Blockchain cloud infrastructure company W3BCloud to go public via $1.25 billion SPAC

W3BCloud joins hands with SLAC to increase the adoption rate of the platform in the blockchain developer community

By Shashank Bhardwaj

Image: Shutterstock

W3BCloud, a Web3 storage and compute infrastructure provider, announced on Monday that it would go public through a merger with an Arizona-based blank check firm, Social Leverage Acquisition Corp I. (SLAC). W3BCloud is a technology collaboration between Advanced Micro Devices (AMD), ConsenSys, and its founders. If no redemptions occur, the transaction is expected to generate up to $345 million in proceeds from the special purpose acquisition company's (SPAC) trust account. The transaction is also expected to take W3BCloud's enterprise value to $1.25 billion, including debt.

In a press release, Sami Issa, CEO Of W3BCloud, said, "This transaction allows us to expand our support to Web3 developers and scale with the Web3 economy's anticipated significant growth."

Howard Lindzon, the co-founder of Stocktwits Inc., leads Social Leverage Acquisition Corp I. Stocktwits is a social network for investors. SLAC is traded on the New York Stock Exchange. It has $345 million in trust. Furthermore, AMD, ConsenSys, SK Inc., and others have committed to an additional $50 million in new investments. SLAC is an early-stage technology venture capital firm that has invested in over 400 founder-led teams, including Web3 companies like Robinhood. It also has experience growing and guiding startups, which will help W3BCloud continue to scale rapidly.

One of the unique characteristics of special purpose acquisition companies, or SPACs, such as SLAC is that their investors can exchange their shares for cash before the entities complete their mergers. This process is known as redemption. So far this year, the average proportion of blank-check shares redeemed for cash prior to the merger has been greater than 75 per cent. In two recent mergers involving Bay Area companies (Wag Labs Inc. and Mondee Holdings Inc.), the redemption rate reached 97 per cent.

W3BCloud, on the other hand, was founded in 2018. The company is booming on Web3's growing popularity by offering storage and computing infrastructure to power decentralised finance, non-fungible tokens, Metaverse projects, and tech firms looking to enter the blockchain space. W3BCloud's board of directors currently includes Joseph Lubin, the founder of ConsenSys and co-founder of Ethereum. The company anticipates a 685 per cent increase in revenue in 2023 over 2021. W3BCloud's seven data centres generated $40 million in revenue last year. Renewable energy powers 85 percent of data centres. They are all located in the United States.

Its data centre services are used by crypto projects such as Ethereum, Solana, Alchemy, Filecoin, Lido Finance, and others. It is worth noting here that the majority of its revenue has come from its decentralised computing and bandwidth segment. Sami Issa will lead the combined operating entity after the transaction is completed. Joseph Lubin will continue to serve on the board of directors.

Shashank is founder at yMedia. He ventured into crypto in 2013 and is an ETH maximalist.

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