VC Firm SpaceFund to Tokenize its Fund with Support from Smart Valor, Abacus

Texas-based VC firm SpaceFund is partnering with blockchain startup Smart Valor and Coinbase-backed Abacus to tokenize its fund.

US-based SpaceFund, a venture capital firm aiming at leveraging blockchain to fund space startups, announced on Monday the creation of the world’s first space security token. The announcement, which was made at the Zurich Crypto Summit, suggests that the company will tokenize its fund and thus provide accredited investors with better access to space-oriented startups through higher liquidity.

SpaceFund founding partner Rick Tumlinson commented:

“SpaceFund’s goal is to support the development and profitability of amazing new space startups around the world.”

“With Jeff Bezos, Elon Musk, and others investing billions into a space economic infrastructure, a revolution is underway in space. We want to allow more visionary people to get involved, to support the entrepreneurs opening space to humanity, and to share in the wealth it will create. This offering is both a giant leap and a first step in that direction,” Tumlinson, who’s also co-founder of several space projects, explained. 

SpaceFund is known for its insider perspective on the NewSpace, an umbrella term that touches upon the private spaceflight industry, which is currently growing at a fast pace. The VC firm relies on a group that includes investment experts, space-oriented technologists, and business leaders engaged in both the space and blockchain markets. SpaceFund’s management team also comprises general partners who operate investment portfolios with dozens of startups under management and pioneers of the security token space.

Speaking about the potentially ideal combination of space and blockchain experts inside SpaceFund, David A. Johnston, the company’s general partner and CEO of blockchain-oriented Yeoman’s Capital, said:

“This is a match made to open the heavens. Yeoman’s has started over 30 companies in the blockchain space, and we are applying that knowledge and network to SpaceFund. Together we are going to change the way people invest in space.”

Initially, the SpaceFund security tokens can be purchased by US-based accredited investors only, as the tokens are compliant with the requirements from the Securities and Exchange Commission (SEC). At a later stage, when international legal frameworks will also become available, the tokens will expand overseas to allow investors from other countries. To achieve this, the VC firm is collaborating with Smart Valor, a Swiss-based blockchain startup that operates an investment platform. In September of this year, we reported that Smart Valor had secured regulatory approval from the Swiss Financial Market Supervisory Authority (FINMA) to operate its business in Switzerland.

Under the new agreement, Smart Valor CEO Olga Feldmeier will join SpaceFund’s advisory board. She revealed that Smart Valor was operating a platform that allows international investors to bet on security tokens despite the diverse and uneven range of regulatory frameworks across various jurisdictions worldwide. 

“Our partnership will ensure that, once the time has come, SpaceFund will follow the fastest path to secure investments from abroad,” Feldmeier added.

SpaceFund’s managing partner Meagan Crawford, who’s also co-founder of the NewSpace Business Plan Competition, mentioned the benefits of tokenizing the fund:

“Tokenizing a space-focused venture capital fund removes major barriers for investors, providing them with liquidity and diversified exposure to exciting startups, while also providing those startups with the long-term support they need to succeed.”

“This is the missing piece to solve the NewSpace financing puzzle - connecting the world’s capital with those who will lead us to new worlds,” she said.

In order to guarantee compliance and handle transactions, SpaceFund reached an agreement with Abacus to manage the issuance and continuous administration of its security token.

Security tokens represent blockchain-based digital units backed by real-world asset ownership. These tokens can be backed by company shares, bonds, commodities, or real-estate assets among others. Unlike ICO-based utility tokens, security tokens have regulatory compliance built-in.