M&A wave in crypto space
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M&A wave in crypto space
Web3 is bustling with activity. Innovations, new features and composable elements of the ecosystems are added every day. From time to time, this inevitably leads to major, structural changes. These lead to M&A, in particular capital increases, consolidation and acquisitions.
Whether you want to increase capital because you want to move to the next phase of growth, or you need to increase capital because you are running out of money, capital increases are ubiquitous and currently one of the main reasons for changes in the shareholder structure of web3 projects.
In crypto winter, consolidation is another important issue. Why not join forces with similar projects, achieve your goals faster and reach critical mass together? Yes, your share of the pie may become a bit smaller, but the pie can be so much bigger!
Acquisitions for exponential growth are, of course, the predominant long-term goal of much of the sector. Among the top reasons for buying projects, companies or teams that we often encounter are:
- Improved access to developers or skills,
- Positive network effects by improved target group penetration and market share gains (especially in the gaming, NFT and social space)
- Economies of scale by consolidation of mining and staking operations,
- Pooling of market liquidity for DeFi projects,
- Enrichment of the ecosystem.
No matter whether you are planning a capital increase, a sale, an acquisition or a merger: We at Blockbuilders Capital are curious about your motives and motivations - let's talk about joint opportunities!
Selling your crypto project to traditional companies
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Selling your crypto project to traditional companies
If you would like to sell your crypto or web3 project, don't limit your search to the obvious options and people that understand the industry as well as you do. We experience more and more awareness of traditional companies that are beyond the stage of mere awareness and are ready to take over web3 and crypto projects.
However, bridging your web3 ideas to investors or consultants from a more traditional environment can be difficult - as no doubt you know since you first tried to explain your project to your grandparents.
When it comes to convincing investors outside the crypto space to acquire, capitalize or finance your company, your project will be evaluated according to traditional metrics and criteria as well. Better be able to present and position your company ideally to maximize value.
Blockbuilders Capital understands that building a succesful crypto project is an arduous and highly emotional journey. You put your sweat and tears into building a successful contribution to this vibrant and exciting, emerging world. As a result, any strategic exit needs to be considered from a long-term perspective beyond the short-term financial implications. Blockbuilders Capital takes into account strategic and personal considerations for the founders and, from experience, provides advice beyond the obvious.
Blockbuilders Capital is committed to partnering with crypto and web3 companies to realise the best strategic, personal and financial outcomes in every sell side M&A situation – whether we are mandated to find the best buyer or to drive a partnership, or to help shaping an optimal exit strategy over time.
Optimizing your exit
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Optimizing your exit
You've worked a long time to achieve the operational success and traction you have. You know how much effort and time it took to get to where you are now. How much time and effort will it take you to grow your business and your bottom line by another, say, 50%? Certainly a lot.
Now, proceeds from selling your business may very easily vary by much more than 50%, depending on when and to whom you sell in which structure.
Sometimes, market conditions just aren't right. Sometimes, you already know that some of your investments will pay off – it's just the potential buyers don't see or believe it yet. Sometimes, you're in great shape, but potential buyers underestimate the strategic value you can bring and the potential of your business.
Investing in optimizing the sales process and timing for an exit can pay big dividends. More than that, deciding what you still want to do before exit to increase the value of the business or project, and what you'd rather not start but leave to the new owner, will be critical to maximizing the outcome for you.
Blockbuilders Capital assists you in this process. Our methodology ensures that the relevant options are systematically developed and evaluated. Unlike traditional M&A boutiques, at Blockbuilders Capital we are not fixated on short-term transactions. We also support you in the long term with strategic and operational advice for a perfect exit.
Mergers, Joint-Ventures and Partnerships
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Mergers, Joint-Ventures and Partnerships
As a web3 company, you probably already have many partnerships in place and are comfortable moving within a network of partners to pursue your specific goals.
Sometimes, however, contractual relationships are not enough and you want to partner with a joint venture company or even merge with your partner. The stakes are higher in that case.
Perhaps you've noticed that another team is working on the exact same problems, just on a different chain? Why not join forces, mitigate risks and become stronger together?
The operational aspects of such a merger are difficult enough. Benefit from the additional input and experience of Blockbuilders Capital. We provide holistic advice with economic, legal and tax expertise. Our smart advice on classic transaction structures, token swaps and all relevant deal constructions allows you to focus on the ongoing business.
