Seven Seven Six is raising $177.6M to invest in crypto tokens
Alexis Ohanian’s VC firm Seven Seven Six hopes to raise $177.6 million for a new fund to invest in crypto tokens, The Information reports.
Why it matters: Venture firms and their LPs remain bullish on the potential returns from investing directly in tokens, despite the downturn in asset prices.
Details: Based on fundraising materials reviewed by The Information, the new fund will be named Kryptós and will focus exclusively on token investing.
- Seven Seven Six received approval to become a registered investment adviser in April.
- The firm will charge a 2.5% management fee — slightly above the industry average — and receive carried interest of 25%, with the potential to earn 35% if the fund returns 5x or more capital.
Between the lines: Seven Seven Six is no stranger to the web3 ecosystem, having already made equity investments in companies like Quick Node, Helium, Yuga Labs, Proof and Doodles.
- But, by becoming an RIA to invest directly in tokens, Seven Seven Six is following the lead of other VC firms, like Andreessen Horowitz, Sequoia Capital and Bessemer Venture Partners.
- Doing so enables those firms to put more than 20% of their funds into non-equity investments.
Yes, but: While VCs that invested in tokens saw outsized returns during the boom times, the crypto market has seen across-the-board declines in asset values since the beginning of 2022.
What they’re saying: But that’s actually a good thing, Seven Seven Six founding partner Katelin Holloway told The Information: “This is the best time to buy if you’re really long on the industry … It’s on sale. Everything is on sale.”