I recently became an Advisory Partner for 44 Venture Opportunities (“44”), a thesis-driven VC firm that operates at the cross section of blockchain, real estate and emerging proptech.
I came across 44 because we’re on the cap table in a few deals together, and I’d heard great things about them from multiple Founders.
What distinguishes 44 from other VCs is its well-defined focus on the foundation of blockchain technology and the future of real estate. My experience of being in the industry is that most PropTech VCs haven’t merged their understanding of the [traditional] real estate value chain with the efficiencies blockchain enables from a transactional, company, and/or sector view. At the same time, Crypto focused VCs tend to favor digital assets such as gaming or art rather than real world assets (or “RWA”), while Generalist VCs have made some bets in the space, but they don’t have any deep expertise or value-add (in fact, generalist firms are a source of deal flow for 44). 44 was the first and only VC I’ve come across with a defined focus and the deep industry experience to execute a scalable and repeatable investment strategy at the intersection of Real World Assets & Blockchain.
Why I Became an Advisory Partner
I’m an active investor in the real estate tokenization space through my family office, and also in startups in the ecosystem such as HoneyBricks, AKRU, QuantmRE, Robinland, and Lofty. I’ve personally invested in startups that are bringing real estate onto the blockchain because it represents one of the few real use cases of Web 3.0 technologies with disruptive potential.
Something that specifically drew me to 44 was their thesis-driven approach. Thesis-driven investing involves building your strategy around a particular assumption about a market, trend or vertical, and what specifically caught my eye within their thesis, bringing everything full-circle, was a focus on real-time compliance (or as they call it—‘compliant-tech’) embedded within blockchain enabled use cases, which will inevitably be the driving force behind the next evolution of the [real estate] asset class, resulting in unparalleled transparency, security, scalability and liquidity to proficiently unlock Trillions ($) in global real estate equity.
In addition to having a clear mission and the drive to achieve it, 44 operates at the crossroads of two major industries—blockchain and real estate. The entire cryptocurrency market is currently valued at around $800 billion, while the value of Apple alone is 3x that, around $2.4 trillion. Meanwhile, the global real estate market was valued at $300+ trillion in 2020. Therefore, we cannot even begin to imagine the opportunities that lie in the overlap between these two markets in the coming years.
From my point of view, the introduction and advancement of blockchain technology in real estate is bringing two important benefits. First, the tokenization of real estate assets is democratizing the real estate industry, which has been notoriously infamous for its exclusivity and limited access due to numerous structural barriers. Now, through blockchain tech, many new stakeholders can enter the real estate market—whether via fractional ownership or other strategies. Additionally, everyone involved in real estate can benefit from the entry of new players and the democratization of the market.
Second, through its core principles and methods, blockchain technology boosts transparency and accountability. These are two areas where real estate typically performs poorly. Once again, the market will perform better and all stakeholders will experience a positive impact with more transparency in real estate transactions.
Finally, I am thrilled to be supporting 44 due to the snowball effect. When investing in a single tech company, I can affect the operations of its customers. When spending my time with an entire fund, I can help improve things for all of the startups they invest in as well as all customers of these startups. This scalability of my efforts is a major advantage, from my personal perspective.
The 44 Venture Opportunities Team
Another key strength of 44 is that they bring together entrepreneurs/repeat founders, investors, and operators that are uniquely aligned to offer unparalleled domain expertise.
The team includes experts with the following backgrounds:
- Google (Wharton/Stanford alum): Head of Growth Marketing + Tech lead manager
- Coinbase (Wharton/Stanford alum): Marketing data platforms + Head of Custody Engineering
- Morgan Stanley, Deutsche Bank, MKP Capital (Wharton/NYU alum): institutional real estate finance – securitization/syndication, CMBS, Freddie Mac, relative value & subordinate debt portfolio management
- Northrop Grumman, Battelle (PhD Stanford): Engineering
- 6x Start-ups collectively (Stanford/UCL alum)
- Plume, Calix, Juniper (Cornell): Product management-marketing-engineering lead
I’m thrilled to be part of the team and continue being at the forefront of technology disruption in the global real estate space.
Market Size and Impact
The 44 Venture Opportunities business model is based on an analogy that compares the current state of blockchain & digital asset adoption to the adoption of the internet in the very-late 1990s or mobile in 2007-2008. In other words, we are approaching the next golden era of financial technology innovation.
On-chain tokenization alone is forecasted to reach between $16 trillion (conversative scenario) and $68 trillion (best-case scenario) by 2030. This is a major market opportunity, to say the least. The development of tokenized asset adoption is being driven by the rapid growth of the Web3 space.
As the adoption and engagement of blockchain technology increases among institutions, a regulatory framework will certainly emerge, proving the necessary validation behind blockchain and tokenization, as many still look at these with a certain dose of skepticism and suspicion. This is understandable for such a revolutionary and technologically complex concept, but we can definitely expect to see the normalization of this trend in the coming years. For now, it is important to separate digital asset price volatility from ongoing tech development and adoption, while knowing a solid regulatory framework is a key factor for the development of any industry, especially one that involves a market with such a huge potential impact.
Early Success and Traction
Currently, 44 Venture Opportunities is launching Series II of 44 Venture Fund Master after an impressive Fund I start and are seeking investment partners which are equally excited about the long-term prospects of the space.
Commencing Q1’22, they took a nimble yet aggressive approach; utilized an expansive network built on trust, reputation, domain expertise and ability to execute; solidified access to deal flow alongside globally recognized VCs; and proved their value to founders and teams.
Fund I: 30+ venture investments, 6 advisory positions. A few investments are listed below.
At the moment, the team is raising Fund II with a total fund size of $15 million, 60+ investments targeted, generally $100k-$500k per investment, $3M-$50M post valuations, 1.0%-5.0% target ownership.
Based on the success and market positioning of Fund I, I am looking forward to seeing what Fund II and subsequent 44 Venture Opportunities will achieve!