60+ Investors Band Together To Form BitAngels, The First Multi-City Angel Network & Incubator For Bitcoin Startups

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Nobody’s quite sure when (and if) Bitcoin will go mainstream, but plenty of investors and entrepreneurs have begun to place their bets. The snowball is off and rolling.

If this post doesn’t make it clear why venture capitalists are loving this emerging market, just in the last two months, we’ve seen the Winklevosses admit they have a crush on Bitcoin, Liberty City Ventures launch its own “Digital Currency Fund,” San Mateo-based accelerator Boost.vc dedicate half of its next batch to Bitcoin startups, while Chris Dixon has said publicly that he’s in and Fred Wilson finally made his first investment in a Bitcoin company.

Today, we can check another growth milestone off the list. Entrepreneurs eyeing the Bitcoin market will be pleased to learn that BitAngels is launching (what it believes to be) the first multi-city angel network and incubator created to invest exclusively in cryptocurrency startups. Fittingly, in the spirit of Bitcoin, it’s a distributed network of angels and entrepreneurs and one that was hacked together in a few days after the Bitcoin 2013 Conference.

Yes, Bitcoin has its own conference now. Better find a mining buddy, pronto.

Led by Engine.co founder David A. Johnston, SocialRadius and Marketwire founder Michael Terpin and angel investor Sam Onat Yilmaz, BitAngels brings together a posse of angel investors who are looking to help entrepreneurs turn their Bitcoin side projects into full-time jobs. To do that, the angel network pooled together about $6.7 million in Bitcoin, which it will invest in approximately $20K chunks.

BitAngels is not a formal fund, so the Bitcoins are soft-circled, not in escrow, but all 60 angels that have joined thus far (the number of angels has almost doubled in the past week) are all accredited investors with extensive experience investing and, naturally, have a lot of Bitcoin. Some mined them, I’m told, but the majority were simply fortunate to get in early when the price was low. And, for those “Bah, it’s already too late” naysayers, they’re still bullish on the market.

The network is also today officially expanding to three on-site locations: Austin, San Francisco and New York, with a network of investors that includes people like Gyft CEO Vinney Lingham, Memory Dealers CEO and “Bitcoin Jesus” Roger Ver, Tradehill CEO Jered Kenna, the Winklevii, BitInstant’s Charlie Shrem and Liberty City Ventures’ Andrew Chang.

But what exactly is the substance of the incubator that BitAngels plans to offer, you ask? Is it TechStars for Bitcoin, or more Founder Institute for Bitcoin? It’s not as formal as either of those, Johnston tells us, instead angels will hold office hours in each of the network’s three locations and will provide as much as support and mentoring from its angels as it can, though much of that will likely be remote. Really, more of a Founder Collective-type deal.

Fleshing out the mission for Bitcoin incubator, the co-founder says that, while the network will remain far less formal than traditional accelerators, he would like to see BitAngels become a “distributed version of Y Combinator.” In other words, to leverage a combination of “some early stage capital, heavy on social capital from the members, weekly virtual classes from the best people in the world for funded entrepreneurs, help with formation, help with recruiting co-founders and a commitment for funding at the end of a 3-month ramp-up process.”

So there you have it. BitAngels isn’t quite there yet, but it’s only been nine days since it was founded, people, so give it some time. Sure, a distributed network makes it a little more difficult to organize, but Johnston says that the idea for BitAngels’ new on-site locations is to get startups around a bunch of other early-stage companies working on ideas in the same space “to leverage off of each other during the week outside of virtual classes.”

Aside from the “virtual classes piece,” it’s the same idea that’s motivated Adam Draper and Boost.vc to test the Bitcoin waters.

Both entrepreneurs and investors have begun to get serious about Bitcoin, and networks like BitAngels will ideally make it a lot easier to access the capital needed to finish that BitWallet you’ve been working on — and access to an experienced group of mentors help you answer those tough questions about the design of your logo.

Hey, it was only a matter of time.

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