Every standard venture capital fund runs under what is called the venture capital exemption rule at the SEC.
#Terra tech game ramp to box 75m license
While we were planning for that, we also realized that we wouldn’t be able to invest in tokens under the regulation or the license that we had with the SEC at that point. It could be a $100,000 allocation or a $5 million allocation, in an early stage company or a late stage company, which is a very open strategy.įor those reasons, we put together what we call the Bitkraft Token Fund No. It’s a fund that’s a bit more opportunistic about how big the allocations it gets in individual companies. They don’t feel bad about us dabbling in this. It’s a fund that will have LPs who are committed and want to invest in tokens. With these two challenges in mind, we decided that the smart thing to do was to build a separate fund that focuses–it’s a bit of a different risk-reward profile.
![terra tech game ramp to box 75m terra tech game ramp to box 75m](https://i.ytimg.com/vi/4X9_1GEoZ0s/maxresdefault.jpg)
Second, investing in tokens as an asset class is something where, after consultation with some of our LPs, we got to know that some of them are actually not comfortable investing in something that’s still–I don’t want to call it the regulatory wild west, but regulation is still in the making. That would not necessarily be compatible with the strategy of our core fund. The allocations typically are a bit smaller in a seed round than what you’d find in an equity seed round. The rounds typically have smaller allocations and they’re distributed across larger groups. While thinking about it, on the one hand we saw that with many of these blockchain deals, the dynamics around the groups that come together to invest are a bit different. We have a second one called Bitkraft Venture Fund #2. Should we do that with our core funds? Our core fund has been called the Bitkraft Venture Fund #1. We’ve been looking at how we could invest in tokens. They’re mostly not very regulated at all, which is obviously an opportunity as well as a threat or a problem.Īll of our funds are U.S.-based. Most important, it’s different in how tokens are regulated. At the same time, though, it’s different in how you look at investing in tokens.
![terra tech game ramp to box 75m terra tech game ramp to box 75m](https://thumbs.gfycat.com/PotablePepperyBlackwidowspider-size_restricted.gif)
It feels a bit like Kickstarter on steroids. It’s a new asset class that brings, on the one hand, quite a lot of opportunity for companies building on tokens, because it allows you to potentially raise capital in different ways. While doing that, we were obviously seeing that–what you’re investing in when you invest in these crypto companies and blockchain companies is often also tokens. We began looking for interesting deals that we could dabble in. Any time before it felt very experimental. Last year, blockchain and crypto seemed to be maturing to a level where their adoption, their use in gaming was finally bringing forward use cases that we could see being adopted at a larger scale. Jens Hilgers: To understand how we set it up, it’s important to understand the origin of the fund. GamesBeat: When you call it a token fund, how is it being distinguished from other kinds of funds you have? To make sure that the company stays on the right side of regulations, Bitkraft became a Registered Investment Advisor with the Securities and Exchange Commission.Ībove: Jens Hilgers is the founder of Bitkraft. But Hilgers believes that mainstream adoption is coming with the right high-quality games. In particular, NFTs can use blockchain to authenticate one-of-a-kind digital items, and that will enable those items to be sold in games for higher prices, enabling better monetization for all games as well as new user acquisitions strategies and game experiences.īut there are hazards, such as the history of crypto scams, the lack of awareness of crypto among mainstream audiences, and even a belief that crypto games just aren’t very fun - largely because mainstream game companies haven’t embraced blockchain yet.
![terra tech game ramp to box 75m terra tech game ramp to box 75m](https://i.ytimg.com/vi/SL98yM1YfnU/maxresdefault.jpg)
Many crypto believers think that the decentralized tech of blockchain will bring sweeping changes to all industries, including games. Piers Kicks (who will speak at our upcoming GamesBeat Summit Next online event on Novemer 9-10) will help run the fund as it navigates the various challenges of the crypto ecosystem, which depends upon the transparent and secure digital ledger of the blockchain.
![terra tech game ramp to box 75m terra tech game ramp to box 75m](https://i.ytimg.com/vi/7-oDbg_K8CM/hqdefault.jpg)
This means that Berlin-based Bitkraft is doubling down on investments at the intersection of cryptocurrency, blockchain, nonfungible tokens (NFTs), and gaming, said Jen Hilgers, in an interview with GamesBeat. The company did so even though it already has more than $540 million in assets under management and 60 companies in its portfolio of game startups. Bitkraft Ventures raised a $75 million token fund last week to invest in blockchain gaming and digital entertainment investments.