Blockchain data securing company Factom announced today it has secured a Series A equity funding round worth $4.2 million. Notable bitcoin and blockchain investor Tim Draper of Draper Associates led the round.
CEO and co-founder Peter Kirby said Austin-based Factom is “delighted” to have an investor of Draper’s stature on board. As for the money, the firm will spend it further developing its core technology and product suite.
What Sort of Company is Factom?
Factom is a non-currency project that uses the Bitcoin blockchain to provide “an unalterable record-keeping system” for enterprise. Aimed at businesses and governments, Factom secures records like supply chain management, medical records, property titles and many others.
Its main product, Factom Apollo, gathers data from various sources and encodes changes in real-time on a decentralized protocol, running on the Bitcoin blockchain. Designed to save auditing time, Apollo aims to streamline applications like tracking insurance claims data and financial trading.
Another product, called Iris, aims to secure devices on the Internet of Things (IoT). It uses blockchain-based records to verify devices’ identity — avoiding the risks and expense of secure certificate authorities. Most prominently for Factom, the U.S. Department of Homeland Security uses Iris to run an IoT application.
Tim Draper on Factom’s Technology
Draper noted how important decentralized data verification solutions will be in the future, and Factom’s role in building them:
“Securing data is mission critical for governments, banks, car companies, credit card companies, retailers and any company concerned with hacking. Centralized data is prone to critical failure by any individual mistake, whether by user error or malicious hacking.
Factom avoids critical failures by decentralizing data through the blockchain, he added. The company’s services could help secure bank accounts, protect against identity theft or prevent malicious actors taking control of dangerous devices like cars.
Draper’s company, Draper Associates, is a seed-stage venture capital firm. Founded in 1985, it seeks out transformative technologies like cloud, IoT and (of course) “new finance.” Draper has also made personal investments in other Bitcoin companies including Korea’s Korbit and Coinplug.
Factom a “Second Revolution” Says Chief Architect
Factom chief architect and co-founder Paul Snow described the firm’s technology as a “second revolution” in computer science. While Bitcoin and blockchain-based value transfer represents the first revolution was blockchain-based value transfer like Bitcoin, “the Factom protocol allows for the open coordination of processes against immutable ledgers of data”.
Factom’s services will impact data and systems just as the first revolution impacted value, he claimed.
Did Tim Draper make a wise investment? Is the Bitcoin blockchain useful for securing other kinds of non-financial data? Let us know.
Images via Shutterstock, Factom, Tim Draper.
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