Founder of IOSG shares insights from attending Token2049: Project teams and VCs are running out of money, and Token2049 has become the last hope for fundraising.

IOSG Ventures

2023-09-19 10:51

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Original Title: "Founder of IOSG Shares Insights from Attending Conference: Project Parties and VCs are Running Out of Money, Token 2049 Becomes the Last Hope for Financing."

Original Author: Jocy, Founder of IOSG

Original Source: DeepTechFlow

The scale of this industry is still growing, and I have participated in various events such as ETHDenver/ETHCC/Black Mountain Zuzalu/Edcon this year. I met many old friends at 2049, and every conference like this attracts a lot of participants in the industry. Many companies have set budgets for such conferences, so even in a bear market, the number of attendees continues to rise with the growth of the industry.

LP continues to support early-stage VCs in the industry, while VCs continue to support founding teams in emerging tracks. Teams are constantly expanding and growing, and everything seems to be moving in a better direction. However, the reality is not so optimistic. For many teams, this may be their last chance to raise funds, especially if the bear market does not end. Most early-stage teams have expanded over the past two years, depleting their runway. Some teams have a very high burn rate and only have 5-10 months left in such a market. They are even willing to buy expensive tickets/sponsorship booths for the 2049 conference to pitch to more potential investors.

Also, I attended an exclusive event hosted by the Medici family. The event had around 120 attendees, with about half of them being VCs. Among these 60 VCs, approximately 90% of their funds are currently raising capital. Due to regulatory pressure in the United States, fundraising has become extremely difficult for these funds. They believe that Asian Chinese LPs will be more generous in supporting them due to their brand and influence.

However, the reality is different from the bustling scene of the 2049 event. Most Crypto LPs are tightening their belts due to the bear market, while traditional LPs are skeptical about the value and use case of this industry. Therefore, it is unrealistic to expect to meet suitable VCs/LPs at a conference event to complete financing. Obviously, the bear market will continue for a while, and this is the time to test the adaptability, endurance, and resilience of the founding team. Like the previous bear market cycle, many founders survived until March 2020, and when they saw Bitcoin at $3,000, they hoped to give up and dissolve the team. Of course, three months later that year, DeFi Summer broke out, and the crypto industry ushered in a new era, and many practitioners saw an unprecedented dawn.

Unlike previous years, this year in 2049 is less commercial as global VCs and founders are invited to attend various side events, making the entire week in Singapore all about the crypto industry, aside from F1 spectators. Of course, my usual routine during blockchain week is to schedule catch up coffee chats during the day with founders we've invested in, and then attend interesting events and catch up with old friends at night (basically, during the week of the conference, I sleep at around 1am and wake up at 7/8am to prepare for meetings).

From the perspective of IOSG, our direction this year is to continue our strategy from the past two years, which is to provide a professional academic platform to help portfolios enter the market and to enable more industry practitioners to discover, recognize, and intersect with them.

Academic and social activities are not in conflict. We usually separate them into two areas. People who enjoy learning can take quiet notes in the internal presentation area, listen to various presentations and panel discussions. Friends who enjoy socializing can network and chat with over a thousand old friends at OFR, exchanging TG and having a good time.

Actually, it's a bit strange to focus on new themes in 2049, because builders/Dev usually don't attend such conferences. Here, it provides more of a platform for capital docking. The power of capital can drive industry progress. We can see the 2 billion dollar valuation military competition in the L2 track, and zkEVM with hundreds of millions of cash is making rapid progress in technology, constantly investing in recruitment, mainnet and application ecology competition, even in a bear market, it can still attract more talented people to join.

In addition, in the first two months of the French ECC IOSG OFR, we have invited more than 20 relevant founders to share in the AI track. This track has long been a radical track for most US Crypto funds to gamble on. Modular labs received more than 14 TS during the bear market, Gensyn was valued at over 400m, and ChainML completed two rounds of financing in less than 6 months.

If you look back at the theme of OFR's activities this year, we are focused on protocol security auditing/ZKML and Generative AI direction/LSD and Modular track. Of course, at the upcoming DevConnect in Turkey, we will invite founders of applications and FOG. Currently, applications on L2 have become an inevitable trend in industry innovation. We are eagerly awaiting these outstanding founders to continue solving industry application challenges.

Accidentally wrote too much. I believe that most people who need to read this type of summary are hesitant, because most practitioners will enter the industry. Therefore, I suggest that those who are still reading this article should treat the next activity as a tour and experience the native power of encryption in the development community. You need to find the shining and hot spots in the industry and create them, rather than just waiting for the next bull market.