Meet the Blockchain VC, Pt. 5

Transcript

hello everyone here is martin from crypto valley association in sioux switzerland it's great to have you here on our webinar meet the blockchain vc it's the fifth time we are doing that i'm very honored and happy to have um through the three uh great speaker jasmine zhang from a and t capital a t capital is an early and growth stage uh fund backed by some important companies and also very early backers and influencers of big bitcoin then we have dominic

briggs from blockwell blockwell has two fonts as i've seen it one equity fund and also a token fund and is focused on web 3 and decentralized technologies and last but not least we have gary schenkman from laden ventures he invests in technology companies mostly in developed markets and in early stage opportunities welcome all three of you great to have you here i also want to encourage our listeners please to submit questions and

proposition in the q and a section of um the website and um it's great to have you here [Music] excellent so i would like to start my question to you please let me know why why do you invest in blockchain technology diamond if you want to take that one first i'm going to throw you under the bus here grace yeah of course no worries so uh thanks a lot martin happy to be here and uh jasmine gary looking forward to the discussion so yeah i mean we

um so the i was in management consulting first so i actually the the first reason why i looked into blockchain was because i was focusing on this on process improvement so very boring this lean management kind of optimization job and and but the the efficiency aspect of of blockchain triggered my interest first um that was around in 2014 and then slowly understood that we have become like very highly dependent on on internet-based solutions and i mean we all know this there the the existing solutions cannot really provide like a trustless environment we have

data monopolies privacy abuse frauds legacy systems which are extremely inefficient data hacks have been kind of become a regular news so so to in order to gain control back to increase trust transparency efficiency and processes but also in security we see that a more decentralized approach makes sense and blockchain as kind of a probably the term most known or distributed ledger technologies is like a perfect solution for that and there are of course many many different ways in use cases you can

you can use it and there's a whole tech stack you can invest alongside of um but like that's the the core that we believe that a more decentralized digital future is actually to the benefit of all of us so gary or jasmine please please i i i if i may just please talk each other i don't i will not invite each of you just one after the author however you feel i think we'll get organized by ourselves completely before you before you go to sleep in singapore i think it's you okay because i'm in singapore and it's pretty late so like before i say some

stupid uh answers i guess like uh i i take it first i think like you know besides like what uh dominic has already mentioned like you know so many um advantages so many cool things like you know blockchain could do with this technology um honestly i think to me it was a really adverse thought because of the press surge of like a bitcoin and ethereum so you started you got notice of like this like you know like technology-backed kind of like applications and then you started to look into it you felt like oh it's really interesting because there are so many different like innovations and you started to talk with people who are working like in this kind of like a field they are all really like

smart and talented people and you feel like oh that is a place where the future is because it gathered like most of their smart like brains and so on so that is definitely you know like one reason for me to really get in get an initial interest in it's like a place and then continue like you know really looking into and backing on the founders of like our portfolios or like friends companies so um yeah that is just like very direct i think answer just to accomplish to be complimentary of like what dominic has already mentioned um yeah gary i like that you like said like you know it's it's the future right like i i feel you know every generation of software you know we kind of unlocked new stuff

that we didn't know how to do before um and you know for a very long time you know early thousands be like oh you know we're going to be a firm we're going to be focused on the future we're only going to be doing cloud software and obviously if you invest in enterprise software of course it's going to be sas it's not going to be on-prem anymore um and for a very long time if you're investing in the web in the late 90s you were investing in basic communication and publishing technology and then lo and behold we had the compute and the bandwidth to all of a sudden have applications in the browser um and it completely transformed what we can and cannot do you know as you know i think as you know people that work and communicate and play uh together and so i think we're on this cusp of yet

another you know thing we can do um and i think transacting just basically moving units around and accounting is the absolute most boring thing that you can do on the blockchain right you know we're talking about you know shared compute resources you know we're talking about really complex operations a 14 year old can go and code up a hedge fund product that was only previously available to billionaires uh and so you know i think that there is this you know next i think decade you know or at least five year cycle we're going to see a whole lot of new applications that move from the realm of pure trading and kind of very nerdy applications to just being you know part of our everyday life and hopefully eventually it will disappear and you'll never have to say

hey are you a blockchain investor because everything will have will touch the technology in some way much like everything touches content delivery networks or everything touches you know large data centers you know you know that was just not something that was possible you know 15 20 years ago i think martin you're mute thank you dominique i hope it won't happen too often this time so um thank you for your insights now um if i see what you were doing or where you're investing and how you see a blockchain technology now i'm i'm wondering

where on you on what are you focusing on is it on new protocols is it on infrastructure blockchain infrastructure projects or is it mostly in application um second layer protocols etc so i i guess i can i can start again um so the what i said before like the entire tech stack is is interesting and the service ecosystem as well it's just the question on um do you want to cover the entire market then you need kind of the the infrastructure layer and the the kind of application layer to get exposure to and that's how we

