Justin Wu — The Founder Turned Venture Partner
Bynd Venture Capital is delighted to have Justin Wu as our new Venture Partner. His experience as a founder and his knowledge will be very important in our pursuit of new investments in Iberia.
Justin brings a wealth of experience and expertise to our team, having founded 2 companies and spent over 6 years in the tech industry in a variety of leadership roles. In fact, Bynd VC invested in one of Justin’s startups in 2019, and we noted that he has a deep understanding of the industry and is well-respected by his peers.
Interview Of Justin Wu
1. How did this opportunity for your new role at Bynd arise?
My relationship with Bynd has been a long one, ever since they invested in my startup BEPRO Network several years ago. Bynd was key in helping me as a founder to grow my business into a success. They provided us with not only capital but also with their experience and mentorship. We sold BEPRO Network in 2021, and are all very happy about that, both founders and investors. The opportunity arose when Bynd decided they wanted to invest more into the growing blockchain space, and they invited me to join the fund as a Venture Partner. My experience as a founder was also considered a value-add to the fund. Having just sold my company, I was available to look to new opportunities and challenges, and the role fit so I accepted. With this additional entrepreneurial DNA, we are now better equipped to deploy capital in the blockchain vertical.
It’s important to note that Bynd Venture Capital will still focus its investments in Digital IT (Web 2.0), consumer goods and sustainability. Blockchain and Web3 investments will only be a new vertical that the fund is exploring due to its potential for growth. I’m happy to join the team to lend my experience in this vertical, as well as share my point of view as a founder in the past.
2. You have a strong background in the Web3 industry. How do you incorporate your learnings when evaluating a potential investment?
Having experience as a founder in Web3 is critical to being able to analyse projects and investment opportunities in blockchain. When one has already passed through the trials and tribulations of this industry as a founder such as: the challenges of raising money, creating a token, community management, product development, investor relations, and so on–one has a holistic view of the lifecycle of blockchain projects. Additionally, being a founder means awareness of and responsibility for all the details of the business. These two aspects, the holistic view and the detailed view I had as a founder in Web3, give me the experience to analyse opportunities in depth.
The blockchain industry is maturing, but nevertheless we still have a lot of first time founders coming to the industry. They may have experience in other fields, and may even be very successful, however Web3 is a different animal. It has its own peculiarities, pitfalls, and challenges that have to be recognised and dealt with. A good example of this are founders who are emitting their own token for the first time. Technically, this is not very difficult; it is in the design of the token, its economics and its surrounding game theory where the real difficulty lies. First time founders in Web3 need to understand that emitting a token is like suddenly becoming a publicly traded company. In fact, it is true, anyone with an Internet connection can purchase the token once it is trading on decentralised exchanges, and even centralised ones. This comes with its own risks and responsibilities. Good Web3 companies with great products but bad token design will struggle to find success.
Investing in Web3 companies is challenging and requires know-how both on the operational side as well as the tokenomics side. Having experience in both as a founder goes a long way towards spotting good investments and avoiding bad ones.
3. You are an ex-founder. How does this experience help you when supporting portfolio companies?
I can really empathise with founders because I’ve been in their shoes. I know their pain because I have felt it myself. Founders can be more forthcoming with me because I know what it feels like to be on their side of the table.
Additionally, there are things you really only learn by doing it yourself. These include the specialised skill set that you develop when you found a company in Web3. It really requires you to be a polymath of sorts. Most Web3 startups are incredibly lean, meaning that founders often wear multiple hats. The same person might be responsible for operations and finance, while also overseeing other departments such as marketing and liaising with legal. On top of this, everyone on the team of a Web3 company has to understand OpSec, IT Security and best practices when handling anything that has to do with the company’s token or treasury. Now throw all of that into an industry that is extremely competitive, fast-moving, and mercenary (as any early stage industry in tech). Founders in Web3 are under a lot of demand and stress, while facing pressure from their token holders and the market in general.
Having both the empathy and the experience of being a Web3 founder allows me to better connect with our portfolio founders.
4. Your focus will be on Web3 and Blockchain investments. What is your take on the Web3 startup ecosystem in Iberia?
Iberia has gained more and more Web3 talent over the years. Portugal especially has been an attractive destination for Web3 founders and the blockchain community in general. We have a mix of great climate, interesting culture and high quality of life that have been key factors for bringing Web3 industry talent here. Websummit has been a large factor as well. Each year, tens of thousands of tech people descend on Lisbon, many of whom are in Web3 or are connected to this industry. As a result, Web3 focused conferences and events tend to aggregate around Websummit, with Eth Lisbon, Solana Breakpoint, Fil.lisbon being some examples from 2022. Porto has also held blockchain events such as Eth Porto, and several Portuguese Web3 companies are headquartered in Braga.
