SyndicateDAO, a company focused on building tools for decentralized Web3 investing groups, today announced a new product called Web3 Investment Clubs, which enable groups of people and communities to launch an investment clubs, often called decentralized autonomous organizations (DAOs).
Syndicate cofounder Ian Lee, said, on the latest episode of my podcast, Unchained, "It effectively transforms any Ethereum wallet -- whether it's a multisig or a Metamask, or a Ledger [hardware wallet] -- into a powerful investing DAO. It imbues that wallet with all of these really powerful capabilities to invest together as an investment club completely on-chain with no backend."
He said the product enables the kinds of group chats in which groups of friends are buying NFTs or investing in different Web3 project to turn that group chat into an on-chain club.
He said investment clubs have historically been popular, with one of the earliest examples from 1898 in Texas. "Oftentimes friends and community members ... will talk about different stocks that they're looking to invest in together. They'll make purchases together, pool their capital together to reduce transaction costs, spread out risks, and learn together together," he said.
In the interview, he noted that half of the Web3 investment clubs at launch are either female-led or all-women DAOs. When asked why he thought that was, he said, "We've been looking for really values-aligned, mission-aligned long-term partners to work with, who are going on this journey together with us to make a difference using these technologies in the world for people in society. And so I think that that's attracted certain types of communities and people to come to us organically. ... Honestly it wasn't intentional. ... As we got ready for launch, we got everyone together. And it was like, oh my God, you know, 50% of these groups that we were working with are either all-women or women-led."
I interviewed three of the founders of these groups to find out why they decided to launch Web3 investment clubs and for their perspectives on the gender disparity in crypto.
Joyce Yang, founder of Global Coin Research
What does Global Coin Research do?
GCR is a five-year-old content and research platform focused on Web3; we've issued the GCR token, 400 of which are required for membership in its DAO.
Our members don’t pool capital together initially, but invest together on a deal by deal basis. For every deal, we collect a new pool of capital. Each member joins our Discord, where they’re able to see the investments available to our community and can make an investment into a deal collectively without having to vote. They can decide, "I’ll invest in this DeFi project, but not this NFT project." They have the freedom to invest in any single deal.
They get direct access to the Discord and the calls with the founders. Afterward, they can join a community discussion and then decide whether they want to invest. As a community, we help projects not just with capital, but also with, say, their Discord setup or finding engineers.
Total investments made: $26 million
Size: 2,500 members
Percentage of members who are women: estimated 10%-25%
Why did you decide to launch a SyndicateDAO Web3 investment club?
We’ve been building a lot of products in house, around collecting funds, doing know-your-customer (KYC) processes, or getting folks to sign legal documents, and these have all been very manual and operations-intensive. We thought Syndicate's product was a no-brainer. We do two to three deals a week, and our check sizes are around $100,000-$250,000, so the number of investments we make rival that of a VC firm.
When Syndicate said they are helping crypto folks streamline those processes and user flow, by creating dashboards, etc., it made a lot of sense to adopt it.
More than 50% of Syndicate DAOs are either women led or are all women DAOs. Why do you think that is?
Traditionally, we've seen a lot of men in the investing industry, but when it comes to capability and access, many female founders and investors don’t have a place to seek out advice for building out these infrastructures.
When you’re running an investment DAO, it requires a lot of emotional intelligence (EQ) and being able to coordinating with different parties and also managing a team and the DAO members. When I see a female-led DAO, they are very sensitive and detail-oriented around how to incentivize and organize a community of people. They have attributes that help them navigate the space.
Why do you think there are many fewer women than men in crypto?
I don’t see discrimination — a lot of projects want to support more women. I think crypto has a high barrier when it comes to the technology and architecture and there’s finance and legal jargon involved. It’s a high barrier to learning for anyone but when NFTs came, it unleashed a lot of great women and creative opportunities for them. It requires a different language to appeal to them. We see more women coming into DeFi, our investment DAOs, so in my opinion, I think crypto onboard women way quicker given the openness and friendliness of the industry.
For investment DAOs, we’re seeing more woman than in a traditional investment syndicate — there are lots of all-women or women-led ones, which speaks to how gender agnostic these industries are. With crypto, it’s so global, it doesn’t matter who you are and what your background is. As long as you make great points, the community takes interest. I think it’s probably not natural to many people, and it’s not — when you often see and learn about crypto in media, I think it’s blown out as a market of flashiness and extreme ridiculousness in terms of events we put on, and that goes on the news, so that often puts off women who are generally more thoughtful about their careers. That’s the gap in communication you see in mainstream outlets vs. women working in crypto.
What do you think can be done to increase the number of women in crypto?
More interviews and more transparency in sharing stories about women in crypto are helpful. Crypto folks feel very comfortable in their own circles and don’t reach out to the outside world. Some people are like, "I don’t want to bother explaining everything to someone who is new." If we can bring better storytelling to the non-crypto space, I think we’ll attract more women.
In developing countries, women are the head of the household, where they’re the ones that hold the capital or manage the savings. When it comes to DeFi, if you explain the returns and risks involved, it’s more attractive. We should bridge that gap when it comes to sharing more stories of how crypto can be useful and integrated in their life.
Julia Lipton of Awesome People Ventures
What does Awesome People Ventures do?
We invest in early-stage Web3 projects.
Total investments made: Fund 2 hasn’t launched, but will be a $20 million Web3 fund; Julia has personally made over 12 investments.
