From FinTech to (Web3) Energy. What could go wrong? 🫣; Bitcoin drops below $19,000, & signals for more crypto bankruptcies ahead 🔔; Global VC funding reaches lows not seen in years. To worry or not?

FinTech is Eating the World, 8 September

Good evening Everyone,

And happy Thursday! Today’s issue is coming late but it’s definitely worth the wait. We’re going to look at why the transition from FinTech to Web3 Energy startup should raise lots of questions (& what could go wrong), Bitcoin dropping below $19k, and signals for more crypto bankruptcies ahead (Terra, Celsius, 3AC weren’t the last ones), and the global VC funding reaching lows not seen in years (& should we worry + a brilliant resource to get investors to say YES to you). Let’s jump straight into the awesome stuff:

From FinTech to (Web3) Energy. What could go wrong? 🫣

The launch & the raise 🚀 Former Revolut Chief Revenue Officer Alan Chang, the neobank’s employee #5 and one of its key lieutenants, has raised a $78M round for his Web3 energy startup Tesseract founded with fellow ex-Revoluter Charles Orr. 

$30M was reportedly raised in traditional equity, with the remaining amount raised through a sale of its native token. Balderton and Lakestar led the round and additional backers of the round include Accel, Low Carbon, and Ribit Capital, among others.

The USP 🥊 According to Insider, the startup is expected to operate as a vertically integrated renewable energy company that buys energy from generators at fixed prices that are then offered to consumers.

It's this process — called a power purchase agreements (PPA) — that Tesseract is looking to tokenize. Each Tesseract token will act as a PPA and correspond to a right to access power targeted at 1 watt of capacity on the company's network, as per Insider. Tesseract's website promises "commission-free energy" that is up to 10 times cheaper. That’s a hefty promise! 😳

Suddenly, energy is very, very sexy. While I have nothing against Alan and his transition to the energy sector (he’s a great guy, spoke with him a couple of times during the early days of Revolut), this definitely raises more questions than answers (is this the “innovation” we actually need?). Here’s the takeaway: