Luno Expeditions will concentrate on seed and pre-seed investments, with a goal of making 200-300 per year.
Luno, a cryptocurrency exchange, has created an investment arm with aspirations to invest $15 million to $75 million per year in crypto and fintech startups.
Luno Expeditions will concentrate on seed and pre-seed investing, with a goal of making 200-300 such investments every year.
The division will be in charge of all of Digital Currency Group’s early-stage investments.
In an interview, Luno Expeditions CEO Jocelyn Cheng remarked, “Practically speaking, we anticipate to invest a range of $15 million to $75 million per year.”
Luno intends to invest $50,000 to $250,000 per company, with the option to increase this amount.
Luno, a London-based crypto exchange that is one of Africa’s largest, is supporting this endeavour from its own balance sheet rather than through a fund structure, which Cheng claimed allows more flexibility.
“We didn’t go with a fund structure since we don’t require any outside money to create this firm, both in terms of capital and management fees,” Cheng explained. “It also enables us to fund investments with evergreen capital, which we believe is more helpful to entrepreneurs establishing fintech startups.”
Luno Expeditions has invested in 20 firms so far, including an Israeli crypto compliance tool and a US non-fungible token (NFT) marketplace.
Many of the world’s largest cryptocurrency exchanges include an investing arm as part of their business model to spur growth in the larger digital asset ecosystem.
For example, Coinbase Ventures (COIN) of Coinbase Global (COIN) executed 150 such acquisitions in 2021, according to Crunchbase, placing its total investment for the year at $3.7 billion. The $2 billion FTX Ventures Fund was recently established by crypto derivatives behemoth FTX to invest in crypto start-ups.
Disclaimer: These are the writer’s opinions and should not be considered investment advice. Readers should do their own research.