VC Electric Just Raised $1 Billion, Here Are 5 Investment Directions It's Watching

On March 1, crypto VC firm Electric Capital raised a total of $1 billion for two new crypto funds: a $400 million fund to invest in equity and tokens; a $600 million fund to invest only in tokens and stablecoins.

Electric Capital declined to name the backers of the new fund, noting that it is almost exclusively university endowments, large nonprofits and foundations. Electric Capital co-founder Avichal Garg said this group of investors is critical to the way Electric Capital wants to invest, and the two large funds need to be built with investors willing to buy into the 10-year lock-up period.

It is reported that the single investment of the new fund is between 1 million and 10 million US dollars, and the investment targets include DAO, NFT, DeFi, infrastructure, and tools that allow more people to access Web3.



DAO


For DAOs, Electric Capital mainly focuses on the following:

Performance-Based Talent Acquisition System - DAOs will be organizations that attract talent, on par with the best companies. Many people join the DAO by purchasing tokens, but this does not ensure that the most talented or prolific contributors will join. Electric Capital hopes to fund the research and development of related mechanisms to allow more people to join the DAO.

Governance Aggregators - It's hard for people to keep track of and prioritize new proposals, especially across multiple DAOs. Electric Capital hopes to support an aggregation platform for governance proposals, making it easier for members to participate in governance.

Improve mechanisms for distributed decision making - many decisions are currently made by the person with the most tokens. Electric Capital needs to have mechanisms that not only increase the number and participation of participants, but also involve more participation of the right people.

Compensation and reward mechanism - DAO contributors need a fair and transparent compensation and reward mechanism. An effective way to compensate contributors for their work today is to issue bounties on platforms like Layer3 through DAOs. Contributions to the DAO can be on-chain, off-chain, one-time or recurring. As the complexity of the DAO increases, these contribution types will also grow and evolve. Electric Capital wants to fund projects that allow DAOs to distribute rewards fairly and openly to all types of contributors.

DAO Discovery Platform - DAOs are being created at an exponential rate. The largest DAOs control multi-billion dollar vaults, issue grants and employ large teams. In contrast, the smallest DAO can be a group pooling resources to buy NFTs. Electric Capital needed a DAO discovery platform to help more users discover and explore DAOs that fit their needs and interests.

Recruitment platform - DAOs need to be able to leverage talent networks and expertise. Electric Capital is willing to invest in projects across the recruiting pipeline that help DAOs identify and recruit the best talent.

Vault Management - Today, DAOs can have complex vaults that include different types of tokens and stablecoins. DAOs face the challenge of effectively managing their vaults through distributed decision making. Organizations like LlamaDAO are experts at creating proposals and helping DAOs make financial decisions. Electric Capital wants to fund more economic instruments that will allow the DAO to grow and utilize its coffers efficiently.

In this vertical, Electric Capital hopes to support the following projects:



DAO creation platforms like Syndicate, talent portals like Rabbithole, DAO-centric bounty systems like Layer3, platforms like Gitcoin where DAOs can do engineering work, and DAO financial tools like LlamaDAO.