San Mateo crypto startup FalconX's value jumps 5X in 5 months to $3.75B

FalconX Ltd., a three-year-old digital asset trading platform startup, said Tuesday that it raised $210 million in new funding at a valuation of $3.75 billion.

The new round of capital comes just five months after the San Mateo company raised a $50 million series B round that gave it a valuation of about $675 million.

CEO Raghu Yarlagadda, who previously was a Chrome operating system product manager at Google, told Bloomberg that his company has been profitable for about a year as revenue grew more then 30-fold. He also said that its gross margin is close to 80%, similar to that of some enterprise software companies.

Monthly transaction volume now tops $10 billion, Yarlagadda told Bloomberg. A key factor he cites is FalconX's ability to provide reliable pricing through connections to more than 100 venues. These include exchanges such as Coinbase and FTX, as well as proprietary trading firms and OTC desks.

Yarlagadda said that he will use the new capital to scale the business globally, with a particular focus on Asia. This will involve hiring staff and building out its infrastructure while launching new products.

The new funding was led by Altimeter Capital, Sapphire Ventures, B Capital Group and Tiger Global Management.

Altimeter CEO Brad Gerstner told Bloomberg that the startup is a market leader in the early innings of strong growth: “FalconX’s product velocity and pace of innovation is remarkable and we believe will play an important role in the future of financial and crypto market infrastructure.”

Other investors in the round included Amex Ventures, an arm of American Express Co., and Mirae Asset.

FamconX's previous investors include Coinbase Ventures, Accel, Lightspeed Venture Partners and Avon Ventures.

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