EigenLabs, which aims to make Ethereum as fast and flexible as centralized networks of servers like Amazon Web Services, announced on Tuesday a $50 million funding round led by Blockchain Capital.
Sreeram Kannan, the founder and CEO of EigenLabs as well as an associate professor at the University of Washington, Seattle, declined to provide his company’s implied valuation. Other investors in the round include Coinbase Ventures, Polychain Capital, Electric Capital, Hack VC, and Finality Capital Partners.
“One of the biggest reasons blockchains are not able to support the original vision of, ‘Hey, we're going to do social networks and Uber and all these crazy things,’ [is] because infrastructure is not ready for it,” Kannan told Fortune.
He believes his company’s flagship product, EigenLayer, is a potential solution to blockchain’s infrastructure crisis, joining a flood of other infrastructure-focused startups that have secured hoards of cash during the most recent crypto bear market.
“By lowering the cost of trust and capital, [EigenLayer] opens up opportunities for entrepreneurs to experiment and build while significantly easing the financial barriers that have hindered innovation in the past," Bart Stephens, founder and managing partner at Blockchain Capital, said in a statement.
As opposed to startup founders who immediately jumped from the dorm to boardroom, Kannan hails from academia. During his masters and doctoral studies, he researched peer-to-peer wireless networks and soon grew interested in blockchain technology. When he landed at the Seattle campus of the University of Washington, he eventually took leave to launch his own startup. And in 2021, he founded EigenLabs.
Kannan saw that the performance of Ethereum, a cloud-computing network that is decentralized—or not owned by one tech conglomerate—paled in comparison to the centralized networks of servers run by the likes of Amazon and Google.
Specifically, when developers on Ethereum run their code on the blockchain, they do not have the choice of which servers, or Ethereum nodes, execute their programs. This creates redundancy, as many servers process the same code.
Developers building on top of EigenLayer, Kannan says, will be able to choose which nodes run which parts of an application’s code. This capability allows programmers to create a division of computing labor, a capability long since available to developers using, say, AWS.
To show the utility of EigenLayer, he and his team are building a “data availability layer” atop their product, or a faster way to write data onto Ethereum’s blockchain, whose data inscription capabilities, Kannan says, are currently reminiscent of that of computers in the 1990s.
But this is just one promise of EigenLayer, which Kannan now hopes to build out as he adds employees, funds code audits, and supports developers seeking to build with his product.
“Our focus," he told Fortune, "will be exclusively on maximizing the surface of innovation, which is what new things can you build, which is going to onboard the next group of application builders, which then onboards the next group of users.”
