Bitcoin as a Fiduciary

Lets buy some Bitcoin as a fund.

I believe it’s now a fiduciary responsibility to own Bitcoin in a fund. I believe it gives liquidity optionality to the LPs in the middle - long term of a VC investment.

My partner Brayton and I, when we go out fundraising people look at our returns and we get the meeting, and then the LPs say:

“Well most of these returns are from Crypto, do you have any returns from anything else.”

It’s almost like returns from crypto have been dismissed as fake or erroneous, which is interesting to me, because it’s one of the ultimate deep technologies… and to be fair to us, it was our entire focus once upon a time.

Now that I’ve had a somewhat longer career, people will sometimes as: “What’s a key learning from investing at Boost VC.”

THE KEY LEARNING IS THAT YOU CANNOT OWN ENOUGH BITCOIN!!!

I’m not very vocal about this, but I believe it may be a fiduciary responsibility now to own Bitcoin in a fund, and here’s why— Optional Liquidity for Limited Partners:

Thomas Laffont of Coatue had an amazing presentation on the state of Venture Capital. It was presented at this years “All-In Summit.” This presentation made one thing very clear — As an industry we are at an all time low for LP distributions.

So my partner Brayton and I looked at each other, and we looked at our balance of Bitcoin in one of our funds, and we made a decisions to distribute roughly 1x DPI on a fund. We returned capital the week it was reported that VC distributions are at an absolute low!

I’m sure this would be a hotly debated topic in Venture Capital as an asset manager. Everyone has their own ways of thinking about this, but the way I think about is:

Venture Capital is very chunky in returns. We invest in many things, and 10 years later hope that we are able to return a 10x, if you have certainty that Bitcoin will be here in 10 years, which I do, it’s an amazing asset to smooth out the returns curve. It’s allowing us flexibility — given we held for roughly 8 years for that distribution and will continue to do that for Bitcoin.

Boost VC will always own a little Bitcoin. Every fund will own some.