BLOCKCHAIN COINVESTORS MID STAGE EQUITY INVESTING

Blockchain Coinvestors Newsletter

Vol. 4, No. 9, April 2022

 

Blockchain Coinvestors Mid Stage Equity InvestING



Blockchain Coinvestors' Mid Stage Equity Investment Performance

 

In our first newsletter of 2022 we focused on the Blockchain Coinvestors' investment strategy and the specific role that direct mid stage investments play within it. We are excited about the progress to date from our 2020 and 2021 coinvestments as shown in the following exhibit. The portfolio of investments now shows a dollar weighted average estimated gross MOIC of 4.7x and a straight average estimated gross MOIC of 8.1x.  

Remarkable; we hope you agree.

 Wyre Exit Announcement

 

Standing out on this table is the recently announced acquisition by Bolt of our portfolio company Wyre. This is, of course, driving the overall return upwards. Congratulations to Yanni and the team at Wyre who have built a great company that provides powerful on and off ramps for crypto. Our initial investment in Wyre was both because of the platform the team had built, and their quality as blockchain and crypto developers. We are excited you have seen your project through to a very good exit. Congratulations too, to those of our investor circle who joined us in that specific investment.

 

Blockchain Coinvestors 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. 

 

We leverage this advantage in two ways. The asymmetric information advantage results from the 40 or more quarterly reports we receive now from the best blockchain venture capital funds about their investments, follow on rounds, valuations, and so on.  We use this to select the mid stage emerging category leaders of blockchain which we wish to invest additional capital into, as well as to drive our early stage token investments. The second advantage is proprietary access. We know the existing investors, have backed them in most cases, and they are typically favorably inclined to having us join follow-on rounds. This should not be underestimated in a sector in which the most attractive emerging unicorns are consistently oversubscribed. To date we have rarely been refused an allocation.

 

Participating in Mid Stage Equity Investments

The intent of the mid stage investment program is to allow our investor circle to identify the emerging unicorns of the blockchain space and to add additional capital into their follow-on and mid stage rounds. Since the fund of funds only provides a small capital allocation to each given its broad diversification, this can represent an opportunity to put more capital to work once the signs appear to favor some players over others in any specific sub theme within blockchain. 

 

To date we have provided access through deal specific SPV's. Later this month we expect to have news for you about another way to invest into these opportunities. 

 

PLEASE STAY TUNED

We believe the performance of the mid stage investment program speaks for itself, although it is still early days, and hope you will take advantage of it in 2022. 

 

Please email us at ir@blockchaincoinvestors.com if you have any questions.

Thank you for reading.

Alison Davis
Matthew C. Le Merle

ABOUT 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 400+ blockchain and crypto projects including approximately 50% of all blockchain unicorns. Our funds rank in the top decile amongst all funds in their respective categories on both Pitchbook and Preqin. 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.

FUND PERFORMANCE

 

Blockchain Coinvestors Funds are continuing to generate strong returns. As of Q3 2021 our funds rank in the top decile amongst all funds in their respective categories on both Pitchbook and Preqin with Net IRR exceeding 60% for Funds I and II. This remarkable performance results from powerful tailwinds driving the world towards a future in which digital monies and digital assets are ubiquitous and the businesses and projects providing blockchain and crypto products, services, and infrastructure benefit disproportionately.

BLOCKCHAIN COINVESTORS FUNDS

Blockchain Coinvestors’ goals are to provide broad coverage of the emerging unicorns and fastest growth blockchain companies and to capture superior returns from investing in the leading blockchain venture partnerships. Our funds are open to investors that meet the Qualified Client definition with a minimum subscription level of $250,000 at the discretion of the Manager. 

  • Blockchain Coinvestors Fund III (Fund of Funds) was created to provide diverse coverage of the best blockchain pure play venture funds in the Americas, Asia, and Europe. Blockchain Coinvestors Funds I and II have already experienced significant appreciation. Fund I Net TVPI is 3.64x with an IRR of 69%. Fund II shows equally impressive early results with Net TVPI of 1.72x and an IRR of 161%. Almost all of our fund investments are performing as top quartile against the Cambridge Associates Venture Benchmark.

  • Blockchain Coinvestors Fund IV (Early Stage Token) provides direct access to promising private stage token projects accessing our relationships with many of the world’s leading blockchain investors. We leverage asymmetrical information from our 40+ VC Funds to pick the most attractive opportunities. This is a continuation of the direct token investing strategy of the Fund Manager that has included private stage investments in Acala, Filecoin, NEAR, Polkadot, Structure, and others.

  • Blockchain Coinvestors VI (Mid Stage Growth) provides direct exposure to the emerging category leaders in the blockchain and crypto ecosystem. The fund leverages our unique sustainable competitive advantage (USCA) in blockchain, web3, and fintech to create a concentrated portfolio of between 20 and 30 investments with attractive return profiles and visible paths to liquidity. The fund assesses the more than 400 blockchain and crypto projects in which we are direct and indirect investors and employs a robust investment framework to select investment opportunities into the leading mid stage growth rounds - typically Series B, C and D. This is a continuation of the mid stage investing strategy of the Fund Manager that has included investments in Bitwise, Brex, InfiniteWorld, Securitize, Uphold, Wyre, and others.

Please visit the Blockchain Coinvestors website to learn more about our offerings. You can also reach our Investor Relations team directly at ir@blockchaincoinvestors.com.

BLOCKCHAIN COINVESTORS SWISS

We are excited to announce that Blockchain Coinvestors Funds are now available through Swiss certificates for those of our non-US investors who prefer this approach. The underlying fund is the same, however, our Zurich based team at Blockchain Coinvestors Swiss, who will introduce in future weeks, can provide detailed information regarding this investment option. Email us at mlemerle@blockchaincoinvestors.com to learn more.

BLOCKCHAIN COINVESTORS ANGELLIST SYNDICATE

Continuing the theme of the democratization of investing, we have a rapidly growing Blockchain Coinvestors syndicate on AngelList providing access to selected coinvestments. Please join us and our partner Lou Kerner on AngelList.

Click here to receive the insightful weekly crypto newsletter and webinar invitations from our Blockchain Coinvestors partner Lou Kerner.

REGISTER NOW FOR UPCOMING WEBINARS AND CALLS

 

Our investment team hosts bi-monthly webinars and calls to help educate our community about the Fifth Era, fintech, blockchain and crypto. We discuss important trends, tailwinds and investment themes including what we have learned and how we are using our knowledge to inform our own investment thesis and actions. Below is a list of upcoming webinars for which you can register by clicking the links:

 

Options for Investing in Blockchain & Crypto
- April 18th, 7:00am PT
- April 18th, 12:00pm PT

 

Public Market Routes for Blockchain Companies

- April 25th, 7:00am PT
- April 25th, 11:00am PT

 

Investing in Early Stage Tokens

- May 9th, 7:00am PT
- May 9th, 12:00pm PT

 

Recordings of past webinars and calls can be found at www.blockchaincoinvestors.com/webinars.

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