COINVESTMENT FREQUENTLY ASKED QUESTIONS

(FAQs)

WHO IS BLOCKCHAIN COINVESTORS?

Launched in 2014, our goal is to provide broad coverage of the emerging unicorns and fastest growth blockchain companies and crypto projects. The strategy is now in its 9th year and has to date invested in more than 40 pure play blockchain venture funds in the Americas, Asia and Europe; and in a combined portfolio of 1,000+ blockchain and crypto projects including 80+ blockchain unicorns. Headquartered in San Francisco with a presence in Grand Cayman, London, New York, Zug and Zurich, the alternative investment management firm was co-founded by Alison Davis and Matthew Le Merle.

PROPRIETARY, ASYMMETRICAL ADVANTAGE

At Blockchain Coinvestors we have worked for a decade to create our unique sustainable competitive advantage (USCA) in blockchain, web3 and fintech investing. This USCA derives from the fact that we are investors in, and have developed relationships with, more of the best blockchain, web3 and fintech funds than anyone else - as far as we know. To this we add a team with more than 100 years of collective investment experience in these sectors. This in turn gives us proprietary access and asymmetric information that informs our coinvestment opportunities.

WHAT IS THE COINVESTMENT PROGRAM?

The coinvestment program offers our investor community the opportunity to increase their exposure to emerging category leaders in the blockchain space. We aim to bring high conviction opportunities to our investor community most of which are also being backed by our funds.

WHAT TYPES OF COINVESTMENT ARE THERE?

We classify the coinvestment opportunities according to the following nomenclature:

  • Coinvestment Opportunity: [Name of Company] - [Stage] [Sector] [Other information if needed]

Examples of prior investments:

  • Coinvestment Opportunity: Coinbase - Mid Stage, Blockchain

  • Coinvestment Opportunity: Uphold - Mid Stage, Blockchain

  • Coinvestment Opportunity: Wyre - Mid Stage, Blockchain

  • Coinvestment Opportunity: DappRadar - Early Stage, Blockchain, being offered only on AngelList syndicate

  • Coinvestment Opportunity: Brex - Late Stage, Fintech

  • Coinvestment Opportunity: Pacaso - Late Stage, Fintech

This nomenclature provides important information for you as you consider the breadth and depth of Blockchain Coinvestors opportunities that you will see as a member of our investment circle

HOW DO YOU DECIDE WHEN TO DO A COINVESTMENT?

On an ongoing basis, we monitor the ‘combined portfolio’ of more than 400 blockchain companies and projects that our funds have capital exposure in.  We watch for the category leaders as they emerge. If we are aware of a follow-on round taking place we see if it meets our fund filters:

  • Backed already by leading blockchain VC's who are following on

  • Emerging as a leader in its category or strategy

  • Round being led by a leading VC who is not already an investor so the round price is being negotiated

  • Company supportive of us being direct investors into the company

If the round meets all or most of these filters we consider it for a fund coinvestment. Different filters apply for early stage and late stage opportunities. In addition, we also on an ad hoc basis have attractive investment opportunities presented to us that we may also chose to invest into and make available to our investor circle.

HOW DOES THE COINVESTMENT ALLOCATION PROCESS WORK?

Once we have an opportunity that meets our filters, and in which we can receive an allocation, the following process occurs:

  • We first determine how much of the allocation is required for the Blockchain Coinvestors funds. The fund of funds each have a 20% allocation for direct investments, while Fund IV (ESTF) and Fund VI (MSGF) have their own portfolio construction criteria

  • If there is allocation remaining after the funds have taken their respective allocations, we may then offer it to our investor circle which comprises our fund LPs and other investors with whom we maintain relationships.

  • We then email our investor circle with information regarding the coinvestment opportunity.

  • If you are interested and would like to invest, please fill out the form provided in the email. It is important that you complete the form and submit it before the provided deadline.

  • If the coinvestment opportunity is oversubscribed, we will allocate first to our coinvestment class (investors who have invested more than $1m with Blockchain Coinvestors are entitled to 75% of any allocation after the funds have invested) and then on a first come first serve basis to non-coinvestment class investors.

  • Once we finalize the deal and determine each investor’s allocation, we will follow up with the subscription documents and wire instructions.

Please note that the Blockchain Coinvestors AngelList syndicate operates within the processes and guidelines of the AngelList platform and investors should review the details of those terms and conditions if joining the Blockchain Coinvestors syndicate on that platform.

CAN I HAVE MORE INFORMATION OR ACCESS TO DILIGENCE?

All the information available to our investors will be included in the initial email or, if possible, the data room. We cannot accommodate any additional requests for information. 

HAS BLOCKCHAIN COINVESTORS CONDUCTED PRIMARY DUE DILIGENCE?

No, our SPVs are structured as coinvestments and therefore we rely on the lead investors for primary due diligence. Blockchain Coinvestors has not conducted primary due diligence and each investor should make their own investment decision.

WILL I RECEIVE TOKENS OR EQUITY AND WHEN CAN I SELL MY ALLOCATION?

Blockchain Coinvestors can only distribute USD to our SPV investors. Hence, while you will receive allocations in equity stakes in fast growing blockchain companies, you will receive cash when the investment is realized. Our investment team will determine when investment positions are liquidated based on market conditions and internal analysis.

WHAT ARE THE FEES?

Our SPV vehicles have the low fee structure of 1% mgmt. fee and 20% performance fee. The initial wire will include your investment commitment, plus 1% organizational cost fee and 4% for the first four years’ annual management fee. If the SPV is terminated prior to four years, the management fees will be pro-rated and any excess fees returned.  If the SPV continues beyond four years, you will receive additional capital calls to fund the 1% annual management fees

ARE THERE SPECIAL TERMS FOR YOUR EXISTING INVESTORS?

We provide special terms for selected current investors:

  • Members of our Coinvestment Class (investors who have invested more than $1m into our funds) are able to invest into any coinvestment at a reduced 1% management fee and 10% performance fee. Other terms remain unchanged

  • For LPs in Fund VI (Mid Stage Growth) are able to invest additional capital into any company that the fund is investing into on preferential terms of 1% management fee and 10% performance fee. Other terms remain unchanged

  • For all other investors the fee’s are 1% management fee and 20% performance fee on all coinvestments. 

Thank you for your ongoing participation and support