Melbourne, Australia-based startup CoinJar announced it will receive "Australia's first major bitcoin investment", signing a deal with local venture capital firm Blackbird Ventures to the tune of A$500,000 (US$455,000). The money will come from a group of individual investors with years of technology and startup experience.
CoinJar, founded in February 2013 by local entrepreneurs Asher Tan and Ryan Zhou, is a bitcoin buy/sell exchange and online wallet service with a clean and simple interface that allows customers to link certain bank accounts for direct transfers in and out of the system. It has also developed an iPhone app available internationally and CoinJar Checkout, a payment processing system for merchants with daily transfers from bitcoin to local fiat currency.
The company claims on its website to offer the cheapest bitcoin trading solution in Australia with a 2% flat fee for buying bitcoin and 1.1% for selling. It has almost 10,000 current users in Australia and wants to use its extra funding as a platform to expand into other countries.
CoinJar previously graduated from startup incubator AngelCube, a company that offers teams $20,000 in initial startup capital as well as mentorship and networking programs. The new VC recognition should also lend new credibility to CoinJar in the eyes of the more mainstream business community, and draw new attention to bitcoin and bitcoin-related service providers in Australia.
Blackbird Ventures' managing director Niki Scevak is heading CoinJar's new investment team. Other contributors include entrepreneur Torsten Hoffman, RetailMeNot founders Guy King and Bevan Clark, game developer Rob Murray, and serial technology investor Chris Hitchen. Hitchen said:
"Bitcoin is a game-changer, but the process of buying, selling and using bitcoin is still relatively hard. CoinJar changes that by making bitcoin more accessible and, eventually much more useful.
Their approach of offering a secure consumer wallet and merchant payment capability for bitcoin in addition to a liquid exchange is what makes them interesting; as consumer and business adoption of bitcoin becomes more mainstream, CoinJar is well-placed to be a significant participant."
He went on to say he believes the team, product and vision are all "strong" and he's excited to be involved.
CoinJar CEO Tan believes bitcoin is maturing into something real businesses can and should use every day to ease transaction hassles and fees.
“It is only a matter of time until business and consumers take full advantage of bitcoin as a solution to digital payments.”
"Bitcoin is moving past a purely speculative play. It is only a matter of time until business and consumers take full advantage of bitcoin as a solution to digital payments," he said.
It received some unwanted attention and bitcoin-related heat from the traditional finance industry in August, when Australia's Commonwealth Bank suddenly froze its business account and even shut down both founders' personal accounts. The bank declined to provide a reason for the actions. CoinJar subsequently received an offer from another of Australia's 'big four' major banks, NAB, to provide new business accounts.
Sydney-based Blackbird Ventures focuses on "inherently global Internet businesses" founded by Australians. As well as providing investment capital it also maintains a network of contacts in Silicon Valley to help local founders make the leap from Australia to an international presence.