build our products around we wanted to give investors the opportunity to give a get a very diversified but complete exposure to the market and then the question is where what financing mechanism if you can call it like that um is the right one on which layer so if you think more decentralized networks protocols then that would be the perfect example of token investments um so if you want to cover the infrastructure side of things if you want to cover the protocols then a token focused fund makes sense and there are very exciting opportunities and dependent on use case they are evolving

as well the sim level like we've seen in in the web 2 world you always have this enhancement of infrastructure and a continuous feedback loop between applications and in first infrastructure so infrastructure is reaching a certain limitation and then it kind of evolves again and with every new step of infrastructure which blockchain is as part of this architecture and you have again a new universe of business models and that's the interesting part about the application layer that you now have software service companies looking at blockchain as technology platforms and using it to build a a better system but at the same time you also have like

the entire service ecosystem which is becoming more institutional and which is absolutely necessary that the crypto ecosystem works and and the latter two like the applications and services they are equity business models so not real true token cases and that's where you would see more traditional venture funds going in so on both ends it's i think there are great opportunities and as you said in the beginning we have funds targeting both both segments if you have a situation where you have an opportunity to deploy through equity at first but then there

is a token issuance afterward um how do you split the allocations between your funds uh does the equity fund then take the token position and have to create liquidity um or do you swap it out no it's we actually also would take if the value creation is in the token but the equity participation is a means to an end then also the token fund can take that equity it's more about where is value accrual happening yeah makes sense jasmine do you guys do kind of both tokens and equity do you guys mix yeah so i do like mix um i guess probably like you know like a german

base like i found is like more strict dates so that's why i'm not sure like um maybe that is a reason why like you know block war is doing two different ones but like we for example like uh i think ours is like more typical like uh we see font so it's like at least in like a cayman island so like we do a mixed cat so like we can't do like both like a token and equity um and directly so like i think for us uh um what dominic said like uh what i really like is like you know it really depends on whether you want to cover the full spectrum and i think it's really hard to look for you know like a team of like for example like us we have like 10 people to cover really every set because i think whole

blockchain space has so much like you know uh opportunities and it's just like hard for everyone to be expert you know really understand each single like field so we try to take advantage of like um you know our gp's like a background and also like other lps backgrounds so i think i understand like martin mentioned like we are backed by like really um some of the biggest like fintech giant from from asia so uh definitely we look a lot into like a finance related like services like projects supports like c5 and d5 i think there will be like really interesting stuff i remember there has been on time you know like people debating like whether we should stand purely on the c5 side on the like defense ad but now like you know with

with our portfolios we really see like you know there's this kind of like merge like between between the two sides because they plan to actually also like launch each other's like product in their own like platform so that is the finance side like we are focusing on and we also look into like a lot into like ift and whenever it's like stuff because we have like some of their um traditional background like you know lps so we see like you know how much like interest like they have been raised through like this kind of like you know quiz time with with mts with that manners because it's so easy to understand comparisons um you know other like little ones their tools like bridges you know like other interoperability interoperability like stuff so it's so easy to have like the

new um you know like old money like to flow in everyone is interested in this area so that is so many things you know with our background we could really help like our um projects our portfolios to open their door like to um a lot of like web 2 like a big players as well so that is the second place we are looking at and the third place um myself is also like quite blue shine is like definitely webs free um and specifically having social fight because i think it's like a social five everyone has like say facebook or twitter or like you know instagram the other place where everyone posts so many of their personal stuff like over there and that is such a you know like a kind of like a business

model where for web three like projects they can really you know um take use of like you know this kind of like uh ownership to make it really like owned by the person like who owns all of these data so and there are so many data like around there so like we definitely think like you know like for web 3 for social fi that is something like really interesting so that's why we have some portfolios um in the pipeline like we want to like invest it's also because like our gp's like background is it's we have a lot of like um you know experience with like facebook twitter and chinese version of like facebook which is kinda like maybe someone knows it so we want to basically you know stand from the point of the view of our lp and gp background to look into the

areas where um you know to choose from like the extensive like areas of like opportunities in in the crypto space to invest in um to be some rest basically yeah super interesting maybe and then i also will of course you also want to know gary's uh opinion but maybe jasmine you you talked about nfts as as a as an investment goal for for you where you and now i'm wondering what what exactly or is there a focus in nfd's or where do you see the use cases maybe also for the others i mean now we we talked a lot about art

nfts paintings etc there are player cards etcetera but is is it only this space or or are you going further i feel like it's just an abstraction right like we we have these tools that are available to us and let's say they're nfts they're twitter and discord and a couple of crappy bots that help us authenticate people and into channels um and the projects at the end of the day you know just like in you know with anything it's a product of what's the commercial mindset of the team uh and if they are a serious group of people that are building a company uh

which is why you know by the way we like equity exposure because we like the legal marriage you know even if the value is generated in a token uh you know we like to have that legal relationship with folks you know there's nft projects that are just fun um and it's okay uh because again this is a cultural moment you know this is a first use of blockchain that's not purely for nerds but also you can use them to have membership they can be fun units i i think you know our entire business you know deploying capital is going to shift to on-chain and nfts because it's a better widget than limited partnership agreements and those are horrible documents and we never want to have to deal with them and that is a great use case

