What is Paradigm?
Paradigm is an investment fund focused on supporting crypto companies and protocols, Web3 has future potential. Paradigm’s method and approach to projects is very flexible and invests in long-term projects, divided into several investment phases.
Paradigm usually invests in the earliest formative phase of a project and will invest more in later stages.
The fund is one of the largest investment funds in the Crypto market, having invested in many successful projects from 2017 to the present. Their enthusiastic support for projects not only in financial terms but also in terms of product development, searching for users to help the project,… has created the success of many projects up to now.
The team consists of 35 main members and 4 collaborators. Among them, the most prominent ones are Fred Ehrsam and Matt Huang.
- Fred Ehrsam is the co-founder. Fred was exposed to crypto quite early and bought his first Bitcoin in 2011. He has also been an angel investor in several crypto projects since the early days. According to Forbes, Fred Ehrsam has a net worth of $4.4 billion.
- Ehrsam founded cryptocurrency exchange Coinbase in 2012 with Brian Armstrong. Since then, it has grown into the largest crypto brokerage in the United States.
- Ehrsam left the company in 2017 but remains on the board of directors and still owns about 6% of the shares; Coinbase went public in April 2021.
- In 2018, he is the co-founded, a crypto investment firm with over $1 billion in assets.
- Ehrsam graduated from Duke and worked as a forex trader at Goldman Sachs for two years before starting to use Coinbase.
- Growing up, he spent thousands of hours with World of Warcraft – where he first learned about the concept of digital currency in the game.
- On Twitter with more than 188 thousand followers, Fred Ehrsam regularly updates the market as well as a lot of useful information.
- Matt Huang co-founded the company and is one of Paradigm’s managing partners. Previously, Matt was a partner at Sequoia Capital – an American venture capital firm with headquarters in Menlo Park, California and primarily focused on early stage venture capital investments.
- Matt is the founder and CEO of Hotspots – the YCombinator company acquired by Twitter in 2012 and he also invests in projects like Bytedance and Instacart.
- Matt Huang bought his first Bitcoin in 2012. However, it was not until 2017 that he really entered the cryptocurrency market. Matt graduated in Mathematics from the Massachusetts Institute of Technology. Matt Huang’s Twitter currently has more than 72.1 thousand followers.
Layer 1 and Layer 2 projects
Layer 1 projects (besides Bitcoin and Ethereum):
Cosmos: Tendermint is the labs behind the Cosmos Hub and the Cosmos ecosystem. In March 2019, Paradigm led a $9 million investment in Tendermint in Series A, with participation from Bain Capital, 1confirmation and many other VCs.
Mina (by O(1) Labs): In April 2019, Mina Protocol successfully raised $15 million from funds, led by Coinbase and Paradigm. This is the Series A of the project.
Optimism: A Layer 2 Optimistic Rollups Solution for Ethereum. In January 2020, Optimism raised $3.5 million from Paradigm, IDEO CoLab Ventures. In February 2021, Optimism continued to successfully raise $ 25 million in Series A, led by a16z, and with the participation of Paradigm.
StarkWare: Another Layer 2 Ethereum solution, using the ZK-Rollups solution, with projects under development on Layer 2 including dYdX, Sorare, and Immutable,… March 2021, project funded The $75 million Series B venture was spearheaded by Paradigm, with participation from Three Arrows and Alameda Research. In November 2021, the project continued to announce the successful funding of Series C, successfully raising $50 million, at a valuation of $2 billion, led by Paradigm.
The fund also invests heavily in Layer 2 Rollups solutions such as Optimism or StarkWare. They invest multiple times (2 times in each deal), often leading those deals – a way to show their dedicated support of these Layer 2 projects.
NFT/ Metaverse/ Gaming
- Zora: A marketplace for NFTs on Ethereum. The project was invested by Paradigm in March 2021 in Strategic Round, with an undisclosed investment amount.
- AI Arena: ArenaX Labs has completed a $5 million Seed Round funding round, led by Paradigm and the framework involved. This is a fighting game building labs on Ethereum that are in development.
- Axie Infinity: In early October 2021, Axie Infinity was invested $152 million in Series B, led by a16z and with participation from multiple funds including Paradigm.
- Royal: An Ethereum-based NFT Music app called Royal raised a $16 million seed round from Paradigm and Founders Fund in August 2021. In November 2021, Royal again announced a successful Series A funding round led by a16z, with participation from Paradigm, Founder Fund, NEA’s Connect Ventures, Crush Music, Coinbase Ventures.
- Fractional: In August 2021, Fractional completed an $8 million seed round, led by Paradigm, with participation from Divergence Ventures, Flamingo DAO, Variant Fund, and Delphi Ventures. This is an innovative project in the field of NFT as the leader in breaking down NFT into parts for trading.