Many legal and transactional aspects of joint ventures and mergers of the respective legal entities are no different from that of traditional companies, but of course, there are also crypto and web3 specifics - better you rely on a specialist.
Blockbuilders Capital offloads some work from you and brings in general merger expertise. When the going gets tough and before you get ripped off, Blockbuilders also suggests appropriate negotiation tactics and brings them to the table in consultation with you.
Buy-side advisory:
Crypto gems for your business
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Buy-side advisory:
Crypto gems for your business
In crypto and web3, adoption and speed are critical success factors. Your company's organic growth alone may not be fast enough.
Supercharge your growth and achieve your strategic targets faster by an acquisition.
You probably already have suitable targets in mind (or Blockbuilders Capital can assist you with that) - but do you have any indication of vendor expectations on price and other conditions?
Blockbuilders Capital helps you identify and evaluate potential targets through rigorous commercial analysis and helps you formulate a solid acquisition strategy.
Blockbuilders capital approaches suitable projects or companies - in close cooperation with you, but not necessarily doxing you.
Blockbuilders capital guides you through all phases of the acquisition and negotiation process. Based on extensive M&A experience, Blockbuilders Capital facilitates the closing, the ongoing communication and also the subsequent integration.
Winning time for a deal
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Winning time for a deal
Blockbuilders Capital often encounters solid companies or projects where financing simply takes a little longer than expected. Unfortunately, this can have serious consequences - with raising capital at a low evalation being the less serious of the risks.
So, “buying time” makes a lot of sense if your runway is limited or someone is pushing you into suboptimal financing deal, or selling your share in the project, or worse. And of course, you can “buy time”. Blockbuilders Capital will show you the options and the price tag.
Often, you'll find that many of these price tags to "buy time" are actually much smaller than the price of suboptimal timing for an exit or equity raise. Some options can significantly increase the value of your business and provide additional opportunities for future value optimization.
Blockbuilders Capital advises on the range of operational actions to "buy time," identifies and negotiates appropriate interim external solutions with financial partners, intermediaries and investors, and structures your proposed deal to benefit from an overall maximization of shareholder (or tokenholder) value.
Selling your project to large corporations:
Closing the deal
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Selling your project to large corporations:
Closing the deal
Large companies "tick" and work very differently. You know that – even by just comparing your current office to that of the large company your're considering for your deal.
It makes a lot of sense to use a third party and advisor for a superb relationship management with your potential acquirer. Good and diverse communication channels into your potential acquirer's organization will give the deal the backing it needs and avoid the pitfalls – at the latest when the inevitable setback threatens to kill the transaction last minute.
Blockbuilders Capital is a rainmaker: We know how to get the deal done. We are on your side, letting you shine – and helping you ensure that all communication to the buyer is channeled in the best way possible to close the deal.
Blockbuilders Capital understands to leverage the triggers in large corporations and make sure that "the fish likes the bait". With their years of experience as executives in multinational corporations, Blockbuilders Capital knows what it takes to avoid hiccups and to keep the process as smooth as possible.
Strategic Financing and Debt Advisory
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Strategic Financing and Debt Advisory
Blockbuilders Capital generally advises not to rely on any single avenue to raise capital for your project, business or DAO. It pays to consider all options and provide for contingencies and backups to ensure that capital, the lifeline of your growing business, never becomes critical to survival.
Even if you're well on your way to an ICO or a secondary sale of coins, make sure it's not the only source of funding. Market conditions and investor interest change quickly. The key to long-term funding success is being able to leverage multiple routes to access financial markets.
Crypto and web3 companies are focused on developing great products on a limited budget - the extreme leverage of the right financial strategy easily gets out of focus. Yet this can significantly increase operational degrees of freedom and has a huge impact on shareholder value.
Blockbuilders Capital advises on every form of financing, from traditional financing options such as capital raises or debt, to financing through mezzanine capital, securitization, factoring, sale and lease back, and all the fantastic new financing options that crypto and web3 markets are enabling for the first time in human history.
Blockbuilders Capital advises in a holistic approach considering strategic, economic, technical, legal and all other relevant aspects. We show you the way to an optimized, cost-efficient and risk-mitigating financial strategy and facilitate you in meeting your immediate financial needs.
