What role does the investor take?

What role does the investor take?

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What role does the investor take?


Investors who invest in this large-scale pass-through model must assume a role that shifts from a simple capital distributor to an active participant in the network. From community building to pass-through projects, to actively operating nodes, to actively managing mobile positions, venture capital funds active in this area will soon be required to participate in network operations. This is not only fulfilling their fiduciary responsibility, maximizing the return on capital of their investors, but also helping to guide their investment network on the right track. The ambitious founders are well aware that the road to lasting success is tortuous, and they will first choose patient partners with patience. These patient collaborators will inject capital into their networks and work, and only when the number of nodes available in the network is at a minimum will they attract a specific user group or other stakeholders through targeted sales or short passes.



The most active investors will continue to participate in all aspects of the network during the investment period:

Staking: As the equity certificate (PoS) or the entrusted equity certificate (DPoS) network goes online on the main net, the holder of the certificate can use the certificate as a share to provide profitable work for the network (transaction verification, calculation, arbitration, transcoding) Or provide security) and receive rewards from the network (such as block rewards) or users (such as transaction fees). In a DPoS network, an operator within the network can perform the work as a service to obtain a a portion of the payment and the pass holder can delegate/bind the pass to the operator. (block blockage BlockBeats Note: You can check out the current popular Staking project at theblockbeats.com

Voting: Many networks are using their passports as a governance tool, whether through a simple pass, second vote or mobile democracy, the pass gives their holders a say. Long-term investors will participate in the governance process of the network and direct it to the the direction that they are most interested in.

Management: Through the Certified Management Registry (TCR), early investors in such networks need to actively participate in the management process while maintaining the high quality of the registry and marking the quality of the people involved in the management.

Running nodes and simple network usage: Since investors themselves may also be users of the network, they may actively build early use case iterations for the network. Their use of the network includes running nodes in the network for data-driven tracking purposes and actively participating in the network economy (such as purchasing services/assets), which will be one of the first to build an ecosystem on top of the network.

Europe: Where the Force is located

The number of developers is big and the academic strength of more than a hundred years

A large number of blockchain developers and technical talents come from Europe with a strong academic tradition, where hundreds of years of technical academic achievements have been born. Among the top 10 technology universities in the world, Europe has 5 exclusive schools, and the number of PhDs in STEM in Europe is twice that of the United States. According to Stack Overflow, Europe has 5.5 million developers, compared to 4.4 million in the US. Europe has not lacked technical talent, but historically, the main employers of these developers and technical talents came from the banking industry. It was not until the financial crisis of 2008 that these technical talents decided to flee the industry. Now, with the wave of democratization of this capital, these European technical talents no longer need to emigrate to the United States to raise funds and establish global companies. The result is that entrepreneurs from different corners of Europe have created significantly more value than any other region in the world: in 2018 alone, entrepreneurship projects in Europe raised $4.1 billion, while in Asia and the United States. The project raised $2.3 billion and $2.6 billion, respectively.

Use distributed teams from the beginning

As a continent of 50 distinct countries, European startups have become accustomed to working with distributed teams and building teams from a global perspective. From the outset, any European startup has recognized the need to develop an international expansion roadmap to avoid falling into the trap of its small domestic economy. Diversified and multinational teams have become the standard setting for European startups, and London, Berlin, Paris and Amsterdam have become centers of technological innovation. We call this phenomenon the technological renaissance of European city-states.

Deep-rooted counter-culture tradition

The greatest advantage in Europe may be due to the history of the past few centuries it has. Although the centralized business model is in line with Silicon Valley's ideals, namely a dense capital pool and a narrow and consistent ideology, the decentralized network model is more in line with Europe's deep-rooted history of political division and the consequent counter-cultural movement. Europeans have experienced two unimaginable catastrophic world wars in their own homes. European families have experienced communism and/or fascist dictatorships, and Europeans have split in the Cold War for more than 40 years. Europeans have always lived under the rule of totalitarian regimes that destroyed the notion of privacy and freedom of expression and regularly seized personal belongings and assets from their citizens. Decentralized networks will, of course, give individuals practical operational benefits, but at the same time have the hope of curbing the nightmare of the entire European society, which Europeans have experienced directly and violently in the past century.