but also fashion gaming i mean there's going to be a bunch of different businesses and i think again if you are an investor that's focused on gaming you're going to find a use case with nfts if you're an investor focused on equities markets you're going to find your exposure there um it's it's just a widget and then the business model really has to do with the commercials of the team yeah i think on nfts too um i don't know when when it really was i think the the buzz about the the terminology of nft came up rather later than the technology itself because in the end it's just proof of ownership right certificate and um and that is the powerful thing

about that technology if if it's really implemented correctly so that you have copyright protection ip and i think that's something where also people have to look out for that not every nft out there is worthwhile buying um and and it will have a same involvement than many other new trends that it will migrate um to those platforms which have real authentication with those wallets which are truly holding only those correct nfts but one example just to to give you an example on the real world application we had a discussion with a

large automotive company here in germany and they were thinking about um how can you use nfts as brand building for example and and think about the design process when you are driving a new car most of that work is is not monetizable but it's pieces of art itself um if you turn these into nfts which this auto company is looking at then you have you're able from a corporate point of view can you can monetize this piece of of production and you have a great brand building mechanisms with your clients or car

car buyers and so there are many many ways to doing this or within in the startup ecosystem if you think about virtual share option programs there is a way to completely removed revolutionize ownership also as through nfts for example so it's not only about art it's not about about in-game swords it's there are so many different um different possibilities to use it um yeah if i may like i had a little bit um i think for iot users that we saw like you know other uh most of like the really big like web 2 like

internet companies were trying to like enter like in this space and we were wondering like you know like they were so aggressive like in the field and we saw like you know like um i think ft one of the usage of them is really it extends like the categories of the on-chain product or asset so it enables like a previously some of the assets would not be able to put on chain just put it in a more simple and logical easy to be understood like way so and all of these kind of like ifts is also um i think as i mentioned before it's just like so easy to understand and it's very easy to be go really visual like uh around the cloud crowd and so on so like you know like people started to do um so many interesting things like

wizard and what gary said like for example like a way of like a membership for example like only funds right and it was like you know other divine like derivatives like on the mts they're just like enable so many different kind of like uh possibilities so i think like you know the more assessed categories like to be put on on chain um there are just like also like more audience like to be here just they provided so many more like options for the users here yeah and also easy to attract a more you know like web 2 like audience because it's just like large easy to understood yeah easy to dance to it basically this is going to sound incredibly wonky but i'm really looking forward to lawsuits in our space so that we can

have some case law you know right now we have the technical you know ability now i think you know sitting here in 2022 to go and create everything from funds to option pools all sorts of ownership mechanisms on chain but how they actually prolly into the real world you know they these things live as foundations as spps as holding companies as llc's as as all these things and those documents are quite fascinating as well because it's basically a promise to reference a number on some network um and you know the idea is that someone who is part of a jury and you know the two sides of the opposing console will be able to go and audit that that contract you know we

really don't have you know proper you know on chain arbitration um or really any case law you know so really everyone is just trusting that this stuff is working um and i think this is going to be kind of the moment between like we all keep saying institutions are coming you know that's kind of yeah that's been the mantra for you know seemingly forever but i think we'll see dramatic shifts in your pension funds in like your retirement funds kind of the real the real big boy money uh you know that will happen after case law so until then we'll have volatile and i think huge gains you know i think if you're interested in the space you know this is a great time to be here because the volatility means there's an opportunity to do very well but stability um and huge widespread

adoption i think will come after just extraordinarily boring stuff like case law yeah i mean um we will see of course let's say in continental europe and other parts of the world we are not only based on on on on on case law we have already some pretty comprehensive at least in some countries such as switzerland some comprehensive legal world legal framework man are not specified on nfts obviously about but let's say especially like this interaction between now the new technology and the the current

legal questions which have to be addressed and so of course this is in my opinion or in all our opinion it's very important to have like a comprehensive understanding of the legal framework what you can do how is it transferring tokens and especially i mean you've mentioned it before like say connecting i.t rights to tokens what does it mean then the transfer is it an asset is it the utility and so on so lots of questions obviously are related to this and i think we all opened work and also lobby um to have a clear regulation in

this and i think now also the us wants hopefully uh to move to move forward um with that because uh the clearer the regulation it is the less disputes we have and disputes of of their lengthy and painful and can block of also many many many many many developments so now i would like to know a bit more also of your funds maybe could you like could you tell me i mean how big is your portfolio in size in capital but also in how many

companies do you invest yeah so in in total it of course depends on the day of time when you look at it but uh let's say we're we're above 120 million in aum um with uh with different products um we have invested with our first fund we have invested around 27 companies or in that case it's more soft agreements protocols the second equity fund which is still in the beginning so it's still

