Tim Draper: The Quintessential Crypto Venture Capitalist

Tim Draper is a man who needs no introduction in the world of finance as he is a colossal figure responsible for a number of companies that span many business niches. He is also one of the few mainstream finance magnates who has shown open support for Bitcoin, cryptocurrency and blockchain technology in general. His support for the crypto revolution hasn’t just been in words only but he has also demonstrated this support by investing in a number of blockchain-based startups.

The third-generation capitalist is known to be one of the most colorful, fascinating, and eccentric fellows in Silicon Valley. He has been described by his sister, Becky Draper as being an unusual guy. Tim is known for his grandiose persona which can be described as being larger-than-life, an energetic individual with an insatiable curiosity about innovation and technology. One of his fundamental principles is the belief that technology has the potential to transform the world. This is based on Tim’s own observation of the remarkable changes that have occurred in Silicon Valley over the years. As a result, he has made it his mission to spread the tech entrepreneurial revolution to many places around the world, hence his fascination with cryptocurrency and blockchain technology.

Early Life and Education

Tim was born Timothy (“Tim) Cook Draper on June 11, 1958. Both his father and grandfather were noted venture capitalists who are regarded as Silicon Valley royalty. He was born to Phyllis Draper (nee Culbertson) and William Henry Draper III. He is the third child of his parents who had two daughters, Becky Draper and Polly Draper. Tim’s father, William was a leading figure in the establishment of Sutter Hill Ventures. He also founded Draper and Johnson Investment Company. His grandfather was William Henry Draper Jr., was a pioneer of the California venture capital scene. He founded Draper, Gaither, and Anderson in 1958.

Tim grew up in Atherton, a competitive and athletic individual. He developed an aptitude for mathematics in his formative years. According to his elder sister Becky, Tim would sit for hours calculating the batting averages of all the players in his favorite baseball team. With this natural predisposition for mathematics, Tim enrolled at Stanford University to study electrical engineering. He graduated in the year 1980 before going on to earn an MBA from the Harvard Business school in 1984.

Personal Life

Tim is married to Melissa Draper and the couple has 4 children; two daughters, Jesse Draper and Eleanor Draper and two sons, Adam Draper and Billy Draper. Both Adam and Billy have followed in their father’s footsteps by venturing into the world of venture capital finance.

Non-Crypto/Blockchain Investment

A lot has been made of Tim Draper’s activities in the world of venture finance over the years. Tim first cut his teeth in the corporate world in the banking sector, working at the Alex, Brown & Sons bank. After earning his MBA from Harvard, Tim would take the plunge into venture capital and that was the start of his career.

Draper Fisher Jurvetson (DFJ)

Upon graduating from Harvard Business school and leaving his banking job, Tim took charge of his father’s investment fund which was worth about $2 million in 1985 and used it as the seed that grew into the DFJ venture capital firm. He was joined by John Fisher and Steve Jurvetson and together they formed the company that has gone on to have numerous successful investments over the years. Today, the Menlo Park-based DFJ is one of the most recognizable venture capital firms in the world. The company has invested heavily, placing smart bets on ventures like Baidu, Hotmail, Skype, Tesla, and Overture just to mention a few.

Viral Marketing

Over the course of Tim’s stellar career in the finance industry, the most popular association that has been ascribed to him is the invention of viral marketing, a paradigm-shifting concept that changed the face of digital advertising. According to the legend, Draper and Jurvetson invented the term sometime in 1996 as they would attach short adverts to the footer section of outgoing Hotmail emails. Viral marketing was one of the main launching pads of the internet e-commerce explosion of the late 90s and early 2000s and it soon became the standard marketing strategy for many businesses.

Crypto/Blockchain Investment

According to CB, Tim Draper, via the Draper Associates venture capital firm is the 4th most active blockchain VC in the world. CB’s statistics were based on a tally of portfolios from the year 2012 to the year 2017. Tim has been a staunch supporter of cryptocurrency for many years and that support has never wavered.

