The VC Making A $100 Million Investment In Web3 Infrastructure

Emma Cui is a founding partner of web3 accelerator and Singapore based-VC fund LongHash Ventures. She pivoted to crypto after starting her career in banking, later moving to a role at McKinsey, which is where she met her co-founder. Cui is now on a mission to catalyze the growth of Web3 with a $100 million fund II that intends to invest in building better Web3 infrastructure.

With the market down, Cui believes that now is an optimal time for VCs to invest in companies building the foundation that will shape the future of decentralized finance (DeFi.) Over the next five years, she hopes to double down on projects that offer scaling solutions, cross chain systems and other tools that impact gaming, NFTs, the metaverse and more. I spoke to Cui about her experience working as a woman in VC, what first sparked her interest in the world of crypto, and why she is so excited about the possibilities of her new fund II.

Amy Shoenthal: Tell me about your career journey and how you got introduced to the world of crypto.

Emma Cui: It started with me buying ETH
ETH

ETH
in early 2016 after I attended Vitalik’s meet up in Singapore. I was very intrigued by the concept of smart contracts and how decentralization can open up a world of possibilities.

Shoenthal: Are you referring to Vitalik Buterin, the Ethereum founder? You’re on a first name basis?

Cui: Yes, that’s who I’m referring to. This was in early 2016, and Vitalik was only 22 at the time. The meetup took place at Singapore Management University, SMU. There were only about 50 people in the crowd. I remember being mesmerized listening to him speak on stage.

The meetup left an immediate impact on me. I went back home and started to read up on everything related to ETH. Figuring out cold storage and wallets was a massive pain back then.

That’s when I decided to look for a job in crypto. I started talking to crypto startups to see if I could find a good fit. Back then, there were very few non-technical people working in crypto and even fewer women, so I wasn’t able to find suitable opportunities. At the same time, McKinsey offered me a role to be a management consultant, helping financial institutions launch digital attacker businesses, which gave me a baseline knowledge for my next role.

A year later, my ex-McKinsey colleague Shi Khai and I decided to launch LongHash Ventures. We have since grown to be Asia’s leading Web3 accelerator and venture fund.

Shoenthal: You recently announced a $100mil fund II. What types of investments are you looking to make?

Cui: Our fund II’s main thesis is to focus on multi-chain infrastructure, particularly around innovative Layer 1s (L1s), scaling solutions such as L2 rollups or cross chain solutions, interoperability frameworks such as Polkadot
DOT

DOT
and Cosmos ecosystem, as well key modular layers such as identity, privacy, data availability. We think the current level of infrastructure is not able to support mainstream-scale retail-friendly applications, and hence, there are massive upsides in building and investing in robust infrastructure.

Shoenthal: Have you made any noteworthy investments yet?

Cui: We’ve invested in many innovative projects such as Astar, Acala, Balancer
BAL

BAL
, Lit Protocol, Parcel, Coinshift, and Safe.

We’ve always believed in the multichain thesis, which was why we were early investors in Polkadot. We worked with them to launch their first ever accelerator. Now we’re also looking into Cosmos
ATOM

ATOM
, cross-chain solutions like Axelar and other rollup solutions such as zkSync.

We’ve also recently invested in Saga, co-founded by Rebecca Liao and advised by Zaki Manian, the former director of Tendermint Labs. Saga wants to enable developers to more easily launch their own blockchain or app-chain in the Cosmos ecosystem.

Shoenthal: What obstacles have you faced as a woman in crypto?

Cui: It’s true that there are subtle differences in how women and men are treated, and it’s not just in crypto. I’ve experienced both conscious and subconscious biases when it comes to getting people to buy into my ideas or feeling like I’m being heard. As women, we owe it to ourselves to make sure that our opinions are heard. We need to punch above our weight.

We had an extremely difficult time raising funds during the 2018/2019 bear market. I was rejected countless times when we tried to set up our first fund. We had four people and we were accelerating 20 projects a year. At one point, we only had two months of runway in the bank. Eventually “DeFi summer” happened in mid 2020, and that’s when things finally started to take off.

Looking back, I think I did a few things right. First, I networked rigorously. I went to as many events as I could, did my research and built a meaningful network. Second, I didn’t take no for an answer. I have been pitching Temasek for four years, and they recently agreed to invest in our accelerator.

Shoenthal: Speaking of, you’re one of the rare VCs that also run an accelerator. Tell us more about the LongHashX Accelerator and the role you see it playing?

Cui: We were one of the first Web3 focused accelerators when we started in late 2017 and now we are the leading Web3 accelerator in all of Asia. We’ve built an extensive network and knowledge know-how to support early stage Web3 projects in a systematic and scalable way.

We want LongHashX to take on the role of trusted “co-founder” for early stage projects, not only supporting the transition of technical talent from Web2 to Web3, but to always be at the forefront of Web3 knowledge and innovation.

Shoenthal: As an investor, what advice would you give aspiring Web3 founders looking to start their own projects?

Cui: There’s so much advice a new founder needs to build a successful project. Solve for a big enough problem that you truly care about. Look for co-founders or early team members who believe in the same vision as you. Most importantly, hustle hard.

Shoenthal: There was this big push to get in early, but then there was a dip. Can you talk about the dip?

Cui: This has been said a lot, but the best building happens during a bear market. The leading DeFi protocols today were built during the 2018 and 2019 bear market. There is less distraction and less noise, which means more room for experimentation. It’s also the best time for VCs to invest because valuations are at more reasonable levels.

Shoenthal: How can we truly build accessibility and diversity into Web3 in all the ways we failed to do so in Web2?

Cui: I think Web3 holds true promise for accessibility and diversity. The entire Web3 space is built around an open and permissionless system, where anybody can have access and can contribute at any time. There is a quote by Thomas Jefferson that says, “Eternal vigilance is the price of liberty.” I think the same applies to Web3.