fundraising going to close finally in june and we already have done three investments there a fourth one is coming soon and we're building a portfolio of 30 companies in that one that that equity fund is more precedent focused and as i said in the beginning it's more the application and service services for the crypto ecosystem and and the other one is more sas b2b and i saw some questions on the side with yeah that if tokens are the real mean to evaluation right it depends right it's um that's that's exactly the differentiation you don't need a token in a tax software as a service business where

um you're finding your crypto tax report or in blockchain analytics you don't need a a token right they are traditional ventures at some point in future maybe there will be an earlier liquidity event due to security tokens but the inflection point on that has not really come yet um yeah so that's that's mainly the the focus um on on the side or the size of the funds at the moment um sure uh we're we're a rolling fund um so we'll do we'll deploy to three to five companies you know uh let's say low six figure checks uh on a quarterly basis um and then we'll put together

let's say seven figure and above spvs maybe twice a quarter um and so you know those tend to go to to our lps uh broadly big fans of what angelus is doing in the space i mean they've i think single-handedly as an organization have done more for venture capital gps just like you know building tools for us than almost any company uh but yeah big big fans of them but yeah we'll we'll either write a hundred thousand dollar check you know three or five times a quarter um or be in the north of a million check let's say twice a quarter uh yeah we've been around for about what 13 months for 14 months now yeah so we're relatively new i think we are probably like and newer

like than than than laden um so we started actually like last year now in april so we were probably the youngest like so only like around 10 months 11 months like old and yeah so we started like in april like last year and we just closed um you know announced like the news of like our first found like close closure of like 100 million us dollar so um as i mentioned like it's a token plus like equity fund we have done um 30 deals like until until today deployed around 30 million like as well um so i think in in general a bit like aggressive for font one it's also because like all of us like uh general

patterns have been in the space like for some time so we have already you know like the pipelines like uh accumulated uh and um it's also like our uh strategy is like actually to invest from like a pre-seed round until like a b stage so we want to like back the funders from the uh early days so really early and then to be able to like double down for the every other round until like a b so that is um basically um restricted by the font size because we are relatively small 100 million and um so for prestige we do like usually like 100k 250k something like that and we can we can invest up to 10 million to like one

single like a project so um yeah that's roughly about it cool congrats on the fundraise thank you yeah 100 million is not a small fund [Laughter] probably compared to a lot of like you know existing uh american north american ones is still like much smaller but um and also like there are so many new funds like inner space and um so many new money you know like old money is coming in so yeah i i think yeah we just want to be contribute among them as well super yeah that's very um a great achievement and in 10 months but then maybe my additional question who are typically your investors is it

qualified investors can also retail investors join your funds with ticket size uh so fast we have actually uh mostly like institutional investors so like over 70 percent is actually coming from the um institutional investors so like a big corporation song and we also take like a 30 around um it's also like i have to be like qualified one because we are kind of like to go through like different uh this kind of like fa fundamental like stuff so they need to be like qualified for um some kind of like you know lose which i'm

difficult to say um yeah so it's around like 70 percent yeah now for for us it's i mean we are baffin registered with which is the german supervisory authority so you have this rule of semi professional investor which classifies as everyone who's able to invest a minimum of 200 000 euro or you are a professional investor and then you're kind of flexible with that and typically we have private individuals many of which have been founders themselves successfully or or single-family offices or even other venture funds who want to get exposure uh to do flow or um

to learn with us as a fund um institutionals not too much yet we have one industrial holding with one corporate we're talking to some institutional investors now but historically it's more private individuals or single-family offices um yeah no institutions for us at all uh we are entirely family office mostly uh founder and entrepreneur back um and yeah like we are we're rolling funds so it's you know angels make sure that you are accredited um now if you're not a us citizen their part for that is is pretty low uh but we accept pretty pretty small

checks um you know we try to democratize it as as much as possible we generally ask we're not too fussy about how much people want to invest but we do ask that they invest for at least a year for four quarters so that they get exposure um you know over over a full cycle of us building a portfolio for them um yeah like this is this is why i i love like the angelus products you know our our overhead and managing you know the net additional lp is basically zero uh people can interact people can self service uh and subscribe on this platform and you don't even people can wire you money without ever talking to you which is kind of incredible if you think about it for for venture capital uh but i think like this is where

you know this is where we're all gonna be going you know i would love to be able to you know on chain follow an incredible trader you know into their nft and other collections and you know into their equity positions uh and and be able to just subscribe and deploy capital alongside them and i think we're not quite there yet you know we have a couple of startups that allow you to to follow portfolios uh we have obviously like these rolling funds where you know the gps we make significant contribution ourselves to have to have skin in the game but you know i think for all of us as fun managers like the the future is going to be much more fluid which can be cool great thank you so um i wanted to ask

also some question now from from our public so i have a question from stefan and he wants to know from you how you see investments in the educational tech and especially also in the metaverse um yeah maybe an example of metaverse because it has been discussed more in a futuristic gamifying way but just to make an example how it can change a lot in traditional industries so talking with a big german corporate on this as well and they're actually already using something like this um think about digital affairs right at

