Tykhe Block Ventures, a USA based Venture Capital firm, has announced the first close of it’s blockchain growth fund. The first close was led by a clutch of UHNWIs and family offices operating in South-East Asia and Middle East. The firm has also committed that approximately $10 million of the fund will be allocated to invest in blockchain and Web3 startups in the Middle East region. Tykhe is also in the process of setting up their Dubai office and aims to launch a $100 million fund later this year.
Tykhe Block Ventures was started in 2021 by Prashant Malik, one of the leading investors in SEA (early investor in multiple unicorns like Urbanclap, Shadowfax, OfBusiness, Coinswitch) and widely recognised as the creator of Apache Cassandra – the distributed database used by majority of technology enterprises globally. Malik built Cassandra when he joined Facebook as one of the earliest employees – that was later open-sourced as Apache Cassandra.
“My passion for the blockchain space started in 2016, as it drew a lot of parallels from Cassandra which is a peer-to-peer masterless database running on a voting mechanism similar to blockchain. In 2021, together with my partners, we launched a pilot blockchain fund which did considerably well. That gave us the belief to launch the $30 million blockchain growth fund. Despite the softness in the market, we have seen great interest from investors who believe that blockchain is going to be the next big narrative in the technology space, like how social media was when I started building Facebook.” said Malik.
As sponsors, Malik and other investment partners have committed $5 million into the fund. The fund managers bring together a combined 30+ years of core blockchain investing experience where they have invested in more than 80+ companies.
“Stellar teams building in blockchain space reach out to us to access not just venture capital, but also relationship capital. Given my experience building Cassandra, I am able to guide them on setting a scalable and secure architecture for DLT (distributed ledger technology).” quoted Malik. Some of the recent investments done as part of the Blockchain Growth Fund comprise of Trust Machines, Fan Tiger, DWallet Labs (Odsy Network), NFTPerp, Convrse.
The blockchain space has been recently marred by implosions of companies like Celsius, FTX and in general a deep correction in cryptocurrency prices. However, Tykhe views these developments as a necessary and healthy correction. “All the players that went down were centralised entities and have no co-relation to the ethos of blockchain technology – which stands for decentralisation. Thanks to our thesis of investment in pure decentralised networks, our portfolio companies have been doing reasonably well, despite the global downturn. Infact, we are probably one of the few funds in our space that has clocked high-double digit returns in the last year – when everyone else has seen a deep correction,” said Ganesh, who leads the investment team.
The global Web3 market size reached $3.2 billion in 2021 and is expected to register a CAGR of 43.7 per cent to reach $81.5 billion in 2030, according to Emergen Research published in June 2022. Middle East, and specifically Dubai, is home to a number of blockchain and cryptocurrency startups and exchanges, making it a natural hub for the industry.
— Ammar Tarique is the content strategist at Teamology Softech and Media Private Limited.
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