Global VC firm Cathay Innovation and French fintech unicorn Ledger have partnered up to launch an early-stage fund dedicated to Web3 — the country’s first-ever dedicated fund to the sector.
With a target size of €100m, the Ledger Cathay Capital fund will invest in Web3 startups globally, from building blockchain and decentralised finance projects to developing new cryptocurrencies. Web3 usually refers to blockchain-powered technology and companies that champion decentralisation, as opposed to centralised platforms like Facebook and Google.
The strategy is supported by French public investment bank BpiFrance. The fund, led by Cathay Innovation cofounder Denis Barrier, Ledger CEO and chairman Pascal Gauthier and Michael Louzado, VP of strategy, M&A and ventures at Ledger, will write cheques from $500k up to $4m-5m. A majority of the fund — some 60% — will be invested in seed or Series A opportunities, with the rest kept for follow-on investments.
“In the next 15 years, we’ll see the tokenisation of everything as blockchain transforms existing asset classes with programmability, trust, security and digital ownership — but this can’t happen in silos,” said Barrier.
Cathay Innovation was an early investor in Ledger, the crypto-security platform that secures 20% of the world’s cryptocurrencies, NFTs and tokens. Ledger has previously made six direct investments into startups, which will also be managed by the Ledger Cathay Capital team. It’s not uncommon for large tech companies to invest directly into companies or have their own VC arms; US-based Stripe is a great example.
Cathay Innovation, which manages more than $1.5bn in assets, is a global multistage VC and an affiliate of private equity group Cathay Capital. In the last six years, the group has invested in 19 unicorns, including Owkin and Getaround.
In the next 15 years, we’ll see the tokenisation of everything
“With Ledger Cathay Capital, we want to help crypto and Web3 builders by granting access to our unique digital security ecosystem, and support building on our security technology platform, thanks to the technical know-how from over 700 blockchain experts and distribution channels to scale the innovative, secure, decentralised services of tomorrow,” Gauthier says.
Investors have been increasingly turning to Web3 investment opportunities globally, with well-known venture capital firms racing to launch products dedicated to the area, such as Andreessen Horowitz, which announced a $4.5bn Web3 and crypto fund last month.
Earlier this year, Binance, the world’s biggest cryptocurrency exchange, promised to help develop Web3 projects in France, through the Station F incubator, as part of a €100m capital injection into the country.
Other funds in France have also been targeting investments in the Web3 space, such as Alven, which closed its latest flagship fund earlier this month, raising €350m. Alven set up a programme to identify and train people in Web3 called Operation3. The programme helps those working in Web2 learn about Web3 and then matches them with tech companies for jobs.