Author: Zen, PANews
After entering the 21st century, with the progress of technology and the rise of the digital economy, the cost and time of entrepreneurship have been greatly reduced, leading to a continuous increase in entrepreneurial opportunities and the number of entrepreneurs. However, the dramatic increase in the number of entrepreneurs has intensified competition for scarce resources, and young entrepreneurs in this group often lack experience and knowledge.
Based on this, accelerators that provide key resources and knowledge-intensive business services have emerged, becoming a key factor in helping emerging projects grow. A batch of accelerator platforms represented by Y Combinator (YC), which has incubated industry giants such as Reddit, Coinbase, and Airbnb, has become an important force in the startup ecosystem.
According to the "2023 Web3 Industry Development Research Report" released by RootData, the number of Web3 developers has surged by 66% compared to the previous period. Obviously, for the Web3/blockchain industry closely related to financial technology, accelerator platforms are also urgently needed. In fact, the Web3 industry is not without accelerator platforms, and Web3Port, which is gradually gaining popularity, is one of the representatives. With the growth of the platform, in February of this year, Web3Port announced the establishment of the 1 billion US dollar fund Web3Port Foundation, and currently manages a 10 billion US dollar secondary fund.
Recently, PANews interviewed Chris, co-founder of Web3Port, and Ken, partner and investment director of Web3Port Foundation, both industry veterans, to delve into the business, development history, and market dynamics of Web3Port, and to share their insights and thoughts on these topics.
Accelerator + Venture Capital, Building a Global Web3 Startup Ecosystem
As an early participant in the blockchain industry in 2017, Chris witnessed the gradual development of Web3 from a relatively emerging field. In 2017, Chris participated in a leading public chain project, where he was responsible for marketing operations, and this experience led him to fully immerse himself in the forefront of the Web3 industry.
In 2018, Chris participated in a cryptocurrency fund for home offices in North America. In 2020, after two years, Chris and other core members of the home office invested in over 200 crypto projects, including top projects such as Polygon and 1inch. As the number of investment projects surged, he began to explore new opportunities: is there a way to better manage post-investment projects in the pool and better support early-stage projects? This is when the embryonic form of Web3Port Labs emerged.
In 2021, Web3Port Labs was officially established. Web3Port Labs is a one-stop Web3 accelerator platform that provides comprehensive lifecycle support for startups, including investment, financing, management, and exits. In the same year, it attracted support from several well-known investment institutions such as SNZ Holding, HashKey Capital, and MH Ventures, and used the funds to expand the team and business scale, and accelerate global market expansion.
After three years of development and expansion, Web3Port is now a Web3 builder that combines a one-stop standardized accelerator platform, Web3Port Labs, and an investment platform focused on cutting-edge technology, Web3Port Foundation, aiming to build a prosperous, technology-driven global Web3 startup ecosystem.
Web3Port Foundation currently manages a 1 billion US dollar primary fund and a 10 billion US dollar secondary fund, with the majority of the funds coming from Asia, including the Middle East and Japan. The fund is managed by an 11-person team and adopts an investment strategy of "primary focus, secondary support." Ken, the partner and investment director of the foundation, was a serial entrepreneur and had worked at Citibank and Ant Group. The accelerator business, Web3Port Labs, is managed by a team of over 20 people.
"Currently, the team has a total of about 30 members, mainly distributed in Hong Kong and North America," Chris said. Although the team is primarily based in Asia, its accelerator and investment business is not limited to this region. Its investment portfolio includes decentralized GPU computing network Aethir, zero-knowledge interoperability protocol Polyhedra, Web3 social platform UXlink, and LSD protocol Puffer Finance, with approximately 59% of the projects coming from the Asia-Pacific region and 41% from other global markets.
Payment infrastructure will be the key driver of incremental growth
Since the establishment of Web3Port Foundation and the launch of a 1 billion US dollar primary fund earlier this year, Web3Port has frequently appeared in the list of investors in various financing news. In the first half of the year alone, PANews has published nearly twenty related news briefs. In the interview, Chris and Ken revealed that Web3Port is currently focusing on seven areas: AI, payment, DeFi, DePIN, social, various core infrastructure (Infra), and RWA.
