Today the European Investment Fund (EIF) and Luxembourg Future Fund (LFF) confirmed they invested €25 million ($30m) in Fabric Ventures‘ 2021 Fund. The Luxembourg venture firm reached the first $100 million close of its $130 million fund.
Other backers include 42 founders, partners and executives from Google, PayPal, Ethereum, Wise, Atomico, Galaxy Digital, the Digital Currency Group and others.
“Despite their rich engineering talent, deeptech entrepreneurs in the Blockchain sector in Europe often struggle to find financial support and investors that have a deep understanding of their space,” said Alain Godard, EIF CEO. “This partnership seeks to address that need.”
He continued that blockchain is an area of “particular strategic importance for the EU and our competitiveness on the global stage.”
This is the first fund that can invest in digital assets, following previous investments in blockchain technologies. It’s part of the EU’s InnovFin Artificial Intelligence and Blockchain Technology pilot backed by EFSI (European Fund for Strategic Investments).
Fabric’s focus is on the ‘open economy’, in contrast to what it sees as ‘closed economies’ which centralize “data and power in the pursuit of profitability”. The fund will invest in equity, tokens and digital assets.
“Fabric’s new fund will be put to work partnering with the most daring and relentless entrepreneurs of the open economy on their journey to architect lasting protocols and platforms, not simply companies”, said Richard Muirhead, Co-Founder and Managing Partner at Fabric Ventures.
To date, Fabric has made 35 investments across blockchain protocols, Decentralized Finance (DeFi), and more recently non-fungible token (NFT) platforms.
The European Investment Fund is part of the European Investment Bank (EIB) that issued a €100 million bond on the public Ethereum blockchain in April. Last month the EIB published a report saying there is an EU investment shortfall in blockchain and AI technologies to the tune of €5 – €10 billion ($6-12 billion) per year.