Animoca Lowers Target for Web3 Fund to $1B After Shaky 2022
Animoca Brands, one of the leading Web3 and blockchain investors, cut the fundraising target for its Web3 fund from $2 billion to $1 billion. The decision comes in the wake of a sharp downturn in the crypto market, exacerbated by the FTX’s collapse in November.
Animoca Lowers Fundraising Target to $1B
Eminent Web3 and blockchain investor Animoca Brands is planning to raise roughly $1 billion this quarter for its Web3 and metaverse fund, halving its initial fundraising target amid persisting crypto winter. The venture capital (VC) firm is holding discussions with potential investors to secure funding to back blockchain and metaverse startups, the firm’s co-founder Yat Siu told Bloomberg recently.
The move comes after the FTX crash in November left a significant contagion impact, resulting in bankruptcies and shutdowns among multiple crypto projects. Furthermore, numerous firms within Animoca’s portfolio were severely hit by the collapse, including the non-fungible token (NFT) seller Star Atlas.
“Q1 is the goal and then let’s see what happens. It is fair to say it’s a challenging market. But we have quite a bit of interest.”– Yat Siu, co-founder of Animoca Labs
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Revenue Slump Amid Crypto Bear Market
Siu added that Animoca could secure slightly less than $1 billion if the ongoing market commotion persists. That figure represents half of Animoca’s original fundraising target of $2 billion for its new fund.
While the collapse of FTX and the global economic downturn has made fundraising notably more complex, Siu remains confident that crypto and Web3 will continue attracting investors. He added that multiple Animoca subsidiaries had secured funds during the FTX chaos.
The Hong Kong-based VC giant said it would not be raising further funds for itself since bagging $100 million from Temasek in September, taking its valuation to $6 billion. Instead, Animoca remains focused on developing an ecosystem of crypto startups working to build Web3.
Animoca has been one of the leading global investors in metaverse, NFTs, and blockchain gaming businesses, backed by investment behemoths such as Sequoia Capital, Temasek, TGV, and more. One of Animoca’s most popular investments is the online NFT multiplayer game The Sandbox.
Siu said the firm’s revenues had been hurt by the crash in digital asset prices, with Bitcoin and Ether down more than 60% over the last year. Crypto prices are trading at substantial discounts amid tight liquidity and a string of collapses in the industry.
Do you think 2023 will be somewhat easier for Web3 firms in terms of fundraising? Let us know in the comments below.