Supervisory first

From a regulatory perspective, the EU has been at the forefront of its efforts to promote GDPR, such as the right to protect consumer digital data, and to open up the financial system's PSD2 for the benefit of its users. Besides, competition between countries in the blockchain sector has begun to provide the clearest and most popular regulatory framework for new business models and governance structures for decentralized networks. The French Minister of Economy publicly stated that France will not miss the blockchain revolution and will become the global center of ICO.

Switzerland has published a very clear regulatory framework for a pass-based network. The Chancellor of the Exchequer has published an Encrypted Assets Task Force to create a constructive regulatory framework for the CV. The small European countries, Malta and Liechtenstein, are pushing the management approach more fully at full speed, trying to become the global hub for decentralized networks and related businesses. In the more common use of data, the United States is known for its unregulated use of artificial intelligence for business-driven use, while China is known for the excessive expansion of totalitarianism that artificial intelligence can cause. There is now a saying about the third road, that is, ethical artificial intelligence, Europe may take the lead in trying this new path. This path builds on the framework provided by GDPR and, combined with the power of artificial intelligence, actively absorbs cryptographic innovations while providing more personalized service while still respecting personal privacy. (block rhythm BlockBeats Note: EU Payment Service Revision Act 2nd Edition (English Payment ServiceDirective 2: PSD2)

The Fabric's Action Plan

As a venture capital fund, our primary goal is to select the best and most discerning entrepreneurs and technicians as partners in the areas of concern. In the next chapter of this article, we will briefly outline our approach to achieving this goal and how to increase the value of the network overtime.

Grassroots procurement

The wave of technology has enabled new business models to thrive on new technology platforms, but the shift to decentralized data networks can enable monetization within the framework of the network's basic protocols, that is, in the application and business layers. Can make a difference. Thus, contrary to the wave of technology in the past, this new wave of technology allows more early value creation to be concentrated in the technology infrastructure layer built by developers for developers.

As major technological advances between Web 2.0 and Web 3.0 are gradually integrated into successful applications, consumer-facing applications can be iterated at a minimal time to increase usability. Consumers will overcome some of the psychological barriers that previously felt unnatural in use cases, thereby fostering new usage habits. Newmarket strategies and distribution formats will provide full support for new products and new markets, such as financial incentives, token airdrops, and decentralized app stores.

We believe that in the next 2-3 years, the most interesting projects will be concentrated in the infrastructure layer: development tools will serve development teams in areas such as smart contract libraries and data management frameworks; basic tool innovations for these blockchain networks will Drive Web 3.0 transformation for individual and institutional investors and provide underlying protocols for computing, storage, and data privacy. (* Block rhythm BlockBeats Note: In 2018-2019, a large number of the underlying public chain projects appeared, and they did very well)

Therefore, as investors, we will focus on sourcing innovative projects from developers, refer to their Github project, use this as a basis for judging whether they can develop and adopt leading technologies, and evaluate their decentralized applications. Fit in the stack. Our venture the capital team will continue to catch up with the times and actively transform. In the future, our biggest investment will be invested in (and contributed to) the hackathon, rather than through entrepreneurship promotion activities. In this era of software control and open source, the developers are the new behind-the-scenes, and they are the ones we will spend time with.

The time to subvert the industry is ripe

It is undeniable that Bitcoin introduces a viable digital value storage method that can even serve as a substitute for government legal currency and gold. By combining a limited supply with a constant ledger book, we believe that this wave of technology will bring a host of new opportunities, not just a new currency. In the financial sector, we believe that compliance will be automatically embedded in the transfer of each asset. Credit scores and premiums will be dynamically adapted to a large number of data sources distributed across the globe, and the concept of the entire capital market will be modular. Processed as a basic programmatic financial element: an open, unlicensed building block that can be easily assembled into any financial application, using data sets that can be imagined by anyone Assets in the market.

