Welcome Bessemer Ventures to Web3
Bessemer Venture Partners is launching a $250 million fund dedicated to the decentralized future
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Yesterday, Bessemer Venture Partners (BVP), a venture capital firm with $10 billion in assets under management, announced it would be launching a $250 million fund dedicated to crypto and a decentralized future.
Over the years at Bessemer, we have been part of several major and long-term paradigm shifts, most recently those brought on by the advent of the internet and the cloud—infrastructure that changed how businesses around the world operate.
It’s clear that we’re now at the onset of the next seismic shift: a new iteration of the web built on blockchain technology. Web3 is an ecosystem that we believe has several decades of transformation ahead of it, and one we’re passionate about partnering with the most talented founders forging this new future.
With venture capital funding for crypto companies jumping from $6.4 billion in 2020 to $27.4 billion in 2021, a 400% increase, it is hard to argue that this seismic shift is not already happening (NYT). Bessemer Ventures is by no means the first venture capital firm to launch a dedicated crypto fund (please see below), but it is another company acknowledging the impact crypto will have over the coming years and is dedicating a lot of money to help accelerate that shift.
Top Venture Capital Firms Crypto Funds
Paradigm - $2.5 billion
a16z - $2.2 billion
Electric Capital - $1 billion
Bain Capital Ventures - $500 million
Dragonfly Capital - $300 million
Blockchain Capital - $300 million
Bessemer Venture Partners - $250 million
Hack VC - $200 million
MultiCoin Capital - $100 million
Union Square Ventures - $75 million
As Arianna Simpson, a general partner at a16z, said on a Bankless podcast, “In the future, there won’t be crypto funds they will just be funds.” Similar to the early 2000s, before ubiquitous adoption of the internet, when venture capital firms were launching dedicated “internet funds”, now they are just funds and there is no need to specify the internet as a focus area.
The technologies emerging from the global web3 movement have the potential to transform legacy industries across sectors including financial services, gaming, cybersecurity, arts, entertainment, and many others.
Despite this being the launch of their crypto fund Bessemer has already invested in several crypto native companies such as NYDIG, MakersPlace, Sorare, and TRM Labs. Bessemer is breaking its crypto fund into three different verticals across consumer crypto, web3 infrastructure, and DeFi.
In the spirit of web3 Bessemer is also launching BessemerDAO, to act as a web3 community for founders, creators, and operators.
Our goals for BessemerDAO are to help the crypto community meet talent, trade ideas on product, business development, and tokenomics, extend visibility into where innovation is happening in the crypto space, and ultimately, aid in staying ahead of major shifts and trends in web3.
While this is not the first dedicated crypto fund, this is the first mainstream venture capital DAO being launched to complement the fund and its portfolio companies. Bessemer can very well be a trailblazer in this regard and start a trend where venture capital firms leverage their extensive network of talent into a decentralized community of thought leaders, advisors, and contributors that can help their portfolio companies, and themselves, succeed in their vision. The DAO will initially be more centralized as it is stood up but the plan is to decentralize all of its components and shift the power to the community over time. Even more exciting is Bessemer mentioning that they hope to utilize BessemerDAO’s community momentum in the future to democratize access to private markets and their investments.
Bessemer applications to join its DAO are currently open and they already have their first cohort of members lined up with entrepreneurs, investors, and operators from Solana, TRM Labs, 6th Man Vetnures, Chapter One, and others. With over $27 billion invested into the crypto industry last year, and as more and more firms launch dedicated crypto funds, it continues to validate the adoption of this movement. We are looking forward to when crypto, web3, and blockchain become as ubiquitous as the internet, and there is no longer a need for venture capital firms to specify that it is a crypto fund.
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