- Parralel: In October 2021, an NFT scifi game called Parralel successfully raised $50 million, at a valuation of $500 million, invested by Paradigm.
- Showtime: Showtime is a Social Networking project for NFTs, which successfully raised $7.6 million in seed round, led by Paradigm in October 2021.
DEX/ CEX/ Derivatives/ Synthetic Asset
Projects in the DEX include:
- Uniswap: In July 2020, Uniswap exchange successfully raised 11 million USD from a16z, Union Square Ventures, Paradigm and ParaFi Capital.
- Osmosis: In October 2021, Osmosis announced a $21 million investment from Paradigm, Robot Ventures, Nascent, Ethereal, Figment and Terraform Labs CEO Do Kwon. Paradigm led the funding round. This is a DEX on the Cosmos ecosystem.
Projects in the CEX include:
- FTX: In July 2021, FTX exchange successfully raised $900 million at a valuation of $18 billion, with participating funds including Paradigm, Sequoia Capital, Ribbit Capital, Third Point, Lightspeed Venture Partners, Coinbase Ventures, Softbank, Sino Global Capital, Multicoin Capital.
- Bitso: In May 2021, Bitso exchange successfully raised $250 million, at a valuation of $2.2 billion in Series C.
- CoinSwitch Kuber: In January 2021, CoinSwitch Kuber exchange successfully raised $15 million Series A, led by Ribbit Capital and Paradigm.
- Tagomi – Unknown: In March 2019, Paradigm participated in a capital raising deal for Tagomi with a value of 12 million USD, including the participation of Pantera Capital. This is a solution platform for buying and selling top coins for institutions. Following this, Tagomi was acquired by Coinbase in 2020.
The projects in the Derivatives / Synthetic Asset include:
- dYdX: In June 2021, dYdX announced to receive a $65 million investment in Series C led by Paradigm. Participating funds include CMS Holdings, CMT Digital, Electric Capital, HashKey Capital and StarkWare.
- Opyn: In February 2021, Paradigm led a $6.7 million funding round, with the participation of Dragonfly, Synthetix co-founder Kain Warwick and Stani Kulechov – founder of Aave.
- Synthetix: Coinbase Ventures, Paradigm and IOSG invested $12 million in Synthetix in a funding round of the project in February 2021.
- Compound – Series A: In November 2019, $25 million was invested in Series A for Compound, spearheaded by a16z, with participation from Polychain Capital, Paradigm Capital and Bain Capital Ventures.
- Yield Protocol – Seed & Series A: This fixed-rate lending project led by Paradigm in a $10 million Series A investment round with the participation of Framework Ventures, Symbolic Capital Partners, CMS Holdings, Variant, and DeFi Alliance and June 2021.
- MakerDAO: In December 2019, MakerDAO sold $27.5 million of MKR tokens to Dragonfly Capital and Paradigm at a valuation of $500 million.
- Euler – Series A: In August 2021, Paradigm spearheaded an $8 million Series A Euler investment with participation from Lemniscap and many other individual investors in the market.
- Jet Protocol – Extended Seed: In early November 2021, Jet Protocol – lending money market on Solana – successfully raised capital in an expanded seed round worth $6.8 million, with the participation of Paradigm, Reciprocal Ventures, Solana Ventures and many more other funds.
- Reflexer: A stablecoin issued by an insurance asset, ETH. They have been invested in the seed round by Paradigm since February 2021.
- BlockFi – Series D: In March 2021, BlockFi successfully raised $350 ($14306) million at a $3 billion valuation. This is a centralized lending application for crypto assets. Leading funds include Bain Capital Ventures, Pomp Investments and Tiger Global, with participation from Valar Ventures, Breyer Capital, Susquehanna Government Products, Jump Capital and Paradigm.
- Tendermint – Series A: Tendermint is the labs behind Cosmos Hub and the Cosmos ecosystem. In March 2019, Paradigm led a $9 million investment in Tendermint in Series A, with participation from Bain Capital, 1confirmation and many other VCs.
- Skynet Labs – Strategic: In March 2020, Paradigm and investment funds such as Bain Capital Ventures, Bessemer Venture Partners, A.Capital, Collaborative Fund, Dragonfly Capital Partners, Hack VC, INBlockchain, First Star Ventures invested 3 million USD in Skynet Labs, the project behind the hosting platform Sia network.
- Gauntlet Network – Seed: In October 2020, Gauntlet Network successfully raised $4.3 million led by Paradigm. This is an infrastructure piece that helps develop the decentralized governance of DAOs.
- Chainanalysis – Series D: In March 2021, Chainanalysis successfully raised $100 million in Series D at a valuation of $2 billion. It is a data platform to provide data to projects, users and organizations.
