TinyTap, the edtech company owned by Animoca Brands, raised $8.5 million in new funding, aiming to “disrupt education with web3.”
Investors included Sequoia China, Polygon, Liberty City Ventures, Kingsway Capital and Shima Capital, TinyTap said Tuesday. The funding was realized in a combination of equity via SAFE (simple agreement for future equity) and token via SAFT (simple agreement for future tokens), Yogev Shelly, CEO of TinyTap, told The Block.
“That being said, at the time the round closed, no exact plans for a token were shared with investors,” said Shelly. “We focused only on how we believe a tokenomics model can benefit maker education and economics in general.”
TinyTap was acquired by Animoca Brands last June for about $39 million for about an 84% stake in the company, and it’s now valued at $100 million with the new financing, Shelly said. TinyTap started raising for the round in October and finally closed it in February, with some investors pulling out in November due to the collapse of the FTX stock market, Shelly said.
When asked why the company was raising money after being acquired by Animoca, Shelly said that even after the deal, TinyTap still had incentive to keep growing. “As a near-profit web2 consumer business, we need adequate funding to continue growing,” he said. “TinyTap will now develop the web3 side of the business.”
What is TinyTap?
TinyTap was founded in 2012 in Israel. It offers a library of more than 250,000 educational games in 24 languages, created by educators and publishers. The games are created using TinyTap’s code-free authoring platform and are accessible to users as part of a subscription or individual courses, Shelly said, adding that a portion of the revenue is shared with content creators.
TinyTap said it is among the top 10 highest-grossing kids apps in the world, with
9.2 million registered users with content created by over 100,000 creators. The educational content is aimed at young learners from pre-K to grade 6, the company added.
TinyTap entered the web3 space last year with the launch of “Publisher NFTsThese NFTs give publishers the right to promote and monetize the content they create, Shelly said. “There is no need to trust the revenue share calculations of Spotify, YouTube and other content creation platforms,” he added.
TinyTap sold two sets of Publisher NFTs worth 243 ether (about $352,000 at the time of the auction). The NFTs were based on Ethereum and sold on OpenSea. But going forward, the company will choose a blockchain that can support a large number of transactions at a lower cast, said Shelly, who declined to name the blockchain.
TinyTap’s web3 subscriptions
In addition to Publisher NFTs, TinyTap has several plans to bring decentralization to the education system. Shelly said there is a plan to introduce a token-based scholarship that only unlocks a PublisherNFT when an on-chain event occurs, such as when a course is completed.
The company also plans to offer custodial wallets for students to store tokens, claim on-chain credentials, and access PublisherNFT content.
“If a group of people go off education, they can accelerate education, so instead of waiting a decade for AI and web3 to be taught in schools, like the time it took coding to get into schools, we can now create education for the future in the present rather than in the future,” said Shelly.
Last week, TinyTap joined Open Campus, a community-led web3 education protocol that tokenizes educational content to enable educators and creators to monetize their content. Binance is currently selling Open Campus EDU token on its Launchpad platform.
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