Magma VC has invested $400,000 in decentralised social messaging startup GetGems (formerly Gems).
Achituv told CoinDesk:
GetGems CEO Daniel Peled further expressed his belief that Magma VC would in turn increase its chances of success in the long term.
“The additional funding will help us scale our company faster which is necessary since the mainstream instant messaging market is very competitive,” Peled said.
Announced in October, the GetGems encrypted messaging service is now available on Android. Gems plans to introduce its basic iOS app, wallet and token system and advertising platform in 2015 using funds from its ongoing crowdsale.
Community support proves essential
Unlike a recent investment made by 10x Venture Partners as part of a crowdsale for e-commerce software developer Ziftr, Magma’s investment has not been made in the GEMZ tokens directly.
However, Achituv indicated that the crowdsale did inform his team's decision to back GetGems, stating that the support of the community provided assurance of the project's viability.
“We hope our investment as a well-known venture capital firm would also increase the bitcoin community as well as general public's trust in GetGems as a platform and therefore its cryptocurrency will have an increasing value,” Achituv added.
“We believe in the blockchain and cryptocurrency as a macro trend and if the right opportunity is found we're open to investing,” he said.
The appeal of crypto 2.0
While GetGems marks Magma’s first investment in the bitcoin ecosystem, Achituv said that the service, operated by Decentrlized Mobile Applications Ltd, was not the first from the industry his firm considered, having vetted a number of bitcoin mining companies in 2013.
Perhaps most notably, however, Achituv voiced his belief that Gems was attractive as it is not wholly dependant on the price of bitcoin, but rather leverages its technological benefits to provide value for consumers.
“We're looking for investments that control their destiny on their own and create new solutions and value. What we are seeing now is not directly on bitcoin, it's more trying to leverage the benefits of the technology for new use cases and capabilities,” he added.
Achituv indicated that he believes GetGems could prove influential in inspiring other businesses to consider leveraging the capabilities of bitcoin in similar ways.
Images via Gems
The leader in news and information on cryptocurrency, digital assets and the future of money, CoinDesk is a media outlet that strives for the highest journalistic standards and abides by a strict set of editorial policies. CoinDesk is an independent operating subsidiary of Digital Currency Group, which invests in cryptocurrencies and blockchain startups. As part of their compensation, certain CoinDesk employees, including editorial employees, may receive exposure to DCG equity in the form of stock appreciation rights, which vest over a multi-year period. CoinDesk journalists are not allowed to purchase stock outright in DCG.