Crypto investment fund Galaxy Digital Holdings announced that its entertainment-focused affiliate, Galaxy Interactive, has raised a second $325 million fund. The capital is from over 70 different sources, including institutional investors, strategic investors, and family offices. Galaxy Interactive’s venture fund is part of Galaxy Digital asset management, which managed a total of $2.2 billion in assets as of the end of September.
Galaxy Interactive was founded in 2018 with a first $325 million fund managed by general partners Sam Englebardt and Richard Kim, targeting the entertainment sector, especially gaming. Although the focus of Galaxy Digital is blockchain and digital assets, Galaxy Interactive also funds projects that are not directly blockchain-related.
The previous fund invested in over 60 interactive companies, including Mythical Games, GreenPark, Genvid, Immutable, and Bad Robot Games. Of the latest $325 million fund, $150 million has already been invested or earmarked, including for 15 additional companies.
Englebardt and Kim’s investment thesis is based on the younger generation becoming ever more digitally native. That means digitally based entertainment, whether through gaming or other engagement opportunities, will increase in relevance and profitability in the coming years.
In 2018, NFTs had their first round of enthusiasts with CryptoKitties and CyptoPunks. But play-to-earn initiatives and substantial blockchain-based games were not on people’s radar. That has changed this year with various NFT auctions making headlines and more games in the industry, such as Axie Infinity becoming mainstream.
“The prescience Sam and Richard have had with respect to this sector has been uncanny,” said Galaxy Digital founder and CEO Mike Novogratz. “They were the first people to pound my desk insisting that gaming and digital objects – which weren’t even called “NFTs” yet – would provide the biggest opportunity for blockchain technology to scale and that Galaxy Digital needed to specialize in this space. Fortunately, we listened, as the companies in the portfolio they’ve built and the pipeline they’ve created are going to have a profound impact on both the real and digital worlds.”
Besides Galaxy Interactive, Animoca Brands is also making strategic investments in a series of blockchain-based gaming initiatives. It invested in a pawnshop-like initiative for play-to-earn NFTs, acquired a majority stake in Bondly, participated in the funding of DeFi platform Vera, and invested in play to earn community Yield Guild.