Kurtosis, a crypto-focused developer tool system, has raised $20 million in a Series A round led by tech-focused hedge fund Coatue.
Investors in the round include Coinbase Ventures, the Chainsmokers’ Mantis VC and angel investor Olivier Pomel, who is the CEO and founder of Datadog, among others. The round comes about one year after its $2.5 million seed round in August 2021, which was led by Signalfire, with participation from Hustlefund, Alchemy Ventures, Figment and NEAR protocol’s co-founder Illia Polosukhin.
The two-year-old company was founded by former Palantir engineering leads Galen Marchetti and Kevin Today in hopes to simplify the tools for developers building on web3. It currently provides services for the Ethereum, Avalanche and NEAR ecosystems.
“We needed to raise capital because the company started as just me and my co-founder and the more we learned about the problems people are facing in these [blockchain] environments, the more we realized the software we would have to build as two developers would take us five years, which is way too long,” Marchetti said. “We developed enough conviction that this tool is genuinely useful for the people we’re working with and we want to go faster.”
The fresh capital will be used to hire new engineers and product experts in the developer tooling space so it can release a new product within the next six to 12 months, Marchetti said.
“The biggest demand circles around testing use cases,” Marchetti noted. “A lot of folks want to do more advanced testing that involves shadow forking different types of production systems.” (Shadow forking is having the data that a normal mainnet has, but being able to use it and mess around with the software tools without financial risk.)
A lot of developers today don’t have a private or secure test net environment to build on, Marchetti said. So as a result, many hacks and bugs in the web3 space occur because the production system is poorly put together due to lack of ability to build in an early-stage environment, Marchetti said.
“Developers need a place to play around and see whether their modifications to the system are safe or work,” Marchetti said. “It’s like building an airplane without using an air tunnel on the ground. There’s a bunch of instances where the airplane immediately crashes. It’s the same thing here.”
Long term, Kurtosis plans to continue building tools that simplify engineers’ ability to build on web3, Marchetti said. “I think we’re going to have every organization able to spin up their own test nets and dev nets that are private and they don’t want the outside world to see or a public one with many different forms of them so they can be configured for the exact use case they’re testing for.”