In 2022, Paradigm's Assets Fell By 34%, Multicoin Capital Dropped 85%
Haun Ventures valued its assets below the $1.5 billion it announced raising
Crypto venture funds did not escape the bloodbath in cryptocurrencies last year.
Filings reviewed by Newcomer reveal a number of sharp decreases in the assets under management held by some of the top crypto firms.
Paradigm, the crypto investment firm co-founded by Coinbase co-founder Fred Ehrsam and former Sequoia partner Matt Huang, saw its assets under management fall 34% over the course of 2022 to $8.7 billion.
I reported last year that Paradigm’s assets had exploded over the course of 2021, growing 343% to $13.2 billion.
What goes up, must come down.
Bitcoin fell 65% in 2022; Ethereum fell 67%. In that environment, crypto funds faced terrible headwinds.
Paradigm’s assets under management are still up 192% from the $2.98 billion that it held at the end of 2020.
Paradigm reported having 73 employees at the end of 2022.
Assets under management is an imperfect metric and doesn’t directly track with a fund’s performance. A fund that generates great returns and distributes its winnings to limited partners could see a decrease in its assets under management. Meanwhile, a fund whose investments are floundering could raise more money from limited partners and appear to be doing well. But on balance, growing AUM is a sign of firm strength.
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In 2022, crypto flashed red.
By my count, Andreessen Horowitz disclosed eight crypto funds1 which add up to $8.2 billion. That's a roughly 9% drop from the about $9 billion in crypto fund AUM that I calculated last year.
In May 2022, Andreessen announced its fourth crypto fund, totaling $4.5 billion — a combination of a seed fund and a venture fund.
Multicoin Capital, which invested heavily in Solana and disclosed that 10% of its assets were tied up in FTX, saw its assets under management fall 85%, according to a financial filing. The firm's assets fell from $8.9 billion to $1.4 billion.2
Multicoin reported having 22 employees.
Polychain Capital dropped 61%, falling from $6 billion in AUM to $2.6 billion.
Haun Ventures, which announced its fund in March 2022, has already seen its holdings fall below the value of the money investors gave it.