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Another week, another gigantic crypto fund. Bain Capital Ventures (BCV) is the latest to join the fray, unveiling a $560 million fund on Tuesday dedicated to crypto investments. The new fund brands itself as Bain Capital Crypto (BCC), separate from BCV, which is a limited partner in the new fund. The crypto fund has backed 12 startups to date and has invested approximately $100 million, Stefan Cohen, managing partner of Bain Capital Crypto, told me in an interview.
The Information reported in October that Bain was raising a $300 million crypto fund. The final amount raised nearly doubles that, indicating strong interest from investors. That demand has helped other venture firms like Andreessen Horowitz raise dedicated, multibillion-dollar crypto funds.
Cohen said Bain wanted to set up a separate crypto fund because “the needs of the founders in [crypto] are just so fundamentally different than the needs of enterprise or consumer software founders.” Crypto founders require more technical advice, an ability to participate in the governance of blockchain protocols and funding across multiple investment cycles, he said.
Included among its investments so far is Variational Research, a decentralized finance startup. BCV has also backed crypto startups from its general funds, including crypto lending startup BlockFi and crypto investment firm Digital Currency Group.
Cohen has moved to the crypto fund from BCV, but most of the team is new to Bain. Alex Evans, the crypto fund’s second managing partner, joined in July from Placeholder, a New York-based venture capital company, to help start the group. The five other team members, many of whom specialize in blockchain research, have all joined since then.
BCC intends to take both equity stakes and “liquid token” positions in startups. The latter financing approach has become more popular among venture funds, given that many crypto companies raise money with token offerings. However, Cohen said that even though it will hold liquid tokens, it won’t actively trade them as a hedge fund would. Instead, it will hold the tokens for the long term.
Crypto Meets Health Care
After I published The Information’s first Crypto Power List last week, I was asked on a call with subscribers if I knew of any crypto startups related to health care. Actually, my colleague Kate Clark published a story Tuesday profiling Love Health, a startup that hopes to use cryptocurrencies to facilitate drug development.
The chairman of Love Health is Ryan Breslow, who founded e-commerce software company Bolt in 2014, and who resigned as CEO earlier this year (he remains executive chairman). JR Rahn, co-founder of a psychedelics company called MindMed, and Ashwath Rajan, who previously co-founded a vending-machine startup, are also co-founders of Love Health.
As for the crypto angle to all this, Rahn told Kate that Love Health’s website will allow potential patients to help choose which drugs should undergo development, and it will reward them for participating with crypto tokens. All of this could enable the intellectual property of a drug to be “owned by the community,” Rahn told Kate.
Outside of Love Health, a few other interesting ventures are blending blockchain with biotech and health care. United Kingdom-based FarmaTrust is using blockchain technology to digitize healthcare, medical device and pharmaceutical data. A dozen pharma companies have also partnered on a project called PharmaLedger, which wants to create a “single source of truth” for healthcare data, with decentralized governance, according to its website.
Deals
- EthSign, a signature platform based on Ethereum, raised $12 million in a seed round led by Sequoia Capital India. The round also had participation from Sequoia Capital and Sequoia Capital China, marking the first time all three units of Sequoia have reportedly participated in the same funding round.
- WalletConnect, which uses QR codes to connect decentralized blockchain applications with cryptocurrency wallets, raised $11 million in a Series A round co-led by Union Square Ventures and 1kx.
- UNXD, a metaverse fashion startup, raised $4 million in a private fundraising round led by Polygon Studios, Animoca Brands and Red DAO.
- KurateDAO, a startup using blockchain-based games to curate online content, raised $6.85 million in a funding round led by Polychain Capital.
What We’re Reading:
- Goldman Sachs Offering ETH Fund to Clients Through Galaxy Digital (Coindesk)
- Avalanche Foundation Unveils $290 Million Incentive Program to Spur on Growth of Subnets (The Block)
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