Benchmark Invests $17M in Crypto Trading App FOMO

Fomo Secures $17 Million Series A Funding

The consumer crypto trading application, Fomo, founded by Paul Erlanger and Se Yong Park, has successfully completed a $17 million Series A funding round. This brings their total funding to $19 million.

An Unconventional Fundraising Approach

Rather than following a traditional seed funding path, the founders proactively identified 200 individuals they considered ideal angel investors. They believed each person would contribute significant value to the business.

Erlanger explained to TechCrunch that they leveraged their existing networks – both previously worked at dYdX – to secure introductions. Where warm connections weren't available, they directly contacted potential investors.

Impressive Angel Investor Roster

Their efforts resulted in investments from 140 of their target angels. Notable names include Marc Boiron, CEO of Polygon Labs, Raj Gokal, co-founder of Solana, and Balaji Srinivasan, former Coinbase CTO and a prominent super-angel.

Park jokingly mentioned that some high-profile individuals, like Elon Musk, weren't reached, but the acceptance rate from those contacted was remarkably high.

The Fomo Vision: A Universal Crypto Access Point

The core concept behind Fomo is a "super app" designed to provide users with access to a vast range of crypto assets – millions in total – across numerous blockchains. The platform aims to eliminate technical complexities for users.

Social trading is also integrated, allowing users to follow and learn from trusted friends and industry leaders by observing their trading activity.

While complete coverage of all assets and blockchains is still in progress, the founders anticipate nearing this goal within six months.

Rapid Growth Fueled by Apple Pay Integration

A key turning point for Fomo came just one month after its May launch with the addition of Apple Pay support. This feature significantly simplified the onboarding process for new users.

“We experienced a substantial increase in both user acquisition and revenue,” Erlanger stated. The app quickly achieved approximately $150,000 in weekly revenue and $3 million in daily trading volume.

Fomo’s Revenue Model

Fomo generates revenue through a 0.50% transaction fee on each trade. A minimum fee of $0.95 applies to Solana transactions, while other blockchains, like Base and BNB Chain, do not have a minimum fee.

Importantly, Fomo absorbs blockchain “gas fees,” which are typically charged for transaction processing, providing a significant benefit to users trading major cryptocurrencies.

Benchmark’s Atypical Crypto Investment

The Series A round was led by Benchmark, a venture capital firm not traditionally focused on crypto investments. Chetan Puttagunta, an early-stage investor at Benchmark, was introduced to Fomo through multiple recommendations from angel investors.

Benchmark’s previous crypto investments include Chainalysis, Toncoin, and a select few others. Puttagunta, impressed by Fomo’s rapid growth, secured a board seat and led the investment.

“Paul and Se and the entire team have a clear vision to make crypto assets both easy to discover and trade,” Puttagunta commented. “Their vision is clearly resonating with truly exceptional growth since they launched a few months ago.”

Continued Momentum and Future Plans

Since the round closed in September, Fomo has expanded its asset offerings and experienced accelerated growth. The platform has onboarded over 120,000 users.

Currently, Fomo processes between $20 and $40 million in daily trading volume and generates approximately $150,000 in daily revenue, according to Erlanger.

The founders envision expanding the app's capabilities to include trading of diverse assets beyond cryptocurrencies, such as prediction markets and traditional securities like bonds.