Acrylic Raises $55M Debut Fund for Crypto Investments

A Significant Year for Cryptocurrency Investment

The cryptocurrency landscape has experienced substantial growth this year, highlighted by Coinbase’s successful direct listing and A16Z’s $2.2 billion fundraising for its third crypto-focused fund. As market values continue to climb, a key question arises for many crypto entrepreneurs: at what stage can they secure initial funding?

Acrylic Launches $55 Million Debut Fund

Ash Egan, the solo General Partner of Brooklyn-based Acrylic, is addressing this challenge with the launch of a $55 million debut fund. This fund will concentrate on what Egan terms “inception capital,” providing resources to projects at their very earliest stages.

The fund’s Limited Partners (LPs) include Cendana, a fund-of-funds firm specializing in emerging VC managers, and Accolade Partners, a blockchain-focused fund-of-funds established in 2020.

Egan’s Extensive Crypto Experience

Prior to founding Acrylic, Egan served as a partner at Accomplice and held investment roles at ConsenSys Ventures and Converge. He has been actively involved in the crypto space since 2015, with successful investments in companies like Chainalysis, currently valued at $2 billion, and BlockFi, now worth $3 billion.

Focus on Early-Stage and Risk-Taking Founders

Egan aims to be the first investor in crypto ventures, potentially even before formal company creation. He envisions acting as an early partner, sometimes even functioning as an integrated team member. His focus is on “founders who are embracing significant risks and pioneering new markets, fundamentally reshaping the existing order.”

The Significance of the Firm’s Name

The name “Acrylic” holds multiple layers of meaning for Egan. As a painter, he appreciates acrylics’ versatility and compatibility with other mediums.

He also draws a parallel to the layered nature of crypto protocols, noting that “acrylic is generally painted in layers… and crypto is layers of protocols.” Furthermore, the name reflects his investment philosophy, emphasizing that “crypto investing isn’t solely a science; it remains an art form.”

Longitudinal Investing and Market Cycles

Recognizing the inherent volatility of the crypto markets, Egan intends to prioritize long-term investing, minimizing focus on short-term price fluctuations. His goal is to invest early enough that market cycles become less critical.

He seeks to collaborate with founders who are resilient to macroeconomic trends and dedicated to building lasting value, regardless of market conditions.

Brooklyn as a Strategic Hub

Acrylic’s location in Brooklyn is considered a strategic advantage. Egan believes the city is becoming a central hub for the next phase of crypto development, attracting companies and individuals.

He emphasizes the importance of being local, given the presence of Wall Street and the media industry in New York City.

Current Investments

The firm has already made investments in several startups and protocols, including US BTC Corp, a low-cost North American Bitcoin miner, Automata, a governance token protocol, Arbitrary Execution, a smart contract auditing company, and Syndicate Protocol, a decentralized investing network. Two additional investments remain unannounced.

Areas of Investment Focus

While open to a wide range of crypto projects, Egan is currently less interested in generalized Layer 1 smart contract platforms – those aiming to compete directly with Ethereum. He believes gaining market share in this space is challenging for newcomers without an established presence.

Building the Acrylic Team

Currently, Egan is operating as a solo GP, but is actively recruiting to expand the team. He anticipates that a dedicated focus on crypto will yield significant benefits through portfolio network effects, fostering collaboration among portfolio companies.

He believes that, over time, the portfolio companies will be able to leverage each other’s strengths and expertise.