LuneX Ventures will build on Golden Gate’s strengths in backing growth companies, gained from applying Silicon Valley expertise across the ASEAN region since 2011. But LuneX, of course, will have a laser-like focus on cryptocurrency and blockchain. According to Mr. Drijkoningen, the opportunity is immense and the time is ripe:
“We view blockchain as a foundational technology, on a par with or possibly exceeding the Internet in disruptive potential. Right now valuations have come down to more reasonable levels and the industry is moving from pioneers to early adopters, which is a great time to start investing.”
ICOs worldwide raised US$9 billion in the first half of 2018, triple the rate of just $6B in all of 2017. Golden Gate Ventures is already a player in this emerging wave. Thus far its portfolio companies have raised over $35M through ICOs, with others soon to follow. Singapore is a prime location for a dedicated fund as the city-state has a burgeoning base of tech talent for crypto/blockchain projects, plus a supportive government: The Monetary Authority of Singapore has made clear it will not regulate pure utility tokens while taking a pro-innovation stance.
LuneX Ventures is Southeast Asia’s first dedicated crypto/blockchain fund with traditional VC backing. It will invest globally in companies that are building out services to grow the new crypto ecosystem. Since the adoption curve is still in the early-stage, LuneX will take a long-term view.
Golden Gate Venture’s spin-out of LuneX comes at a seize-the-day moment—Andreessen Horowitz recently announced a dedicated crypto fund—and it will help new companies in the space to seize the day as well. Blockchain entrepreneurs need more than just capital. They seek out specialized funds like LuneX to provide industry access and expertise, which conventional VC funds have trouble to provide. Mr Drijkoningen again:
“Traditional investors currently struggle to access this new asset class: there are legal, custodian, banking, tax and other operating obstacles to overcome. LuneX Ventures has been been built from the ground up to address all these. We have gone the extra mile to make sure the fund is fully compliant while providing easy access to accredited investors. Our mandate allows us to invest in tokens of promising startups. For us, it's important that our interests are aligned with those of founders. In the end this is how we all benefit.”
LuneX is looking for entrepreneurs and companies who are able to bring the industry to the next level. Qualities favored include scalable infrastructure and interoperability, along with practical solutions to issues such as custody and security, and institutional services that will drive the next wave of adoption.
In addition to Mr. Drijkoningen and support from Golden Gate Ventures, LuneX Ventures has just hired its first full-time associate. Tushar Aggarwal runs the popular blockchain podcast “Decrypt Asia.” Tushar also has experience as a mentor to young fintech companies, and he will finish a master’s degree in digital currency and blockchain while working at LuneX.