the moment you have to travel around the world uh companies spend millions on showing their products in in different parts of the world and they have their whole sales staff going there um what i've seen was a demo where and it's actually in use where you can walk through a virtual world and you have staff sales people interacting with you and you can show products in 3d turn them around you can directly buy them in there you can look at videos so it's a maybe it's not the full-fledged meter verse yet but it enables for me um in this example a future of work where you can increase

decrease costs you can it's a more sustainable way of working um so metaverse not only in the gamified version has a lot of benefits for traditional companies to use it and edtech i think was the other um yeah especially if you see at these in the beginning play to earn models there have been models coming out where it's some somewhere play to earn and learn models um so if you can gamify learning um that can have a huge effect of course it has to be set up right and incentivizations have to be right but

i've also seen it in hr and recruiting tools where you can have this edtech component and actually in a playful way you get a 360 assessment on your capabilities or what you have to work on and that's so both both topics offer real-world examples and we're not far away of actually using those or which are already being used so yeah that's that's my opinion on those two topics cool should we jump on to the next one we jump on to the net or do you want to say something sorry

no i think you could jump yeah maybe just mean yes yeah so i just want to i because i'm not sure like if i understood it right i mean in terms of like education like attack but my understanding might be something like rabbit hole or like er right i mean the one later got like acquired by coinbase right so like i think that kind of like education like tag is quite like needed in a space where you can i really enjoy like the model where you for example come across like a a product you don't know how to use it a protocol like i don't know how does it work and then you just like you know try it on and like you earn some of the native tokens like from them so like uh i think it's pretty educational and also it just like you know looks really um

user friendly as well so it's pretty easy to get on board just like more um users and the ones who are not familiar with and i think you know like in terms of like with uh my levers because i also saw like earlier there were questions uh asking about like what is what is overview of like ft powered like web series so i was thinking um you know we we like uh as a venture capital fund it doesn't make so much sense especially for us we don't really do a secondary market so it doesn't make so much sense for us to say like for example like investing like a punks or apes you know like this kind of um more um you know like this kind of like i have ts rather you know just more functional like i have t's like this mt

can be used like in certain kind of like ways so one of the recent project like um we have invested in so they combine like you know imts with um say so it's like a a website version of gaza town plus roblox so you have like your mts and then well you have like a functional utility kind of like a tokens every time like you need to consume like these clam tokens so that you could send out like an invitation invite to the person like who want to join like your uh space basically and then like with this you could also like play games like with with you know like a different like a friends of your of your network and so on so i just like you know give it like more

functionalities so people could uh spend more time like you know with the mts so that is the kind like i was like um having in mind it's just like now they're kind of like just walking around to show galleries or something rather you know just empower it like with small functionalities so that is the kind of matters like we we have like uh just as to um have in mind basically yeah yeah we have a interesting thank you we have another question from jasper and he's mentioning that he raised in an ico in 2016 signifier was found he was funded by token sales

now he is approached by vcs or interested in investing in his company but obviously he has now many tokens on his balance sheet so he would like to know how you would look at such a such a such a situation i have to meet yep gary do you want to go first uh sure i mean look i i think the answer to all these types of questions is always it depends um you know i i think it you would value the treasury uh you know depending on the transactional value you know the listings on exchanges all this

kind of stuff um you know you can have the biggest treasury in the world that might be worth something whether if there's really no liquidity uh you know if you try to capitalize the operations of the company in the real world by hiring people uh you know you might trigger you know a collapse of the pricing right so you know i wouldn't treat i would kind of think delicately you know about the valuation of the company and think what is the value of the business that that you're creating at the end of the day and you know if you have a massive treasury you know why do you need you know institutional or you know other other forms of professional capital um and if it's for operational support you know that's it's one thing you know if it's to capitalize

operations it's something else yeah and then if i may add something here maybe also for the other thing i probably it's not only i mean these tokens i think they are not um a treasure you know it's more reliability if you sell tokens and you know you have something outstanding and you have new new investors in your equity i think we had similar cases uh companies which raised um tokens into 16 to 17 and now the tokens aren't worth anything anymore and then now in order to to continue with it with the business model they had to raise equity and i mean the

the reason at that point in time was there was no real value in the token in the first place so of course kind of the token holders are pissed because there's no more value in that token and then this company tried to think about okay how can they keep the community at peace um of maybe offering also equity to them and moving the entire business model to equity um to continue a business operation so it's it's really about what gary said also is there any worth at all or any sense in having that token in the first place um if yes then

and if there is value to it then yes it's a treasury and you would probably as an investor buy equity but also get a certain portion of of the treasury tokens um and so it's really a question on what the business model is um where is the value creation if it's only in equity then the token side has no worth and then also a vc wouldn't value that so that's always the first question we ask when investing does a token model make sense is blockchain at all needed because there are cases where blockchain just isn't that

extensive step of improvement to a web 2 based model um so i would think about all these questions and how you plan to build up your your future business model good i have another question from nicholas um he is building a play turn game and he would like to know your thoughts about nft games especially play torn like x infinity star you want to go

