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Israel-based StarkWare announced on Nov 16 via Twitter that it had raised $50 million in a Series C funding round, and that the firm’s valuation is now at $2 billion. Sequoia Capital was the lead investor, among other contributors.
Seven months ago, StarkWare raised $75 million in a Series B funding led by Paradigm.
We are excited to announce our Series C of $50M at $2B.
A big thanks to our lead investor, @sequoia, our wonderful follow-on investors, and the dozens of ecosystem partners and collaborators who participated in this round, for their vote of confidence in our products and tech.
Layer-2 (L2) blockchains, which build on the Ethereum network, offloading the computational stresses while still writing transaction data to the main network.
StarkWare, which builds an Ethereum scaling solution called StarkNet, has just closed a $50 million Series C led by Sequoia Capital. The raise comes several months after the firm raised a $75 million Series B led by Paradigm, a crypto VC firm co-led by former Sequoia Capital partner Matt Huang.
This latest raise values the Israeli startup at a whopping $2 billion.
Crypto VC firm Paradigm debuts monster $2.5 billion fund
As the Ethereum network continues to swell in popularity despite traction from competing blockchains with deeper efficiency, investors are starting to dump more money into the infrastructure startups aiming to help Ethereum scale to more users and more transaction volume.
Israel-based StarkWare said the round was led by Sequoia Capital, with participation from existing investors, including Paradigm, Three Arrows Capital, Alameda Research, and Founders Fund.
This was an “opportunistic” fundraise, StarkWare co-founder and CEO Uri Kolodny told The Block in an interview, meaning that the company is already profitable but secured new funds to grow its team and ecosystem as fast as possible.
What is StarkWare?
StarkWare is one of a few blockchain startups that have built Ethereum scaling products using rollups technology.
There are mainly two types of rollups — ZK-rollups and Optimistic rollups — that allow executing Ethereum transactions off-chain and storing only transaction data on-chain, thereby reducing the network congestion, increasing its speed, and reducing gas fees.
StarkWare uses ZK-rollups for its scaling technology.
— StarkWare (@StarkWareLtd) November 16, 2021
StarkWare uses ZK-Rollups to scale Ethereum. ZK-Rollups bundle transactions off-chain and create ZK-SNARKs, which get submitted to the base chain.
They allow for faster transactions with significantly reduced gas fees. Rollup technology currently comes in two flavors—ZK and Optimistic.
Optimistic Rollups such as Arbitrum and Optimism rely on trust between parties, resulting in a challenge period where anyone can dispute the legitimacy of a transaction. This means it can take up to a week for users to transfer funds back to Ethereum mainnet.
That means with StarkNet, any developer can write and deploy their smart contracts permissionlessly, like on Ethereum.
StarkWare hopes to bring “crypto apps for all” with StarkNet. StarkWare’s other co-founder Eli Ben-Sasson said in the interview that StarkNet will help make blockchain technology “usable by a much wider population.”
Several projects have committed to building on StarkNet, including MakerDAO, Aave, and Argent, said Kolodny.
When asked whether Uniswap is looking to partner with StarkWare, Ben-Sasson said, “we’re very hopeful that Uniswap will join us, but that’s up to their governance process to do that.” Uniswap currently uses Ethereum Layer 2 scaling solutions from Optimism and Arbitrum that use Optimistic rollups.
When token?
StarkWare’s Series C round comes just seven months after its $75 million Series B round in March.
As more efficient use of blockchain drives down transaction fees and carbon footprint, they save millions of dollars weekly and prevent harm to the planet.
“StarkWare is attacking one of the most important problems in crypto – the computational scalability of the blockchain,” said Mike Vernal, partner at Sequoia. “StarkWare is the clear market leader in terms of zero-knowledge roll-ups, powering over $100 billion in transaction volume just last month and helping dYdX, Sorare, Immutable and others to serve millions of customers. We are thrilled to deepen our relationship with the team behind such a foundational technology.”
Until now, StarkWare’s technology has been available only to clients through its scaling engine StarkEx.
Israel-based StarkWare appear on Tuesday via Twitter that it had raised $50 one thousand thousand in a Series C funding round, and that the business firm’southward valuation is now at $2 billion. Sequoia Capital was the lead investor, among other contributors.
Seven months ago, StarkWare raised $75 one thousand thousand in a Series B funding led by Image.
Nosotros are excited to announce our Series C of $50M at $2B.
A big thanks to our lead investor, @sequoia, our wonderful follow-on investors, and the dozens of ecosystem partners and collaborators who participated in this round, for their vote of confidence in our products and tech.
We’ve settled over $200 billion and settled over 50 million transactions.”
StarkWare’s particular scaling solution is what’s called a zero-knowledge rollup; it processes a number of transactions on its platform and inscribes the bundled data to the Ethereum network. Unlike competing “optimistic rollups,” which rely on a network of validators to ensure that the bundled data is legitimate after it’s published, zero-knowledge proofs leverage cryptography to mathematically ensure that everything is up to snuff before publishing it.
Those cryptographic proofs require more computational effort than other solutions, but their more secure architecture has led plenty of developers to believe they are the future of scalability for the Ethereum network.
Some of StarkWare’s customers include ConsenSys, Immutable, dYdX and Sorare.
StarkWare has raised $50 million in a Series C funding round that values the firm at $2 billion. The company plans to launch StarkNet Alpha on Ethereum mainnet by the end of November.
StarkWare Increases Valuation
Just weeks before StarkNet Alpha’s mainnet launch, investors are doubling down.
The ZK-Rollup developer announced the end of its Series C funding round Tuesday after raising $50 million from several existing investors.
Sequoia Capital led the round, with investment funds Paradigm, Three Arrows Capital, Alameda Research, and Founders Fund also participating.
We are excited to announce our Series C of $50M at $2B.
A big thanks to our lead investor, @sequoia, our wonderful follow-on investors, and the dozens of ecosystem partners and collaborators who participated in this round, for their vote of confidence in our products and tech.