- Erasure Bay: A decentralized market for data serving the prediction market, invested 11 million USD by Placeholder and Paradigm in March 2019.
- Flashbot: A project to research and reduce the negative impact of MEVs on Ethereum, invested and financially supported by Paradigm to develop. It is not clear how much money they are supported by Paradigm, but Paradigm is the sole financial partner of the project.
- Keep Network: A project to bridge BTC into Ethereum for use in the Ethereum ecosystem, and also a security layer solution used for blockchains and allows users and applications to store data privately. They were invested $7.7 million in April 2020, with the participation of Paradigm Capital at the forefront, Fenbushi Capital, Collaborative Fund attending.
Services for end users
- TaxBit – Series B: In August 2021, TaxBit successfully raised $130 million at a valuation of $1.33 billion in Series B of the project. The deal was led by IVP and Insight Partners, including participation from Tiger Global, Paradigm, 9Yards Capital, Sapphire Ventures, Madrona Venture Group.
- Diem – Seed: Diem completed a funding round of unknown value in March 2020, with the participation of Paradigm.
- MoonPay – Series A: At the end of November 2021, MoonPay announced the completion of Series A funding deal of $555 million, at a valuation of $3.4 billion. The deal was spearheaded by Tiger Global Management and Coatue, with participation from Blossom Capital, Thrive Capital, Paradigm, and NEA.
- Matrixport – Unknown: In December 2019, Matrixport completed a funding round with the participation of Paradigm at unknown valuation, unknown amount.
- Fireblocks – Series B: In November 2020, Paradigm led a $30 million Series B, with participation from Cyberstarts, Tenaya Capital, Swisscom, Galaxy Digital, Digital Currency Group (DCG), and Cedar Hill Capital. In this investment, Fred Ehrsam also joins the board of directors of the Fireblock project.
- Argent – Series A: In March 2020, Argent announced it had completed a $12 million Series A funding round, spearheaded by Paradigm and featuring the Compound founder. This is a wallet application for storing and trading decentralized crypto assets.
- BetDEX: In November 2021, BetDEX was invested $21 million in seed round by Paradigm and FTX. This is a decentralized football betting application.
- Genesis Digital Assets: This is a Bitcoin mining firm, they were invested by Paradigm in September 2021. The deal, valued at $431 million, includes participation from NYDIG, Stoneridge, FTX, Ribbit, Electric Capital, Skybridge, and Kingsway Capital. In addition, Matt Huang also joined this firm as one of the company administrators.
- Lido: The first and largest staking solution on the market at the moment. In May 2021, $73 million was raised in a Treasury Diversification round. Paradigm purchased $51 million in LDO tokens (15,120 ETH), while the remaining $22 million was invested by Coinbase Ventures, Three Arrows Capital, Jump Trading, Alameda Research, Digital Currency Group.
- Amber Group – Series A: In February 2020, Amber successfully raised $28 million in Series A funding led by Pantera, Paradigm, and attended by Polychain Capital, Blockchain.com, Coinbase Ventures and Fenbushi Capital. This is a startup with many crypto products and services providing to many audiences in the market.
- Gitcoin: In April 2021, Gitcoin successfully raised $11 million from many large investment funds including Paradigm, 1kx, Electric Capital, IDEO, The LAO, MetaCartel Ventures, Naval Ravikant, Balaji Srinivasan.
- Namebase: Project about domains working on Handshake blockchain, invested by Paradigm and INBlockchain in November 2018 in the project’s seed round. The amount of the project receiving investment is currently unknown.
- Spacemesh: In September 2018, Spacemesh received a $15 million investment, led by Polychain, with participation from MetaStable, Paradigm, Coinbase Ventures, Bain Capital, 1kx, Arrington XRP Capital, Danhua Capital, Gumi Crypto, Electric Capital , Collaborative Fund.
In 2021, Paradigm invests in less than 30 projects – a relatively small number compared to many investment funds of the same size. Previously, the fund often focused on projects of the Ethereum ecosystem.
By 2021, Paradigm’s portfolio will mainly invest in these projects, all in the NFT, Metaverse and Gaming segments. This shows that there is a high probability that NFT, Metaverse, and Gaming will continue to thrive and last until 2022. Because these projects have raised a huge amount of money from investment funds that “haven’t had a chance to use yet”. . In addition, the fund also invests in many projects in the fields of CEX, DEX and Derivatives.
Top 5 projects with the highest YTD in 2021:
- ETH: 413%
- UNI: 388%%
- SC: 376%
- ATOM: 368%
- MKR: 333%
Above is an overview of Paradigm Investment Fund, Paradigm team as well as investment portfolios of this Fund. Hope this will be useful information for you.