Monday Fund Day: VCs CoinFund and Shima Capital raise $500m combined… in THIS crypto market?

Coinhead Rob Badman
CoinFund Shima Capital

"Decentralised startup with anon founders? Shut up and take my money." (Getty Images)

Last year, and into the first few months of this one, VC crypto dosh was flowing like clichés from a rookie NRL reporter. But SHUT THE GATE… Terra Luna and other bad things helped initiate bear-market savagery and now the crypto venture capital party’s over. Right?

Er, nope, even though you’d have every right to think so.

Actually, as we mentioned a couple of weeks ago, a recent report from Messari and Dove Metrics revealed that a stupendous US$30.3 billion in VC money was raised in 1,199 funding rounds by crypto projects and startups during the first half of 2022. And that was more than 2021’s entire VC crypto funding in total.

And now, quite a hefty slice, in just two raises, can be added to this year’s surprising, Smaug-like haul. Between them, CoinFund and VC Shima have just recently pulled more than US$500 million into the space.

It’s not to say everything’s coming up roses right now in crypto land, because it isn’t. Still, this proves that at least some deep-pocket parties are maintaining intense interest in the icy depths of a magic internet money winter.

Follow the money?

 

CoinFund’s humungous US$300m raise

New York-based crypto investment firm CoinFund last week announced a $300 million Web3 venture fund named “Ventures I”, which is set to back early-stage blockchain/crypto projects and will be deployed over two to three years.

Partners from Venrock, Adams Street Partners, Teacher Retirement System of Texas, Theta Capital Management, StepStone Group, and Accolade Partners are all backing the new fund.

 

David Pakman, CoinFund’s managing partner said that the fund will invest in crypto projects and firms focused on foundational, layer 1 blockchains, DeFi, web3 infrastructure projects, asset management, exchanges, marketplaces, NFTs, gaming, payments, and decentralised applications.

Er, so that’s pretty much everything then. Apart from extremely overleveraged and irresponsible centralised crypto-lending platforms. Although best not rule anything out.

“When we sum these possibilities together, we think we are looking at the largest amount of economic value creation we have seen since, well, the Industrial Revolution,” wrote Pakman in the firm’s announcement.

Guess the guy’s pretty bullish on crypto.

The CoinFund Ventures I fund is expected to invest in 30 to 40 startups, with funds ranging from US$6 million to US$10 million in value for each.

And Pakman believes that, despite the bearish conditions the market’s been enduring for the best part of the year so far, CoinFund is in a good position to take advantage of lower-entry pricing with its investing strategy.

 

Shima Capital enters VC scene with US$200m crypto fund

A newish, San Francisco-headquartered VC firm called Shima Capital has entered the crypto-funding space with a bang. Specifically, a US$200-million-dollar-sized explosion of scratch-your-back-you-scratch-mine goodwill targeting various early-stage startups across the blockchain ecosystem. Much like the CoinFund… fund, then.

The Shima Capital Fund I is backed by Dragonfly Capital, crypto exchange OKX, Mirana Ventures, US businessmen Andrew Yang and Bill Ackman and, last but not least, blockchain gaming incubator and GameFi-investment big gun Animoca Brands.

And it’s all set to deploy up to US$2 million in pre-seed funding to promising startups and innovators focused on specific areas including decentralised identity, decentralised social media, decentralised autonomous organizations (DAOs) and blockchain gaming, which is where Animoca will no doubt show some added interest.

According to an official announcement on the matter, the fund will aim to “consistently deploy capital when founders need it the most” – in other words, during bear-market-building phases – in addition to helping hire talent, building community and fostering overall technical development.

The fund’s strategic investment team is being led by “veteran investor” Yida Gao, the co-founder and former general partner of Divergence Digital Currency, a US$100m+ crypto hedge fund that’s managed to navigate this year a hell of a lot better than Three Arrows Capital.

 

 

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