Xoogler.co: Crypto Startup Opportunities with Avichal Garg

Avichal’s Background

Avichal Garg is a Managing Partner and Co-Founder of Electric Capital, a venture firm that invests in cryptocurrency projects and blockchain companies. He is a successful serial entrepreneur with executive experience at both Google and Facebook, which acquired his previous company in 2012. At Facebook he was Director of Product Management for the Local product group, a team of 400 engineers responsible for $3.5B in revenue. Avichal is also a successful venture investor and was a part-time partner at YCombinator. He is an investor in crypto companies and protocols such as Anchorage, Bitwise, Celo, Coda, Dapper Labs/Cryptokittes, dYdX, and Lightning Labs, as well as many technology companies outside of crypto such as Color Genomics, Cruise, Boom Supersonic, Newfront Insurance, Optimizely, and Notion.

Avichal and Curtis envisioned Electric Capital as a fund primarily focused on crypto space, setting themselves apart from other VC firms. Clients come to Electric Capital because the fund has recognizable success in these crypto markets: “Do what you’re doing, just do it with our money”. Avichal says his team is unique because they consist entirely of engineers who compile code, profile nodes, analyze blockchains, and perform deep technical diligence with proprietary software. Electric Capital engineers also write their own software to manage custody, to participate actively to secure crypto-networks, and to source investment opportunities.

Thinking Outside the Box

Cryptocurrency continues to change how markets and investors value money. The intersection of central bank-backed currency and the growth of the internet exposed each of their flaws in the modern world, setting the stage for decentralized money to take off. Rather than representing money, like current online bank statements, crypto tokens can actually be money. Most transactions are more private, run faster, and are safer to execute using a blockchain. Avichal noted that sometimes it is difficult to imagine computers “owning” “real” money by replacing governmental legal code with decentralized computer code, but that is where the future is headed in his opinion.

The Future of Crypto

Avichal’s Q&A session involved a lengthy conversation on the future of crypto both in terms of growth and policy. The world is beginning to take a greater interest in the crypto markets because with the interest rates being very low for the foreseeable future a higher volatility of cryptocurrencies might be a good source of growth. Smart endowments are taking the risk as are some forward-thinking pension funds. These are the first two puzzle pieces in a picture of a global paradigm shift in mainstream investors’ cryptocurrency valuation approach.

In terms of policy, crypto sits in the middle of the complex battle between the world’s two biggest economies. International trade is currently based on a USD standard in most commodities markets. But as China pursues strengthening the yuan’s position as an alternative reserve currency, government support of cryptocurrencies might become a viable policy for the U.S. Avichal explained that as the U.S. continues to drag its feet, the People’s Bank of China (China’s central bank) is making moves with crypto currencies to establish a government-supported and tightly controlled cryptocurrency market. Though politics are complicated, either way crypto is establishing itself as an important commodity in international markets. Check out Avichal’s Twitter thread on this topic and Electric Capital’s recent Medium article, The Case for Collaboration: Why the US Government and Crypto Ecosystem Must Work Together.

Why Crypto Might be the Right Choice

Crypto is good for the world because

• A large portion of the world has no access to traditional money systems, but they have smartphones that can access crypto markets.
• There is more financial privacy and personal protections in transactions.
• Blockchain eliminates the middleman in money transactions: less fraud, less wasted time, more money actually finishing the transfer.

You should invest in crypto because

• Blockchain is structurally built on principles different to the modern Internet, and radical ideas like this are often the successful challengers to the status quo.
• Crypto currently offers a good way to hedge your assets because of its high volatility. Don’t drain your life savings into these markets, but their future looks bright so it is worth having in your portfolio.

Thank you Xooglers

Thank you Avichal for taking the time to speak today! The audience was very engaged and everyone was able to learn something new from this incredible discussion. And thank you to all of the Xooglers who were able to make Avichal’s outstanding talk on crypto, the future of crypto markets, and opportunities to get involved in the startup community. Avichal’s team recently unveiled Electric Capital Fund II, a $110M crypto-focused fund.

Avichal’s 16 Ways to Get Involved with Crypto Start-ups

DeFi

• Decentralized Market Maker: What would a decentralized Jump look like?
• DeFi Insurance: Risk mitigation is key as capital locked in DeFi grows.
• Credit Scoring: Is there a way to do unsecured lending in DeFi?
• Robo Advisors: Wealthfront for DeFi.

Community Owned Networks

• Fan Clubs: Patreon without platform risk.
• World-Building: Projects like Decentraland, Cryptovoxels, SomniumSpace tying digital ownership with game dynamics.
• Decentralized Bloomberg: Data markets with privacy & token incentives for data providers.

Fintech & Marketplace

• Fractional Collectible Market: Own a piece of your favorite collectibles.
• Invoice Factoring Market: Buy and sell invoices as an asset class.
• Loyalty Points Exchange: Loyalty points beyond simple tokenization.
• Gift Card Exchange: P2P exchange of gift cards.

Payments

• Better X-Border Remittances: International payments with lower fees & shorter wait time.
• Browser with Micropayments: Fluid pay-as-you-browse experiences.
• User Friendly Wallets: Crypto wallets for users who are not crypto-fluent.

Privacy Tech

• Keybase and Private Slack: Private productivity app built for remote teams.
• Private Payments & Digital Cash: We’ve invested in privacy tokens & continue to fund teams working on the ability to transact privately with a focus on thoughtful go to market plans.