Arete Capital, McKenna’s newly created investment firm, launched its first hybrid fund on April 1, targeting $20 million.
McKenna is a well-known cryptocurrency and derivatives trader who most recently served as a researcher at ROK Capital. They created the fund with co-founder Ilya Paveliev, who has traditional investment management experience and was previously head of growth at blockchain infrastructure company Haruko.
The founders told The Block that the fund has reached approximately $10 million in commitments by launch and expects to close the full amount over the next two months.
Half of the funds will be allocated to venture investments and the other half will be allocated to liquid token investments. It will primarily focus on institutional DeFi, real assets, blockchain gaming, and other emerging cryptocurrency ecosystems.
The fund has appointed three advisors. Collin Erickson, an independent advisor on projects such as Centrifuge; crypto anon SparkC, co-founder of cryptocurrency gaming group WolvesDAO; And there is a cryptocurrency called Odysseas, created by an engineer at Phylax who previously worked at Nomad.
Fund Settings
The two founders said they met less than three years ago through a group of people in central London who had switched from traditional finance to cryptocurrency. They stayed in touch during the bear market following the collapse of cryptocurrency hedge fund Three Arrows Capital and cryptocurrency exchange FTX.
McKenna said rock-bottom prices and low sentiment suggest now is the perfect time to leave research and start your own fund. They joined forces with Paveliev in the second half of 2023, seeking to combine the latter’s institutional knowledge with their cryptocurrency-based experience. They also began publishing cryptographic protocol research articles under the name Arete Research.
“Arete Capital is basically an evolution of Arete Research and us having very complementary backgrounds,” McKenna said. “And we think we have the capabilities to produce these first-tier managers over the next three to four years.”
The team plans to make a few strategic hires over the coming months, but maintain its workforce size.
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