Amsterdam-based Theta Capital Management has announced the launch of its latest blockchain fund-of-funds, Theta Blockchain Ventures V, with a target raise of $200 million. The fund will focus on investing in specialized crypto venture firms, allocating capital to between 10 and 15 venture firms in the digital assets space. The goal is to achieve a 25% net internal rate of return for investors, as outlined in an investor deck obtained by Bloomberg.
Founded in 2001, Theta Capital Management shifted its focus to digital assets in 2018 and currently manages approximately $1.2 billion in assets. Despite challenging market conditions, the firm has seen success in fundraising, having recently closed a round of over $170 million. Across its prior five funds in the Theta Blockchain Ventures series, the firm has delivered a 32.7% net internal rate of return from January 2018 through December 2024.
The fund-of-funds model allows institutional investors to gain diversified exposure to early-stage blockchain startups through established venture capital intermediaries. Theta has been a significant player in the industry, having invested over $600 million in crypto-native venture capital funds since 2017, making it one of the largest institutional allocators in the blockchain space.
The fundraising effort comes amidst a challenging period for crypto venture investing, with increased interest in artificial intelligence drawing attention away from crypto investments. However, there are pockets of growth emerging, with Web3 startups raising $9.6 billion in Q2 despite a drop in deal counts. Infrastructure-focused sectors, such as validator networks and mining operations, have attracted the highest median round sizes in recent quarters.
Despite the challenges facing the crypto venture capital space, Theta Capital Management has continued to attract institutional interest in specialized crypto investment strategies. The launch of Theta Blockchain Ventures V marks the firm’s sixth fund under the Blockchain Ventures series and comes at a time when other notable players in the space, such as Maven 11 and Pure Crypto, are also pursuing fundraising efforts for their crypto venture funds.
In conclusion, Theta Capital Management’s latest fund launch underscores the firm’s commitment to investing in the blockchain and crypto space, despite the headwinds facing the industry. With a track record of delivering strong returns for investors, Theta continues to be a key player in the evolving landscape of crypto venture capital.