Hi everyone, it has been one year since we established our fund. In 2021, we raised $100M from some of the world’s largest Fintech groups and have been investing into web3 startups from pre-seed to series B. On this first anniversary, we would like to introduce A&T Capital in more detail.
A&T Capital is led by three founding partners based out of Berlin, Singapore and Shanghai, and supported by a global dynamic team of researchers and analysts .We have a proven investment track records into crypto since 2014. Our varied backgrounds in high tech, TradFi and venture capital help us understand what is essential for a startup to succeed. We have witnessed the evolution of the crypto space, worked a broad spectrum of use cases and are determined to provide long term support to our portfolio companies!
The following developments and observations have shaped how we approach the market:
As L1’s rise in prominence and number, new talents are attracted to the industry. While not being crypto-native, their operational excellence, capability to scale and proven go-to-market strategies have proven vital to help projects grow faster and bigger. The space has never be more background agnostic and welcoming; attracting talents with various interest with the depth and breadth of skills needed to drive the industry to the next level.
We therefore strongly welcome new talents and actively support projects with fresh, new perspectives. To us, the excellence of the founding team is more important than the crypto legacy it comes from.
Even though we do not like to admit it, governments around the world still have not settled on how to approach decentralised technologies and every small change in policy can have a deep and immediate impact on the industry. After all, we are still early adopters and it will take several (failed) iterations for best practices to emerge.
China once hosted around 75% bitcoin’s hash rate. Given the country’s circumstances (supply of tech-savvy entrepreneurs, affordable energy prices and general innovation drive) it seemed like China would remain a dominant player in crypto mining. A vibrant ecosystem of investors, projects and user base flourished until May 2021, when China’s state council announced a crackdown on cryptocurrency mining (and later token transfer in general) forcing the industry to relocate.
Germany was the first country to recognise bitcoin as a ‘unit of account’ in 2013. It attracted early builders and communities many significant projects emerged from this. In 2020, when the pandemic hit Europe and companies were forced to work remotely, the strong network effects of crypto hubs such as Berlin were severely reduced and lost most of its appeal. This led to the creation of new hubs such as Lisbon, which successfully attracted founders with tax benefits and lower costs of living.
Having seen several hubs come and go, we aim to support projects that are flexible in the way they approach their labor force, with founders that have international appeal and experience and can navigate an uncertain and ever changing regulatory framework.
Capital is cheap. The real value of an investment comes from the benefits, resources and support the investor can provide to the project. Investor confidence in crypto has increased significantly over the year. In 2018 only a handful of projects would have been able to get attention from the established institutional investors. Since 2020, we consistently see institutional investors active even in early stage investments. The space certainly got more crowded and barriers for funding have been reduced.
Launching our fund in such a competitive environment is an exciting prospect. We are uniquely positioned to support promising decentralised startups to realise their full disruptive potential through our understandings across different markets, broad connections in the space and our focus on product.
Coding might be open-sourced, might be forked and copied, but a good product is a competitive advantage that is not easily duplicated. Crypto has evolved to a stage where user experiences actually matters. Building a successful product can be difficult and we have witnessed a lot of failures due to missing or misaligned product-market fit.
As we believe that product think is strongly shaped by experience, we actively provide our portfolio companies access to some of the world’s most experienced product managers. Earlier this year, we set up a permanent A&T Capital product council to help our portfolios edge out the competition. Members of the council include early employees of tech giants such as Alipay, Google, Microsoft and Twitter, with wide range of expertise in engineering, product, legal and business development. You can find more info about the product council here.
Crypto space is full of opportunities. We choose to focus on areas we have previous experience and can add the highest value directly. Below maps out our announced portfolios in each sector over last year, where we have deployed over $30M.
This year, we want to focus on products that serve a broad range of users including both newcomers and advanced users. Considering the current state (see observations above), we believe it’s time for a new wave of killer infrastructure projects. Therefore, we would like to call for entrepreneurs who aim to build web3 applications in the fields of SocialFi, Wallet, DID as well as necessary tools (e. g. messaging protocols) to reach out to us. Our team has necessary expertise required to help shape the product.
Building a new fund can be challenging, but we have received tremendous help from our friends. The team is extremely grateful for the support of our limited partners, business partners as well as all our portfolio companies who have trusted us from day 1. We believe the world is on the cusp of a lasting technological revolution and we are going to play a significant role in it.
Luck is a critical factor to achieve exceptional success in business. Experience, connections and knowledge can help increase the likelihood of a lucky stroke. We are here to help make it happen.
Last but not least, kudos to ALL entrepreneurs who are thriving to build a new era.
The future is NOW.