Pipe offers bitcoin industry a way to ‘Mine Now, Pay Later’
The Miami-based startup also releases the Pipe API for any company with recurring revenue
Today, Pipe, creator of the first trading platform for recurring revenues, announced the launch of its alternative financing solution for bitcoin miners, dubbed “Mine Now, Pay Later.”
“There are somewhere upwards of a million bitcoin miners right now, and we believe bitcoin mining is only going to keep growing. The need is tremendous not only because so many people are getting into the space, but because traditional finance hasn’t been able to offer a financing solution,” said Harry Hurst, co-founder and co-CEO of the Miami-based Pipe. Indeed, the dedicated mining hardware needed in this non-traditional industry can cost upwards of $10,000 a piece, and prices are climbing.
The first use case for Pipe in this space was Compass Mining, the largest platform for bitcoin mining and hosting. Compass has been offering Pipe’s “Mine Now Pay Later” option to its customer base for a few months. With the option, customers who purchase Compass’ mining equipment can pay for managed hosting for services in monthly installments and Compass Mining can trade these contracts on the Pipe platform to get fully paid up front. “They get the best of both worlds by having access to capital and flexibility for their customers and bitcoin miners get access to the hardware they need with much lower up-front costs,” Hurst says.
In conjunction with Pipe’s announcement today of the availability of Buy Now Pay Later for bitcoin miners, Pipe released an API that now allows any company with a recurring revenue business model to build embedded finance into their platforms, “a multi-trillion dollar market,” Hurst says.
Companies in various industries have been testing the beta version of the API.
“Our goal is to become the platform of platforms. The Pipe API allows companies with recurring revenue in almost any industry to give flexible payment options to their customers and clients while also getting instant access to the capital they need to scale,” Hurst said. “The API makes this model even more rinse and repeat, so companies can easily integrate it into their current system.”
Founded in 2019 and launched in 2020, Pipe started out by serving SaaS companies, but that’s only half its business now. Today it serves a variety of businesses such as D2C subscriptions, media companies, insurance, healthcare, VCs, and other verticals with its platform. Last month, the startup announced its first acquisition in the media and entertainment space and opened a new division in that industry. Pipe, which has fewer than 100 employees, has raised a total of $316 million in venture capital, and after its $250 million raise in May it was valued at $2 billion. Today’s news exemplifies how Pipe is expanding to less traditional industries, including bitcoin mining. Miami has seen an explosion of interest in all things crypto and web3, including new companies springing up and upwards of $800 million in venture capital flowing into South Florida crypto-focused companies last year.
“The Bitcoin network is built on the idea of decentralized finance, or DeFi. The more individuals mining bitcoin, the stronger and safer the network is,” Hurst said. “By powering a Mine Now, Pay Later solution for bitcoin hardware, Compass is making it possible for anyone with a mining operation, even individuals, to start or scale their mining faster by knocking down that barrier to entry of up-front hardware costs by offering financing through Pipe’s API.”
Follow Nancy Dahlberg on Twitter @ndahlberg and email her at firstname.lastname@example.org
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