jasmine i want to take this one yeah because that's really funny i mean in terms of like uh actually infinity i actually met the founders like in 2019 like during like athcc like event and uh that probably is my biggest like you know mistake and like not investing like and um at that time but uh um i would say like uh it's really hard to say i think like this is like alpha games like uh in our preference it's like sometimes very individual there are certain kind of games people like to play spend time like night there are you know like some kind of people just don't like it for

example but like for me for example at the moment i don't know how it is just to be easy for someone to spend initially i don't know 1000 like us dollars like to have the initial like input to play a game that is probably not so interesting as some games like in like a ps5 you know like just from like my my perspective so and that's why like you see like there are so many like gills like in this inner space because they have to organize you know like people to do like this kind of like operational work to just be playing there so i think like you know like one of the things we have always like you know when we invest in like i can find like a

project we always see first of all because we're looking to like proceed like a very early stage so we always see like for example like whether the team is like really um you know have shown like a proven track record so they can build like at least like you know fun games to play because people are not machines like they're not just be there to you know press and so on so like they need to be like really fine like for people to play and really like a doable like kind of like a games and also like i think secondly because like you know these kind of like play-to-iron games um one difference like in web 3 it's like there is token so how do you design your token economy that is also pretty important so how to make it really

utilized right so that is the two things that we look at when they are really like early stage kind of projects but i think that like uh most of the gameplay projects we have invested in it was like last year and um now after like a few like investment we also started to be like really you know like cautious in a way to check just like more criterias like in this in this field because you see star atlas it looks really good but takes years for the game to really launch and then who knows what will happen like you know in the in the market there will be there can be so many different like uh possibilities so i think at the moment like a play to earn kind of like model have to be like really um innovative and really like

interesting unique to be able to like really catch people's eye because there are just so many games like to be there so how to really design a fun game and also with like a functional token economy i think that is pretty important i'm glad you answered this one because we've made zero gaming investments honestly we have invested in they are really like close like networks so we know the founders pretty well so you know like they we know like that they're long-term ones so if you are to be there in the market for only like i don't know one or two years that is definitely not our target because our fund is also like 10 years like fund life so we can't wait we can't have like the patience just like you know most of games as long as

you really determined to be there and founders were recognized we can't wait for you for like a you know like a long time like enough just like into a show like you could really build like a real game for for real people human to play yeah thank you um i have another question from evangelos he's referring to a statement of dominic regarding the security token and why they did not take off yet and he wants to know your thought why and if this is the case

that's a very good question i i have not found a real answer to that yet we've been looking into the security token space since three four years and i've seen many startups in the space and and i think if i i guess an answer would be that the biggest bottleneck for me is the liquidity side of it so we've seen see many approaches where you have the tech place or you have a those companies helping to build the tech layer so more as a wide level solution we have some which approach it in a reg

tech layer so where you have tech and regulatory environment um and then you have the other layer where you have the more secondary layer i would call it where you have um like the the actual projects being tokenized or assets um and then you have the more customer facing layer so this this would be kind of the the stack in in this embedded investment security token piece and and all the projects where we have seen securitized assets these assets have been not high quality assets so the

there's there's very little likelihood that you have customers really buying that or investors really investing in that um and you need different backgrounds different track records on every level so on the tech side you have to be very good and know what protocols to build on this secondary layer you need more the traditional finance background to to build out that layer and really be able to judge the investment character so it makes no sense to tokenize any real estate on the street but it has to be a good asset so take moon fare for example i don't know if you know that business it's um they're offering joint investment into

private equity funds for example um they are so successful in a web 2 based model um choosing these assets and this business model could be tokenized for example as well choosing those assets because they're all from that industry and they're taking this due diligence and quality approach for them but once you have invested in a security asset there's still the lack of transferability so there's no exchange or a liquidity market with enough liquidity to to enable that exchange so at the moment it's still from a german point of view if you have to sell something a security then you have to go to the notary for example so

there are certain efficiency aspects just of using the technology um but the the real making physical assets liquid that part has not come yet and i and i think it will come when i when i think of deutsche berser or schnuck whatever they are building platforms like that um the moment like such a highly secure and big marketplace will become online i think that could become a inflection point i'll be i'll be more forceful um you know only finance nerds care about sdos investors don't actually care

every single investment will be an sto but by the time that happens you'll be buying stos through robin hood and you won't be able to tell the difference whether it's equity or not the problem now is that if i have primarily my gains in crypto um then purchasing you know an sto you know with my hard-earned volatile crypto um is not the best yield um and not the most interesting thing that i could be doing with my money and then on the other side if i'm a traditional investor that actually cares about a compliant offering think about it from a roadshow perspective you know let's say i'm doing an offering i am you know trying to build you know an spv for a hotel or for a company or or for a fund and i'm going to investors that actually care um this

is a regulated offering now i have to explain to them why i'm not doing a normal offering because i am now expecting them to have all of this infrastructure around custody and interaction with me in order so they can receive and use this token so for super traditional investors holding tokens you know without proper custody and all that figured out is extra hassle and for crypto native investors the yield play is just not not that interesting if it's a piece of real estate so i think what will happen is that yes absolutely all equity will be tokenized uh but it will become completely invisible and i don't think we'll have this big push by institutions to be counterparties without having intermediaries that will make it

