Female-led fund invests in deep tech and fintech companies with a barbell strategy; provides founders access to new markets in volatile times
SAN FRANCISCO, CA / ACCESSWIRE / May 24, 2023 / MarketX, a global thematic investment platform focused on venture capital deals, along with its founder Cathryn Chen, announces the launch of Radiate Ventures, a dedicated investment vehicle with discretionary capital investing in disruptive technologies focused on fintech, deep tech, and vertical SaaS.
Radiate Ventures is led by General Partner Chen, along with an investment team in San Francisco, Miami, New York, and Singapore. They employ a barbell strategy, focusing on early-stage companies (seed to Series A) and growth stage opportunities, with an emphasis on secondaries and special situations.
As economic winds have shifted, many startups have seen a drop in valuation, and venture funding has been more difficult to obtain. Radiate Ventures offers startups much-needed capital at the right time.
The Fund will invest between $500,000 and $1.5 million in seed and series A companies, and between $5 million and $20 million in growth to late stage private companies around the world, many of which are located in the United States, Asia, and the Middle East. The Fund is targeting an IRR of around 30%.
"Most venture funds originate out of Silicon Valley and tend to have a more U.S.-focused view," said MarketX Founder and Radiate Ventures General Partner Cathryn Chen. "However, the world is becoming increasingly multipolar, and Radiate Ventures finds global opportunities and picks the unicorn founders who can navigate the evolving geopolitical landscape. We look for entrepreneurial shapeshifters whose cultural diversity enables their organizations to thrive amid change."
Constructing an Antifragile Portfolio
In times of economic uncertainty like today, Radiate Ventures seeks to invest in antifragile companies, which are characterized by gaining strength from disorder.
"Looking to build a robust portfolio of antifragile venture deals means investing in uncorrelated areas, and that means identifying disruptive innovation through the lenses of geopolitical arbitrage and global diversity," said Chen.
The Fund builds this portfolio by focusing on three specific areas of innovation: fintech, deep tech, and vertical SaaS, leveraging the investment team's broad geographic reach.
"We have 10 nationalities among us on the team. That diversity of life experiences drives diversity in how we individually think about the world, and that in turn drives how we collectively identify and evaluate antifragile investment opportunities," Chen continued.
Deep Tech Portfolio Examples
"Take the energy sector, for example. We believe energy is positioned well to provide a balance to more beta-driven sectors. Energy-backed companies have performed well over the course of 2022, and stand alone as the only sector that saw growth in VC-backed exits," Chen commented.
"As geopolitical instability rises, the price of energy soars, resulting in the record profits in the sector this year. Where Radiate Ventures can add further value is helping the transition toward more renewable sources of fuel."
As an example, one of the portfolio's deep tech companies owns the technology to create green polymers that can replace fossil fuel-based chemicals. This will become particularly important to Middle Eastern countries like Saudi Arabia as they push to diversify their economies away from oil and achieve emission reduction targets.
"When I first visited Riyadh in 2019, I was awed by the startup fervor that was omnipresent in this country. It reminds me of Beijing 20 years ago. The speed of execution is perhaps even faster. They're getting the best of the East and the best of the West," said Chen.
Radiate Ventures also made a Series A investment in an Israeli company that leverages AI inference to create more advanced chips. This investment comes at a time when the global supply chain for the semiconductor industry is facing tectonic shifts due to geopolitical tensions between China and Taiwan.
Successful Track Record
The GP's track record speaks to the success of the firm's investment philosophy. Many of MarketX's liquidity events occurred in a short period of time, with several successful exits under three years. MarketX's team of local investors performs extensive due diligence to identify the best investments, which are typically unknown to people outside of those countries.
"Everyone understands the concept of ‘buy low sell high,' but most people are still hesitant to go back in the markets. In today's macro environment, companies who previously had no intention of taking outside investor money are finally open to talking to investors for additional funding. High growth private companies, even the so-called ‘decacorns,' are now forced to lower their valuation in order to raise the much needed capital in order to sustain growth. It is a perfect entry point for venture investors. All the stars are finally aligning," said Chen.
About MarketX
MarketX is a global thematic investment platform focused on venture capital deals. The firm has managed more than $250 million since inception with portfolio companies including ByteDance, Stack Overflow, Meituan, NeuReality, Airbnb, Palantir, Postmates, Tencent Music, and Emerge. MarketX is connected with more than 30 brokerages focused on trading secondaries around the world. It also has investors in more than 40 countries who want to invest and support this ever-growing startup ecosystem.
MarketX and Radiate Ventures provide institutional-grade financial products for family offices and investment funds.
MarketX started building on-chain back in 2015 with the help of Ethereum Foundation founder Vitalik Buterin to create a semi-public record of all private transactions with the aim of increasing transparency and authenticity of the private markets. In 2022, MarketX spun out another team to create Infinity Finance, which is looking to take leadership in the secondary liquidity space by allowing investors to exit their shares quickly both via fiat currency and alt-coins. Infinity Finance raised a pre-seed round at $100 million pre-money last year to pioneer the decentralization of private stock ownership using smart contracts and ERC-20 tokens.
For more information, visit www.marketxventures.com.
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SOURCE: MarketX