The listed venture capital fund is dipping its toe into ‘decentralised finance’ one of the most avant-garde areas of disruption in financial services.
Agmentum Fintech, the £190m investment trust focused on financial technology start-ups, has made its first foray into decentralised finance or ‘DeFi’ through an investment and partnership with ParaFi Capital.
ParaFi is an alternative investment firm focused on blockchain and decentralised finance started by former investors from private equity firms including KKR. It launched in 2018 and is US-based.
DeFi aims to bring software to roles within the financial services tech stack normally provided by intermediaries. Cryptocurrencies and blockchain feature heavily in the umbrella term but are specifically aimed at building applications on top of Etherum.
Augmentum says its rationale for entering the DeFi space follows strong momentum for the sector and will invest in emerging DeFi protocols; smart contract infrastructure layers supporting key financial applications.
"Led by Ben Forman, the ParaFi team has impressed us from the outset with their deep sector expertise and network — built through time in both traditional finance institutions (including TPG, Blackstone and KKR) as well as in the crypto and wider emerging technology spaces and alignment on a data-driven approach to opportunity evaluation and powerful ongoing portfolio support," Augmentum said in a blog post.
"Working together we will back development teams on the ground in Europe and the United States and co-invest in projects prior to public launch, providing our respective investor groups with access to a unique portfolio of high potential DeFi assets and maximising potential returns."