, including the tendencies for VCs to focus on strong technology teams as a hedge against uncertainty regarding how the industry may evolve.
As for her prediction for the technology's killer app, she asserted her belief that the developing world will perhaps provide the answer.
However, she hinted at the many components are needed to realize it, concluding:
"This whole idea in the longer term of having an identity that you have different assets associated with and can transact with, that is very attractive as we get to a more global and cross-border world. There's so much more movement of people and assets across borders and I think this is where the blockchain can excel."
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