Similarly, there are significant opportunities in redefining supply chain management, including inventory tracking and origin verification across multiple vendors, as well as automated credit financing and auditing. Especially in the automotive sector, this shift has opened up a set of operational and interactive systems with new possibilities across automotive data sharing and vehicle tracking across manufacturers. Online, the universalization of universality makes it possible to make global ownership of digital assets. Although it involves only simple encrypted collections at first, the process will inevitably evolve towards subject identity and certification. Peer-to-peer data, software licenses, and work providers can be revived into their true form, without the need for Airbnb or Uber to get a slice of each transaction.

Because of the lack of trust between people, there are still a large number of middlemen in our transactions today. By abstracting the elements of trust, decentralized networks will not only fundamentally change our business operations for all existing departments. The view, and will also introduce a new business model based on the original business model generated by the P2P environment.

Active network participation

As we mentioned earlier, the role of investors in this area is also undergoing fundamental changes. Simply locking and regulating our assets will not only miss the potential rewards of a dramatic increase in the network but in many cases, even the negligence will damage the project itself. These digital assets are designed to motivate all participants to participate in the process of value creation: from providing capital to working and using it.

Proactive network engagement can take the form of block verification in PoS network transactions in exchange for block rewards, or mining in the Merkle mine. Also, you can focus on providing the network with the ideal resources available in exchange for user fees, such as storage resources, data resources, or registry management.

By designing appropriate incentives in these networks, individuals and professional service providers will quickly deliver services to earn returns and expenses. In a competing decentralized network, network providers will follow the footsteps of network participants, who are likely to flock to a network of many network providers to form a chicken or egg. The problem of raw chicken. Also, if you look at it from a vacuum, you will find that there is a risk that participation in early network development is not an economically viable option: relying on transaction costs in a network without transactions, or before there is no buyer. The ocean protocol network (the ocean protocol is a block-based data exchange protocol for unlocking data and providing users with fair results) provides data streams that will incur losses.

Except for early investors, no rational actor will cater to this particular scenario. Because the return on venture capital funds is mainly achieved by maximizing the likelihood of exceptional success for each investment, the potential for us to achieve exponential results in the network exceeds the supply and development network. The sunk cost. Therefore, we intend to help the network we invest in to crowdfund their supply providers, not limited to internal selection or proxy, and we will openly commit ourselves to the network projects we invest in, the networks they build. Active participation. We've outlined how to run nodes in the Ocean Protocol, provide data for data streams, and work with the companies we invest in to prepare for their network startups.

Accidentality in acceleration

We believe that extraordinary things can happen by actively participating in community value creation and connecting smart people. By immersing ourselves in this community, we not only find the best opportunities at an early stage, but we also create a network that contributes to the the successful growth of our portfolio. To this end, we have organized a series of events with different forms and purposes. The purpose of each activity is to bring together a specific group of people to solve specific problems, including:

Regular technical meetings: bringing together the developer community to collaborate on research and development issues in infrastructure, the economy and adoption;

Large conferences like CogX: Focus on introducing Web 3.0 to a wider audience, showcasing the latest in research and development, and helping businesses, governments, and investors adapt to emerging business models;

Founder's Annual Summit: An intimate gathering to showcase the progress of each project in the portfolio and proactively match these projects to other partners in the ecosystem;

Talent Dinner: We will take the initiative to match talented engineers, product designers, cryptographers, community builders or operational stars with projects in our portfolio.

Fabric House

We are building the Fabric House and are firmly committed to bringing together the smartest developers in London around us and working together to build a decentralized data network. Due to the nature of open-source software development, most projects are distributed teams and there is no solid foundation. We believe that for developers building decentralized networks, flexible collaboration spaces not only provide opportunities for inspirational collisions between projects but also become one of our most valuable resources. Similarly, no matter when we stay in Berlin, we are residents of FullNode – a space that Gnosis and Cosmos have built for blockchain projects.

