Tim Draper: Passed on Coinbase, son’s bet nearly doubled Fund V

Tim Draper says he passed on an early chance to back Coinbase because he misjudged how quickly retail crypto adoption would arrive. He posted the reflection on X on July 14.

Draper described the decision as one about timing rather than the founders. He had already invested in Coinlab, an early bitcoin infrastructure company, and wrote that he admired Brian Armstrong from their first meeting.

Adam Draper, founder of Boost VC and an investor focused on blockchain startups, reached a different conclusion and wrote the first check to Armstrong’s company. Tim Draper joined a subsequent funding round after Adam’s investment.

Coinbase was founded by Brian Armstrong and Fred Ehrsam. The company began as a service for buying and storing bitcoin, expanded its product set for retail users, institutions and developers, and later listed on Nasdaq under the ticker COIN.

Tim Draper posted that returns from Coinbase nearly doubled Draper Associates Fund V.

Armstrong responded on X, thanking both Drapers and praising their willingness to back companies before markets were fully formed; he described their bets as “sci-fi level” and called them fearless, independent thinkers.

Draper also offered a message for founders: if the first venture capital firm declines, try other firms in the same network or consider contacting younger investors in those networks.

The firm’s later stake in Coinbase became a large holding for Draper Associates Fund V and increased the fund’s overall return.