Chris stated, "AI's position in the traditional market is stable, and it is unanimously considered a field of certain growth. The combination of Web3 and AI can bring many opportunities, especially in data storage, ownership, and settlement, where Web3 can play a crucial role." Ken added that in the AI race, the capital noise of Web2 has already overflowed, with traditional market AI investments reaching over 30 billion US dollars in the first half of 2024, while Web3-related AI investments are only around 10 billion US dollars. "Therefore, we believe that the future capital overflow will spread to Web3, especially at the intersection of AI and Web3, and this trend will change the original data value transmission and production relationships between models and applications."
Ken's experience at Citibank and Ant Group has made him very familiar with traditional payment systems and has given him unique insights. He believes that payment is the cornerstone of the entire digital economy, and without digital payment infrastructure, e-commerce, food delivery, red packets, and various offline QR code payments would not exist. "Therefore, we have devoted a lot of effort to the payment track, and we also believe it will be the core driver of incremental market activity in Web3." Chris also pointed out that one of the most core functions of Web3 is to solve payment issues such as cross-border payments and high-frequency transactions, and when Web3 payments can truly connect with traditional payments, it will bring immeasurable growth.
In addition, as a native financial product of Web3, although DeFi has not yet had a disruptive breakthrough, it has the potential for innovation and is still worth paying attention to. Tracks like DePIN and RWA connect the traditional market and Web3, bringing new users and asset increments, playing the role of a bridge for Web2.5. "The social field is also a key focus for us, as it can bring traffic from the traditional market into Web3. Especially projects like UXLink, with its Web2 background and traffic resources, show tremendous potential."
People-oriented, Emphasizing Team Quality and Technical Strength
Accelerators typically provide support such as funding, mentor guidance, and market resources, which are limited and therefore require a certain screening mechanism to ensure the selection of the most promising and growth-oriented startup projects, thereby achieving optimal resource allocation and increasing investment returns. As a fully standardized accelerator platform dedicated to "investment, financing, management, and exits," Web3Port has developed an innovative funnel model screening mechanism. Regarding the important considerations for evaluating project teams, Ken summarized three main aspects, including team vision, industry values, and technical strength.
"Whether it's Web2 or Web3, there are many similarities in the requirements for founders. We always believe that the project is 'people-oriented,' and the most important thing is always the people and the team," Ken believes that the founder's belief in the industry, understanding of the track, and attitude when facing difficulties play a crucial role in the success or failure of the project. "We highly value the values and temperament of the team behind the project. For individuals, resilience and outstanding abilities are crucial; for the team, the ability to form a good chemical reaction and continuously generate strong execution power is key."
In the Web3 field, there are often many short-term profit-oriented projects that engage in irresponsible behavior towards the market, investors, and users. However, there are also many teams that have experienced industry cycles and continuously refined their products, adapting to trends and iterating. Ken stated that Web3Port is very focused on a project's contribution to the entire industry and track. Some projects may quickly profit at a certain point but are not conducive to the long-term healthy development of the industry. "We do not pay too much attention to such projects. On the contrary, Web3Port has been deeply involved in the industry for many years, deeply understanding the key factors needed for the industry's health and long-term development. We are committed to promoting the construction and growth of these factors."
The third point, which is also very important, is the technical strength. Technology is the moat of the project, determining the project's future market position. "We firmly believe that every major change in the Web3 industry is driven by technology. Whether it's the early Distributed Ledger of Bitcoin or the smart contracts of Ethereum, they are all industry progress brought about by technological innovation." Ken stated that technology is like the skeleton, and token economics is the industry's blood, while marketing is the external flesh. Only with a strong technical framework can a healthy project grow.
Regarding how to identify and avoid low-quality projects that take the short-term profit route, Chris also shared some experiences for ordinary investors: First, look at the investment background; second, look at the team's product capabilities, which can be judged by using the product to assess its maturity and user experience; third, look at data traffic, such as their performance on Twitter, TVL (Total Value Locked), and other data, which can reflect the project's operational status. Chris also cautioned, "It is important to note that judging whether a project is a rug and judging whether it can make money are two different dimensions. If you want to judge whether a project will rise, that is another level of question, not just simply avoiding rug projects."
Full-Cycle Acceleration, World's First Five Standard Modules
In terms of specific operations, accelerators generally provide strategic assistance, experience guidance, and build bridges for startups based on their resource networks to help these projects achieve rapid development and accelerate the product's marketization process. As a one-stop Web3 accelerator that can provide full-cycle acceleration and investment support, Chris summarized the services and resources that Web3Port can provide into five major modules: business positioning and economic model design (tokenization), financing, marketing, listing support, and other auxiliary support.
