How to evaluate a company paid in cryptocurrency?

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November 20, 2024

by a searcher from Roosevelt University in Boston, MA, USA

I am evaluating a business that sells services into the web3/blockchain ecosystem. The revenue numbers are attractive, and profit margins are healthy but the company is paid in cryptocurrency. In fact the entire business seems to operate on crypto (paying employees, vendors, receiving payments, etc). The company is based outside of the US so there is not an ability to secure an SBA loan. The demand for their services seems fairly steady.

Are there M&A lenders who work in the blockchain space? How do lenders feel about businesses operating internally on cryptocurrency? What should I look for specific to these kinds of businesses?

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Reply by a professional
from Tufts University in Boston, MA, USA
My understanding is it's fairly common for "crypto native" companies to keep as much of the business in crypto as possible to avoid FX fees.

I imagine you wont find a traditional lender for something like this. But I'd be curious if smaller crypto VCs, trading firms, etc may be interested, especially given the bull run of the last few months.
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Reply by a searcher
from University of Arizona in Tucson, AZ, USA
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