In this Tuesday Feb. 19, 2019, photo Alexis Ohanian, founder of the social media company Reddit, speaks during an interview in New York. (AP Photo/Bebeto Matthews)
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Seven Seven Six, a venture firm founded by Alexis Ohanian, the co-founder of Reddit and noted crypto bull, led a $5.3 million seed round investment in QuickNode, a company powering the future of a decentralized internet founded in 2017. Other investors include SoftBank Opportunity Fund, Arrington XRP Capital, and Crossbeam.vc.
QuickNode is a middleware company, meaning that it sits between its clients and the blockchains as an intermediary. The service offerings, which include a suite of application programming interfaces (APIs), can be used to query blockchain data and facilitate the operation of decentralized applications. QuickNode’s platform supports integration with six networks: Bitcoin, Ethereum, xDai, Polygon (MATIC), Binance Smart Chain and Optimistic Ethereum.
QuickNode, which is profitable, currently serves over 30 billion requests per month and grew its revenue over 1000% in 2020. Notable clients include data analytic firms CoinGecko, DappRadar, and Dune Analytics. Among other customers are the decentralized lottery provider PoolTogether and decentralized finance (DeFi) tokenization startup Fairmint.
Speaking to Forbes in advance of the announcement, Ohanian, who was also an early investor in leading crypto exchange Coinbase, said that “when you’re marketing services to developers, you’re not going to win based on sizzle. You’re gonna have to win based on state [quality]. Is what you’re building actually a critical piece of infrastructure to these companies? And the numbers don’t lie when you see growth like this.”
With the raised capital, QuickNode is going to scale up and out its business to support more blockchains and offer a more diverse product suite. “We are going to continue expanding our platform, building features and higher level abstractions to help developers save time, save money, get to market quicker and build the best version of their applications,” says Dmitry Shklovsky, co-founder and co-CEO of QuickNode. Regarding new blockchains that will be supported, Shklovsky noted that they have “about a half dozen additional networks in the pipeline”. While he declined to disclose specific names, Shklovsky did say that they will all be compatible with Ethereum.
Bridging the Centralized-Decentralized Divide
However, it is worth pointing out that while QuickNode may be driving a decentralized future, the company is itself a centralized entity like Coinbase. Additionally, it hosts its services on traditional cloud providers such as Amazon Web Services, Google Cloud, and Digital Ocean. While using multiple services provides redundancy, each one stands as a potential bottleneck. That said, the company is open to integrating decentralized and blockchain-based storage platforms in the future when their performance can support the needs of its clients.
When asked about this potential contradiction, for at least the time being, both Ohanian and Shklovsky noted that it is important to find the right balance between centralization and decentralization. Ohanian said, “At the end of the day, there are clearly some important roles that decentralization plays, and there are clearly important roles that certain centralized technologies play…at the end of the day, for Web3 (blockchain-based internet) to thrive, we’re going to have to take cues from the previous internet boom….Making it really easy for software engineers to start building and then scaling blockchain infrastructure is a really important foundational part.”
Shklovsky echoed this sentiment saying, “I believe that Dapper Labs (creator of NFT platform NBA Top Shot) put it best. They said that anything of value is decentralized. Everything else is there to provide the best user experience.”