Bessemer Venture Partners sees it as the most crypto-native way to support founders.
Bessemer Venture Partners announced last week it had committed $250 million to invest in Web 3 projects, making it the latest venerable venture capital firm to increase its focus on crypto.
However, the Bessemer announcement was unique in two key ways: the capital wasn’t from a crypto-specific fund and the firm concurrently launched a decentralized autonomous organization (DAO).
Sequoia Capital and Bain Capital recently announced large new funds specifically dedicated to investing in crypto projects. Bessemer instead made its $250 million commitment from the firm’s $2.5 billion global growth fund.
We’ve always had flexibility from our main funds to be able to invest across roadmap areas of all types,” said Bessemer partner Ethan Kurzweil in an interview with CoinDesk. “And so there’s really no need for us to raise a dedicated round.”
But it was the DAO angle that really stood out. Bessemer, a firm that launched 111 years ago as a family office, made its crypto move more distinct – and perhaps more puzzling – with the launch of BessemerDAO.
“We wanted to provide portfolio services in a new way, both to our founders as well as other founders that we may invite into the DAO,” said Kurzweil. “We figured this was the most crypto-native way to provide portfolio support that we could think of as opposed to just taking our venture style and force-fitting it into crypto.”
But what does it really mean?
Kurzweil said there are five core components of what Bessemer hopes the DAO will do and how it will provide portfolio support for founders and companies: talent introductions, business development through networking, community, tokenomics and, eventually, an education track around investment themes and areas of innovation.
The BessemerDAO Discord channel opened last Thursday and started on-boarding members. The DAO is a token-gated community, with Bessemer granting every member invited to the Discord a special non-fungible token (NFT) that provides access.
We want to set up as flexible a structure as possible. There will be a token that everyone gets for being in [the Discord], but then we’re going to see how the incentive structures evolve from there,” said Kurzweil.
The DAO isn’t decentralized from launch with the Bessemer team in charge of setting things up, he added.
“There’s a centralized group of people that come together to instate it, give it a purpose, invite the initial cohort of people and get the community going. And then it takes on a life of its own,” said Kurzweil.
The fund could eventually have a fund or pooled capital to contribute to various projects, said Kurzweil. He said he doesn’t know when or if this could happen, but Bessemer would “love to help in democratizing private markets, and we’d be fully supportive of that.”