Coinbase is one of the biggest cryptocurrency exchanges in the world. With more than 13 million users, what we’re now discovering is that Coinbase as a company has some serious financial firepower. The latest move that Coinbase has made is one that tends to fall in line with any company that’s looking to grow through diversification. In a $100 million deal, it has acquired startup Earn.com, a product that lets members send and receive digital currency for completing tasks such as replying to emails.
Seeking top-level talent
The purchase of Earn.com shouldn’t come as a huge surprise, largely as negotiations had been ongoing for months. This now marks Coinbase’s fifth major acquisition, arriving hot the heels of the deal to buy Cipher Browser. Financially, the deal for Earn.com does represent the company’s biggest to date, but – much like Coinbase’s other business dealings – talent acquisition is on the agenda.
Following the completion of the deal, it has been revealed that current Earn.com CEO Balaji Srinivasan will be appointed the very first Coinbase CTO. It’s also expected that the rest of the Earn.com team will migrate over to Coinbase soon rather than later. This deal appears to mirror what happened with Cipher Browser, as that acquisition saw highly rated developer Peter Kim join the Coinbase ranks. Earn.com is being labeled as an expensive acquisition, but for Coinbase it’s apparently worth the cost as it looks to further the develop the technology behind the product, all the while acquiring its top talent in the process.
Snapping up Silicon Valley’s finest
Srinivasan is widely considered to be one of the most highly sought-after talents in Silicon Valley, so the move represents something of a coup for Coinbase. Holding an MS in Chemical Engineering and BS, MS, and PhD in Electrical Engineering from Stanford, he’s known for being an early backer of cryptocurrencies and blockchain technology. Many see the arrival of Srinivasan as a marker that could change Coinbase’s recruitment efforts in the future. In the past, Coinbase has struggled to fill vacancies with legitimate top-tier tech-sector talent, but that now appears to be changing.
Saving the day
For Earn.com, the deal with Coinbase is something of a saving grace. The hype surrounding the company was massive upon its debut, as it was founded as secretive bitcoin mining operation “21E6” back in 2013. After launch, it generated over $100 million in funding, but suffered following Bitcoin’s fall in value during early 2018. Expensive operational costs began to weigh Earn.com down, so Coinbase might have saved the company from more financial pain – even if the company’s change of direction had lessened the damage. Srinivasan believes that with Coinbase on board Earn.com can continue to benefit its “hundreds of thousands” of users, “With Coinbase’s user base and distribution muscle, I think it could hit $100 million in ARR in a few months. I’m proud of the fact that we turned what could have been a disaster into a successful product and I’m excited about the road ahead.”
The Coinbase expansion continues
As an acquisition, Earn.com doesn’t exactly represent anything particularly groundbreaking – especially when you factor in the sheer cost of the deal. However, it does represent another major move from Coinbase when it comes to talent acquisition. With another sought-after Silicon Valley name now making up part of the company’s corporate hierarchy, there could be exciting times ahead for Coinbase as the leading crypto exchange continues to grow.