Exclusive: Ego Death Capital closes $100M fund for bitcoin companies

What they're saying: "We're in bitcoin, investing in true companies ... that are solving real world problems," Nico Lechuga, one of the founding partners, tells Axios.

Zoom in: Ego Death focuses on software companies building businesses that rely on the bitcoin protocol.

• The fund's typical target company has $1 million to $3 million in revenue, and its growth is constrained by its capital on hand.
• The fund is focused primarily on Series A rounds to scale companies that are working, with a small portion set aside for promising seed investments.

Behind the scenes: The investors in the second fund are primarily family offices that are invested in bitcoin and are eager to see its economy built out.

• Lechuga said the space lacked a lead series A investor, so that's what Ego Death is looking to do.

Catch up quick: The second fund has already made a few investments, including Roxom, a bitcoin-based exchange; Relai, a bitcoin saving tool; and Breez, a payments infrastructure built on the Lightning network.

• It does not invest in hardware companies (such as those making wallets) or in bitcoin mining or its infrastructure.

Zoom out: Unlike a lot of crypto funds, Ego Death isn't interested in crypto tokens.

The intrigue: Many investors have been burned by supporting crypto companies when they would have done better just buying and holding bitcoins.

• Lechuga argues that not only can a bitcoin-based company see massive early growth, but many of these firms generate cash flow in BTC, which helps them outperform the underlying cryptocurrency.

The bottom line: "We see bitcoin as the only decentralized and secure base to be able to build on," Leshuga said.