Introducing Variant Fund III

$450m to support the leading founders in web3


Variant was founded on a simple idea: the networks that define the next generation of the internet will turn users into owners. This ownership aligns incentives so that networks can grow bigger, faster; it can also serve to drive more equitable outcomes. Tokens distributed via blockchains make this world possible. 

This vision is becoming a reality. Decentralized networks owned by users, like Uniswap, are outpacing their centralized competitors. New models for token distribution are enabling startups to turn their users into owners who can influence the direction of projects. Communities around the world are raising funds onchain to purchase and govern everything from NBA teams to golf courses to an original copy of the US Constitution, providing a glimpse into how online communities can direct resources to effect global change. NFTs have enabled creators to earn from their content to the tune of $3.9 billion last year, without relying on advertising or the altruism of fans. DeFi is providing millions of people around the world access to sophisticated financial tools that don’t rely on extractive middlemen. What began as an experiment in cryptography has become the underpinnings of a techno-populist re-architecture of the internet that allows users to hold onto more of the value that they create.

Since Variant began, we have backed visionary founders at the forefront of this movement and guided them through the earliest stages of their journey.

Today, we’re expanding that work. Variant has raised $450 million to invest in builders of the user-owned web, including both a $150M seed fund and a $300M opportunity fund to double-down on projects with demonstrated traction from our portfolio and beyond. To support this effort, we’ve doubled the size of our firm to 15 professionals with deep expertise across DeFi, consumer, and infrastructure, and built out our portfolio support function to offer guidance on go to market, token design, community building and more. 

Variant Fund $450 million in new funding

What we have learned over the last few years has reinforced our thesis that user-owned networks grow bigger and faster than their traditional centralized counterparts, with more favorable economic terms for users. Beyond that, it has also shown that ownership is a vast design space, with different experiences ranging from participation in a community to financial exposure to governance.

Variant Fund investment areas

As we deploy Fund III and build alongside our founders, these are some of the areas we are most excited about.

Financial empowerment through DeFi

The DeFi revolution has empowered a new generation of owners to take control of their assets and access capital and liquidity, just as simplified end-user experiences are lowering the barrier of entry for using new and complex financial products.

Interest areas:

  • Protocols addressing the financialization and productivity of NFTs
  • Financial primitives that leverage user ownership to unlock sustainable liquidity network effects
  • MEV derivatives and other net-new markets related to blockspace
  • Stablecoins that prioritize safety, risk management, and mainstream consumer adoption
  • Financial primitives that leverage composability to create net-new functionality, such as lending optimizers and DEX aggregators
  • Financial products that bridge the legacy financial system with DeFi, allowing new users and institutions to cross the chasm

DeFi projects in Variant’s portfolio: Cozy Finance, Empiric, Euler, Fei Protocol, Flashbots, Gearbox, Goldfinch, Morpho, Sense, Union, Uniswap, Verto, Yield Protocol

The expanding layer cake of blockchain computing

Blockchain development isn’t sequential and cannibalistic. It is composable, comprised of an ever-expanding stack that opens a new adjacent possible for developers to build applications. From low-level computing primitives to developer tools, web3 infrastructure is maturing and on the verge of supporting the new product experiences demanded by mainstream consumers.

Interest areas:

  • L1s, L2s, and L3s – application-specific and general purpose – will create abundant blockspace, enabling developers to build new, increasingly complex on-chain applications. 
  • New computing primitives required for projects to progressively decentralize their full stack, from computation to storage, indexing, query, bandwidth, connectivity, and more.
  • Applied cryptography that enables new features such as privacy, and applications predicated on it.
  • Cross-chain interoperability that enables apps with native omni-chain product experiences.
  • Protocols and services that mitigate the burden of private key management and custody.
  • Improved security tooling that make web3 safer for developers and users

Infra projects in Variant’s portfolio: Aleo, Aptos, Aztec Network, Ceramic, Dimo, Flashbots, Phantom, Polygon

Variant Fund quote

The new frontier of web3 consumer

Web3 has the potential to satisfy user needs in completely novel ways, from using on-chain activity as the basis of new social graphs to pooling and managing capital among online communities. Coupled with infrastructure improvements, we believe we are on the brink of seeing web3 applications go mainstream. 

Interest areas:

  • Applications that enable net-new user behaviors, by taking advantage of the unique capabilities of web3. For instance using on-chain behavior as a social graph or introducing incentives that financially reward positive user interactions.
  • Applications and infrastructure that unlock web3 on mobile. 
  • Web3 social networks that combine unique social and economic incentives.
  • New token economic models that coordinate user behaviors, such as X-to-earn and resource marketplaces. 
  • Verticalized marketplaces that aid in the discovery, use, and exchange of ownable digital goods, particularly those that seek to become user-owned. 
  • Networks that use financial incentives as a means for bootstrapping and ultimately defeating legacy incumbents. 
  • Projects addressing capital formation for various missions, from investing to creative projects to social impact and beyond.
  • Tools that enable experiments to make governance more accessible, engaging, and productive. 

Consumer projects in Variant’s portfolio: Bonfire, Catalog, Draup, Formfunction, Foundation, Friends with Benefits, IndiGG, Loot, Magic Eden, Mirror, Oncyber, PleasrDAO, Sound

User experiences defined by new forms of ownership

Tokens and NFTs enable net-new user experiences that satisfy diverse motivations and “jobs-to-be done”, from control to belonging, to financial alignment with the products you use everyday. Ownership is a design space for new product features and experiences.

Interest areas:

  • Networks whose users experience ownership as influence over the strategy or direction of a project 
  • Networks whose users experience ownership as belonging in a community – like a social club 
  • Networks whose users are in economic alignment with the service – like through revenue sharing 
  • Networks whose users experience greater utility based upon owning assets – for example, in-game assets

Variant Fund mission

Come build with us

Variant was designed for this moment in crypto. And we have stayed small for a reason: because it enables us to work intimately with our portfolio and guide founders through the most important questions they face early on in their journey. That work is as critical now as ever. 

In the next three-to-five years, we will see a generation of projects create net-new markets that were not possible until now. If you’re building at the forefront of web3 and looking for a partner like Variant, please reach out

And if you’re interested in joining our growing team and supporting the next generation of user-owned networks, check out our open roles here