The TMT king that has invested in Meituan and Didi is entering the NFT and Metaverse

Cailian Press | Blockchain Daily (Shanghai, reporter Zhang Yangyang) reported that there is no doubt that NFT and Metaverse have contracted almost all the hot spots in the blockchain field in the first and second half of the year.

Behind the two hot tracks, a powerful capital institution is quietly emerging - Coatue Management, an American hedge fund that has invested in almost all TMT Chinese stocks.

On November 23, Pokémon GO developer Niantic announced that it had received $300 million in new financing, which will be used to invest in existing games and new applications, as well as to expand the Lightship developer platform and build the metaverse. This round of financing came entirely from Coatue.

Testing the waters of NFT and the Metaverse

Dapper Labs is one of the big players in the NFT collection market. With NBA Top Shot, Dapper Labs is currently the leader in NFT sports collections, and its valuation has reached $7.6 billion after the latest round of financing.

Tianyancha shows that Dapper Labs has completed three rounds of financing this year, and the main investors behind it have begun to change, all of which have become Coatue's sole or lead investors . The latter's investment can be said to be generous: $250 million, $305 million, and $250 million (lead investment). Compared with Dapper Labs' previous six rounds of financing, each of which was tens of millions of dollars, this amount has directly jumped by an order of magnitude.

Since September, the Metaverse has stood at the center of the Chinese and foreign capital markets and has become one of the biggest outlets. With its well-known AR game developer, Coatue is knocking on the door to wealth in the Metaverse world.

On November 23, Niantic, the developer of Pokémon GO, received $300 million in new financing - all of which came from Coatue. The funds will be used to invest in existing games and new applications, as well as expand the Lightship developer platform and build the metaverse.

“Niantic is building an AR platform based on a 3D world map that we believe will play a key role in the next transformation of computing,” said Matt Mazzeo, general partner at Coatue.

Only invest in the industry's leading TMT king

In 1999, Philippe Laffont, who studied under Julian Robertson, left Tiger Fund and founded Coatue, focusing on the technology, media and telecommunications (TMT) sectors. It currently has 9 funds and is now one of the largest technology investment institutions in the world.

According to the latest "13F" report released by the US SEC (investment institutions with assets under management exceeding US$100 million are required to submit quarterly position details to the SEC). In the third quarter of 2021, Internet technology companies accounted for 9 of Coatue's top 10 holdings. (See the figure below)

Coatue’s investment style can perhaps be described as “a ruthless man of few words.”

Looking at its official website, it only has three office locations and one email address. Coatue partners and members, including Philippe Lafont, rarely accept interviews or speak out.

But this does not conceal its edge at all - since its establishment, the scale of assets has jumped from 45 million US dollars to over 20 billion US dollars, and the listed companies it has captured include Meituan, Didi, Snap, Rivian, etc.

Coatue's consistent investment style is to only invest in the industry leader and place heavy bets on leading unlisted companies in the TMT field: it is generous in its investment, either investing alone or at least leading the investment and continuously following the investment.

According to Tianyancha data, overseas, Coatue has participated in the C, D, E and even F rounds of financing for super unicorns such as Snap, Grab, and Reddit since 2013; in China, Kanzhun.com, Mafengwo, Meituan, Didi, ByteDance, Heytea, Dingdong Maicai, etc., along the development trajectory of the Internet economy, from platform giants to new consumer upstarts, all have Coatue behind them.

Classic investment circles bet on NFT and blockchain games

The “classical investment circle” can be broadly understood as traditional investment institutions such as PE/VC and family offices. This is actually a relative concept. After the concept of blockchain has moved towards a wider field of vision, a group of investment institutions focusing on the blockchain field have emerged.

One signal at present is that as blockchain gradually moves out of the early stages of the industry's development and moves towards the mainstream, the traditional investment circle has also begun to smell the wealth that is bursting out of this field.

According to Tianyancha data, in 2021, blockchain was the field with the highest proportion of all Coatue investments, except for financial technology, with a total of 11. Specific businesses include NFT and blockchain games, encrypted payment service providers, encrypted auditing and security agencies, exchanges, etc. Before this year, Coatue's investments had never been involved in blockchain.

Coatue’s blockchain investment began with Dapper Labs in the NFT and blockchain gaming sectors, which is also currently the most in-demand sector for blockchain financing.

Earlier in July, Blue Pool Capital, the family wealth management fund of Jack Ma and Joseph Tsai, invested in blockchain gaming company Animoca Brands. This was Blue Pool Capital’s first investment in a blockchain project.

According to a reporter from Blockchain Daily, an industry investor once said, "We have started to invest in NFT projects. There are no major opportunities in traditional Internet."

However, industry insiders have different views on the crazy influx of funds.

Yu Jianing, rotating chairman of the Blockchain Committee of the China Communications Industry Association, believes that the next ten years will be the golden decade for the development of the Metaverse, and the window of transformation has quietly opened. NFT projects and development teams that are highly related to the Metaverse are usually still in the early stages, and investment institutions have the opportunity to gain more dividends by making early arrangements.

Some industry insiders also told the Blockchain Daily reporter that "there is a lot of money in the market now, but it does not mean that people really understand it." In addition, it is still questionable whether related NFTs and blockchain games can be legally tried. If they are overseas, it is also necessary to look at the local policy constraints.