Odaily News Tom Dunleavy, partner of MV Global, said in an article on X that no project in the cryptocurrency industry needs more than $10 million in financing. The reason why projects such as Berachian, Monad, Abstract, and Movement were able to complete huge financing is entirely because VCs need to give them so much money.
When a VC completes fundraising of more than $300 million, it will not be able to effectively deploy these funds unless it continues to make investments of more than $20 million. Even if you invest $5 million each time, you must invest in 60 projects, which means you need to conduct due diligence on more than 1,000 projects.
What project needs $20 million in funding when marginal fixed costs are so low and AI productivity is growing? VCs are essentially providing these new companies with 5+ years of…working capital, and these projects can get additional funding when the token is issued, which creates terrible incentives for the project owners.
Tom finally called for no more financing exceeding $10 million and no more valuations exceeding $100 million.