In Web3 projects, business positioning and economic model design are crucial, directly impacting the project's sustainability, user growth, and differentiation from other market competitors, forming the foundation and core of the project. Therefore, Web3Port provides unique acceleration support by helping projects with business positioning and assisting in designing economic models to help startups establish themselves in a competitive market and attract long-term user participation. In terms of financing support, Web3Port can help projects connect with an existing network of 700 VCs for introductions to investors. Additionally, its business resource network can enable projects to complement each other through cooperation and business bonding, thereby expanding more opportunities.
Web3Port also provides comprehensive market support and guidance for projects, involving marketing plans and event planning, and ensures that projects gain broad market exposure through the use of KOLs, media, and other marketing resources. During the listing process, Web3Port provides strategic guidance to ensure that projects can successfully complete the listing steps. Finally, Web3Port also provides other auxiliary support modules such as audit company and human resources company recommendations, meeting various non-core, relatively small, specific, or limited needs of enterprises to promote the comprehensive development of projects.
Chris concluded, "Web3Port's full-cycle support covers all key aspects of financing, marketing, and listing. Unlike other accelerators in the market, we have achieved standardized full-cycle support. Our team of 20 people is responsible for different departments, such as listing and marketing. The close cooperation between departments provides targeted support according to the project's needs. This allows each department to be deeply involved, ensuring the full utilization of resources during the acceleration process, truly achieving scalable and standardized support."
Waiting for Market Opportunities, Keeping Vigor to Convey Confidence to the Market
Since the establishment of the world's first accelerator, Y Combinator, in 2005, accelerators have become an important element of the startup ecosystem. However, in the Web3 field, true accelerators are still relatively rare, and many early accelerators have already exited the market. Chris stated that many people are unwilling to start an accelerator, as the return model of accelerators is relatively indirect. "The logic of direct investment is very simple and clear, evaluating projects, investing, waiting for token unlocking, and there is a mature and transparent system in the market to support this logic."
Chris told PANews that even though he and several partners have years of industry experience and a certain industry understanding, starting an accelerator is still very challenging. He analyzed that there are two reasons: first, the returns of accelerators are unstable and often lagging; second, the industry's recognition of accelerators is also not high. Many people prefer funds or incubators because incubators can provide comprehensive support, while accelerators provide specific services on demand, such as financing or marketing.
"Back in 2021, starting an accelerator was indeed a very difficult thing, but it was valuable that we persisted." In the first two years of Web3Port's inception, the entire industry was very depressed. The market was mostly in a bearish state, and the environment was very difficult, putting accelerators that serve project parties in an even more difficult situation. At that time, the Web3Port team had less than ten people, and how to do systematic work for the accelerator was a huge challenge. When asked how Web3Port achieved multiple milestones and accomplishments later on, Chris summed up three key factors.
"First, persistence. From 2021 to the present, in nearly two to three years, we have achieved tangible results, with a project library of over 2600+ projects, which is enough to prove this point. In the early stages, we tried to prove ourselves more through the success of the accelerated projects, although this path was painful and long, it was solid and had sediment, and it was also a responsible performance for the projects and the Web3 market." He also pointed out that Web3Port has explored a standardized and scalable path in the accelerator, making substantial innovations that are rare in the current market. The last key factor for success is that the market has provided opportunities. In the first half of this year, the market experienced a wave of trends, attracting many people from traditional industries to pay attention to the Web3 field. "So, I think success is not only based on our own efforts, but also on market opportunities. And we believe that opportunities are still waiting for us."
Maintaining the Vigor of a Young Fund, Conveying Confidence to the Market
In February of this year, based on the judgment that the market was in the early stage of a bull market, Web3Port decided to launch a primary fund. Although it was established not long ago, it has already invested in over 40 projects, with a total investment of about 30 million US dollars. Therefore, will this frequent investment pace continue, and will Web3Port adjust its investment strategy according to market cycles?
