What happened to Katie Haun and her $1.5 billion crypto fund?

What happened to Katie Haun and her $1.5 billion crypto fund?

What Happened to Katie Haun and Her $1.5 Billion Fund?

Cryptocurrency has faced a significant downturn in recent times, leading to the implosion of various projects, including Terra and FTX. This downward spiral has sent the industry into a state of turmoil. Additionally, the venture industry has experienced its own painful pullback due to rising interest rates and unrealistic valuations. Amid these challenges, Katie Haun and her $1.5 billion fund, Haun Ventures, seemed to have vanished from the media spotlight.

Curiosity about Haun’s whereabouts and the state of her fund led my colleague Leo Schwartz and me to dig deeper. We spent several months investigating how Haun has been navigating this crisis. During the pre-crypto crash period when Haun was raising funds, she projected a two-year deployment schedule. However, as we reported, Haun Ventures is now proceeding more cautiously and plans to take around three years to spend its capital.

As of mid-June, the firm had deployed approximately 30% of its capital across about two dozen positions. This includes investments in popular cryptocurrencies like Bitcoin and Ether, as well as smaller-cap tokens tied to projects typically associated with venture capital investments alongside traditional equity. However, Haun Ventures declined to disclose any specific holdings.

Haun Ventures’ investment strategy has been split almost evenly between digital tokens and traditional equity, with a recent emphasis on startup investments in 2023. One notable investment is in NFT creation platform Zora. We also reported for the first time their participation in a $32 million extension to a Series B round for Aleo, a privacy-focused blockchain network, and an investment in Artemis, a crypto data analytics platform. More deals are expected to be announced soon. Haun’s LPs (limited partners) seemingly remain unconcerned about the pace of investments, with one LP stating, “If this goes to zero, like, it’s not going to crush our portfolio.”

However, there is still pressure for Haun Ventures to deploy capital due to management fees. Typically, venture funds charge an average of around 2% in fees, and Haun Ventures declined to comment on its fee structure. Despite exercising relative caution in her investments, Haun’s retreat from the media spotlight since the collapse of FTX in November suggests a change in her approach. Previously, Haun had actively courted the media, helping boost not only crypto but also her own career. However, our reporting unveiled criticism from some of her former colleagues in the law enforcement world regarding her glowing media portrayals.

• The average workday decreased by 37 minutes and fewer people are wo...
• Tom Brady invests in English soccer team, following Ryan Reynolds.
• HR chiefs at some companies earn up to $8 million annually, with th...

As we delve further into Haun’s current situation, it becomes clear that when she returns to raise a second fund, she will need a compelling narrative to demonstrate how she effectively responded to the changing market. According to Fred Wilson, co-founder of Union Square Ventures, a tight and well-thought-out story will be crucial for Haun Ventures’ future success.

While the crypto industry faces challenges, it’s important to highlight significant developments in other sectors. For example, Carlyle Group, one of the leading private equity firms, reported a decline in earnings and revenue, reflecting the strains of a tough dealmaking environment. Similarly, top-performing VC firm Union Square Ventures marked down the value of seven of its funds by nearly 26% this year, underscoring the broad impact of the market downturn.

Venture Deals

• LightForce Orthodontics, a personalized 3D printed braces system based in Burlington, Mass., raised $80 million in Series D funding. The round was led by Ally Bridge Group and included Transformation Capital, CareCapital, Omega Venture Partners, Matter Venture Partners, the American Association of Orthodontics, Kleiner Perkins, Tyche Partners, and Matrix Partners.

• San Francisco-based gene editing biotech company Amber Bio secured $26 million in seed funding. The round was led by Playground Global and Andreessen Horowitz Bio + Health, with participation from Eli Lilly, RDF, Hummingbird Ventures, and Pillar VC.

• Tel Aviv-based digital financing platform 40Seas raised an additional $6 million in seed funding. Eminence Ventures, QED Investors, Team8, and ZIM participated in the round.

• Lightup, a data quality monitoring platform developer in Mountain View, Calif., raised $9 million in Series A funding. Andreessen Horowitz and Newland Ventures led the round, with participation from Spectrum 28 Capital, Shasta Ventures, Vela Partners, and Incubate Fund.

• Cheyenne, Wyo.-based multilingual customer support company Language I/O raised $8 million in Series A1 funding. The round was led by Joint Effects and included the Wyoming Business Council’s Wyoming Venture Capital Fund, Gutbrain Ventures, PBJ Capital, and Omega Venture Partners.

• Falls Church, Va.-based cybersecurity company Hushmesh raised $5.2 million in funding, with Paladin Capital Group and Akamai Technologies as the lead investors.

• Southampton, U.K.-based data analytics and simulation tools software company Dynamon secured £4 million ($5.02 million) in funding from bp ventures.

• Mexico City-based legal tech startup and B2C labor law provider in Latin America ConfiAbogado raised $1.65 million in seed funding. Tuesday Capital led the round, with participation from DTB Capital, Seedstars International Ventures, 500 Global, Invariantes, Goodwater, GAIN Capital, and Side Door Ventures.

• Miami-based video editing software company Wisecut raised $1 million in funding from Tim Draper.

The venture deals mentioned above highlight the continued activity in the startup ecosystem despite the wider challenges in the market.

Private Equity

• Guidepost Growth Equity acquired a minority stake in Intellum, an Atlanta-based enterprise learning management system, for $25 million.

• Arlington Capital Partners acquired Integrated Data Services, a software and tech support and development provider for federal government customers based in El Segundo, Calif. IDS’ co-founders Jerome Murray and James Truhe will retain a minority stake in the company. The financial terms of the deal were not disclosed.

• BlackRock acquired Kreos, a growth and venture debt financing provider to companies in the technology and healthcare industries based in London. The financial details of the transaction were not disclosed.

These private equity transactions demonstrate continued activity in the market, with firms strategically investing in various industries and sectors.

What Lies Ahead for Katie Haun Ventures?

The story of Katie Haun and her $1.5 billion fund has taken an interesting turn amid the challenges faced by the cryptocurrency and venture capital industries. With her fund taking a more cautious approach to investments, Haun Ventures seems focused on navigating the changing market landscape diligently. As Haun and her team plan to deploy their remaining capital over the next few years, the investments in Zora, Aleo, and Artemis highlight their strategic choices. However, Haun’s avoidance of the media and the need to demonstrate a strong narrative when raising future funds indicate the importance of adaptability and responsiveness in the investment world.

While Haun Ventures continues its journey, it is crucial to note the broader impact of the market downturn on other players, such as Carlyle Group and Union Square Ventures. These challenges serve as a reminder that the investment landscape is constantly evolving, and success lies in understanding and responding to these changes effectively.

As the world of finance and technology continues to intertwine, it will be fascinating to witness Haun Ventures’ future endeavors and the broader resilience and adaptability of the investment ecosystem.