BlockchainÂ startup Factom has raised a $4.2m in new fundingÂ toÂ build a series of unnamed new products for its blockchain data network.
The Austin, Texas-based company that lets users cryptographically store data on its Factom blockchain had recently won a $200,000 grant from the US Department of Homeland Securities and now plans to scale the firm with a series of hires to be announced over the coming months.
Factom co-founder and CEO Peter Kirby said the Series A round, led by venture capitalist Tim Draper, will also be used to further develop its core technology and suite of products.
Kirby told CoinDesk:
“We really believe that when you move all the data in the world into the blockchain you can create a lot of transparency and value.”
FactomÂ had previously raised a bit over $3m in a round including VC firm Plug and Play, and already has three enterprise products, a data protection tool, an identity solution and distributed data storage service similar to a more traditional database.
In total, Factom’s protocol is being used to secure 67.4 million records, according to its official website.
Behind the investment
Though news of the fundraise was expected to be released on Wednesday, investment news site Frisco Fastball picked up the Series A filing with the SEC and provided insight into the round.
The Frisco Fastball concludesÂ that the funding round could represent a high trust in the company given that it sold 100% of its offering.
“The average offering size for companies in all industries in our database is $3.05m,” the news source said. “The total amount raised is 37.41% bigger than the average for companies in the database.”
The comments may be a surprise given that the startup has long been one of the more contentious in the industry. In addition to questions about its use of a publicly traded digital asset to fund its operations, Factom has also seen potentially key partnerships fail to materialize.
Still, investor Tim DraperÂ lauded the firm in statements to CoinDesk, focusing on how he believes the platform can mitigate issues common to centralized data storing services.
“Centralized data is prone to critical failure by any individual mistake, whether by user error or malicious hacking. By decentralizing data through the blockchain, Factom avoids critical failures due to user error or hacker.”