Based on our network of investors and capital providers, combined with your existing network, you will reduce your financing costs and your risk of financial distress - and achieve a long-term strategic advantage.
Blockbuilders Capital supports the crystallization of your achievements in a shorter timeframe.
Stakeholder management in M&A processes
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Stakeholder management in M&A processes
Many M&A projects have already failed due to internal resistance - for example, if the board of directors does not approve the deal, not only is the current project dead, but the stakeholders have also been "burned" and a similar project will not be possible again in the foreseeable future. Make sure that doesn't happen to you - with the right stakeholder management.
Also, for a successful post-merger integration, it is necessary to consider the most important stakeholders as early as possible, even in the phase when the deal is still being discussed confidentially in the smallest circle.
This is especially true for web3 projects. Developers often are the most important stakeholders and frequently token holders as well, but beyond that, community involvement is of much greater importance for many projects than in traditional environments.
Blockbuilders Capital engages all stakeholders - by conviction. Stakeholder management is not only a necessity for a successful deal, but also of utmost importance beyond the deal. In the long term and sustainably, shared goals are achieved through stakeholder collaboration. Even a failure of a deal at the last second can never be ruled out - it is good if the stakeholders still pull together, even then.
Blockbuilders Capital advises on stakeholder management on the basis of many years of sound experience, integrates the relevant methods and instruments and advises on the design of the communication plan.
Selling your project to large corporations:
Integrity
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Selling your project to large corporations:
Integrity
You see an opening to sell your crypto project to a large corporation, or even a competitor? Congrats, that's just marvelous! Or is this a betrayal of the ideals of web3, decentralization, freedom and empowerment?
Will you bring your startup spirit to your future parent company, can you even achieve a “reverse takeover”, or will your innovative pace be stifled?
Blockbuilders Capital can show you possible paths from experience, as well as strategies to protect your financial and non-financial interests. Within certain limits, it is possible to mitigate the risks to your heritage and your employees’ future work environment.
Blockbuilders Capital devises strategies that go beyond the immediate steps of closing the deal and, if desired, advise you on your personal role and how to protect your interests over the long term.
Buy-side Advisory
for traditional companies
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Buy-side Advisory
for traditional companies
As a business, you are well aware of the threat and opportunity that crypto and web3 pose to your industry.
In order to strengthen your business and move forward quickly, it can be a costly and time-consuming process to build up staff and skills and grow yourself into the crypto and web3 industry, only to possibly find that your specific approach ends up becoming obsolete again.
Better to speed things up, focus on the winners, and acquire a company or DAO that is already where you want to be, or that brings the required competencies in a single step, rather than go through a lengthy and uncertain process.
Blockbuilders Capital speaks your language and has a sound understanding of your business strategy, challenges and opportunities, but also provides you with an overview of the relevant segments of the crypto and web3 world.
Blockbuilders Capital will help you select potential acquisition targets that are in line with your strategy. We assist you in evaluating cultural fit and alternative options. Blockbuilders Capital helps discreetly assess readiness to sell, appropriate incentives, and potential levers for a quick close.
Blockbuilders Capital finds the right approach for a successful and speedy closing, once you choose to go that route.
Blockbuilders Capital sheds the right light on your web3 gem.
About
Blockbuilders Capital
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About
Blockbuilders Capital
Blockbuilders Capital and its contributors have a long track record of successful M&A projects and transactions with multinational corporations as well as smaller and mid-sized companies, primarily in IT and high tech. The total transaction volume on which we have advised is well into the billions of euros.
Blockbuilders Capital has structured, initiated and led transactions primarily on the buy and sell side, but we also supported mergers, joint ventures and many successful capital raises.
In recent years, crypto and web3 became first an area of curiosity, then an obsession, and now a profession for us at Blockbuilders Capital. We expanded our team to include specialists to cover different crypto subsegments.
We believe in AND (&&) over OR. We create value in cooperation with you and with an holistic approach. We love to learn about your project, your technology and your perspective on the space, and are eager to contribute.
We believe in decentralization and the power of the DAO - and we live it by bringing you the best value of a decentralized organization. However, the nature of M&A requires a very structured, rigorous and straightforward process. We deliver this process very efficiently, in close coordination with you and all of your stakeholders.
Blockbuilders Capital combines many years of M&A experience with an excellent understanding of crypto and web3 specifics - please contact us for a quote for your project!