30,000 Bitcoin Purchase

One of Tim’s earliest involvement in the crypto space was in June 2014 when he bought 30,000 Bitcoin from an auction held by the U.S. Marshalls. The Bitcoin was part of a stash that had been confiscated by the U.S. government after the closing down of the notorious Bitcoin darknet marketplace, Silk Road. At the time, of the purchase, the price of Bitcoin was somewhere in the $600 region. This purchase of Bitcoin has made Tim be part of an elite group of personalities in the crypto space who are crypto millionaires. When Tim purchased the 30,000 Bitcoin, they were worth a total of about $19 million. Based on the current price of Bitcoin, Tim’s Bitcoin holdings should be worth about $240 million which constitutes a 1,000 percent increase in less than 4 years.

Despite the volatility of Bitcoin, Tim insists that he isn’t interested in cashing in on his Bitcoin fortune anytime soon. In a 2017 interview with VentureBeat, Tim likened such a move to “trading gold for shells.” Tim has vigorously maintained that he is in the market for the long haul, viewing Bitcoin not just as a speculative investment, but as the genuine future of money. He has stated many times, the belief that crypto will replace fiat within the near future.

Bancor

During the 2017 ICO boom, Tim made headlines for his involvement with a couple of high-profile ICOs that raked in hundreds of millions of dollars. This first of these was Bancor, the Israeli-based cryptocurrency exchange startup project. Tim acted not only as an investor on the project but was also attached to the project in an official advisory capacity. The Bancor ICO raised $153 million during its 1-month run from June 12, 2017, to July 12, 2017.

Tezos

If the Bancor ICO was thought to be a fluke then the Tezos ICO helped to dispel most doubts about Draper’s growing influence in the crypto industry. Tezos was a highlight of 2017 as it one of the most high-profile ICOs ever carried out. With Arthur and Kathleen Breitman at the helm of affairs, they went out of their way to get Tim Draper involved in the project. Tim not only invested in the Tezos project, he also campaigned vigorously. Even before the public sale, the presence of Tim Draper had helped the Tezos project to raise millions of dollars in early-stage funding from a number of venture capital firms.

The Tezos ICO took place over a 2-week period from July 1, 2017, to July 14, 2017. It raised a total of $232 million and was the highest grossing ICO for a brief period. In the aftermath of the ICO, the project ran into a number of difficulties as disputes arose over control of the funds that had been raised. Tim remained an advocate of the project even in the midst of the controversy, advising on probable ways the issue could be resolved.

Credo

Fresh from his investment exploits in the Bancor and Tezos projects, Tim wasted no time investing in yet another blockchain project, Credo. The main aim of the Credo project is to leverage blockchain technology in combating email spam which is a $20 billion a year problem for the global digital economy. Before the ICO went live, Tim bought a 10 percent stake in the company. As usual, Tim acted as an advocate for the Credo ICO proving once again that he is an ardent supporter of the crypto and blockchain revolution.

The Credo ICO raised about $11.3 million in ether. The crowdsale took place from September 30, 2017 to October 31, 2017. Prior to the start of the crowdsale, the hard cap target had been set at $10 million so the ICO was indeed another successful ICO that Tim Draper had been involved in.

Views on Cryptocurrency

Tim Draper doesn’t just only invest in blockchain projects, he is also a positive voice and influence in the industry. Many notable figures in mainstream finance maintain either a stoic ambivalence on market or are harsh critics of the industry. Tim, on the other hand, has never ceased to be optimistic about the future of the industry. For example, in the aftermath of the China ICO ban, while there was widespread panic, Tim maintained that China was making a grave mistake and that they would see themselves falling behind the rest of the world. He predicted that Japan would become the crypto powerhouse in the Asian theater.

Such is his enthusiasm for cryptocurrency that he wrote an open letter to the United States SEC regarding whether Credo tokens, the token of one of the ICOs that he invested in were indeed securities. He made a case for why they weren’t securities and he advised the commission on how best to regulate the expanding crypto ICO space.

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