COINOTAG News, May 15th. In a recent address at the Toronto Consensus conference, Dan Tapiero, CEO of 10T Holdings, raised critical insights regarding the valuation trends among cryptocurrency startups. He emphasized that a significant number of these firms are seeking valuations that greatly surpass their actual revenue, posing challenges for venture capital to yield satisfactory returns. “It’s perplexing that founders perceive a valuation of 50 to 80 times revenue as standard,” Tapiero remarked, emphasizing the impediments this creates for liquidity providers.
Notably, Tapiero’s firm has declined over 200 investment opportunities due to perceived overvaluation, encompassing well-known names like FTX and BlockFi. The stringent criteria of 10T Holdings demand enterprise valuations of at least 4-5 billion USD, with a market-sales ratio capped at 10 times. Despite apprehensions around a potential valuation bubble, data from PitchBook illustrates a robust growth in cryptocurrency venture capital, with first-quarter transactions soaring beyond 6 billion USD. Additionally, during the conference, Pantera Capital’s CEO, Dan Morehead, proposed an innovative “Equity + Token” investment model, highlighting that 86% of their funded projects are profitable, with 22 achieving unicorn status.