EchoVC launches an $8M new fund to invest in blockchain startups
Lagos-based VC firm, EchoVC, has launched EchoVC Chain, an $8 million pilot blockchain-focused seed fund.
By Anna B Kiwanuka
An $8 million pilot blockchain-focused seed fund has been formed by Lagos-based venture capital firm, EchoVC. EchoVC is a technology-focused early-stage VC firm focusing on investing in underrepresented founders and neglected markets.
Commenting about this, the firm’s team stated in a blog post, “Over the past few years at EchoVC, we have become intrigued with blockchains. The more we explored, and learned, the more excited we’ve become about blockchain applications and their functions in Africa.”
The team added, “For African markets, we believe blockchain functionality is more of a need, rather than a want. Our thesis is to leverage these functions to enable new leapfrogs or unlock novel market opportunities, across the continent.”
According to the Venture capital firm, the EchoVC Chain is an $8 million pilot seed fund focused on making investments in founders and startups that span EchoVC’s specific areas of interest. The company has been excited with two capabilities of blockchain, that is to say, the ability to abstract or tokenize, and the ability to scale autonomously.
The Venture Capital firm also noted, “However, our perspective on the applications of blockchain in Africa traverses multiple layers. Our first layer of focus is on foundational fintech infrastructure. This includes infrastructure leveraging stablecoins to optimize payments, liquidity, and treasury; and also explores the unbundling and delivery of crypto/fintech building blocks, or “primitives” – which other companies can utilize to scale faster. The second layer above this targets blockchain functionality. DeFi functionality can be leveraged in Africa for innovative financial products improving access to credit and savings, or perhaps powering new-age decentralized neobanks. NFTs can serve to foster the creator economy for the rising Gen-Z, enable games to provide new ways to earn, or even fractionalized real-world assets and portfolios to lower affordability barriers to investments.”
Furthermore, EchoVC is excited about the prospects of DAOs, not just for their ability to scale autonomously, but also to organize human networks.
The company stated, “Examples in Africa are social collectives and informal markets, which are key strands of Africa’s offline economic fabric. DAOs can organize the offline and informal networks in a way that is beneficial for all participants. This should unlock labor liquidity and increase earning potential for the bottom-of-the-pyramid demographics. Other examples include decentralized agent networks, social networks, as well as gig networks.”
Conclusively, the company also noted, “Looking beyond this, we continue to explore other emerging blockchain aspects ranging from digital identity, privacy, decentralized infrastructure edge nodes, and agile supply chains to a possible future intersection between AI/ML and DAOs. On the regulatory side, we continue to observe the evolving landscape. Our view is that regulation is required and will have a positive impact to help guide innovation, improve stability, and remove frictions that still exist between decentralized and centralized worlds.”
“One aspect that we are tremendously excited about is the advent of central bank digital currencies (CBDCs) as the digital version of cash, channeled through the banking system – to remove friction in access to financial products, streamline cross-border payments, and enable programmable local money,” the company added.
EchoVC, which says its mission is to be the Sequoia Capital for underestimated founders and markets, has invested in almost 40 companies across various markets worldwide and made its first investment in the blockchain segment in 2021.