MicroStrategy's $42B Capital Raise Plan

In partnership with

📢 Sponsor | 💡 Telegram | 📰 Past Editions

Good Morning.

November is going to be a busy month for all of us. The US election is happening in a week, coinciding with FOMC plus Devcon the week after. If Kamala wins, there’ll be short-term pain. If Trump wins, I believe BTC will conclusively break above ATH. Regardless, both policies will lead to more inflation and supposedly a more bullish 2025 outlook for risk-on assets.

The new pod episode is up!

The new pod episode is up!

In Today's Email:

• What Matters: MicroStrategy 42B Capital Raise Plan 📈 

• Founders Highlight: Fabrizio & Matthew of Legion 🪙 

• Deal Flow: Nillion’s $25M Funding 🖥️ 

You read and share. We listen and improve. Send us feedback at [email protected].

TOGETHER WITH

Experience the all-new Decentraland

Explore the future of Decentraland with the new Desktop client, now available on Mac and Windows. Enjoy smoother performance, more immersive environments, upgraded avatars, new social features, daily quests with mini-games, and more. Dive in to unlock new badges and experience Decentraland like never before.

Download Decentraland to start exploring.

WHAT MATTERS

MicroStrategy 42B Capital Raise Plan

State of play: MicroStrategy announced its Q3 2024 financial results and highlighted an ambitious three-year, $42B capital strategy to expand its Bitcoin reserves.

MicroStrategy’s Q3 total revenues reached $116.1M, though software revenues decreased year-over-year.

• For Q3, MicroStrategy achieved a 5.1% BTC Yield and increased its Bitcoin holdings by 11%, raising the year-to-date yield to 17.8%.

• To further drive BTC Yield, the company has set a target range of 6-10% annually for 2025-2027.

• Operating expenses rose dramatically due to impairment losses on digital assets, contributing to an operational loss of $432.6M.

Announcing the “21/21 Plan,” the company aims to raise $21B through equity offerings and $21B through fixed-income securities.

• The strategy is centered around accumulating Bitcoin and is expected to boost shareholder value by leveraging digital assets as treasury reserves.

• CFO Andrew Kang noted that they issued $2.1B in equity and debt, using part of this to repurchase senior secured notes.

• The move reduced annual interest expenses by $24M.

Why it Matters: MicroStrategy’s $42B capital plan shows its continued push into Bitcoin, aiming to drive shareholder value and set a new standard for using digital assets in corporate finance.

What’s next: With an ambitious 6-10% BTC yield target through 2027, MicroStrategy’s 21/21 Plan focuses on accumulating Bitcoin while balancing financial stability.

For builders and investors: Michael Saylor is the best financial engineer in the past decade.

BUILDER-INVESTOR HIGHLIGHT

Fabrizio & Matthew of Legion

Intro: Fabrizio Giabardo and Matt O'Connor are the Co-Founders of Legion, an onchain fundraising platform focused on transforming early-stage crypto investments through a merit-based system.

• Fabrizio is also a Project Lead at Delphi Digital.

Previous background: In his early career, Fabrizio developed a foundation in service design, customer experience, and digital strategy. Matt spent his time at Bridgewater Associated before dabbling in crypto.

The big idea: Fabrizio and Matt are democratizing early-stage crypto investment through Legion by enabling transparent capital raising and allowing investors to participate based on contributions rather than wealth.

Take a peek at our referral reward at the bottom of this issue. Share this newsletter and receive our list of 500 crypto VC individuals 👇

INSIGHTS

Allegations of MrBeast's $23M Profits

State of play: A new report by @hxnterson & @kasperloock claims that YouTube sensation MrBeast profited $23M in crypto through a series of scams and dubious deals. However, the report's credibility is called into question.

• Much of the report focuses on MrBeast’s promotion of crypto tokens that later depreciated in value, which is not illegal if done within regulatory guidelines.

• The report has sparked mixed reactions online, with many expressing surprise at the allegations while others demand validation from more credible sources.

• The topic trended on social media, earning over 1M impression, as discussions around the nature of celebrity endorsements in the crypto space intensified.

DEAL FLOWS

Nillion Raises $25M for 'Blind Computing'

Deal flows - this week, we saw $170M+ in deals 💼 

Privacy blockchain project Nillion has raised $25M in a funding round led by Hack VC, with participation from angel investors and contributors from notable projects like Arbitrum, Worldcoin, and Sei.

• Nillion's "blind computing," enables the processing of data without revealing its contents, facilitating secure application collaboration.

• The project aims to bridge the gap between blockchain and AI, ensuring security while decentralizing data ownership.

• Nillion is partnering with various blockchain networks, including NEAR, Aptos, and Ritual.

Deal flows in the past week:

• KRNL Labs, $1.7M Pre-Seed Round

• Cap Labs, $1.9M Pre-Seed Round

• Axel, $2.5M Pre-Seed Round

• Native, $2.6M Seed Round

• Magma, $3.9M Seed Round

• Nitro Labs, $4M Seed Round

• PARAVOX, $4.5M Seed Round

• Spire, $7M Seed Round

• PumpBTC, $10M Seed Round

• Sapien, $10.5M Seed Round

• Alliance Games, $8M Series A Round

• Gelato Network, $11M Series A Round

• Citrea, $14M Series A Round

• Vixchain, $7M Unknown Round

• BitSmiley, $10M Unknwon Round

• Ellipsis Labs, $21M Unknown Round

• Nillion, $25M Unknown Round

• Glow Labs, $30M Unknown Round

💰 Secondary Market and M&A Deals (Powered by Acquire.Fi)

• BounceBit (sell) SAFT, Min Size - $500,000, Valuation: Open

• ZkSync (sell) SAFT, Min Size - $500,000, Valuation: Open

• DAWN (buy) SAFT, Min Size - $1,000,000, Valuation: Open

• SUI (buy) Tokens, Min Size - $1,000,000, Valuation: Discount from spot

• Babylon (sell) SAFT, Min Size - $1,000,000, Valuation: Open

• Web3 Marketing Agency + Syndicate M&A, TTM Revenue: $7M, TTM Profit: $3.5M Asking Price: $10M

QUICK BITES

• Coinbase pledges $25M to Fairshake PAC.

• Securitize crosses $1B in tokenized onchain assets.

• Immutable received a Wells notice from the US SEC.

• COIN drops 15% after weaker-than-expected earnings.

• Crypto losses to hacks and scams surpass $1.4B in 2024.

• ZetaChain resumes block production after a 6-hour outage.

• CZ makes his first public appearance at Binance Blockchain Week.

• Kraken launches its desktop trading apps inspired by Cryptowatch.

• Tether registers $2.5B in net profit for Q3, bringing YTD total to $7.7B.

• Florida's CFO says the state holds about $800M in crypto investments.

NOTEWORTHY READS

• Matti’s read on GOAT.

• Decentralised’s read on sentient AGI.

• @tradetheflow_’s read on SOL restaking race.

If you enjoy reading this issue, please consider subscribing. It takes 1 minute of your time but it would mean the world to us 🙇

Disclaimer: All the information presented in this publication and its affiliates is strictly for educational purposes only. It should not be construed or taken as financial, legal, investment, or any other form of advice.