As the combined market cap for ICO projects reach one trillion dollars within the next year, VCs begin to take notice.
Firms like Andreessen Horowitz and Union Square Ventures have formed Polychain Capital, a crypto hedge fund. And one of the largest VC firms in the country, Sequoia Capital, has recently invested in China’s Bitmain, raising $50 million from several venture firms. .
Venture capital is a type of investing where firms will invest in sometime hundreds of companies and only expect one or two to pay off overall. This type of investing has recently been limited to people with a lot of capital such as wealthy individuals, investment banks and other financial institutions. But with the advent of blockchain, this business model is slowly being reinvented.
What’s been described as the ‘leapfrogging’ phenomenon, tokenized equity can redefine venture capital on how startups raise funding. Those who want to get involved in supporting tech startups can do so without having a high income. Anyone in the world can now leapfrog over traditional capital structures and fund investments into private companies.
In 2011, Hackers/Founders was formed at the suggestion of Naval Ravikant of AngelList. Now, H/F chapters can now be found in 128 cities and 47 countries with well over 300,000 participants. H/F manages a portfolio of post-product stage tech companies, and provides services such as legal, accounting, and talent in exchange for equity.
Hackers/Founders has yielded an impressive growth of 30% year over year for the past five years while some of the best venture capital funds in Silicon Valley yield between 15%-20%
Hackers/Founders plan to start Hack Fund, a liquid venture fund on the blockchain which will launch HACK tokens to potential investors. HACK will use the Ethereum blockchain technology to make startup investing available to people around the world.
|Targeted number of investments: 30 for every $10M raised.||Typical initial investment by Hack Fund: $100k-$250k Seed, $500k-$2M Series A.||Investing in startups seeking to have their own token sale as well as those growing towards traditional exits.|
Types of companies H/F invested in:
|Ad Tech||Artificial Intelligence / Machine Learning||Consumer Commerce||Blockchain|
|Digital Healthcare and Medical Hardware||Family Tech and Education||International / Emerging Markets||IOT, Drones, and Hardware|
|Mobile and Tablet (IOS and Android)||Online education / video||Payments and Financial Services||SMB Productivity & Cloud Services|
Hack Fund will utilize 100% of returns to reinvest into new or existing portfolio companies. Reinvestment ensures the fund continues to create value over time, increasing the chance for future returns and adding value to Hack Fund portfolio. Hackers/Founders track record of 30% fund growth could make this a lucrative opportunity for investors.
The Power of Liquidity
In essence, HACK tokens will act like a digital stock into the venture capital market. While traditional venture capital funds usually need to wait years to see returns from their investment. But due to the tokenized nature of HACK, investors will be able to buy, sell and trade tokens in a fund that derives value from H/F’s pool of startups.
Long Term Vision
Outlined in their whitepaper, Hack Fund’s long term vision is to bring capital to Latin America and other undercapitalized markets around the glob. We have seen a huge jump in Latin American markets such as Venezuela due to the lack of currency liquidity. Our liquid venture capital fund enables us to invest and support startups around the globe in ways that would not otherwise be feasible.
Hack Fund is committed to integrity, transparency, accountability and the use of smart contracts.
Token Sale Terms
Token exchange rate
$1 USD = 1 HACK
Minimum Investment in the U.S.:
75% of all tokens will be allocated for sale, with 5% of that going towards operational overhead. Any additional operational costs will be borrowed out of the remaining 70% and will be paid back at a rate of 5% interest per year.