With the promise of significant returns on late-stage ventures, Andra Capital has presented a fund based on cryptocurrency and raised $500 million for the new Silicon Valley Coin (SVC) built on the Ethereum blockchain.
Made of 80% of late-stage firms, with at least two rounds of funding and valued at $500 million each, the fund also contains 20% of early-stage firms under the Andra Capital portfolio.
The new SVC is currently available only for U.S. investors with a net worth of over 1 million, and soon will be available for investors worldwide to purchase the token depending on each country’s regulation.
“We’re changing the dynamic in venture capital by providing more investors access to high-growth Silicon Valley assets,” said Reuters Haydar Haba, managing partner in Andra Capital.
Andra has created 1 billion coins for SCV, priced at $1 per token, to raise $1 billion overall. With $500 million already allocated, the venture firm is preparing a Public Offering soon.
Many ventures firms are avoiding experimenting with blockchain and cryptocurrencies to fund their projects, mainly over concerns of compliance with U.S. regulations, but Andra based this new fund in San Francisco, aiming to attract national investors alike.
“By strategic design, our fund is conservative and treated as a traditional security offering, so we remain compliant with U.S. regulatory requirements and are exempt from registration under Reg D requirements,” told Dr. Hermann Liu, managing partner at Andra. “The fund only accepts qualified investors in the U.S. and permitted investors globally. All investors are required to undergo KYC/AML and investor verification.”
With this fund, Andra Capital is targeting an internal rate of return (IRR) of 30%, in a 10-year period. This is above similar funds that in the past ten years gave to investors IRRs of 12% and 20%.