Alex told us how data science helps surface the signal from the noise when it comes to blockchain data.
Hello! What’s your background, and what are you working on?
I’m Alex Svanevik, co-founder and CEO of Nansen. I’ve worked for 10 years around the artificial intelligence and data science fields, plus a few years in management consulting.
2017 was the year I really got into crypto, namely right before the great ICO boom (and subsequent bust). I was drawn to the strange mix of idealism, technology, intellectualism, memes, greed, and general wild fun that crypto offers. In addition, I saw that there was a lot of value I could contribute as a data scientist. There was tons of data easily available, yet still many fundamental pieces missing.
Nansen helps crypto investors and crypto professionals surface the signal from the noise when it comes to blockchain data. We do this by aggregating data on millions of addresses, overlaying it on all the activity that happens on the blockchain, and then presenting easy-to-digest analytics. Our customers like Nansen because the platform provides perspectives on the blockchain market that they can’t get anywhere else.
What’s Nansen backstory?
Originally we started Nansen purely as a wallet-labeling service. Yet we quickly realized we should leverage the power of Blockchain ETL, the most popular open-source project for ingesting blockchain data that was created by our co-founder Evgeny, to get a more holistic view of all blockchain activity.
At that point, we’d already worked in crypto for a few years with different startups and projects, and we noticed our clients often had the same needs. Getting a better understanding of the entities interacting on-chain was a recurring theme. Because of this our conviction in Nansen as a product was strong, so we spent a few months building the first version of it and then launched it in April 2020.
We didn’t have any external funding for these efforts, so we decided to only offer a paid version of our product right out of the gate. Additionally, this model could give us stronger validation that we were building something valuable. And in fact we received our first paying customer on our launch day!
The philosophy of pricing as a feature is a key Nansen principle, since it ensures we set a high bar for ourselves. Our customers expect to get “need to have” data, not just what’s “nice to have.”
The three co-founders of Nansen (Evgeny, Lars, and myself) have 25+ years of experience working with data science and engineering between us and that’s definitely helped in building Nansen from the ground up. Evgeny is among the world’s leading experts on approaching blockchain data, which his work with Blockchain ETL and Google shows. Lars is an excellent data engineer who has architected a solution on top of Blockchain ETL (as well as other data sources). His experience working with massive amounts of data is also highly beneficial to the team.
Our motivation for building Nansen was that there’s so much noise in crypto, and we wanted a way to cut through that for crypto investors and crypto professionals.
What went into building the Nansen?
In terms of technology, Nansen’s roots date back to late 2017 when Evgeny and I were independently working on creating ways to query Ethereum data with SQL. Thankfully I discovered Evgeny’s work in early 2018, and we started working together. We ended up co-founding a small consulting DAO called D5, in which Lars also became one of the founding members.
Late 2019 is when we started actively working on the wallet-labeling technology powering Nansen, and it took us six months to launch. We obviously had good timing, as the DeFi ecosystem has heated up throughout 2020 and Nansen has lots of DeFi analytics, a dynamic that’s attracted investors to us.
From the start, we decided to focus 100% on Ethereum with a philosophy of “nail it, then scale it.” This turned out to be a good decision since Ethereum has proven to have the most vibrant blockchain ecosystem to date. Beyond this, Nansen leverages a range of open-source technologies, including:
- Ethereum ETL (or Blockchain ETL more broadly)
Because of these reliances we also find it important to contribute directly to various open-source efforts ourselves. Additionally, we use Google Cloud, Coinbase Commerce, Stripe, and Carrd.
What’s your business model?
We charge our customers monthly or annually for access to Nansen. Users can try out Nansen for $9 for 7 days to see if it’s worth it. Personally, I’ve been positively surprised by how many people have opted for the trial so far – we’re about to hit 1,000!
Although any crypto investor or crypto professional can get value from Nansen, our primary focus right now is the investor segment of the market, both institutional and “retail-plus” investors. There are two simple reasons for focusing on investors. First, because members of this demographic all have the same overall goal, namely to maximize returns, which means we can optimize for this when building Nansen. Secondly, investors represent the largest segment in crypto.
What’s your position on the regulatory landscape today?
We hope the transparency Nansen brings to the crypto space can be a force for regulators to view crypto in a more positive light. Our focus is on crypto-native customers though right now, not regulators.
What are your goals for the future?
In order to build a long-term business, it’s key for us to build sustainable revenue streams. So we’re aiming to grow our annual recurring revenues to US$1M within the next 12 months. The way we hit that goal is by having Nansen provide so much value to investors and crypto professionals that they feel that without a Nansen subscription, they’re seriously missing out.
As for myself I’m motivated by building the best team and workplace in crypto, wherein people can experience personal growth and a sense of accomplishment.
What are your future thoughts for the DeFi market?
DeFi has recently been somewhat conflated with the narrower trend of yield farming. While yield farming itself has elements of an “ICO 2.0” boom and bust cycle, DeFi is certainly here to stay. Some predictions for the ecosystem include:
- DeFi becoming a big force in the business sector (in contrast to retail) within the next year, as companies discover products that are 10x superior to traditional banking.
- More Fintech and CeFi frontends building on DeFi backends to make these protocols accessible to 10,000x more people.
- An increased consolidation of analytics companies in the space, like how CB Insights just acquired Blockdata.
Where can we go to learn more?