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Why Bain Capital Ventures Backed Robot Ventures to “Reinvent Finance”

On Our Radar: Deals we are paying attention to for their impact on industry.


Robot Ventures is just the latest blockchain investment by Bain Capital Ventures, which has about $3.6 billion of assets under management.


BCV and Ripple’s developer ecosystem initiative Xpring, along with unnamed “fintech-obsessed angel investors,” have invested a combined $1 million in an early-stage blockchain venture capital firm called Robot Ventures run by Robert Leshner, who announced its launch in a on his blog on April 11.


Last year, BCV participated in a $133 million funding round for another blockchain venture by Basis. That effort to develop a stablecoin has since shut down due to regulatory concerns.


BCV Partner Salil Deshpande, who heads the Palo Alto, Calif.-based venture capital firm’s Network Investing program and led its investment in Robot Ventures, told Karma Network on April 11 how the fund came together. BCV had initially invested in Compound, an Ethereum-based financial open source protocol Leshner launched in 2017.


“We enjoyed working with him and brainstorming about the sector so much that we set him up on AngelList as a small fund manager and put him in business by becoming the anchor investor in his small fund,” Deshpande explained. “It's an example of how we don't just talk the talk, about working closely with our entrepreneurs and having great relationships with them, [and] how we come up with scalable ways of working with them.”


Leshner said Robot Ventures will provide “capital, extensive whiteboarding, and product strategy to founders with a passion to reinvent finance.”


He also referenced two startups that provide an indication of the types of companies Robot Ventures will back: Point, a high-interest debit card with rewards, and Coinmine, a crypto mining company. Cointelegraph confirmed that Robot Ventures completed investments in both during the first quarter of 2019.


Although Point is still in its initial stages of launching, Coinmine had already raised $2 million prior to the Robot Ventures investment and has begun selling a $799 device that aims to make cryptocurrency mining as simple for consumers as playing video games. Still, Coinmine’s CEO and co-founder Farbood Nivi told Karma Network that Leshner’s backing is a “no-brainer” for the company.


“He not only gets finance, he gets crypto, he gets fundraising and he gets being an entrepreneur,” Nivi said. “That’s exactly who you want on your side.”


Ripple, too, has set its sights on blockchain. The real-time currency exchange and remittance network invested in Robot Ventures through its Xpring project, which aims to create a community of developers, entrepreneurs and companies focused on blockchain technology. It has worked with blockchain platform Forte to establish a $100 million game developer fund.


Robot Ventures and its backers are investing in fintech during a time of rapid growth and disruption for the industry, Marek J. Olszewski, managing partner of Catalus Capital, told Karma Network.


“It’s really a very frothy space [and] there’s a ton of really interesting innovation,” said Olszewski, who is based in West Palm Beach, Fla. He credits venture capital investment for driving innovation in the financial industry, which he said has long been hindered by regulation and established traditional companies.


“As long as the VC system continues to pump in this significant amount of money, this growth will definitely sustain itself,” Olszewski said. But he also cautioned: “As soon as the VC spigot [turns] off, which it surely will at some point in the next few years, there’s going to be some sort of a shakeout. It’s only going to be the companies that have produced real strong products and generated meaningful sustainable revenues that are going to be able to survive.”


Ambreen Ali is a freelance writer and editor based in the New York City area who specializes in business and technology. She has 15 years of reporting experience, including covering Capitol Hill and reporting from South Asia.

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