Why Katie Haun didn't invest in FTX
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Katie Haun onstage at Axios BFD. Photo: Chris Constantine on behalf of Axios
At Andreessen Horowitz and her namesake firm Haun Ventures, Katie Haun has made dozens of investments in the crypto ecosystem. But one company she didn't back was FTX.
Why it matters: FTX's lack of governance should have been a red flag to investors, she said at the Axios BFD in San Francisco.
The big picture: Haun shared many reasons why she didn't invest in FTX, the least of which was the company's valuation, which had just reached $32 billion when her firm launched.
- She cited the lack of traditional governance at the fast-growing crypto exchange.
- "There was no board; there was no CFO. ... We have traditional things we look for, that any venture investor would look for: TAM, founder, and market opportunity ... but we also look really seriously at regulatory," Haun said.
- FTX founder Sam Bankman-Fried "probably wouldn't have wanted us on the board," she conceded. "I would have been asking too many questions."
The intrigue: After Bankman-Fried was found guilty on all counts, Haun wrote a post on X (formerly Twitter) discussing her view of his likely sentence.
- Asked if she thought the sentence was fair, given that customers would be paid back in full, Haun said: "It was the largest financial fraud in history, and people have different views on whether victims were made whole. But I don't think I need to tell you that there are going to be victims that are not made whole."
Reality check: Putting aside the results of the bankruptcy process, she noted that sentencing serves an additional purpose.
- "If you think about the theory of criminal prosecution, it's not just ... for restitution and to make victims whole — it's to deter future crimes," Haun said.
- "And I think there's no question that a sentence of that magnitude sends a pretty big deterrent message out there."