Spain continues to be a great source of both deal flow and development in the blockchain industry. There are numerous blockchain events each year in city centers such as Madrid and Barcelona, as well as quality teams and founders in Spain working to launch their Web3 companies.
Iberia has many top tier technical universities that train thousands of students in computer science and engineering each year. Courses in blockchain engineering and programming are becoming increasingly common in technical universities throughout the region, and the world. A significant percentage of these students decide to become entrepreneurs in Web3.
Accelerators in Web3 and co-working spaces also play a fundamental role in the development of the Iberian Web3 Ecosystem. Bynd has partnerships with many Iberian accelerators and co-working spaces across Portugal and Spain.
In summary, Iberia has a robust and growing Web3 community. Our goal at Bynd is to build a deal flow funnel that is able to capture opportunities as this source of deal flow grows.
5. Do web3 and blockchain founders have different characteristics and qualities than founders from other industries?
I wouldn’t say that Web3 founders are inherently different from other types of founders. I will say that the particular pressures, demands and constantly changing nature of the blockchain industry end up molding Web3 founders into having unique skillsets. In this case, it is more the nurture over the nature, if you will. This industry teaches you to always be flexible, and to always have OpSec and game theory in mind. Since there are economic incentives and consequences behind almost everything that is done in Web3, founders have to be acutely aware of how their words and actions effect the market. This is particularly true if these founders have their companies’ tokens trading on the open market. Couple this with the fact that trading in Web3 and transactions function 24/7–there are no normal banking hours–this creates a constantly evolving environment that Web3 founders have to deal with on a more or less constant basis. I will say that one of the key inherent qualities that a Web3 founder must have before joining this industry is resilience. They have to have the ability to take setbacks in stride, and overcome obstacles and challenges.
One of the main misconceptions of this industry is that it is really easy to make a lot of money quickly. I can say that as a founder, it takes a massive amount of work and dedication to build a successful business in Web3. If one can do it, the potential for upside is attractive. But founders, especially first time Web3 founders, should expect to work a lot and learn a lot in this industry if they want to survive and succeed.
6. Which are the big trends to look out for during the next year?
Trends, most colloquially called “narratives” in Web3, tend to change very quickly as development proceeds at speed. Investing based on narratives in Web3 can be a bit of a double edged sword. Some narratives quickly gain popularity, only to fall out of fashion just as fast. One of the key competencies of funds that invest in blockchain is to be able to identify opportunities for value creation that are independent of the prevailing narratives. If they happen to fit what is currently hot on the market, all the better. Due diligence and experience in this area are necessary to avoid simply chasing fads.
Having said that, there are some narratives that have turned into bedrock fundamentals in the blockchain ecosystem.
Decentralised Finance, or DeFi as it is known in the market, has become a cornerstone use-case for blockchain. DeFi continues to grow in user numbers, trading volume, and Total Value Locked (TVL) which is a measure of capital deployed into DeFi markets.
With the transition to Proof of Stake on Ethereum, we are seeing new opportunities to bring liquidity, derivatives and pooling services products to ETH tokens that are staked.
Additionally, with the further development of Zero-Knowledge Proof technology within the blockchain sector, new opportunities in blockchain scaling, transaction throughput and transaction privacy have arisen.
7. Considering current shifts in the market, how do you see the future of Web3?
There will always be volatility, unknown unknowns, and challenges on the horizon, but the future of Web3 is undoubtedly bright. At the same time that you have growing adoption of blockchain technologies, you also have sensible regulation catching up and allowing greater consumer safeguards and protections. Blockchain companies are focusing more and more on user experience and on-boarding new users with less technical backgrounds. Additionally, more and more enterprises are investing in the industry and developing products for their clients that increasingly demand access to blockchain products and services. Younger generations are excited about the technology and its potential, and each day new entrepreneurs enter the market to launch their Web3 companies. Funds like Bynd Venture Capital are here to capitalise these startups and help them grow and achieve their full potential. We are confident that the blockchain industry will grow and become a critical and vibrant part of the global digital economy.
Bynd Venture Capital
Bynd is a leading Iberian Venture Capital firm operating since 2010, with focus on seed / early stage technology companies connected to Iberia, having done 50+ investments across verticals and geographies.
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