Zima Red ep 118: Baek Kim - Hashed: Growing from $700k to $4 billion in Assets Under Management
Primer: Hashed is a crypto native venture fund. They started with $700k in 2018, growing to $4 billion AUM today. In this episode of the Zima Red podcast, Baek Kim shares how he got into crypto and joined the team at Hashed. He shares with us the 2 areas Hashed focuses on and their plans for the future.
Background
Started his career as a robotics engineer
Fell into the rabbit hole of startups and crypto
Set up his own startup and did not finish his Master’s programme
Worked on internet protocols, IoT, and robotics stuff before stumbling on blockchain again
What Attracted Him To Crypto?
After his startup, he was working at Amazon as a software engineer
He and his roommate studied crypto after work every day
As an engineer, he was interested about how blockchains enable a coordination game between different devices to work together for a common good
Hashed and others introduced him to the industry
Wants to dedicate his 20s to the industry
How Did He Get To Know The People At Hashed?
It was through Simon, the CEO of Hashed
He had to raise seed funding from angels and the incubator in Korea for his previous startup. That was how he met Simon
Remembered Simon and reconnected with him
The Early Days Of Hashed
Did not know how to build a fund
All of them are software engineers. None of them had a finance or VC background
They wanted to help other founders succeed in Web3
They started out as a syndicate of angels
Started thinking of building Hashed as a proper fund to help the founders they invest in
Set up an entity in 2018. Started with $700k
Hashed
A crypto native venture fund
Has invested in the space for 5 years
Focused on 2 areas:
Decentralized money
Gaming
Growth Of Their AUM
Started with $700k
Grown to over $4 billion through VC investment
Process Of Incubating Startups
Terra
After college, he was a tech writer covering Asian startups in English
Reached out to Anyfi, an IoT Mesh Network project, and Do Kwon responded to him
When Do Kwon started Terra, Hashed started to work with them
Axie Infinity
In 2018, they started an incubator called Hashed Labs focusing on crypto gaming
Saw gaming as the biggest gateway for crypto adoption
Found out about Axie Infinity
Became an advisor on their token model
Other Projects
Became an advisor and led the seed round for Sandbox Game
Why Did They Focus On Gaming?
The future of all consumer services and apps will be gamified
Games are a more immersive version of apps
Web3 and crypto makes the incentive and gamification more explicit because of financial engagement
“Good gaming founders, good gaming services will become more than games, will become like a neobank, will become financial services and all that.”
- Baek Kim
How Do They Add Value As Investors?
They are very approachable
They chat with founders on a daily/weekly basis
Through these conversations, they find different ways to add value and help out
Last year, they acquired 2 public Triple A gaming publishers in Korea and internalize those talents
They have grown that subsidiary, called UNOPND, to 80 people
They are building on top of their portfolio ecosystem to bring interactive experiences, entertainment, and content for the users
Their team is building 7 different projects:
The first game they have launched is League of Kingdoms
Their second game is Derby Stars, a horse racing game
Runs their own validator/staking business
Use $10 - 200 million of their capital to help bootstrap some of their DeFi protocol portfolios
Have a quant finance team
Provide advice on fundraising, go-to-market strategy, building, and onboarding
Long Term Vision For UNOPND
Their main goal is to make the studio sustainable
Keeping it flexible as a fast moving organization
Their Quant Finance Team
Led by a legendary trader in Korea
Wanted someone that has been through all the cycles
Many of the founders in their portfolio companies require assistance in the capital markets and this team provides them with the support
Types Of VCs In The Space
2 types of crypto VCs:
A small nimble team with a very select portfolio
VC that builds different services to help their portfolio companies
Managing Their Team
Have to hire the right talent
It’s really about how much governance power and trust they can give to the team leads
Scaling Hashed
In the past 5 years, their focus was to go global
As the industry matures, there’s a new wave of talent coming from different avenues and geographies
Realized that many other crypto funds are not covering emerging markets such as Southeast Asia and India
Last year, they scaled their India team and Singapore team
One of their venture partners is based in India. Through him, they learned about the Indian market and got to invest in several Indian startups
Launching a dedicated India seed fund called Hashed Emergent
Have to give them as much autonomy and trust as possible
What Are Some Interesting Insights That They Have Discovered?
Listening and iterating a lot
They were wrong most of the time
Don’t try to be smarter than the founders because founders are the one researching and pioneering that category
In crypto, crypto founder-community fit is important. Founders are now required to build beyond product and build a community as well
What Excites Him The Most About NFTs?
NFTs enabling a sense of connection with other people
Thoughts On The Metaverse
Many metaverse apps or games are actually microverses — limited and bounded by certain parameters
The Metaverse should be permissionless and limitless. Users should be the owners and have the governance power to steer it
Grand 5-10 Year Vision
Focus on building his community
Love being part of a fast moving passionate community
Single Favourite NFT
His ex-colleagues started an NFT project called Off Live
Off Live collaborated with an artist called Mi Sang on the GhostsProject
Most Controversial Thought On NFTs
There’s too much supply of NFTs right now
Many NFTs will die
If He Could Improve One Thing In The Space
Increased scalability
Who Does He Look Up To And Why
Simon from Hashed
Simon got him into crypto
NFT Ecosystem In 3 Years
We do not use the term NFT anymore
NFTs would become part of the experience that apps, services, and communities offer
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