Crypto-focused venture firm Electric Capital has raised a $400 million for its third early stage fund, as well as a $600 million digital token-fund.
Why it matters: Raising huge pools of capital to invest in crypto is becoming the norm as the industry's boom continues—despite regulatory uncertainty and ongoing concerns over scams.
Between the lines: Electric's pair of funds reflects a growing reality in crypto investing: many companies and projects may never raise traditional venture capital beyond the early-stage once their token networks get deployed.
- At that point, purchase tokens may be the only way for an early investor to keep investing—and to keep purchasing what's valuable about the company.
- "There are seed or Series A companies that haven't gone up the S-curve," says Electric Capital managing partner Avichal Garg in reference to the idea that startups can hit an inflection points that trigger high growth before hitting maturity.
- "So if you can find high quality investments, you want to hold them because they haven't gone up the S-curve."
- Sequoia Capital also recently announced a token-focused fund.
Go deeper: Meet the modern crypto VC