“The world needs another venture capital fund” - Literally no one, 2009.
“The world needs another crypto fund” - Literally no one, 2023.
“The world needs another crypto fund” - DBA, 2023.
Crypto is a scam. Ok, not all of it, but it's a magnet for grifters and idiots. For crypto to succeed, they must be squashed and removed. We (unfortunately) can't literally squish them (can we?), but we can drown them out by elevating the good actors.
That's why we're starting DBA. Crypto's underlying values are not manifested in those recently elevated to speak for it. We hope DBA is a new voice for these values, embodying them and supporting those good actors. Just one request - don't trust us. That's how we got into this mess. Follow our actions, not our words.
As one of our lovely haters said recently:
"Small groups of technologists are developing and deploying applications of their technologies for explicitly ideological reasons, with those ideologies baked into the technologies." - Reid Blackman
We can actually agree on that bit. The internet was also built on a neutral and open ideology, and we'd say that's worked out pretty well.
But, it turns out the internet is missing some pieces. For example, it's been unable to support applications requiring p2p operations and global consensus (like money). Companies fill these gaps, and it's actually pretty impressive - Transferwise and Revolut have made global currency swaps instant and free. I can't trust a peer on the other side of the world, and everyone needs consensus on who has what money. These "reputable" companies patch the internet's shortcomings, but they're still band-aids.
Intermediaries create friction and fragmentation. Most of you probably live in a country with pretty good financial access, and you don't need to transact or run a business across multiple countries. Unfortunately, those who do will understand how isolated, limited, and outdated our financial services are. You stitch together regional service providers to get e-commerce features. You wait months to open bank accounts and accept customers, and much of the world will be cut off from your services. This sucks, but that's been the best option.
The result - money is mostly regional and built on a tech stack pre-dating cars. Your horse isn't gonna hit the 0-60 of a Model S Plaid if you strap a spoiler on it's back (although Fast and Furious XII will definitely try). It's still a horse. We need a new framework which enhances rather than limits the internet.
The big holy-moly-this-stuff-matters realization is that crypto is the feature addition which patches this hole for the internet. I can directly interact and transact with anyone in the world, and everyone can agree on the result.
Direct. Why does direct matter? A system is as strong as the weakest link. And our current system has some overweight-"vegan"-in-Bahamas-level weak links in it. Direct has no links.
The internet's open design principles make it the only viable way to build global services, but it's been limited in the services it can provide. As a result, applications like money were built with a reliance on centralized operators who have the exact opposite design principles of the internet. Conversely, crypto is built on the same open and neutral design principles as the internet.
Building on a direct global network, like the internet or crypto, allows for build-once use-anywhere technology. Crypto isn't a replacement for the internet, but it is a massive feature addition to it. Crypto isn't going to replace everything in "Web 2", but it does finally bring new use cases like money to the internet natively.
This will unlock significant markets over the next decade. This clearly includes bitcoin-like non-sovereign money, but we believe it can also span much further. The possibilities range from clearly practical stablecoins to the wild likes of fully on-chain autonomous worlds.
Creative developers can build these new markets to fill in the internet's gaps. We're making a bet on the global population's desire for growth and innovation - they'll come to the world's largest market, the internet, and to the best way to tap into a global user base, crypto.
DBA is a New York-based investment firm. We are in person in a real space.
We're also Partner-led. That means our crypto-native Partners drive our strategy and work directly on every deal we do. Founders deserve nothing less than our undivided attention and resources.
Michael Jordan: Michael was the Co-Head of Investments at Galaxy Digital. He began as an engineer at the firm's inception in 2017, but he quickly gravitated toward investment research. In 2018, he moved full-time to build the current investment team which oversees equity and protocol investments. Michael led Galaxy's investments into foundational winners like Fireblocks (Series A, B, and C), Tagomi (now Coinbase Institutional), Bison Trails (now Coinbase Cloud), CipherTrace (acquired by Mastercard), and others. He has literally nothing to do with a famous basketball player.
Jon Charbonneau: Jon was previously an Infrastructure Research Associate at Delphi Digital. He was the Sector Lead for Layer 1, Layer 2, and MEV research with recent coverage including Ethereum, rollups, MEV, distributed builders, and censorship. He also worked on Delphi's venture investing within these sectors. Prior to Delphi, Jon worked as a structured credit banker at Deutsche Bank (not Jane Street) in New York. Jon holds a B.S. in Economics from Duke University (not MIT).
This is not a crypto index fund. Our mission is to identify fundamental growth, invest in its category kings, build alongside this concentrated portfolio, and manage the associated risks.
Crypto is hard - it requires knowledge of cryptography, distributed systems, secure computation, and a bunch of other stuff we wish they would've taught us in school instead of watching Bill Nye when our teacher was out (ok maybe axe something else, those were awesome). We don't need an opinion on everything, but we do have strong opinions on the stuff we think actually matters.
We go deep because we find the good stuff in the weird corners that most people haven't looked at. This tends to be the applied use of frontier technologies. Applied use interests us because it's not high energy particle physics (we just call Tarun if it is), but rather practical problem-solving with the goal of building systems for everyone. We want to define the interesting-ness (definitely a word) and valuable-ness (yes, we do still have to pay the bills) universe of protocols and companies then become experts there.
We will make direct investments in those protocols and companies. We won't have 100 of them. No one can manage that (effectively). Nor, do you need to. We have opinions, a lot of them, but not 100 of them. There are usually 10-15 interesting things being built at any time in crypto, so we want to focus on them.
We think this is what founders want - focused and dedicated investors. Long-term partners deserve a lot more than 1% of their investors' brains. Hopefully, we'll be domain experts in understanding your problem space, and we'll dig in to help drive it forward. If we aren't, we'll help you find those rare experts to nerd out on your ideas and [insert-color-of-your-project]-pill them.
Our name "DBA" embodies our belief that crypto funds should actively be "doing business as" their investments. We take ownership both literally and figuratively, working as partners.
Everything DBA does must answer three questions:
DBA serves these three "customers," but DBA has one mission - support the good actors who will help crypto fulfill its potential. To do that we need to work with the best.
The best founders want to partner with the best funds, and vice versa. The best LPs invest in the funds that back the best founders. Our "chicken and the egg" answer here is to start with the R&D community. Crypto is uniquely community-oriented and built in the open. It's is a social movement as much as a technological one. We believe value-aligned investors will attract the brightest minds with revolutionary ideas in the long-run.
(Lower-case r) research. We'll be going deep on what we think are the most interesting opportunities in crypto, and we'll be open with our thoughts and findings. Hopefully we DDoS you with enough fresh ideas to get you as excited as we are.
If this sounds interesting to you, please contact our PR team at [email protected].
Ok, actually just follow/DM us on twitter. to see what we're up to. Even better, please come hang out if you're in NYC! Seriously, perpetual work from home can get super lonely. We want to be a meaningful part of the community here, so please reach out and stop by.
Thank you,
- MJ and Jon.
This post is for informational purposes only. It does not constitute investment advice or a recommendation or solicitation to buy or sell any investment and should not be used in the evaluation of the merits of making any investment decision. It should not be relied upon for accounting, legal or tax counsel or investment recommendations.