"The secondary market is relatively sensitive, and our secondary fund adjusts its positions according to market fluctuations. Overall, the performance of the secondary fund has been very good." Chris believes that there is a significant difference between investments in the primary market and the secondary market, "but investments in the primary market are relatively less sensitive because the investment cycle in the primary market is longer." He stated that as a young fund, it needs to maintain its vigor and convey confidence to the market through continuous investment. "We not only need the market, but the market also needs funds like ours that can continuously empower and create value."
"Secondly, in times of market downturn, it is actually a good time to seize high-quality projects." Therefore, even in the current market environment, Web3Port still maintains a relatively flexible and healthy investment strategy, screening 100 to 200 projects each month, with actual investments in projects ranging from 5 to 10. Although the market is relatively depressed, they still maintain a stable investment pace and are more willing to seek more alpha opportunities at this time.
"Web3Port's current achievements come from persistence. I believe that persisting in screening and investing in primary market projects is necessary. This will help us maintain a high level of investment acumen. When the market improves, we may adjust our strategy in a timely manner and become more aggressive at any time. Although the current market is not as active as in a bull market, our investment pace may not be as fast as when the market is good, but we still maintain a stable investment speed. Because our fund is still young, we can use this window to give investments more time to find more alpha opportunities and high-quality targets, preparing for the bull market."
Remaining Optimistic for the Coming Year
Regarding the future market trend, Chris, who has persevered through difficult times with Web3Port, has shown cautious and conservative optimism.
"I believe the current market is in a good cycle, but it cannot be fully called the early stage of a bull market. Personally, I predict that the market will improve in the second half of this year." Chris stated that they have always been very attentive to traditional markets, as the performance of the Web3 market is highly correlated with the traditional financial market. Factors such as interest rate cuts in the United States, presidential elections, and changes in traditional financial market liquidity will all affect the performance of the cryptocurrency market, making it difficult for it to break out into an independent trend. "Therefore, first, we remain optimistic and believe that the second half of this year to next year may be a good time, based on the upward trend of the traditional market cycle."
"Secondly, I believe that the AI market and other emerging tracks may bring new opportunities." Whether it's apps or new narratives, they could create new possibilities in the market. Investments in the primary market usually capitalize on hotspots or trends. He stated that in the first half of this year, we saw a wave of enthusiasm for Bitcoin, Layer 2, and AI, and even the rise of some traffic-based projects. However, these hotspots quickly faded because they did not generate enough sustainability and cash flow, and did not bring sustained liquidity and traffic growth to Web3, nor did they create wealth and a snowball effect similar to DeFi.
"Therefore, we believe that by the end of this year and the beginning of next year, we may see new applications or narratives in the AI, payment, and DePIN tracks, which will drive the market. This is our optimistic expectation, but we cannot be certain that it will definitely happen."
Chris also mentioned the need to remain cautious because traditional market liquidity is still poor, and liquidity not only affects the blockchain market but also the traditional market. If the liquidity issue in the traditional market cannot be resolved, even with optimism, the market performance may not be as expected. Therefore, Chris believes that 2025 may be a good market cycle, but if the traditional market's liquidity is severely lacking, or if the AI bubble bursts, then the second half of 2025 may enter a period of adjustment earlier.
Infinite Possibilities for Web3 in the Middle East and Africa
Although Web3Port has always been focused on the global market's development, it is currently paying more attention to the opportunities in the Middle East and Africa markets. In these regions, the infrastructure and innovation potential of Web3 have become increasingly evident. On the afternoon of September 18th, "The Last Gold Mine of Web3," hosted by Web3Port, Klickl, and Royal Prestige Group, will be held in Singapore. The event's co-organizers include Coinlist, C1 Fund, Comma3, EVG, HashKey Capital, IOSG, Metamask, Nomad, Summer Capital, SevenX, SNZ, and many other well-known Web3 companies or institutions.
Klickl is a leading Web3 open finance platform in the Middle East and North Africa, offering a range of services including banking, digital payments, and cryptocurrency trading to facilitate seamless entry into Web3. Royal Prestige Group (RPG) is a holding company focused on promoting and developing diversified businesses in key areas in Abu Dhabi and internationally, investing in real estate, technology, biotechnology, energy, and finance to achieve sustainable long-term returns.
The conference will focus on exploring Web3 development opportunities in the Middle East and Africa. Web3Port and Klickl will jointly announce a series of major initiatives at the event, establishing the strategic position of the UAE in the new era of Web3. As a participating media outlet, PANews will provide continuous coverage of the event.
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