Two different situations in startup investments! A16z rumored to be forming its second crypto fund, while SoftBank estimated to suffer a massive loss of 13 billion USD.

While the global financial markets are facing a major downturn due to the impact of the coronavirus, many crypto funds are experiencing closures and losses. However, some well-known venture capital firms see the crisis as an opportunity. According to reports, Silicon Valley investment giant Andreessen Horowitz (A16z) is seeking to raise up to $450 million for the operation of its second cryptocurrency fund.

• A16z reportedly seeking $450 million in fundraising
• Investment firms are generally not immune to financial downturns

According to a report by the Financial Times on the 14th, a source revealed that A16z may finalize the new fund in about a week and has not set a hard cap limit on its size, and A16z has not responded to this news.

Note: Fundraising for crypto projects can be divided into SoftCap: fundraising within a certain period, failure to reach the threshold is considered a failure, and all funds are returned; HardCap: fundraising reaches the specified upper limit and ends immediately, no overfunding.

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Andreessen Horowitz is a well-known venture capital firm in Silicon Valley that has invested in projects such as Facebook, Twitter, Airbnb, Lyft, Pinterest, and Slack since 2009. It has been investing in the crypto space since 2013 and launched a $350 million crypto fund in 2018, which has invested in notable projects like Coinbase, Libra, Maker, Compound, and dYdX in the DeFi sector.

SoftBank Reports $13 Billion Loss

While firms like A16z continue to demonstrate precise investment strategies and even consider setting up a second cryptocurrency fund amid a global economic downturn, other investment institutions may not be as fortunate.

SoftBank Group Corp. recently announced its forecast for the 2019 fiscal year, estimating a $13 billion loss, primarily attributed to ill-advised investments in companies such as the Vision Fund, WeWork, and satellite operator OneWeb.

In addition, SoftBank's founder, Masayoshi Son, may face significant pressure from shareholders. The activist U.S. investment firm Elliott Management holds a substantial stake in the company and advocates for changes in corporate governance and investment strategies.

Previously, there were reports that Twitter CEO Jack Dorsey received warnings from major Twitter shareholders, accusing him of not focusing on the platform's operations and threatening to replace him. Despite the turmoil, Jack Dorsey ultimately retained his position, and one of these major shareholders is Elliott Management, which also has investments in SoftBank.

Adaptive Capital Announces Closure Following March 12th Devastation

After the cryptocurrency market crash on March 13th, Adaptive Capital decided to exit the market, stating:

The company suffered significant losses following the sharp decline in Bitcoin. The risks of continuing operations in such an unstable environment outweigh the potential gains. During the sell-off period, certain exchanges suspended operations, severely impacting our ability to respond. Therefore, we have decided to close and return funds to investors.

Furthermore, the cryptocurrency investment bank Galaxy Digital revealed its financial status during its quarterly earnings call on April 1st, reporting a net loss of $32.9 million in the fourth quarter of 2019. Its CEO, Michael Novogratz, attempted to bolster investor confidence by claiming that Bitcoin will rise before the year's end.