Company plans to be first to market with this next generation chip technology, which will be one of the most efficient chips in the market and enable KnCMiner to dramatically increase its bitcoin mining capacity
February 3rd, 2015 – Stockholm/London: KnCMiner, the professional bitcoin mining company, announces a Series B investment of $15M led by Accel Partners with participation from existing investors Creandum, GP Bullhound and private investor Martin Wattin. KnCMiner plans to use the new capital, in addition to cash generated through operations, to increase its bitcoin mining capacity and continue to build the bitcoin-processing infrastructure of the future.
KnCMiner has also completed its 16nm chip tape-out with Alchip at Taiwan Semiconductor Manufacturing Co Ltd (TSMC) and expects to be first to market with this next generation chip technology. This will be one of the most efficient chips in the market, enabling KnCMiner to dramatically increase its mining capacity and to become a trusted, low-cost scale provider of bitcoin mining capacity on a global basis.
Founded in Stockholm in 2013 by datacentre and Application-Specific Integrated Circuit (ASIC) experts, KnCMiner started by designing and selling bitcoin mining hardware to 3rd party miners, but has been mining bitcoins directly on an industrial scale since February 2014. KnCMiner has generated over $100M in revenue since launch and re-invested most of its profits in the mining operation.
Bitcoin mining to date has been dominated by individuals who pool their computing resources; however, as the market in bitcoin and other blockchain-based applications matures and expands into the mainstream there is a need for industrial-scale bitcoin mining capacity in regulated markets. A bitcoin miner plays a fundamental role in maintaining the integrity of the Bitcoin network, as it is the transaction clearing mechanism that eliminates the potential for double-spending. There are very few teams worldwide that have the expertise required to do industrial scale mining, like KnCMiner. The combination of its scale and leading edge architecture will sustain it as a significant player going forward.
KnCMiner is also a technology leader in Bitcoin mining. It has entered the production phase of a 16nm chip with TSMC through its trusted partner Alchip. This is not only TSMC’s first 16nm production for bitcoin mining, but also one of the very first 16nm chips in any segment to enter full production phase.
While the public focus has been on bitcoin price volatility, the market for bitcoin and other blockchain applications has been expanding dramatically. Blue-chip merchants such as Dell, Expedia or Microsoft now accept bitcoin, whilst leading payments companies such as PayPal and Stripe have added bitcoin products. Top tier investors have to date invested over $400M into bitcoin companies. KnCMiner has partnered with several bitcoin companies directly, including Circle Internet Financial and BitPay, to improve liquidity and thus the end user experience. Working alongside the vibrant Bitcoin community, KnCMiner will continue to partner with other companies in the ecosystem to increase user adoption.
Sam Cole, co-founder and CEO of KnCMiner, said: “We have invested more than $70M over the last 12 months into building a world-class bitcoin mining operation and plan to invest a further $150M over the next 18 months as we become one of the key transaction processors within Bitcoin. We are delighted to be partnering with Accel in this next chapter, as we continue building our brand and relationships within the Bitcoin and broader financial communities.”
Michiel Kotting, Partner at Accel Partners will join the company’s board, whilst Fred Destin of Accel will join as observer. Kotting said: “We are excited to back the KnCMiner team, as they have proven to be world class operators in a very dynamic marketplace. We strongly believe in the long-term potential of Bitcoin technology and see large scale miners like KnCMiner playing a crucial role.”
Staffan Helgesson, General Partner at Creandum: “We are happy that Accel Partners are joining us in supporting KnCMiner's rapid growth. Since we invested in KnCMiner in 2014, they have built a world-class payment processing platform and grown to be one of the leading bitcoin companies globally. We believe KnCMiner will be one of the key infrastructure companies in the bitcoin ecosystem long term."
GP Bullhound also advised the company for this round.
Founded in 2013, KnCMiner is a global Technology leader in the Bitcoin space. KnCMiner has an exceptional track record of delivering next generation ASIC chips to the market. Based in Stockholm, Sweden, KnCMiner develops state-of-the-art chip design and cloud services for blockchain-based applications and cryptocurrency mining. KnCMiner also runs industrial-scale operations in other locations globally with the main focus in the Arctic Circle. For more information, visit the KnCMiner web site at www.kncminer.com.
About Accel Partners
Founded in 1983, Accel Partners has a long history of partnering with outstanding entrepreneurs and management teams to build world-class businesses. Accel today invests globally using dedicated teams and market-specific strategies for local geographies, with offices in Palo Alto, New York City, London and Bangalore. Accel has helped entrepreneurs build over 300 successful companies, many of which have defined their categories, including Alfresco, Angry Birds (Rovio), Atlassian, Circle Internet Financial, Cloudera, ComScore, Dropbox, Facebook, Gameforge, Groupon, Imperva, Kayak, Nimble Storage, Playfish, QlikTech, Spotify, Supercell and Varonis. For more information, please visit the Accel Partners web site at www.accel.com. Find us on Facebook at www.facebook.com/accel.
Creandum is a Stockholm and Palo Alto based VC firm investing in fast growing European companies within the consumer, software and hardware industries. Creandum was founded in 2003 and has in the last decade invested in more than 40 companies, including Spotify, Epidemic Sound, Vivino, iZettle and Tictail. Visit www.creandum.com for more information.
About GP Bullhound
As dealmakers in technology, GP Bullhound provides independent strategic advice on mergers and acquisitions and private placements to entrepreneurs, companies and investors. By combining a true passion for innovation with great access to global buyers and capital across Europe, US and Asia, GP Bullhound has completed transactions with many category leaders including Avito, Delivery Hero, Fjord, King.com, Pingdom, Pozitron and Spotify. The firm was founded in London in 1999 and today also has offices in San Francisco, Stockholm, Berlin and Manchester. For more information, please visit www.gpbullhound.com