Sunning my bitties and investing in ASIC mining farms, how about you?

"Thinking it’s 'too late' to get into #Bitcoin is an illusion of the ego." -

Excited to be kicking this off.

ego death capital raising $100 million Fund II

In 2021, ego death capital was officially launched as a venture capital firm. Andi Pitt, Nico Lechuga, and I, along with Preston Pysh, Lyn Alden and Pablo Fernandez as advisors, saw an emerging opportunity to invest, through ego death capital Fund I, in companies that would both accelerate the Bitcoin ecosystem and allow us to work alongside some of the most amazing entrepreneurs of our time. Most of the “smart” money at the time still hadn’t realized that #Bitcoin was emerging not only as the preeminent store of value, but equally important, the first layer (tied to energy) of a new peer-to-peer decentralized internet of money. Because of this, many venture funds didn’t understand the difference between Bitcoin and everything else, which is probably still true today. Bitcoin was scaling in layers and there was now an opportunity to build enduring businesses on a stable and secure foundation. The thesis of Fund I was to take advantage of that asymmetry in knowledge and help the best entrepreneurs build value for users. The #Bitcoin ecosystem at that time was still quite small. We raised $25.2 million in Fund I + a $7.5 million SPV to ensure a disciplined focus on companies that could be enablers of the transition underway.

We’re extremely proud of the entrepreneurs in our Fund I portfolio companies, their teams, and their success to date. So far in Fund I, we have led funding in Fedi, Breez, Synota, Relai, and Wolf, along with two companies in stealth. Our thesis proved correct, and many of our portfolio companies (as well as others in the broader Bitcoin ecosystem) are now experiencing incredible growth, with much more expected on the horizon. Real companies, bringing real value to users – and growing as a result.

In 2024, the funding market still hasn’t caught up to the opportunity, and a significant gap exists in Series A funding for Bitcoin only companies. This makes sense because a majority of venture capital still doesn’t understand the transformative nature of the Bitcoin protocol nor how it is emerging in layers. Without this key knowledge, it would be hard to understand the profound shift this entails to businesses in the future. This leaves Bitcoin only entrepreneurs not only pitching on the value and metrics of their business, but in parallel trying to “teach” capital that has been burned with their crypto investments about a new protocol. To add insult to injury, it is many of these same Bitcoin only entrepreneurs who warned of the various scams in the crypto/web3 market in the first place. It’s not a stretch to say that those building on Bitcoin prefer a partner who understands and is focused on it. For any entrepreneur, it is hard to imagine building enduring trust with a financial partner who doesn’t share your world view.

One of the most exciting things about the Bitcoin space is the extraordinary talent it attracts from all over the world. Having a front row seat at the profound shift that the internet demonstrated and how it attracted the best and brightest, I honestly didn’t think I would have another chance to experience it. Instead, we’re experiencing something even more powerful than the rise of the internet. An exponentially growing talent pool of entrepreneurs, users, and capital who fully understand that the most profound challenges of our time are unable to be solved from the very system creating them. Who instead of trying to optimize from within that broken system, have decided to focus their time, talent and capital on a parallel system built on Bitcoin that changes the world.

That dedication applies to our team too, we are very excited to announce that Lyn Alden and Preston Pysh are joining Fund II as partners. Through their work as advisors to Fund I, we already know the incredible value to the fund and companies in it they provide. In addition to our new partners for Fund II, we are adding renown Bitcoin and Lightning Network expert, Lisa Neigut alongside Pablo Fernandez as an additional technical advisor. We are also fortunate to add Pete Briger (Chairman of Fortress Investment Group) as an advisor to Fund II. Besides being a long time Bitcoin advocate, Pete helped to build Fortress into one of the preeminent financial firms of our time. These moves deepen our own bench with incredible people so that we in turn can continue to deliver value to the entrepreneurs and investors we serve.

While it is still early and there will be many ups and downs along the way, a transition from the world operating on top of a dishonest ledger, to the world working on top of an honest ledger is firmly underway. That transition will create incredible business opportunities, while bringing hope and abundance to billions of people around the world.

We feel super fortunate to be a part of it.

Read the full release here:

“Responsibly all-in.”

“I like the orange coin. A lot.”

My research and audience straddles the macro finance world and the bitcoin world. And so humorously, I get heat from both sides.

“Lyn, I love your macro work but you’re too obsessed with bitcoin; I wish you would focus less on that stuff.” -hedge fund reader.

Vs

“Lyn, since you’re a fellow bitcoiner, why do you only have a 5-10% allocation to bitcoin in your public model portfolios!? Shouldn’t you sell all your stocks and buy more?” -fellow pleb.

I talk to many institutions, as well as high net worth individuals, and medium net worth individuals like engineers and doctors. This is where individual situations come into play. I had been watching bitcoin for a while, publicly wrote about it near the top of the cycle in 2017 and (correctly) passed on it from that point, but then kept watching it during the bear market and then hardcore jumped into it during the March/April 2020 crash starting at $6,900/coin as a long-term bull, and haven’t wavered since.

For example, 2.5 years later as Bitcoin crashed amid the FTX fallout in November 2022 from 69k to sub-16k, I was at Pacific Bitcoin laughing about it. I was not uncertain.

In those initial months of 2020, I put every dollar of my liquid capital into bitcoin. I didn’t sell my existing stocks and trigger capital gains tax, didn’t withdraw from my IRA or 401(k), but otherwise most of my existing liquid cash and all of my incoming earned cash went into bitcoin. I threw like a quarter of my net worth into it. And it paid off. For me as a conservative investor, that was my version of “all-in”. I wasn’t fucking around. I never go all-in like that, but I did it for bitcoin.

I grew up poor, and then worked for 12 years in engineering and engineering management. There is no world where I would invest in such a way that there was even a 1% chance that I could be wrong and lose my entire net worth and the past 12 years of my work at that point. I would never be 100% invested unless I consider it to be risk-free, and I consider nothing to be risk-free, and so I diversify by default. I am conservative as a baseline, but opportunistic when appropriate. I put at most 5% into any one stock, but I threw 25% into bitcoin as an anomaly due to how bullish I was. My husband was like, “what are we doing?” and I was like, “trust me, here’s why”.

And then, there are eight family members and associates who, if I were to go broke, would have to radically diminish and change their lifestyles. Their housing support and their everyday income comes significantly from my earnings. It’s like running a small business. So, when I see people on social media be like, “wHy DoN’t YoU gO aLl iN?” I’m thinking like, “Bitch, I’ve gone about as all-in on this new distributed ledger as I can while still sustaining a reasonable level of lower volatility equity and other assets for tangible income and fallback support for eight people”. And then I realize the anon who wrote that is probably a single dude in his parents’ basement, and my response is unwarranted. Don’t let anons on social media affect you.

For example, our extended family ran into a liquidity issue and had to change households this year, and we got a good real estate deal but it was based on me having six figures in liquidity to just throw around at short notice, which meant having maintained adequate diversification for that possibility, which I was anticipating.

In my model portfolios, I began to recommend a 5% bitcoin allocation in early 2020, and then I took some chips off the table in 2021 near the highs after a 3x and 5x gain as Musk was pumping Dogecoin, to rebalance back down to that 5% target. Why? Because not everybody has put a thousand hours of research into it and can realistically put a quarter of their liquid net worth into it. My point was, “your portfolio has zero bitcoin, you should probably have at least 5% bitcoin, and better yet, you should buy bitcoin non-custodially at whatever size is appropriate for you. As it soars, rebalance. As it falls, buy back in.” That rebalancing worked well for my public portfolio. I warned of exuberance, leaned into fear, despite not trying to predict any short-term price action.