Venture capital (VC) agency Cosimo Ventures has launched a brand new tokenized VC fund referred to as Cosimo X. The new fund will deal with early stage deep tech corporations with a selected focus on blockchain know-how, spanning industries akin to synthetic intelligence, augmented and digital actuality (AR/VR), Internet-of-Things (IoT), and cybersecurity, the agency mentioned on Thursday.
In addition to capital, Cosimo X will present its portfolio corporations with recommendation and assist, and steer them towards profitable preliminary coin choices (ICOs) and Series A funding spherical. Rob Frasca, managing companion of Cosimo Ventures, mentioned there was a “clear lack of funding options and guidance available to early stage companies as they navigate the complex deep tech landscape,” and Cosimo X goals to fill the void.
Cosimo X will concern so-called Cosimo tokens, that are set to signify “an indirect economic interest” within the fund and backed by investments within the agency’s portfolio corporations. Token holders will be capable of transfer extra simply in or out of positions within the fund within the open market, the corporate claims.
The firm mentioned the brand new fund goals to remodel the illiquid conventional enterprise capital market and decrease entry limitations. It added that not like conventional VC funds, which usually require a minimal funding of US$500,000, Cosimo X will settle for a minimal funding of US$250,000 for qualifying traders within the US, and US$10,000 for qualifying traders outdoors of the US.
“The VC investment model has remained stagnant over many decades and has been slow to adapt to new funding structures. Investors — especially high net worth investors and crypto holders — are looking for new ways to diversify their token-based portfolios,” mentioned Ciarán Hynes, managing companion of Cosimo Ventures.
“The tokenized VC mannequin will enable for liquidity that has been absent from conventional VC funds till now. The Cosimo group has been on the forefront of worth creation for early stage corporations over the previous 25 years and has developed a course of that we imagine will create worth for our traders and portfolio corporations.
“We imagine that blockchain is catalyzing an enormous change in each the VC mannequin and panorama and we couldn’t be extra excited to supply our traders with this game-changing providing.”
Cosimo X joins the rising listing of tokenized funds launched in latest months to supply liquidity to the worldwide VC ecosystem. These embody funds established by the likes of Blockchain Capital, Spice VC, and Life.SREDA.
Most not too long ago, US-Korean VC agency SparkLabs launched a safety token to let anybody spend money on its accelerator applications. The agency mentioned it’s aiming to “democratize” funding alternatives.
In the identical trend, Silicon Valley VC agency 500 Startups’ new 22X Fund permits accredited traders who buy 22X tokens to come clean with 10% fairness within the 22nd batch of its portfolio corporations. Proceeds from the fund are distributed professional rata to taking part corporations, with token holders in a position to commerce tokens after a yr and obtain proceeds from liquidity occasions.