Deal Box, a capital markets advisory and packaging platform, has launched its venture arm with plans to invest $125 million in startups using web3 technology, the company shared Wednesday.
“We believe in the transformative power of web3 and we intend to invest in both web3 startups and companies using web3 technology, including blockchain, to impact and reshape people’s daily lives,” said Thomas Carter , CEO of Deal Box, to MastStatus.
Deal Box was founded in 2005 and has a total deal flow of more than $200 million with more than 500 package customers, according to the website. It partners with investment and digital asset focused companies such as Tezos, Vertalo, tZERO, Texture Capital, Fundopolis and Resolute Capital Partners, to name a few.
The venture arm, Deal Box Ventures, will focus on startups in five fund areas: emerging growth, real estate, fintech, social impact and what it calls “FunTech” which will look at “action sports, innovative leisure and experiential consumer products that are changing “. the way we rest and play,” the company said.
“On the FunTech side, we know that football, soccer and basketball teams have emerged as behemoths in terms of team ratings,” Carter said. “There are a lot of consolidation opportunities in action sports and the potential is quite big. It is an extraordinary moment for these action sports categories as they become institutionalized and more recognized.”
For the fintech category, AI and blockchain will be the fastest path to business value creation, Carter added.
Each fund totals $25 million, and the sum of the five funds is $125 million, Carter said. “This will be an achievable goal to raise per fund, and then we will launch larger funds.” This amount is “the best basis for achieving the results we want to achieve over the next three to five years,” Carter added.
Deal Box has pulled strategic institutional funds from family offices and high and very high net worth individuals, Carter said. There is also interest from institutional investors, other family offices and sovereign wealth funds, Carter added. “So far we’ve brought in just under $5 million and we’ve come in close to $40 million.”
The company has completed initial strategic investments in three startups – Total Network Services, Rypplzz and Forward-Edge AI – as part of its web3 investment thesis.
The resilience of the web3 companies that can survive the recent downturn should be an indicator that they are “doing something meaningful that addresses a real need in the market and hopefully good decision making,” Carter said. Many projects in the web3 space have been speculative, but Deal Box hopes to show both investors and founders that blockchain and web3 technology can be used while still “playing within the confines” of the US Securities and Exchange Commission.
“There has never been a time when technology has had a greater impact on innovation and people’s daily lives,” said Carter. “This is the start of a new wave. We are witnessing the emergence of the fourth industrial revolution.”