basically indistinguishable where they're buying a piece of equity or a piece of tokenized equity and maybe to answer that access is a huge point so if you have an asset where normal investors don't have access to right so big funds where minimum investment is 40 million or so or you have [Music] very large unicorn type private assets let's say spacex or n26 or so you want to invest in that category and you have a tokenized form of that um if that if it's about limited access for many investors then a tokenization approach can make sense but you need that level of

quality first also to to attract and build a positive experience also around that yeah so short answer we're not there yet [Laughter] yeah jasmine i think security token is not really a field for me um i i didn't really look into it so much like in that in front of us like we we were um we have been like actually primarily like looking into more like a native stuff so like entrance kind of like product i think it's just like you know take time within the time of like our font life i think that is probably still hard but

like for the future it might be but we just like you know more to say like a practical looking into within the front lifetime yeah i think this is absolutely interesting here also response which which also reflects a bit what also gary and and then and dominic said i think also first thing is i mean that we have in the in the traditional mark it's they are not so inefficient no if you go to if you want to have real estate exposure you can easily buy a real estate fund or you can buy you know an index product from blackrock

without no spread very easily and so on so probably the need is not really there and then obviously also what what what gary said i mean the fantasy is not in let's say a real estate investment with a three percent deal per year if you can go into tokens where you gain that per day or per hour and of course also i mean seeing who are until now the token investors i think they're more interested in this exciting stuff than in the boring stuff until now and probably that's why even though there have been some interesting um some interesting

ventures i mean the demand as i've as far as i saw it the demand client-wise was not really here and then obviously we have still the problem with the whole uh with with the exchanges that you know it's uh of course security trading is burdensome and requires special regulation and and and and so special [Music] licenses which you do not need with a utility token or with a pure payment token uh exactly so i think this is this is this these are

these are the main my main main findings now i have another interesting question from frederick one which i also wanted to address anyways and this is what are you looking for i mean we have many also startups here in our audience and they want to know what do they have to do so that you could invest in their in their in their product in their token in their equity what are you looking is it the idea the business model the team the tech the mix what are what what catches your attention if you

get the file on your desk it's always the team i mean it's any i i think that that's where i think every investor has to almost start because you know ultimately people business if you walk away kind of this stuff stops working um but you know to the startups on the feed um you know we all have our own products that we've sold you know we also went and fundraised right and we sold a very specific strategy in our portfolio approach uh and so very frequently you know i know you know has nothing to do with you but has to do with your fit within the portfolio or the model or the strategy that you know that we've sold to our to our investors right um you know it's

but i think for everyone it's you know you're a serious team of qualified people building a you know for a big transformational market um and you're intellectually honest with yourself about the value you're creating for your constituents or your users yeah and it also it's it's a lot about stage right if you're raising a precede then it's definitely mostly team the the idea and how you can execute it i mean if you want a structured pitch deck with kind of the problem statement the solution also why blockchain right and don't create a token if there's no need for it

so that really think about the business model and then the further you come in terms of stage then traction starts to matter so there are um great great studies also and you can google quickly on typical kpis an investor would expect at sea stage or at series a stage so be aware of whatever you're raising it's the valuation at a certain stage is only kind of the investor giving you the benefit of the doubt that you are able to achieve the kpis and valuation for the next round so go to market strategy has to be sound

and you and within your capabilities as a team you have to be able to prove that you are able to to build that um startup from from your step where you're in to the next step and yeah i've avoid um [Music] only getting feedback on your products from your closer inner circle really talk to customers your potential customers um try to figure out what what value can you give to your customers and then figuring that out is again the purpose you would need yeah

um i agree i think that team is definitely like something while looking into it i mean and it to be like also like more specific i think like the um the kind like we really like it's like the team has already some experience like in in in the field in the in the crypto space i mean this person have already um you know witnessed like you know the cycles so he's not like a kind of like father i i mean i'm i'm only saying like just to be more specific and also more ideal that you know has been like already in a space to see like witness like the cycles so he knows you know when the market goes down the customer goes away the user is like you left your platform if they will not be panicked and so on

so like you know to really acknowledge all of these things that could be possibly happen and also like teams gene right so like the team whether they have for example like uh you know already understanding into like uh finance related like risk management stuff if they want to do like that funding um like this kind of like a stuff so like you know the consistency of like their their work you know whether they really understand like the market and one of the questions i always like to ask is really the insights of theirs towards like the market the problem they want to let yourself i think that is pretty uh always very interesting like you know to hear from a founder from a very early stage so and then like with the with the project is also really i

think depends on the fields like working with uh working in so like we are for example looking into like some projects they do like ift plus music or like ft plus like social fire like this kind of stuff how do they you know really move like the traditional web 2 like audience from instagram or facebook like to their platform besides the tokens they said they might they will give to like all of these like a big qrs and so on who have like a big like you know like pool of like fans so like you know like all of these like uh assaults whether it is like logical and whether they have already started school um i think could be like really important as well so one thing i think we tend to ask less is

