CoinFund Announces New Early-Stage $300M Web3 Venture Fund

As students of the tech industry, we are taught that major technical architectural transitions catalyze massive value creation. Going back to the mechanization phase of the industrial revolution, we see hundreds of new companies created with enormous economic consequences.

In the late 1970s and early 1980s, we witnessed the birth of the personal computer revolution, paving the way for thousands of hardware and software companies to be formed and collectively changing how we work, create, and communicate. In the mid-1990s, we started to wire together all those personal computers, launching the commercial internet and inspiring hundreds of thousands of entrepreneurs and engineers to build web (not PC) software and to create applications atop largely open-source protocols. And more recently, around 2008, we witnessed the mobile, social, and cloud computing revolutions we refer to as web 2.0, creating trillions of dollars of new enterprise value, moving software to the cloud, shifting computing and attention to mobile devices, and allowing self-publishing of digital content atop socially-connected platforms. These major technical transitions seem to occur every 12 to 15 years or so, and as entrepreneurs and investors, we seek them out and aim to hop on the waves as early as possible.

The next major architectural transition is upon us. Tens of thousands (maybe even hundreds of thousands) of software developers are building a new computing stack on top of open source blockchains, made possible by combining existing technologies like cryptography and distributed computing in novel ways. This breakthrough enables trustless peer-to-peer transactions, cryptographically secure identity, real-time global settlement of asset transfers, user-sovereign data, and ownership models for provably-scarce digital intellectual property. We call this new architecture, and its technology stack, web3.

Beyond these innovations, a new set of guiding principles has emerged. Many web3 adherents aim to produce a more equitable web, where users and developers own the networks on which they build and play, where web 2.0 platform companies cannot monopolize and profit from user data, where transaction middlemen can neither censor nor obscenely tax transactions and content distribution, and where ownership itself is both an incentive to join and incentive to stay on these new networks. Overall, web3 has created a new architecture and business model for common goods, a way of bringing about products and services that are owned and governed by their users and monetized through digital assets. One of the first common goods to benefit from this is open source software—the very protocols and tools on which web3 is built.

If you believe we are building an entirely new web on which all future software will be built, then you can see how big a set of investment opportunities that presents. But web3 doesn’t stop there. Blockchains can also impact the global financial system in ways web 1 and 2 never did.  Decentralized finance (DeFi) promises to deliver a more equitable and inclusive system by eliminating intermediaries and driving efficiencies across execution, borrowing, lending, and settlement layers. NFTs, which create ownership rights and financial infrastructure for nonfungible goods, create enormous economic opportunities for all intellectual, and eventually even physical, property. 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.

What evidence is there that this transition is already underway? The data tells an interesting story. According to Pitchbook, of the 725 new VC-funded startups founded this year so far, at least 138 (or 19%) of them are in crypto and web3. There are about 100M to 200M crypto wallets in the world (here, here), of which at least 30M to 40M seem to be monthly active users. And those 30M or so hold somewhere between $1T and $3T worth of crypto assets (depending on prices)—enormous value creation by any standard. In addition, about 6M to 10M people have bought NFTs over the past two years, responsible for more than $30B of sales. Consumer adoption at this level makes NFTs the most successful new consumer product since the launch of the smartphone. Relative to the five billion people on the internet, crypto adoption is still in the early stages, but the scale is already staggering.

To capitalize on these realizations, CoinFund is proud to announce the launch of our new Venture fund (“Ventures I”). In addition to our well-established seed-stage investment program, we now add an early-stage Venture fund to the platform. This will allow us to make larger investments in new companies showing meaningful traction and put more money to work into our existing successful portfolio companies as they scale.

Our view is those best equipped to find, invest in, and help build successful crypto and web3 companies are those investors who do nothing but focus on the giant landscape web3 entails. This focus creates a “clean slate” investing discipline undistracted by legacy business models and unbiased by legacy approaches to building technology, many of which we feel are outdated strategies not appropriate for creating the networks of the future. That is why CoinFund was started as, and continues to be, a purely cryptonative investing team, investing in and helping to build some of the most important companies in web3 since 2015.

Celebrating the launch of new venture funds is kind of a silly moment…it’s all just potential energy and possibility at the start, in a world where investment performance is all that matters. That said, we wanted to do so to thank the many high-quality institutional LPs, family offices, and web3 founders who are supporting us and also to share this news with the broader web3 entrepreneur community. We get our biggest thrill from working with the exceptional, risk-taking, true visionary founders driven to create a new decentralized and fair future. We look forward to bringing our cryptonative investing team to your service and continuing the inspiring work of helping catalyze this important, global transition.

We would especially like to thank a number of the partners of Venrock who continue to collaborate with and invest in us, Adams Street Partners, Teacher Retirement System of Texas, Theta Capital Management, StepStone Group, and Accolade Partners for their meaningful commitments and guidance.

