German Family Office Lennertz Eyes $165M for Blockchain Investments

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As a seasoned investor with over two decades of experience under my belt, I find the recent announcement by Lennertz & Co to raise $165 million for its third blockchain-focused fund of funds quite intriguing. Having dabbled in various asset classes and industries throughout my career, I’ve learned that consistent outperformance is a rare gem in the investment world, and it seems that blockchain has become such a treasure trove for Lennertz & Co.

Lennertz & Co, a prominent German multi-family office, aims to gather approximately $165 million for its third investment fund dedicated to blockchain technology. This information comes from a report by Fortune, based on an interview with the company’s investment head, Oksana Tiedt.

The company has completed the initial stage of fundraising, but Tiedt declined to reveal the amount collected at this time. This German company started considering investments in the cryptocurrency sector back in 2016 and launched its inaugural fund worth $35 million in 2020.

Targeting Blockchain VC Firms

Despite Lennertz not putting money into cryptocurrencies or related ventures directly, it channels its funds towards venture capital firms and financial establishments that are backing Web3 businesses. Its initial fund included notable entities such as Multicoin, Polychain, and Hack VC.

In 2022, Lennertz launched a second blockchain investment fund, raising $65 million. Initially, the focus was on specialist funds that specialize in cryptocurrency strategies, notably including Bain Capital, Lightspeed, and Andreessen Horowitz.

Moving forward from past victories, Lennertz is currently trying to acquire new funds for their third blockchain investment fund. Their goal is to primarily partner with prominent US venture capital firms, but they are also open to exploring potential opportunities in Europe.

As Fortune reports, approximately $165 million is set to be distributed among 8 to 10 companies, spread across both regions. The primary focus will be on American businesses, as Tiedt disclosed. Additionally, Lennertz intends to invest in the Polychain and Bain Capital blockchain funds, with an estimated annual yield exceeding 35%.

Expanding Horizons in DeFi and AI

Tiedt clarified that the reason for establishing this new fund is due to the fact that the firm’s blockchain-related investments have frequently exceeded the performance of their other investment categories.

In simpler terms, Tiedt stated that the funds are indeed providing actual returns (distributions), but in today’s tight market, everyone from private equity to venture capital firms are finding it difficult due to a shortage of such returns. Interestingly, blockchain seems to be thriving in this scenario.

Regarding market fluctuations, she revealed that Lennertz’s approach of investing in other funds instead of directly purchasing companies or cryptocurrencies, has enabled it to steer clear of the setbacks associated with market declines.

Instead, the organization aims to broaden its scope by delving into various prospects within the decentralized finance (DeFi) realm. Tiedt mentioned that Lennertz is keen on other facets of cryptocurrency, specifically cross-chain connectivity and the artificial intelligence (AI) field.

Presently, Lennertz’s total investment portfolio allocates around 10-12% towards blockchain technologies, signifying a strategic dedication to this fast-growing sector in the blockchain industry.

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2024-10-10 11:05