really like the business model how to monetize it and so on so i think like especially for early stage we don't really try to challenge because there are just like so many ways who could have like imagine like compound like large tokens or there are so many just like in your new like kind of like a stuff so definitely like a team and also like for me i think the teams like in insights into the area where they want to tackle yeah thank you so now i would like to know from you i mean you're all based somewhere else where do you invest region or in which regions do you do you invest

well the token side is pretty global anyway um so there's i mean there are venture hubs but but that's more a global focus on the equity side we're especially focused on europe uh i would say equity side focus on u.s uh you know teams can be anywhere uh but you know we think that there is good legal and financial infrastructure to execute on projects um in the us or europe uh so we generally like to see the companies legally live there even if the founders are somewhere else uh global globally basically yeah don't really have that guarantee you got

you guys are cooler than us i want to say that they're like uh yeah it's like you say it's bad great thank you very much i have one maybe last question from my side and then i would also like to give you the word the last word to tell something which uh you would like to add to our discussion i wanted to ask you i mean how did you see or did you hear about crypto valley switzerland uh what do you think about it where do you see its potential now from an

outside view it's interesting for us even though that crypto valley association switzerland has almost half of its members are outside of switzerland so we really try to be a global spot here but it's i'm wondering what you think now being in asia in germany in the us how you see um or how you perceive crypto valley switzerland well i'll you know i'll say something i'll be nice look i i think in any new space you know high quality educational

content um it's great you know especially you know in a space where you know there's a lot of crap out there you know right and i think in crypto and blockchain um just because it's relatively easy um to you know push this information versus the equities world um and so you know i generally support you know and enjoy and enjoy spending time with any organization that puts out quality content i i think we need more and more of it and the need for quality content won't go away i think we'll we'll be more dependent on it over time yeah i think as well um like these these hubs these communities um it is a great

way of of interacting among startups um it is a more synergetic and efficient way um so and for vcs it's easy because you can jump into a hub and see what's going on and so we like we like what you're doing we've been in contact with cvvc in the past we've looked at several cohorts i mean switzerland is a a great ecosystem um in the blockchain space um also a lot due to regulatory environment um so yeah it's it's a great place to be i guess yeah i say i i think that's uh and i

just like through this call um we have like basically seen like as so much like effort like i've been put into like this uh this webinar i mean from like crypto valley it's like so much like work and then you can see like really you guys like once you um provide a great like um you know platform for entrepreneurs to be connected with investors and i think that is just really great work like you know like you guys are doing it um but i think i think like you could you guys could do i could have done like also so much more um like do different things like in different like uh regions and then you know like for a conference also like have more diversities um yeah i mean i'll be that would be just like uh you know even better but

overall i have been like enjoying it so much like so far and um i think i can i just tend to be very direct and i hope you guys don't mind thank you jasmine you're absolutely right and i think diversity it's it's it's a very important uh point which obviously uh we're also it's it's also challenging us because it's uh it's you know uh tech still unfortunately is pretty much a man's world i mean i see it i have a son who is 16 years old who starts as an i.t engineer doing is doing an apprenticeship here and unfortunately in his class no

no girls and i really hope this changes and i think we need role models like you jasmine and i think i mean you did an excellent performance and i think your thesis is you provided us us today was also very um very good and and and and and inspiring and so i i hope we really go this path and [Music] again it would be great to have you to meet you in person to see you soon here in switzerland maybe at the crypto valley conference which is

taking place in second and third uh of june also for our audience if you're interested to join please register and uh thank you again and please if you want you i i want to give you the last word go to sleep jasmine it's not like yeah like my mind just like processing like so slowly like every sentence i need you like uh but yeah it's it's like this but like and it's been like really a true pleasure to you know like a chat with like all three like a gentleman's and then being like so considerate and so on and then i think it's just like in general a very

exciting like space and um i'm just like so fascinated every day you know getting to know like all of these you know new people who want to explore who want to learn and then i'm also like learning with all of the founders of entrepreneurs of like our portfolios so it's been like a truly um i don't know like honored and really happy like to be in this space and then um i like to help i also like really contribute whatever i could and then i was like really looking forward to miss you know other guys like in crypto valley like conference engine so second and third don't forget yeah thanks martin a lot

it was a great discussion guys and so i hope to do this again soon just because i saw that you are passing on information um maybe you can pass on the email so either write me directly if you if you if you want to talk about your project startup and definitely please just because we have a standard process and which assures that you get answer as quick as possible please also include this email i'm just sending it here maybe martin you can include that as well just to make sure that

if i'm not i always try to to answer as quick as possible but it's it's easier if you definitely put the pitch address as well cool same here i i dropped the link in uh it was awesome meeting you guys so martin thank you so much for organizing um and yeah hopefully see you in the real life uh sooner than later bye bye thank you everyone have a good day bye