Ayelet Anikst/Tiny Tap
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EdTech startup TinyTap raised $8.5 million for staff expansion and product development, Insider has learned.
- The Animoca Brands' subsidiary is backed in the latest round by firms including Sequoia China and Polygon.
- A cofounder says the round took longer to close because of uncertainty in the crypto space at the end of last year.
TinyTap, an educational technology startup and Animoca Brands' subsidiary, has secured an $8.5 million funding round, Insider has learned.
The Tel Aviv-based EdTech firm will use the funding for staff expansion and product development.
Sequoia China, Shima Capital, Polygon, Liberty City Ventures, Kingsway Capital, and GameFi Ventures are among the backers for the company's latest funding round.
Founded in 2012, TinyTap offers a platform for user-generated educational content, dubbing itself as "the world's largest library of games by teachers." Once acquired by investing giant Animoca last year, the startup began doubling down on its Web3 efforts.
TinyTap began incorporating blockchain technology into its services with more tokenized content via non-fungible token collections. Animoca paid $38.8 million in June for an 80.45% stake in TinyTap.
Animoca cofounder Yat Siu says NFTs make it possible for teachers to "better generate equity from their work and link up with co-publishers who can handle the promotion of their courses, all while offering students enhanced learning materials."
"Teachers and educators are among the most important content creators and contributors in society, and yet their wages typically do not reflect their critical importance," Siu said in a statement. "This is why we're incredibly excited at the Web3 opportunities that TinyTap is exploring in the field of education."
The startup raised their latest round as venture capital investments became harder to come by. VCs and investment firms have pulled back as the technology sector faces economic headwinds amid a higher interest rate environment, looming recession, and bank turmoil stemming from last month's fall of Silicon Valley Bank.
While raising capital last year, TinyTap cofounder Yogev Shelly told Insider that the round took longer to close because of fallout and uncertainty in the crypto sector as well.
"We started in October and within a month reached 80% of what we aimed for in the round," Shelly, who is also CEO, told Insider. "By November some big investors who had soft committed for a large part of the funding had to fold due to certain fallout and rising uncertainty. As a result, the round took a bit longer to close, and we had more to prove."
Shelly added: "After the success of the PublisherNFT Auction, when we sold 80% ownership in 12 courses for 243 [ether] while doubling TinyTap revenue in 2022, investors took notice and we over-subscribed."