General Market Status Report

In January 2018, we released a regular release of the Census Market Status Report, focusing on the quantitative trends of the CIS ecosystem, as well as qualitative analysis of major developments in the field, in-depth studies such as the evolution of funding mechanisms, and insight into the global cryptocurrency center. Trends, understanding development activities that leverage market corrections and regulatory environments in emerging markets. This the report not only helps us stay ahead in the ever-changing European and global arena but also enables us to be attracted to them by attracting mature and emerging projects, exploring the talents of the ecosystem, academic and industry associations.

The report has been translated into 4 languages and has been cited by more than 100 media publications and well-known interviews, including university lectures. The reports of these two versions have become an important reference for understanding the development of this field. In the future, we intend to supplement the report with more regular newsletters (including selected pieces of data).


How does Fabric recruit?

As in the Web 2.0 era, talent is the driving force for innovation in the decentralized Web and the scarce resource for the best projects to compete directly with each other. Since our goal is to invest in the project at the beginning, recruiting for the team will be one of the top priorities we can participate in. We are building a well-planned community of talented engineers, product managers, and community builders to programmatically match them to related projects in our portfolio.

First, we use an internal social mapping platform to proactively identify potential candidates through Github, Twitter, Reddit, and other networks, and tailor them to the projects, locations, interests, and reputations they have previously participated in. recommend. Also, we regularly host a series of events and dinners for developers, with a focus on further cultivating offline physical communities and allowing projects in our portfolio to share their vision and collaborate.

Not limited to known investment vehicles

We have been keeping pace with the rapid changes in investment tools over the past two years, and certainly will not evade further tool iterations in the future. From equities, certificates to SAFTs, SAFTEs, and securities pass, the milestone value-adding investment tools that can promote governance are still being improved. To avoid being tied to any technical constraints in the future, Fabric Ventures insists on the agnosticism of asset forms. We will not ignore new investment tools, and naturally, we will not miss opportunities. We will try more tools and apply them to network participation, regulation and liquidity management.

Correctly treating liquidity

Despite the considerable liquidity of the VEx market, Fabric Ventures will be patiently investing in digital networks for a long time. We have invested in teams that are building significant technology and continually improving user adoption, which can take decades.

However, a highly liquid market does provide our portfolio with day-to-day pricing and double the value of the undervalued positions we already hold. Unlike holding traditional stocks, as the venture capital fund ends at the end of a project's life cycle, the certificate will be easier to sell and will not harm the project. As cryptocurrency exchanges are fully regulated and may include a chain compliance framework, we are fully capable of selling passes to qualified investors in the open market without having to promote IPO or project acquisitions while retaining over-the-counter transactions. Larger buyers are buying options for the pass.

It is because of this liquidity that our venture capital funds also have the opportunity to make way for strategic participants in capital or networks with different risk/reward perspectives, which may ultimately increase the value of the remaining certificates. If we believe that a team or project has deviated from our direction during our investment or is unable to promise a return corresponding to the level of risk, then we may also choose to sell a successful project, or be forced to quit quickly. These liquidity models are still in areas that require further development and iteration, just as these investment vehicles are like a broad-based fork for the venture capital model itself.

In conclusion

The new wave of technology-centric waves centered on blockchain technology not only represents the intergenerational transformation of computing architecture, but also the transformation of organizational principles. A new wave of people-centric services intertwined our unprecedented intimacy with our daily lives. For humans to believe that their machine partners will not abuse the ever-increasing data torrent, we need privacy and incentives driven by cryptocurrencies. mechanism. We believe that building a Web 3.0 with flexibility, security and privacy protection from the technology infrastructure, development tools, and data management framework has a long way to go.

To support this vision, Fabric Ventures is adapting the patient risk investment model to make our investments more responsive to development projects for decentralized networks – selecting the most daring technicians and communities at an early stage, in their overall project development and The operational phase provides full support and is an active participants in the network they are building.




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