Key Takeaways
- • Andreessen Horowitz (a16z) announced the close of Crypto Fund III, a $2.2 billion venture fund that the firm says is the largest crypto-focused VC fund raised to date.
- • The fund will be co-led by Chris Dixon and Katie Haun, and will invest across all stages, from seed-stage projects to later-stage networks.
- • Limited partners in a16z's previous crypto funds drove demand, according to a source familiar with the raise told The Block; the firm also netted more than $440 million from selling Coinbase stock after its Nasdaq debut, per CoinDesk.
- • a16z is expanding its crypto team with several senior hires, including Anthony Albanese as COO, former SEC director Bill Hinman, and Tomicah Tilleman as global head of policy.
- • The raise comes amid a broader surge in crypto venture activity, with The Block data showing more than $8.8 billion invested in startups in 2021 versus $3.07 billion in all of 2020.
Summary
Andreessen Horowitz, the venture firm led by Marc Andreessen and Ben Horowitz, announced Thursday the close of its third crypto venture fund, "Crypto Fund III," with $2.2 billion in committed capital. The firm describes it as the largest crypto venture fund raised to date. In a press release, the firm said the fund is "a validating moment for the ecosystem and another sign that crypto becoming an ever more mainstream part of our financial infrastructure." The fund will be co-led by Chris Dixon and Katie Haun, who wrote in a blog post that the vehicle will help them "find the next generation of visionary crypto founders" and invest across seed-stage through fully developed later-stage networks.
The close follows months of market reports. The Financial Times reported in April that a16z was raising $1 billion for a crypto fund, and tech blogger Eric Newcomer wrote in late May that the target was $2 billion. A source familiar with the raise told The Block that demand came mostly from limited partners in the firm's earlier crypto funds, which have posted strong returns. According to CoinDesk, a16z netted more than $440 million from selling Coinbase stock shortly after the exchange's direct listing on Nasdaq. The firm's crypto mandate is broad, spanning decentralized finance, bitcoin applications, and Web 3. Its portfolio includes Dapper Labs, Celo, Uniswap, and Near.
alongside the fund, a16z crypto has been hiring aggressively. Anthony Albanese, who joined from the New York Stock Exchange last year, is being promoted to chief operating officer. The firm also hired Bill Hinman, a former SEC director who once said ether is not a security, and Rachael Horowitz, previously the top communicator at Coinbase. Tomicah Tilleman, a former senior advisor to President Joe Biden, is joining as global head of policy. Dixon and Haun said the hires are meant to help "translate 'crypto' to the mainstream" amid ongoing challenges and misconceptions.
The announcement also comes as crypto venture investing has remained active despite a slump in coin prices. Framework Ventures recently announced a $100 million fund focused on DeFi, and Blockchain Capital announced a $300 million fund backed by PayPal and Visa. The Block's data shows more than $8.8 billion poured into crypto startups in 2021, compared with $3.07 billion in all of 2020.
The close follows months of market reports. The Financial Times reported in April that a16z was raising $1 billion for a crypto fund, and tech blogger Eric Newcomer wrote in late May that the target was $2 billion. A source familiar with the raise told The Block that demand came mostly from limited partners in the firm's earlier crypto funds, which have posted strong returns. According to CoinDesk, a16z netted more than $440 million from selling Coinbase stock shortly after the exchange's direct listing on Nasdaq. The firm's crypto mandate is broad, spanning decentralized finance, bitcoin applications, and Web 3. Its portfolio includes Dapper Labs, Celo, Uniswap, and Near.
alongside the fund, a16z crypto has been hiring aggressively. Anthony Albanese, who joined from the New York Stock Exchange last year, is being promoted to chief operating officer. The firm also hired Bill Hinman, a former SEC director who once said ether is not a security, and Rachael Horowitz, previously the top communicator at Coinbase. Tomicah Tilleman, a former senior advisor to President Joe Biden, is joining as global head of policy. Dixon and Haun said the hires are meant to help "translate 'crypto' to the mainstream" amid ongoing challenges and misconceptions.
The announcement also comes as crypto venture investing has remained active despite a slump in coin prices. Framework Ventures recently announced a $100 million fund focused on DeFi, and Blockchain Capital announced a $300 million fund backed by PayPal and Visa. The Block's data shows more than $8.8 billion poured into crypto startups in 2021, compared with $3.07 billion in all of 2020.
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