The Block, a cryptocurrency-focused media startup, tells Axios that it has bought out its non-employee shareholders, including its investors and co-founders (who have left the company).
Why it matters: The company says it wants flexibility to better compensate existing and future employees in an increasingly competitive talent market, and to be independent from outside investors and interests.
Details: With a mix of debt and cash from CEO Mike McCaffrey, the company returned to its investors 1.5 times the capital they paid in, plus interest.
- The Block had raised just over $4 million across convertible notes from VCs, including Greycroft, Pantera, BlockTower Capital, and Bloomberg Beta. This does not include the founders' stakes in the company (McCaffrey declined to say how large those were).
- The Block is not yet profitable.
- Roughly 70% of its revenue came from advertising, while the rest was from subscriptions to its paid news content and research products.
The bottom line: The Block used venture capital to get started and finance its early operations.
- "We want to be disentangled from it so we can cover it independently — we have been doing that, but this cements that independence," news director Frank Chaparro tells Axios, adding that the cryptocurrency audience is particularly skeptical when it comes to potential biases and conflicts of interest.
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