Tezos launching VC fund and investing in stocks and bonds after $232 million ICO

 

  • Tech startup Tezos raised $232 million in July through
    an “initial coin offering”;
  • Spending $50 million on venture investing, rest being
    put into stocks, bonds, and precious metals;
  • An unusual use of funds from a tech business, likely to
    fuel criticism of ICO sector.



Startups are raising hundreds of millions selling new
digital coins online.

Breaking
Bad


LONDON — Early-stage tech companies are enjoying a funding boom
in 2017, raising over $1 billion so far this year through
so-called Initial Coin Offerings.

ICOs involve
selling newly created digital currencies online
. This new
method of fundraising was pioneered by Ethereum in 2014 and has
caught on with investors and startups this year after a big rally
for Ethereum’s Ether currency.

One startup plumped for an ICO is Tezos. It
raised $232 million selling “
tezzies
back in July
, the biggest ever ICO at the time.

Tezos is building a database-like platform for banks and other
corporates to use to write “smart contracts” on. It uses
blockchain technology, originally developed to underpin bitcoin,
and competes with other startups like Ethereum and
Bancor. Tezos has been in development since 2014 and is the
brainchild of husband and wife team Arthur and Kathleen Breitman,
former Morgan Stanley and Accenture workers respectively.

What has the company been doing with its huge pile of cash since
raising it? Investing it, apparently.


Crowdfund Insider reports
that Tezos is committing $50
million to venture capital investing, backing companies that are
building on its platform. As for the rest of its cash, it’s
investing it in “things like stocks, bonds and precious metals,”
according to the report.

This is all pretty unusual.

Firstly, tech companies don’t often double up as venture capital
offices — it’s not…

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