Former General Partner for Polychain Capital, Tekin Salimi, has launched a new blockchain-focused investment fund that will eventually evolve into a founder-owned decentralized autonomous institution (DAO), providing a new way to reward startup executives for their contributions.
The $ 125 million fund, known as ‘dao5’, will invest in blockchain and cryptocurrency projects in its pre- and initial phases. In the startup world, a rollout usually helps a company’s founders start their own business. The first round is the first formal round of equity financing.
The fund will primarily invest in projects focused on Tier 1 blockchain technology infrastructure, privacy technologies, decentralized finance (DeFi), DAOs, games, non-fungible tokens and crypto-focused social platforms.
Unlike traditional venture capital funds, where business owners simply receive financing directly from venture capitalists, Dao5 will provide grant recipients in the form of management tokens that will shape the fund’s future DAO. Dao5 employees and advisors will also receive Governance Tokens.
The fund is expected to begin the formal transition to DAO and thus reach the appropriate level of decentralization around 2025.
By following DAO’s management structure, dao5 tries to give project managers a certain degree of risk diversification, as all grant recipients will have access to all other projects in the portfolio. The company says this will encourage entrepreneurs to collaborate and increase their chances of success.
“The goal of dao5 is to explore a new model for launching DAO by first focusing on attracting talent and capital through venture capital investments, and secondly on increasing the intrinsic value by leveraging the collective talents of the dao5 community,” said the founder. Tekin Salimi.
Selimi has been a general partner of Polychain Capital – one of the largest crypto-equity funds – for more than four years. His tenure in the company expired in February.
Related topics: Legal DAOs: Why are the Marshall Islands investing in a decentralized future?
Supporters of decentralized autonomous organizations see this method of management as an important innovation in how organizations and systems work. The authority of the DAO can be used on all types of management schemes where there is a major agent problem. As the Cointelegraph reported, the Republic of Marshall Islands has taken a bold step to normalize decentralized corporate governance by officially recognizing DAOs as legal entities.