Firms & Funds

Blockchain Founders Fund wraps up sophomore fund at $75m

Fund II's backers include Polygon, Ripple, Octava, NEO Global Capital, Appworks, GSR, LD Capital, Metavest Capital and family offices.

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Blockchain Founders Fund of Singapore announced that it has held a final close on $75 million for its second fund.

Investors in Fund II include “family offices and institutions in the industry, including Polygon, Ripple, Octava, NEO Global Capital, Appworks, Sebastien Borget (COO of The Sandbox), GSR, LD Capital, Metavest Capital and more,” the firm said in a statement.

BFF began fundraising in January 2021 and held an initial close in March 2022, according to Venture Capital Journal research.

The new fund will focus on backing pre-seed and seed-stage Web3 and blockchain start-ups. Currently, BFF has invested in more than 100 start-ups including Altered State Machine, Splinterlands, GRID, Krayon and Magna.

BFF managing partner Aly Madhavji told Cointelegraph that the fund will potentially be invested across more than 200 companies within the next 12 months. “There is a high level of competition for deals in the space, regulatory uncertainty, as well as a limited track record of successful projects,” Madhavji told the publication. “In order to address these challenges, we focus on making investments in high-quality start-ups that have strong fundamentals and demonstrate solid indications of traction.”

Companies in the crypto ecosystem are working on blockchain networks, infrastructure and developer tools, access (including crypto exchanges and payment networks), Web3 and decentralized finance, according to PitchBook. After two huge years, crypto-related VC investments declined sharply in the past few quarters.

PitchBook‘s Q4 2022 Crypto Report noted that investment in the sector rose from $25.1 billion in 2021 to $26.2 billion in 2022. However, investors started to pump the breaks late last year. “At -47.9 percent, crypto VC deal activity continued to decline sharply in the fourth quarter of 2022,” the report states. “The vertical’s third consecutive QoQ decline to $2.5 billon is the lowest amount of capital invested since Q4 2020. Deal count also reached its lowest level since Q4 2020, at 345 deals, representing a QoQ decline of -39.6 percent.”