The co-founder of Kravis Kohlberg Roberts (KKR), Henry Kravis, has reportedly invested in an alternative fund focused on fintech and blockchain opportunities. Kravis joins a list of outspoken Silicon Valley investors who have defied traditional thinking and embraced the rise of innovation in distributed ledgers, as reported by Bloomberg, June 28, 2019.
Raking in the Big Names
KKR is one of the most significant private equity funds in the world, with a global presence stretching from Asia to North America. Henry Kravis is undoubtedly one of the most influential names in the investment management industry, having founded KKR and driving it to the top of the chain.
Henry Kravis is said to have invested in ParaFi, an alternative investment fund, according to the fund’s founder Ben Forman; Kravis’ spokespersons declined to comment. With this investment, Kravis joins the likes of Peter Thiel, Marc Andreessen, and Naval Ravikant – Silicon Valley tycoons who have pledged their money to help the cryptocurrency industry grow and prosper.
ParaFi manages close to $25 million, meaning Kravis’ investment in the space is not sizeable but is nonetheless common for any portfolio with tight risk management rules. Ben Forman was an ex-employee of KKR who wanted to set up a digital assets division at the firm. It was quickly made clear to him, however, that this wouldn’t provide him with the optimal set up to truly harness the investment potential of digital assets.
Among other investors in ParaFi are Bain Capital and Dragonfly Capital Partners, both of whom are well-known names in traditional venture capital and private equity. Salil Deshpande, a partner at Dragonfly, believes ParaFi is well set up to capitalize on high returns in a misunderstood asset class that provide asymmetric risk-reward opportunities.
Currently, the market is not yet at a stage of maturity, which means investments still have the potential to yield parabolic returns. Those who invest in uncertain, however high potential investment opportunities will reap the highest degree of rewards.
Most large investors will enter the space when the market is not yet mature but still has proven its capacity to execute and scale. Presently, it seems as though the opportunity to push large sums of capital into the space is ripe and attractive to a wide variety of names.
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