The private American venture capital firm, Andreessen Horowitz (a16z), intends to raise $450 million for a second cryptocurrency investment fund, according to a report. The company already raised $300 million in 2018 for its first-ever investment fund devoted to cryptocurrency-related businesses.
A16Z To Raise $450M?
The Financial Times reported yesterday that Andreessen Horowitz will be raising $450 million for a second cryptocurrency investment fund. By citing “two people briefed on the matter,” the report indicated that the venture capital firm is preparing to expand in the sector in this period of uncertainty for investors.
The COVID-19 pandemic rattled the financial markets, and investors are approaching with more caution now. Therefore, FT indicated that this particular fundraising comes at a challenging time for cryptocurrencies and venture capitalists.
Nevertheless, a16z could finalize the new fund within a week, according to the report. However, the VC firm has not yet placed a hard cap on the size.
At the time of this writing, Andreessen Horowitz has not commented on the matter.
Previous Cryptocurrency Endeavors
Andreessen Horowitz led a 2013 fundraising for the most popular U.S-based cryptocurrency exchange – Coinbase. The latter raised $25 million in a Series B round – the most substantial amount at the time for a company operating with digital assets.
Founded in 2009 by Marc Andreessen and Ben Horowitz, the VC firm also raised $300 million in 2018 for its first-ever fund dedicated to cryptocurrency-related companies. It aimed to invest in various niches from early-stage coins and tokens to later-stage networks like Bitcoin and Ethereum.
The company also noted that it will hold those investments for up to 10 years – longer than the typical venture fund.
General partner at Andreessen Horowitz, Chris Dixon, outlined the firm’s patient approach back then:
“We have experienced ups and downs in the cryptocurrency market, and expect there will be many more. There’s potential in the technology, and some of the downturns can be the best investments.”
The VC firm would continue investing aggressively, even if the cryptocurrency market decreases in value, Dixon added.
Additionally, the VC company invested $25 million in the decentralized finance (DeFi) project – Compound Finance. As Cryptopotato reported last year, the firm saw high potential in the DeFi sector.