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According to an announcement today, London-based Venture Capital firm Northzone has launched a €1 billion fund aimed at investing in crypto and Fintech startups.
Founded in 1996 as a joint investor, Northzone has backed a wide range of tech companies, from fintech companies like open banking specialist TrueLayer and its now-acquired giant Klarna, to music streaming platform Spotify, which is said to be exploring web3. But the company also ranked crypto infrastructure startup Magic Labs, web3 security company Sunscreen and DeFi gro protocol in its portfolio.
Wendy Xiao Schadeck, a partner at Northzone, described web3 as the company’s “core area.” She authored her crypto investment thesis in July 2018 – the start of extended crypto winter.
The venture capital firm has the infrastructure in place to support startups through both stock investments and token sales and has been involved in token staking, Xiao Schadeck said. She also suggested that the company would be willing to invest in a decentralized autonomous organization (DAO) under the right circumstances.
Northzone currently has no exposure to NFTs, unlike London-based venture firm Blossom Capital which purchased NFTs — including Bored Ape, CryptoPunk, and Azuki through its latest $432 million fund. But that could change.
“We look at new investment methods that are in line with what we do,” Xiao Schadeck said when asked about buying NFTs. “But not at the point where we said we were going to spend part of the funding on buying NFTs or anything like that. So far, we have not seen NFTs as an investment target that fits our risk criteria.
Xiao Shadeck also said that she is not discouraged by some bumps in the DeFi space. Investment firm Gro was hit by Terra’s reliance on UST in May, which led to a reassessment of its strategy to generate profits for clients. However, Xiao Shadeck said that Northzone will continue to look at the web3 infrastructure space and DeFi protocols like Gro.
According to Xiao Shadeck, the supervisory board has not yet determined whether Northzone will follow the lead of other European venture capital firms such as Aglaé Ventures and Cherry Ventures.
“We will discuss and evaluate to see if the time is right for that,” she said, noting that such a move would allow the company to engage in trading and liquidity of the token. “I think the most likely thing to happen is that we will continue to invest in web3 companies in addition to our core fund and if they decide to launch tokens, we will keep them.”
