Polychain Capital Raises $200 Million for Fourth Fund — Implements Staff Changes in VC Firm | Blockster

Polychain Capital, a leading venture capital firm in the crypto space, has successfully raised approximately $200 million in the "first close" of its fourth fund, according to sources familiar with the matter. The firm aims to raise a total of around $400 million for this fund, signaling continued interest and investment in the crypto industry despite the challenging market conditions experienced during the so-called "Crypto Winter."

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Founded in 2016 by Olaf Carlson-Wee, the first employee of Coinbase, Polychain Capital quickly established itself as a prominent player in the crypto venture landscape. The firm has made strategic investments in notable companies such as Uniswap, a decentralized exchange, and Yellow Card, an African crypto exchange.

Pitchbook data indicates that Polychain has previously raised three funds, amassing a reported $2.6 billion in assets under management. However, this figure is subject to fluctuations due to the firm's liquid token hedge fund.

Following the deployment of most of the capital from its third fund in 2022 and 2023, Polychain turned its attention to raising capital for its fourth fund, targeting approximately $400 million, according to report by Fortune.

The recent successful "first close" of $200 million indicates that Polychain has secured agreements with investors, known as limited partners, to begin deploying the capital. The firm will continue to raise funds from investors as it progresses with its fourth fund.
The achievement of this funding milestone is a positive signal for the crypto venture capital industry.
Data from Pitchbook reveals that global crypto VC firms raised only $1.7 billion across 12 funds in the first half of 2023. In contrast, they raised $22.5 billion across 91 funds throughout 2022. Furthermore, Bloomberg reported on Tuesday that CoinFund, another prominent crypto VC firm, raised $158 million.

The infusion of fresh funding into Polychain Capital has coincided with some staff changes within the firm's approximately 25-member team, with approximately 15 individuals focused on research. Three members of the research team have been let go, while a new team member has been added.

Additionally, General Partner Niraj Pant has departed to pursue his own venture. These personnel adjustments reflect the shifting priorities of Polychain as it prepares for its fourth fund.
The firm is placing greater emphasis on data science, evidenced by the addition of a researcher with expertise in this field.
Moving forward, Polychain's fourth fund will adopt a different focus as the firm navigates the bear market. The reshuffling of staff reflects the evolving investment priorities, with a particular interest in Ethereum-based projects similar to Polychain's previous investments in Arbitrum and Scroll, both layer-2 networks on the Ethereum blockchain, and EigenLayer, an Ethereum re-staking protocol.

Polychain Capital's successful fundraising efforts and strategic staff changes position the firm to pursue new investment opportunities in the evolving crypto landscape. As the industry continues to mature, Polychain aims to leverage its expertise and capital to support innovative projects and contribute to the growth and development of the crypto ecosystem.