Crypto investor Katie Hawn raised $1.5 billion for her new fund after leaving Andreessen Horowitz, breaking several records in the process.
Haun Ventures’ launch marks the largest venture fund ever created by a single co-founder, according to Pitchbook. Former investment banker Mary Meeker held the previous record with a $1.3 billion fund after her exit from Kleiner Perkins.
“It seems, frankly, like a lot of pressure. But I think that motivates everyone on the team,” Hawn told CNBC in her first radio interview since Andreessen Horowitz left. “Web3 is the new era of the Internet, worthy of a new era of investors.”
Web3, or Web 3.0, loosely refers to public computing applications built on the blockchain – the same technology underlying Bitcoin and other cryptocurrencies. Examples include NFTs, which are traceable certificates of ownership attached to digital files such as pieces of art or videos, and decentralized finance applications, where self-executing “smart” contracts can be used to replace intermediaries such as lawyers and bankers in certain types of transactions. But overall, the space is still in a very early and experimental stage.
Katie Hawn, General Partner of Andreessen Horowitz
Haun’s fund will be split into two parts: $500 million for early-stage companies and protocols, and $1 billion for “acceleration” or later projects.
Hawn, a former federal attorney general, became Andreessen’s first general partner in 2018, where she co-led several crypto funds alongside Chris Dixon. Andreessen Horowitz will be a limited partner in Hon’s newest fund, while Marc Andreessen, the company’s founder, and Dixon all contributed personally to her new endeavour.
Her exit caught many people in Silicon Valley by surprise. While it was a “dream job,” Hawn said leaving was more about taking risks, and “getting out of her comfort zone.”
“There is clearly a relationship, and there are friendships there. We still intend to collaborate closely with Andreessen Horowitz,” she said. “One of the unique things about our fund size is that we don’t have to drive every trade, we can play well with a lot of other crypto investors – the founders don’t want to have one investor at the cap table, even in the first rounds.”
Haun Ventures’ nine-person team includes Chris Lehane, a former Airbnb CEO and Clinton administration official, Tomica Tillman, a former employee of President Joe Biden, and Rachel Horowitz, who led the communications teams at Twitter, Google, Facebook and Coinbase. Several employees left Andreessen Horowitz with Haun for the new fund. The smaller team, she said, allows the company to be more “smarter” and act as “project contributors” in addition to venture capitalists.
“Gone are the days when founders only wanted capital,” she said. “One of the things that Haun Ventures will do for its founders is to actively contribute to the projects that we invest in.”
The launch comes during a bear market for Bitcoin. The world’s largest cryptocurrency is down nearly 40% from its November peak, as smaller cryptocurrencies like ether see deeper losses. Haun, who invested during previous downturns or “crypto winters,” said there is still plenty of developer activity and a rally.
“When I think about the deployment of the first two crypto funds, it was during a period of huge volatility — it was definitely a crypto winter with prices down 70% and projects still being born during that cycle,” she said, referring to Solana and NFT exchange OpenSea. “One of the things I’ve learned as an investor with a long-term view of the space, is that great products will be built and great protocols will be built, regardless of pricing.”
Crypto exchange Coinbase, of which Haun is a member, has seen nearly 58% of its decline last year. However, Hawn said valuations of private startups have not been affected so far.
“There is a bit of a lag. We are still seeing very high ratings in crypto projects. The last time this happened, with macro market corrections, it took a while to translate into crypto. I think the same may be true here,” she said.
While cryptocurrencies may struggle to regain momentum and the dollar flow In private companies at an all-time high. Blockchain startups It made a record $25 billion in investment capital dollars last year, according to recent data from CB Insights. This number is eight times more than the previous year.
This influx of stunt dollars has sparked some controversy on Twitter.
Tesla CEO Elon Musk and Twitter Co-founder Jack Dorsey – two of the world’s most famous tech billionaires – were among those questioning Web3. Dorsey argues that venture investors and their limited partners are the ones who will end up owning Web3 and “never get away with their incentives,” he tweeted, calling it a “central entity with a different brand.”
“I look at it as Web3 finally got some well-deserved critics in the space,” Hawn said. “If I could choose between offering Jack Dorsey some critique versus some of the myths we’ve heard perpetuated so long in space, I would definitely choose the first. So I think the debate is healthy.”
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