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Earlier this week, Blockworks first reported Pump.Fun’s plans to raise $1 billion at a $4 billion valuation via token sale.
The potential B-nut adds to the already fairly large war chest of the Memecoin Launchpad, which has generated more than $700 million in revenue since its launch last year. Some people speculate that fresh funds could go towards the deployment of the Pump.fun blockchain.
In this week’s roundup of Lightspeed Podcast, Helius CEO Mert Mumtaz said launching Layer-1 without any other swings in the growing pump business would be of little else to help, but would increase the take-rate of the business. Mumtaz thinks this is insufficient money.
“If what they bothered is increasing margins, say 80% to 85%?” Mumtaz meditated. “If I were their VC, I’m going to say, ‘What are you doing? That’s very boring.’ ”
Rather, Solana Infrastructure CEO said Pump.Fun’s fresh billion could risk risk new Moonshot ideas to diversify their core business. (To be fair, there’s a world where both Pump.Fun will develop new business lines and expand margins with the new L1, but I’ll put that aside for now).
That’s a big question about pump.fun. Can you find the second pitch? After the pump comes to dominate the Solanas swap market, you can follow the same path as the Jupiter you acquired, adding Memocoin frontend, NFTS, lending and more.
“Historically, what we saw with Crypto M&A is that it’s a kind of lack of discipline,” said Ryan Connor, head of research at Blockworks Research. “It will be pretty important to see which pumps are buying and whether it is synergistic with the business,” Connor added that if pumps are trying to expand their reach globally, they may need to address significant legal costs.