Voyage(r) Update — 5/8/2021
2017 Crypto called, and it’s jealous of 2021 Crypto. What a year so far! Meme coins are now worth more than most S&P 500 companies and the worst coins are now exploding 300% in days. The amount of new capital coming into crypto looks shocking to some but was predicted by many. And the best of the 2021 bull market is likely yet to come. As if 2021 couldn’t get any more exciting, all eyes will be on SNL tonight to see if Elon Musk can pump Doge to $1. Talk about comedy.
Voyager has been on the front lines trying to bring a better crypto experience to many new market participants. It hasn’t been without issues and growing pains (more on this later), but growth has been astounding. As originally introduced in the Voyage(r) to the Cosmos series, let’s visualize key metrics performance YTD.
Voyager AUM Growth
Remember that Assets Under Management (AUM) matters because it generates revenue for the company. AUM has grown 112% per month YTD. There was a big spike in January and February. Followed by a continued double digit growth in March and April, even with Bitcoin flat over the last couple of months. Excluding January and February 2021, the last 1.5 years has seen a 38% growth PER MONTH. That’s insane, and I anticipate an unbelievable Q1 2021 revenue number during the next earnings call.
The graph is even more impressive when looking at pure AUM growth. Can you say exponential?!?
Funded Accounts Growth
Next, let’s look at Customer Funded Accounts. Remember, user growth matters for the token growth. User growth has been a mere 154% PER MONTH so far in 2021. When you look at it compared to 2020, user growth looks absolutely silly.
Growth Comes at a Cost
Let’s not forget that all this sudden and rapid growth comes at a cost one way or another. Any plan Steve and team had on platform resources, support staff, team resources, capital requirements going into 2021 were completely thrown out the window a few weeks into the year. A 2 year old company just becoming profitable in Q4 2020 with 25 employees at the end of December was faced with all of the following in a short 3–4 month window… A DNS attack, a 1–2 day explosion of new users, banking problems, customer fraud, twitter attacks, relentless support tickets, and more. All of this was and is being responded to by the small and mighty Voyager team while keeping customer funds safe.
There have been plenty of issues to go around though. Crypto is 24/7, 365 and if your support ticket isn’t getting answered or deposit isn’t completing, some customers can lose trust. This is reality and consequence of this growth. But let’s not lose sight of how complicated and difficult these issues are to solve quickly.
As an example of the magnitude of issues needing to be solved, let’s just take support tickets. Steve mentioned in an interview last week that Voyager is up to 100 employees. Growth of accounts has been 937% December 2020 to April 2021. Support staff alone likely needs to grow at least 10–15x to keep up pace with customer tickets and that doesn’t necessarily account for all the future growth. This is only 1 of 5+ issues the company currently faces and is actively solving. Not to mention new features and functionality that is promised to be delivered.
The fascinating part is the business metrics show customers are still coming to Voyager at ever increasing rates and bringing more assets. It’s not surprising given the company has the best trading experience, lowest fees, and offers the best interest.
As an investor in Voyager, I continue to focus on the longer term growth and experience I get as a customer. The short term has and will continue to be impacted by issues. Each investor needs to weigh the current risks, the growth potential, and other investment opportunities for themselves.
Metcalfe’s Law Update
The VGX Metcalfe pricing model has seen better days. From December 2020 to beginning of March, it was flawless. Remember that the model worked because the theory was a certain % of new users would buy VGX for benefits on Voyager (growing the network of customers receiving benefits). It was turned on its head from March forward with delays in the SWAP and VLP launch and other growing pains Voyager was dealing with. I will be fascinated to see once the VLP launches, how numbers trend to see when we will hit previous targets. I still hold my $40-$50 price target for VGX end of the year from the Warp Speed — Voyage(r) to the Cosmos article.
The stock has also lagged in its AUM Metcalfe value as well. This is related to issues as well, but also is related to growth in outstanding company shares. Remember, Voyager needed to raise funds to make strategic investments in infrastructure, support staff, and other resources because of all the growth.
Stock dilution has been averaging 6% per month in 2021 vs 3% per month in 2020. This just means the model needs to be adjusted to account for the increased supply to work effectively.
Voyager & Market Rebellion Partnership
Voyager and Market Rebellion announced a new partnership this week to offer equities, options, and futures trading using crypto as a base currency. This is an exciting opportunity for customers to trade across asset classes. As an investor, this will bring more revenue to Voyager and expand the utility function of VGX giving it more value over time. It’s a powerful and unique offering in the expanding marketplace. I don’t expect the new functionality to go live in 2021. It’s more likely a 2022 item, but I am sure we will hear plenty more on this topic throughout the remainder of the year.
Lots has been going on in Crypto in 2021. Voyager continues to grow at an incredible trajectory. It hasn’t come without issues. Growth comes at a cost. Plenty still needs to be worked through, but all things considered, the team has faced adversity remarkably well in 2021. Issues and delays have impacted the Metcalfe pricing model, and we’ll keep an eye on how it responds once utility is in place. Crypto to stocks is coming to Voyager with industry titans, but likely in 2022.
Hope you enjoyed the update! If you like what you read, take the time to clap for the article below or like it on Twitter. If you have thoughts, feel free to add a comment below to the article or on Twitter.
If you are not a current Voyager customer and would like to start investing in crypto with Voyager, download the app and trade $100 to get $25 of free Bitcoin. Use code AFK8SG to claim your BTC.
Disclosure: I am a current VGX token holder. This is not financial advice. This article is for informational purposes only. Do your own research or seek out the professional advice from a financial advisor.