{"id":26844,"date":"2025-05-15T00:46:34","date_gmt":"2025-05-15T00:46:34","guid":{"rendered":"https:\/\/dogewisperer.com\/crypto-startups-scaring-away-vcs-with-80x-valuations-10t-holdings\/"},"modified":"2025-05-15T00:46:34","modified_gmt":"2025-05-15T00:46:34","slug":"crypto-startups-scaring-away-vcs-with-80x-valuations-10t-holdings","status":"publish","type":"post","link":"https:\/\/dogewisperer.com\/?p=26844","title":{"rendered":"Crypto startups scaring away VCs with 80x valuations: 10T Holdings"},"content":{"rendered":"
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\"Crypto<\/p>\n

Too many crypto startups are pricing themselves out of venture capital funding by chasing valuations far exceeding their revenues, according to Dan Tapeiro, the CEO of crypto-focused venture capital firm 10T Holdings.<\/p>\n

\u201cFor some reason, founders and CEOs think that they should be raising capital at 50 to 80 times revenue. So that makes it very hard for us to make a return for our liquidity providers,\u201d Tapeiro said while speaking in a panel discussion at the Consensus conference in Toronto on May 14.<\/p>\n

\u201cSo a lot of those deals we just pass almost automatically, even businesses that we really like, we won’t invest in if the price isn’t reasonable in the beginning.\u201d<\/p><\/blockquote>\n

10T Holdings has passed on over 200 companies for similar reasons, including the now-bankrupt FTX,<\/a> BlockFi and Celsius, Tapeiro said.\u00a0<\/p>\n

Tapeiro said 10T Holdings looks for crypto projects that have valuations above the $400 million to $500 million range with a valuation-to-revenue ratio of 10x or less.<\/p>\n

\"Crypto
Host of Crypto In America Eleanor Terrett (left) moderating a discussion with Pantera Capital CEO Dan Morehead (middle) and Dan Tapeiro (right) at the Consensus conference. Source: Cointelegraph<\/em><\/figcaption><\/figure>\n

VCs often prefer lower valuations because they offer more upside potential with less risk.<\/p>\n

Realistic valuations often make follow-on funding rounds<\/a> more attractive to investors while also simplifying the exit process.<\/p>\n

\u201cValuation is very important,\u201d Tapeiro said.<\/p>\n

Despite Tapeiro\u2019s comments, it appears that crypto startups have had no problem attracting VC funds<\/a>, as PitchBook reported on May 13 that the total value of crypto venture capital deals rose over 100% quarter-on-quarter<\/a> to $6 billion in Q1 2025, while the number of deals only increased by 8.8%.<\/p>\n

VCs should diversify their bags<\/h2>\n

Also speaking alongside Tapeiro was Pantera Capital CEO Dan Morehead,<\/a> who said more VCs should opt to receive a mix of private equity and tokens when investing in crypto startups.<\/p>\n

\u201cEach one has their pros and cons, and then they go in these wild pendulum swings where sometimes tokens are really expensive and ventures cheap. Sometimes it’s the opposite.\u201d<\/p>\n

Related: <\/strong><\/em>Crypto VC deals drop in Q1, but funding more than doubles: PitchBook<\/strong><\/em><\/a><\/p>\n

\u201cSo as an investor, I always advocate people investing in a wide spectrum of tokens and ventures.\u201d<\/p>\n

Morehead\u2019s Pantera has taken a more aggressive approach than 10T Holdings over the years and seen considerable success, making a return on 86% of the startups it invested in, with 22 of those reaching unicorn status<\/a> <\/strong>(companies reaching $1 billion valuations).<\/p>\n

Magazine: <\/strong><\/em>Danger signs for Bitcoin as retail abandons it to institutions: Sky Wee<\/strong><\/em><\/a><\/p>\n