Quick take:
- C1 Secondaries Fund wants to purchase shares of Animoca Brands at a discount of 62% as per the latest valuation of the stock.
- The crypto fund is also eyeing a 63% discounted stake in Chainalysis as per the company’s last valuation.
- Although crypto prices have bounded back in the past few months, Web3 funding has continued to fall.
C1 Secondaries Fund, the crypto firm founded by a former Coinbase executive is hunting for bargains in the Web3 space. According to the Australian Financial Review report citing DealStreet Asia, the $500 million crypto fund has identified Animoca Brands and Chainalysis as potential opportunities as it prepares to capitalise on the current market conditions.
C1 Secondaries is prepared to write checks of about $20 million to $50 million to acquire private stakes in companies valued at least $300 million based on their most recent funding rounds. The firm looking for discounts of up to 80% on leading Web3 companies.
Animoca Brands recently announced an $11.88 million second tranche for its Web3 loyalty project Mocaverse, bringing the total raised to $31.88 million. According to the announcement, the funds were raised by issuing new ordinary shares at a price per share of A$4.50 (~US$2.95). Therefore, buying Animoca Brands shares at $1.12 would represent a discount of about $62%. The report also indicates that the firm is eyeing a 63% discount on the shares of crypto analytics firm Chainalysis.
C1 Secondaries Fund is capitalising on a rare opportunity where, despite the recent rebound in crypto prices, Web3 funding is still declining. The Bitcoin price has recently rallied to trade above $44,000, while Ethereum topped $2,350. Even with Monday’s sharp pullbacks the trajectory still indicates a bullish crypto market.
On the other hand, Web3 funding has continued to decline over the past several quarters. With just three weeks remaining to wrap up the fourth quarter, Web3 startups have raised $916 million according to CrunchBase’s Web3 tracker. It is unlikely the figure will surpass the $1.3 billion raised in Q3.
These are unique circumstances for Web3 VCs as startups are desperate for funding to take advantage of the recovering market.
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