Ayre Group's VC arm eyes 10-15 blockchain deals this year

Joanna Socha
17 July 2023

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Ayre Ventures, the venture capital (VC) arm of family office Ayre Group, will look to make about 10-15 investments this year, both as part of follow-on investments and into new targets, Managing Director Paul Rajchgod said.

Although Ayre Ventures is not a typical VC fund, as it does not have LP investors and its only investor is Ayre Group's founder Calvin Ayre, it does have a similar strategy to other VC firms, Rajchgod said. Ayre Ventures co-invests with other VCs and sometimes competes with them to be a lead investor, he noted.

Ayre Ventures invests in utility blockchain companies that operate in the Bitcoin Satoshi Vision (BSV) blockchain ecosystem, he said. He added that it invests in organisations that use blockchain technology to streamline things or bring efficiency, for instance, data authenticity, auditability and security. An example is a portfolio company mintBlue, a Blockchain-as-a-Service (BaaS), which has developed an e-invoicing solution that includes the use of blockchain for ID verification of senders and recipients, improving efficiency, transparency, and reduction in the risk of e-invoicing fraud.

Ayre looks at growth companies that generate a few million dollars in revenue, have approximately 15-20 employees, and use blockchain to differentiate themselves from competitors. Ayre Ventures typically invests in companies at Series A or seed stage, he said, depending on the region. It invests approximately USD 2m-USD 3m per company, typically for a minority stake.

Ayre Ventures is "very patient" when it comes to holding companies in its portfolio, which, in case of seed investments, could last seven to 10 years, he added.

It does not have a geographical focus, as it invests in companies from around the world. It usually finds potential targets through networking and conferences, but is also approached by the targets.

Portfolio development
Ayre Ventures has made 30 investments since 2018, deploying around USD 100m, he said, and has also made several exits. At present, Ayre Group's website lists 23 portfolio companies and vehicles (including the Black Dojo incubator that focuses on BSV blockchain and which it first backed in early 2022, and its SNGLR Capital venture capital group).

Ayre Ventures does not have a specific budget for future investment, as it does not need to raise capital from outside investors, he noted.

The firm is also assessing about three to four potential exits in the next 18 months, Rajchgod said, either through an IPO or a sale, declining to disclose details about the potential deals.

In addition to its original investment in Black Dojo, fellow portfolio company nChain acquired a 51% stake in the firm earlier this year. The incubator business model is quite different from VC investing, Rajchgod noted, adding that Ayre wanted to support an "incubator that features startups making use of ‘real blockchain utility' to gain a strong advantage and disrupt certain industry leaders."

In October 2022, Mergermarket reported that nChain was considering raising more than GBP 100m in equity and would look at bolt-on opportunities, citing CEO Hakan Yuksel. In April 2023, the company invested USD 4m in Transmira in return for a 20% stake, as reported.