Concentrated Capital — How It Started

I’ve been nurturing the idea of the fund for a while now.

Ever since arriving in the U.S. with Rarible, I’ve had an everlasting feeling of a roaring economy, an entrepreneurial spirit, and, finally, a subtle sensation of high trust and integrity – a system where the combination of strict regulation and a reputation-first approach creates a necessary safety for capital.

It’s hard to describe – coming from a low trust economy it feels like nonsense to give someone else capital for their full personal discretion and expect not a fight for protecting it, but rather a shared journey of pursuing success.

Naturally, I started to receive offers from incredible founders to participate in their funding rounds.

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The first one was Aptos – a billion-dollar valuation deal by a team building a next-gen blockchain inside Facebook, who decided to continue their work after the Libra project was shut down.

Looking back, I understand now how grateful I am for the opportunity I was presented.

It ended up launching at a $10B FDV and, while bringing financial results for me, it also defined the qualities of the kind of project I want to invest in:

• Industry-scale mission
  Built inside Facebook, the project targeted billion-user-scale issues like scalability, finality, and security.

• Olympic team
  You can’t call it “strong” or “good” – it’s not a percentile of talent.
  It’s simply the top 1–10 people in a field, aimed at solving Olympic-level impediments.

• Led by a Tier-1 VC
  Unsurprisingly, I found that teams like this are consistently backed by a16z – the strongest VC in the world. Yes, sometimes they come late, sometimes they do too many deals, but if you reverse the question and look at the biggest market-share companies in their sectors – DEXs, lending, bridging, NFT, social – you’ll see they’re backed by them.

• Market Size and Escape Velocity
  Going “public” through tokens was a key crypto innovation in capital structure – spawning myriads of projects looking to launch a token for an obscure idea.

  Those deals came endlessly; many investors got burned – seeing token launches under $100M, Tier-2 exchange listings, and then limbo.

  Every important crypto problem solved today is at least a billion-dollar problem. A project achieving product-market fit in such a sector never struggles with private funding, Tier-1 exchange listings, or secondary market liquidity. Access becomes the real problem.

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I was fortunate enough to be in this Olympic-level game myself by co-founding Rarible. We were the second-largest NFT marketplace. Our token reached a $1B market cap. We generated over $300M in NFT trading volume, onboarded some of the world’s most recognized artists to Web3, and facilitated millions of their fans to transact in crypto – for many, their very first time.

I was also fortunate to compete against an a16z-funded, mission-driven team – witnessing firsthand the immense strength of talent networks, business connections, and execution speed.

I was fortunate being on both sides – receiving and giving away network effect – showed me how powerful it is. It drives a lion’s share of project outcomes. Everything in crypto is a network of people interacting with each other.

I was also, paradoxically, fortunate to live through a bear market – when everything goes south. We optimized team efficiency multiple times, reinvented the business model to a more sustainable B2B one, with a completely different distribution.

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Through this journey, I formed hundreds of like-minded founders and investors, joining tens of dense private communities, and built my Twitter profile organically.

Often, an opportunity is just one written DM away from you.

I was able to participate in around 25 funding rounds of incredible teams – all sourced through this network and by being present at the “happening places” – crypto conferences around the world, in relentless pursuit of connecting with industry-changing individuals.

I’m happy to preserve the values and qualities of the projects I described above in my portfolio. I’m proud to be an investor in LayerZero, Matter Labs, Mocaverse, Story Protocol, Farcaster, GenSyn, WalletConnect – each of them solving a billion-dollar problem at least and moving our industry forward.

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They say the best motivation is when you simply can’t not do it. The journey I’ve shared primed me not to be able to do anything else.

About a year ago, it became clear that I’ll spend the next 10 years of my prime career – from 30 to 40 – pursuing the industry’s immense growth alongside the best minds in this market, which is expanding simultaneously in multiple directions and solving world-class challenges.

I now have far more deal flow and access to opportunities than I have capital available – which led me to the decision to open up for external capital and form Concentrated Capital.

This will be a pool of capital directed at the core problems of the industry I live and breathe in.

This is happening. I welcome you to this inner circle – in whatever capacity you see fit for yourself:
observer, referrer, advisor, portfolio company, co-investor, LP, partner, or simply a dear friend.

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Overly excited,
Alex

P.S. Stay tuned for the next letter. In this one, I’ve shared my motivation and the venture side of my story. I’ll also be covering liquid market updates, industry-level news, and reviews of the sectors I’m following.
P.P.S. It wasn’t easy to send this first letter – I truly appreciate your support and feedback. You can simply reply here.