Blockchain cloud infrastructure company W3BCloud to go public via $1.25 billion SPAC
Blockchain cloud infrastructure company W3BCloud to go public via $1.25 billion SPAC
W3BCloud is partnering with SLAC to increase the adoption rate of the platform in the blockchain developer community
By Shashank Bhardwaj
Image: Shutterstock
W3BCloud, a provider of Web3 storage and computing infrastructure, announced Monday that it would go public through a merger with an Arizona-based blank check company, Social Leverage Acquisition Corp I. (SLAC). W3BCloud is a technology collaboration between Advanced Micro Devices (AMD), ConsenSys and its founders. If no redemptions occur, the transaction is expected to generate up to $345 million in proceeds from the special purpose acquisition company’s (SPAC) trust account. The transaction is also expected to take W3BCloud’s enterprise value to $1.25 billion, including debt.
In a press release, Sami Issa, CEO of W3BCloud, said, “This transaction allows us to expand our support for Web3 developers and scale with the expected significant growth of the Web3 economy.”
Howard Lindzon, co-founder of Stocktwits Inc., heads Social Leverage Acquisition Corp I. Stocktwits is a social network for investors. SLAC is traded on the New York Stock Exchange. It has $345 million in trust. Furthermore, AMD, ConsenSys, SK Inc. and others have committed an additional $50 million in new investments. SLAC is an early-stage technology venture capital firm that has invested in over 400 founder-led teams, including Web3 companies like Robinhood. It also has experience growing and mentoring startups, which will help W3BCloud continue to scale rapidly.
One of the unique features of special purpose acquisition companies, or SPACs, like SLAC, is that their investors can exchange their shares for cash before the entities complete the mergers. This process is known as redemption. So far this year, the average proportion of blank check shares redeemed for cash before the merger has been greater than 75 per cent. In two recent mergers involving Bay Area companies (Wag Labs Inc. and Mondee Holdings Inc.), redemption rates reached 97 percent.
W3BCloud, on the other hand, was founded in 2018. The company thrives on Web3’s growing popularity by providing storage and data infrastructure to power decentralized finance, non-fungible tokens, Metaverse projects, and technology firms looking to enter the blockchain space. W3BCloud’s board of directors currently includes Joseph Lubin, the founder of ConsenSys and co-founder of Ethereum. The company expects a 685 percent revenue increase in 2023 compared to 2021. W3BCloud’s seven data centers generated $40 million in revenue last year. Renewable energy powers 85 percent of the data centers. They are all located in the United States.
The data center services are used by crypto projects such as Ethereum, Solana, Alchemy, Filecoin, Lido Finance and others. It is worth noting here that the majority of revenue comes from the decentralized computing and bandwidth segment. Sami Issa will lead the combined operating unit after the transaction is completed. Joseph Lubin will continue to sit on the board.
Shashank is the founder of yMedia. He ventured into crypto in 2013 and is an ETH maximalist.
