Sfermion Raises $100M NFT Fund as Facebook Stokes Metaverse Mania

The NFT investment firm will focus on the “experiential infrastructure that involves the NFT space.”

Nov 1, 2021 at 1:39 p.m. UTC
Updated Nov 1, 2021 at 6:02 p.m. UTC

Sfermion, an investment firm led by crypto podcaster and analyst Andrew Steinwold, says it has raised $100 million for a new fund focused on non-fungible tokens (NFTs), with contributions from Marc Andreessen, the Winklevoss twins, and Digital Currency Group (which funds an editorially independent CoinDesk).

Steinwold told CoinDesk that the fund, dubbed simply “Fund II,” will focus in on the “experiential infrastructure that involves the NFT space.”

It’s part of Sfermion’s mission to usher in the advent of the “metaverse” – a digital layer sitting on top of the real world, accessible via the internet, virtual reality (VR) and augmented reality (AR). This sort of thing has been around for years (remember Yelp’s Monocle?), but has yet to capture the mainstream imagination in a significant way.

And while some crypto investors have been consciously building toward this concept for years, particularly within the world of NFTs, metaverse fever is spreading far and wide.

Last week, Facebook changed its company name to Meta, signalling ambitions to dominate this new avenue of the internet; CEO Mark Zuckerberg said he hopes to see a billion people in the metaverse a decade from now.

To hear Steinwold tell it, parts of the metaverse are already here – and the rest is coming whether we like it or not.

“We don’t realize, ‘Oh my gosh, I’m spending literally all day on my computer, I’m spending all day on my phone,’” he said. “You almost don’t even notice it, it’s just natural. [The metaverse] is going to evolve in a similar way.”

Steinwold added that NFTs are key to metaverse infrastructure, since they can provide a form of digital ownership. “If you don’t have ownership, then really what you have is a communist-style dystopia,” he said.

Steinwold has expressed a fascination with what he sees as a “communist” internet on Twitter, too. “NFTs … give users property rights in the digital world,” he wrote in one post. “The internet just went from communism to capitalism (HUGE!)”

Steinwold, a 29-year-old Chicago native, also hosts a podcast called Zima Red; past guests have included Kayvon Tehranian, the CEO of the NFT marketplace Foundation, and Vignesh Sundaresan (a.k.a. MetaKovan), the investor who paid $69 million for an NFT at Christie’s earlier this year.

Matthew Roszak, founder of the tech company Bloq and a general partner in Sfermion’s Fund II, called Steinwold “one of the best NFT thought leaders and investors out there.”

Other metaverse believers on board with the fund include Andreessen Horowitz’s Chris Dixon, the hedge fund manager Alan Howard, Digital Currency Group (DCG), CMT Digital and Animoca Brands. DCG owns CoinDesk as an independent subsidiary.

DISCLOSURE

The leader in news and information on cryptocurrency, digital assets and the future of money, CoinDesk is a media outlet that strives for the highest journalistic standards and abides by a strict set of editorial policies. CoinDesk is an independent operating subsidiary of Digital Currency Group, which invests in cryptocurrencies and blockchain startups. As part of their compensation, certain CoinDesk employees, including editorial employees, may receive exposure to DCG equity in the form of stock appreciation rights, which vest over a multi-year period. CoinDesk journalists are not allowed to purchase stock outright in DCG.

Will Gottsegen is CoinDesk's media and culture reporter. He holds ETH and two NFTs above CoinDesk's disclosure threshold of $1000.