In another sign that crypto has become a mainstream investment, private equity veteran Glenn Hutchins, along with his son James Hutchins and partner Travis Scher, have launched a new venture capital crypto fund with a marquee list of investors including hedge fund billionaire Paul Tudor Jones, Raj and Indra Nooyi (the latter being the former CEO of PepsiCo) and James Todd Smith, better known as LL Cool J.
Other high-profile investors in the fund include Josh Harris, billionaire co-founder of the investment company Apollo Group; venture capitalist Geoff Yang; SoFi CEO and former Twitter COO, Anthony Noto; Wall Street executive Vincent Viola, owner of the Florida Panthers hockey team; and Joe Moglia, former CEO of TD Ameritrade and retired Coastal Carolina head football coach.
James Hutchins, previously head of research at Coatue Management, one of the world’s largest technology-focused investment funds (whose founder Philippe Laffont is an investor in the fund) and Scher, who previously ran investments at Digital Currency Group, one of the world’s biggest investors in crypto companies (which has also invested in the fund), will manage the fund through their company North Island Ventures. Hutchins the elder is North Island’s chairman. The fund has raised some $72 million.
“Crypto promises not just to revolutionize finance but also to invent a new computing paradigm that will be as transformational as the PC, the internet, mobility and the cloud,” says Glenn Hutchins. “It is the proverbial next big thing.”
There are a number of other crypto venture funds out there currently, so the North Island fund will need to differentiate itself, which it might be able to do given the experience and reputation of the founders and given that North Island already has back office infrastructure in place. The thesis of the fund is that crypto is an enabling technology which offers unprecedented capabilities that entrepreneurs can leverage and combine to create applications that could not previously exist.
“Crypto is no longer just a fringe technology movement,” says Scher. “There is extraordinary momentum behind decentralized solutions to some of society’s biggest problems, and our goal at North Island Ventures is to partner with the top entrepreneurs in the world bringing these solutions to life.”
The fund has already made seven investments so far, including Dapper Labs, the company behind the Flow Blockchain and NBA Top Shot; Nori, whose mission is to reverse climate change using a blockchain-based marketplace for carbon offsets; and Axelar, a company building “a new interoperability protocol to enable transactions and messages to be passed across blockchains.”
The three managers have all been investing in crypto for years. Glenn Hutchins, for example, who became prominent and made his fortune from the success of private equity tech firm Silver Lake which he co-founded, first began investing in crypto in January 2016 when the price of Bitcoin was around $400. Today it is $32,000.
Andy Serwer is editor-in-chief of Yahoo Finance. Follow him on Twitter: @serwer.