23 September 2023
There has been a recent influx of VC companies allocating large portions of their investment to Cryptocurrency, blockchain, and web3 technology development in the previous several months. Recent news includes the closing of $650 million by Cryptocurrency-focused investment company Dragonfly Capital's third fund, which was oversubscribed. In January of this calendar year, Electric Capital successfully raised $1 billion to invest in blockchain companies and purchase tokens. Both Inflection, which has collected $40 million for its 2nd Cryptocurrency-focused early-stage fund, as well as Hack VC, which has raised $200 million for its Cryptocurrency seed fund, have recently had significant fundraising success.
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New Zealand's inaugural venture capital fund with a focus on web 3.0 or Cryptocurrencies has been launched. This fund was initiated by Global From Day 1. In-house Crypto, as well as web3 specialist Navaz Ahmed, will serve as General Partner of the US $5 million "GD1 Crypto Fund 1." The fund is dedicated to financing the next generation of web3 or Crypto entrepreneurs and projects throughout the globe, and it has already secured two ventures in which GD1 will invest alongside the likes of VC heavyweights Andreessen Horowitz, True Ventures, as well as Kleiner Perkins.
With startups such as Easy Crypto, a platform that sells Cryptocurrencies, Veve, a firm that has recently partnered with Marvel Comics to create NFTs for enterprises, and Fluf World, a metaverse made up of three-dimensional rabbits with personality, New Zealand startups are becoming a major player in web3. GD1 believes that New Zealand-based investors should have access to what it calls "the future of the internet," despite the fact that these firms and others like them rely mostly on funding from outside of the country.
We are excited to always have Nawaz leading the web3/Crypto strategy at GD1, as this has been one of our aims all along: to diversify into new areas of expertise and to consistently grow our knowledge base by onboarding folks with unique and fascinating skills. We are pleased to begin establishing the groundwork for our investment strategy in this area, and Nawaz's work provides GD1 with an essential vehicle to test our early thesis around the notion of permissionless innovation on which web3 is founded. We'd want to be the first to investigate this untapped potential for New Zealand-based funds. GD1 Crypto Fund 1 will help New Zealand entrepreneurs, and it will also enable local investors to become involved in abroad firms, with the aim that some of the rewards would trickle down to the New Zealand startup ecosystem. The fund's backers are mostly individual investors as well as family offices from the area, with some institutional and foreign limited partners rounding out the group.
The goal of the funds is to give potential limited partners (LPs) with the finest prospects worldwide while also contributing to the health of the local economy. According to Ahmed, the fund would invest between $100,000 and $200,000 in about 25 to 30 pre-seed to Series A firms working in areas like decentralized finance, decentralized autonomous organizations, NFTs, web3, and Crypto infrastructure. Ahmed claims that GD1 has already invested in two portfolio firms for this fund, one of which is a New Zealand firm. After receiving initial commitments from global limited partners (LPs) with an established track record in creating good digital transactions, GD1 anticipates a fully subscribed first closure for the fund in June.
Investment in In-House Expertise
Veteran angel investor Nawaz is famous for his work on Techemynt, the initial stablecoin pegged to the New Zealand dollar. He is well-versed in both web3 and Cryptocurrency, having built and advised on new initiatives for multinational Crypto-advisory organizations including Faculty Group and Genesis Block, and having made angel investment alongside top tier VC firms. In addition, he shares the insights of successful capitalists as well as businesspeople from all over the globe on his podcast, The Inquisitive VC, with the local startup community. As with the startups they back, they keep tabs on people they'd want to collaborate with, and ever since our paths met in 2019, we've been impressed by Nawaz's dedication to 'learning by doing' in the web3 domain. This is a great time for GD1 to launch a new VC service and acquire the proper in-house capabilities to firmly deliver on the web3 aspirations thanks to his impressive record of angel investments, exceptional worldwide networks, as well as compassionate commitment to business formation. Having somebody of Nawaz's caliber join our team will allow us to invest the funds we earn in the most promising local and international talent and initiatives.
Disclaimer: The author’s thoughts and comments are solely for educational reasons and informative purposes only. They do not represent financial, investment, or other advice.