Chain Reaction: Crypto VC space may be on the cusp of recovery (w/ David Pakman)
This week on Chain Reaction, Jacquelyn interviewed David Pakman, managing partner and head of venture investments at CoinFund.
Before CoinFund, David spent 14 years at the venture capital firm Venrock. He also led the Series A and B rounds at Dollar Shave Club which was acquired by Unilever for $1 billion. And in 1991, David co-created Apple Music when he was a part of Apple’s system software product marketing group
We discussed the state of the crypto VC environment, areas he’s focusing on for investments and what he thinks investors are missing.
We also talked about:
AI compared to crypto
Future of NFTs
Regulatory impact on investors
2024 outlook
Advice for startups
Chain Reaction comes out every Thursday at 12:00 p.m. ET, so be sure to subscribe to us on Apple Podcasts, Spotify or your favorite pod platform to keep up with the action.
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Credits: Equity is produced by Theresa Loconsolo with editing by Kell. Bryce Durbin is our Illustrator. We'd also like to thank the audience development team and Henry Pickavet, who manages TechCrunch audio products.
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CoinFund’s new $300 million fund aims to capture ‘steep’ early-stage value
Web3 investment firm CoinFund recently launched a $300 million fund targeting early-stage crypto and web3 startups.
In this episode of The Scoop, CoinFund Managing Partner David Pakman shares how this fund fits into CoinFund’s broader investment thesis for crypto and web3, including why the fund is specifically targeting early-stage startups.
The new fund is intended for new crypto startups already showing signs of success. As Pakman explains,
“We saw a lot of seed-stage companies graduating to have real progress and we wanted to invest in that stage too, so we raised a fund purposefully to invest at the Series A, maybe Series B stage of crypto projects that are showing some traction.”
While CoinFund is also looking to raise an additional $250 million fund specifically for seed-stage investments, Pakman says the early-stage investments typically see the most value creation:
“A company is showing a little bit of progress, they may be showing some evidence of product market fit, and they're going to raise — not growth capital yet — but, you know, ten to fifteen million dollars… the steepest part of the value creation can happen just after that moment.”
Episode 117 of Season 4 of The Scoop was recorded live with The Block's Frank Chaparro and CoinFund Managing Partner David Pakman.
Listen below, and subscribe to The Scoop on Apple, Spotify, Google Podcasts, Stitcher or wherever you listen to podcasts. Email feedback and revision requests can be sent to podcast@theblockcrypto.com.
This episode is brought to you by our sponsors Tron, Ledn
About Tron
Founded in 2013, Huobi Global is one of the largest virtual asset exchanges in the world. Huobi Global serves millions of users across international markets. Since its establishment, Huobi Global has committed to providing first class virtual asset investment services. Huobi Global's robust infrastructure, product innovation and capital strength provides a truly customer-centric and secure trading environment to help our international users to achieve their investment objectives. Please refer to Huobi's official website for more information: huobi.com.
About Ledn
Ledn was founded on the unshakeable conviction that digital assets have the power to democratize access to the global economy. We help you to experience the real life benefits of your Bitcoin without having to sell it. Start a savings account, take out a loan, or double your Bitcoin. For more information visit Ledn.io
Crypto feels broken. That’s because it’s the internet circa 1996.
David is a CS major who worked in Apple’s music group in the 90s and went on to become CEO of eMusic in the aughts.
At Venrock, David invested in early-stage crypto, consumer, and enterprise tech companies. He was early to crypto as a node maintainer on the Bitcoin blockchain and an Ethereum miner, setting up a rig in his basement several years ago.
At CoinFund, he focuses on early- and growth-stage crypto and blockchain companies and technologies like Upshot, a platform for crowdsourced NFT appraisals, and Rarible, a digital art NFT platform.
ICYMI: Listen to our episode Web3 won’t save us.
This week’s Lifeboat badge goes to user M-M for their answer to Find the area of an n-interesting polygon.
See Privacy Policy at https://art19.com/privacy and California Privacy Notice at https://art19.com/privacy#do-not-sell-my-info.
20VC: Dollar Shave Club's Series A & B Lead Investor, David Pakman on The Requirements For A Successful Subscription Business & Why A Lot of Investors Do Not Like Consumer
David Pakman is a Partner at Venrock and the man behind Venrock's leading of the Series A and B rounds for Dollar Shave Club. Prior to Venrock David spent 12 years as an internet entrepreneur. Including being CEO of eMusic, the world's leading digital retailer of independent music, second only to iTunes. Prior to eMusic, David co-founded Myplay in 1999, which he later sold, in 2001, to Bertelsmann's ecommerce Group. If that wasn't enough David is also the co-creator of Apple Computer's Music Group.
In Today's Episode You Will Learn:
How did David make his way into the world of VC with Venrock?
David invested in Dollar Shave when subscription ecommerce funding was largely out of favour. What was it that excited Dave about Dollar Shave and why did he choose to invest?
To what extent do we see the existence of party rounds in today's funding environment?
Venrock took the rather unusual position to lead both the A and B rounds for Dollar Shave. What was the internal conversations like within Venrock towards this decision?
Dollar Shave was growing at phenomenal rates with impressive growth, what was behind the decision to sell at this time? What were the incentives behind selling to Unilever?
Will we see other large e-commerce exits in the future? What does the future M&A environment look like for consumer businesses?
Items Mentioned In Today's Show:
Matt's Fave Book: Mindset by Carole Dweck
Matt's Most Recent Investment: Pearl
As always you can follow Harry, The Twenty Minute VC and David on Twitter here!
Likewise, you can follow Harry on Snapchat here for mojito madness and all things 20VC.
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20 VC 055: David Pakman @ Venrock on The Future Of The Music Industry
Quote of the Day: 'A great entrepreneur has the ability to bend the world to their will'. David Pakman, 20VC
David Pakman is a Partner at Venrock, having spent the past 12 years as an internet entrepreneur. This includes David's appointment as CEO of eMusic, the world’s leading digital retailer of independent music, second only to iTunes. Prior to joining eMusic, David co-founded Myplay in 1999, which he later sold, in 2001, to Bertelsmann’s ecommerce Group. Before Myplay, he was Vice President at N2K Entertainment, which created the first digital music download service. If that wasn't enough David is also the co-creator of Apple Computer’s Music Group.
In Today's Episode You Will Learn:
How David started his career as an entrepreneur and later made the move to VC?
How David found the transition from entrepreneur and CEO to being a VC?
What is the main value add that both Venrock and David provides to their investments?
What makes a great entrepreneur for David?
How long do VCs need to know entrepreneurs before making investments?
What 3 tips would David give for best sourcing deals as a VC?
What areas does David believe are soon to be disrupted? How does David predict the next big industries to be disrupted?
What did David think of Jay Z's launch of Tidal?
Who will dominate in the music streaming sector in the coming years?
Items Mentioned in Today's Episode:
David's Fave Book: Mindset by Carole Dweck
David's Favourite Blog: Ben Thompson's: Stratechery
Dollar Shave Club: Shave Time, Shave Money
YouNow
Tidal: High Fidelity Music Streaming
As always you can follow Harry, David, The Twenty Minute VC and Venrock on Twitter here!
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