CoinFund Announces New Early-Stage $300M Web3 Venture Fund

As students of the tech industry, we are taught that major technical architectural transitions catalyze massive value creation. Going back to the mechanization phase of the industrial revolution, we see hundreds of new companies created with enormous economic consequences.

In the late 1970s and early 1980s, we witnessed the birth of the personal computer revolution, paving the way for thousands of hardware and software companies to be formed and collectively changing how we work, create, and communicate. In the mid-1990s, we started to wire together all those personal computers, launching the commercial internet and inspiring hundreds of thousands of entrepreneurs and engineers to build web (not PC) software and to create applications atop largely open-source protocols. And more recently, around 2008, we witnessed the mobile, social, and cloud computing revolutions we refer to as web 2.0, creating trillions of dollars of new enterprise value, moving software to the cloud, shifting computing and attention to mobile devices, and allowing self-publishing of digital content atop socially-connected platforms. These major technical transitions seem to occur every 12 to 15 years or so, and as entrepreneurs and investors, we seek them out and aim to hop on the waves as early as possible.

The next major architectural transition is upon us. Tens of thousands (maybe even hundreds of thousands) of software developers are building a new computing stack on top of open source blockchains, made possible by combining existing technologies like cryptography and distributed computing in novel ways. This breakthrough enables trustless peer-to-peer transactions, cryptographically secure identity, real-time global settlement of asset transfers, user-sovereign data, and ownership models for provably-scarce digital intellectual property. We call this new architecture, and its technology stack, web3.

Beyond these innovations, a new set of guiding principles has emerged. Many web3 adherents aim to produce a more equitable web, where users and developers own the networks on which they build and play, where web 2.0 platform companies cannot monopolize and profit from user data, where transaction middlemen can neither censor nor obscenely tax transactions and content distribution, and where ownership itself is both an incentive to join and incentive to stay on these new networks. Overall, web3 has created a new architecture and business model for common goods, a way of bringing about products and services that are owned and governed by their users and monetized through digital assets. One of the first common goods to benefit from this is open source software—the very protocols and tools on which web3 is built.

If you believe we are building an entirely new web on which all future software will be built, then you can see how big a set of investment opportunities that presents. But web3 doesn’t stop there. Blockchains can also impact the global financial system in ways web 1 and 2 never did.  Decentralized finance (DeFi) promises to deliver a more equitable and inclusive system by eliminating intermediaries and driving efficiencies across execution, borrowing, lending, and settlement layers. NFTs, which create ownership rights and financial infrastructure for nonfungible goods, create enormous economic opportunities for all intellectual, and eventually even physical, property. 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.

What evidence is there that this transition is already underway? The data tells an interesting story. According to Pitchbook, of the 725 new VC-funded startups founded this year so far, at least 138 (or 19%) of them are in crypto and web3. There are about 100M to 200M crypto wallets in the world (here, here), of which at least 30M to 40M seem to be monthly active users. And those 30M or so hold somewhere between $1T and $3T worth of crypto assets (depending on prices)—enormous value creation by any standard. In addition, about 6M to 10M people have bought NFTs over the past two years, responsible for more than $30B of sales. Consumer adoption at this level makes NFTs the most successful new consumer product since the launch of the smartphone. Relative to the five billion people on the internet, crypto adoption is still in the early stages, but the scale is already staggering.

To capitalize on these realizations, CoinFund is proud to announce the launch of our new Venture fund (“Ventures I”). In addition to our well-established seed-stage investment program, we now add an early-stage Venture fund to the platform. This will allow us to make larger investments in new companies showing meaningful traction and put more money to work into our existing successful portfolio companies as they scale.

Our view is those best equipped to find, invest in, and help build successful crypto and web3 companies are those investors who do nothing but focus on the giant landscape web3 entails. This focus creates a “clean slate” investing discipline undistracted by legacy business models and unbiased by legacy approaches to building technology, many of which we feel are outdated strategies not appropriate for creating the networks of the future. That is why CoinFund was started as, and continues to be, a purely cryptonative investing team, investing in and helping to build some of the most important companies in web3 since 2015.

Celebrating the launch of new venture funds is kind of a silly moment…it’s all just potential energy and possibility at the start, in a world where investment performance is all that matters. That said, we wanted to do so to thank the many high-quality institutional LPs, family offices, and web3 founders who are supporting us and also to share this news with the broader web3 entrepreneur community. We get our biggest thrill from working with the exceptional, risk-taking, true visionary founders driven to create a new decentralized and fair future. We look forward to bringing our cryptonative investing team to your service and continuing the inspiring work of helping catalyze this important, global transition.

We would especially like to thank a number of the partners of Venrock who continue to collaborate with and invest in us, Adams Street Partners, Teacher Retirement System of Texas, Theta Capital Management, StepStone Group, and Accolade Partners for their meaningful commitments and guidance.