Percentage of members who are women: unknown
Why they’re launching a Syndicate Web3 investment club:
We’re working with an investment club that will be doing as many of the Awesome deals as possible. I always wanted a syndicate of women to invest alongside the fund. You have all these female-led syndicates growing, sharing members, and sharing deal flow and bringing more women into the ecosystem in a way that’s so much faster. With a traditional fund, you can’t just add limited partners with five paychecks. You have a 99-LP limit, you have a ton of legal, ops and overhead, but with a community investment club, people can get into the game in a way they haven’t been able to before.
More than 50% of Syndicate DAOs are either women led or are all women DAOs. Why do you think that is?
The barrier is finally low enough for people to get involved. I have a $20 million venture fund. You can only have 99 LPs, so the minimum check size is really prohibitive, but when you pool your money as an investment club, the barrier to entry goes way down. Previously the bar was so high — I and so many of the GPs who’ve started these funds haven’t paid ourselves in years, because starting one of these things is so capital intensive. It’s a big deal what Syndicate is doing from an access and diversity perspective.
You have syndicates in Web2, like AngelList, but it doesn’t have the same momentum, because the upside and the return timelines are longer and more limited— you might write a check for $5k, and you might not see anything for 10 years. I love AngelList, but there aren’t that many women there.
There’s this criticism that syndicates and investment clubs or DAOs are just group chats with a group wallet, so what’s the big deal? But that is the big deal. They’re open chats and you can see the information and the data and see who is raising, why, and people’s thoughts. That access to information makes getting involved easier than when things happen behind closed doors. In a closed system, everything is one-on-one email intros, information is scarce, and privacy is #1. This [Web3 investing] is happening on Discord and Twitter.
Token liquidity is important. Let’s say you want to buy a house and all your investment are locked up for 10 years. You should just consider that money will go to $0 — it either exits or goes to $0. But in Web3, you might lose but at least it’s liquid and you can recoup some of it. That’s a different from “you may or may not see something in 10 years.”
Why did you decide to launch a Web3 investment club?
We’re launching a couple of investment clubs, some that I’m running and some that my friends are running. One is going to invest alongside Awesome. We’re also doing another one where we just talk about trading liquid tokens, and it’s all women GPs. Some of us are paying attention, and some of us are too busy looking at new tokens, but we might as well pool all our money, and then the people that are actively trading can just manage it and we get the same upside. I’m not a DeFi expert to the level of my friends, but there’s no reason why we should’t all get to those returns. Same with NFTs. So those are the two female syndicates I’m involved in.
Wealth compounds, and if women aren’t in the game, it’s hard to catch up. Already, in the last bull run, there weren’t that many women involved. We’re looking at the delta between us and our male friends and going, “Oh shit.”
Why do you think there are many fewer women than men in crypto?
It’s risky, opaque, it requires learning, and new tools. Part of it is women tend to be more risk-averse. And you have an asset dropping 40% in a week. Women tend to want to understand things. Whenever I’m sharing deals with women, they do 10 times more due diligence. We have two female funds of funds in our fund. They did 10 times more diligence on me. Almost to the point where I was like, ”I’m not going to respond to your emails.” But I did it because I wanted female LPs.
What do you think can be done to increase the number of women in crypto?
More education, more projects that appeal to women. The Crypto Coven project is one of the coolest projects I’ve seen. The number of people they’ve onboarded because it appeals to a different demographic — part of it is making women the consumers. It’s hard to sell me on a Bored Ape. It doesn’t appeal to me, but you look at Crypto Coven, it’s artistically stunning and so thoughtful — even their documentation and smart contracts.
Future project:
I’m putting 50% of my GP carry [20% of the returns she earns in the fund] into a DAO so we can share the upside with the community, so anyone who shares a deal, helps diligence a deal, help support a company, makes meaningful connections can actually earn upside. It will be distributed to the DAO members as if the community were my cofounder.
Sutian Dong of Multitudes and Global Women in VC
What do Multitudes and Women in VC DAO do?
Multitude is a fund that discovers and invests in diverse founders of both funds and companies. Global Women in VC is a community started in 2015, and we’re launching he Women in VC DAO on Syndicate — the web3 investment club.
In 2015, my Global Women in VC cofounder Jessica Peltz-Zatulove and I started a gathering of female investors in New York, which has, over seven years, grown into the largest global community of women in VC, who share deal flow and opportunities and find new companies to invest in.
Total investments made: No investments so far
Size: almost 4,000 members in 2,000 cities across 60-some countries
Percentage of members who are women: 100%
Why did you decide to launch a Web3 investment club?
If you and I are in the community, you might say, ”I’m investing in this seed round, would you like to look?” People are sharing alpha, but there’s no way for our community to benefit collectively from the alpha.
Within the Global Women in VC community, there are women who invest in Web2 and Web3. Everyone has their own fund, so the Women in VC DAO is a powerful way to leverage all the unique insights that all the individual members have and invest behind those insights and networks. It’s the first vehicle that allows them all to benefit under a single entity in Web3.
The amount of capital that goes to female founders every year is not a lot. How many female investors are there and where are they? When you look just at the Web3 lens, there’s not a lot of diversity in women in crypto, so this is an effort to enable women in our community who are crypto curious but not entrenched to quickly get up the curve and invest alongside their peers.
We have insight from all over the world, but a club is limited to 99 individuals, so we’ll see how our first beta launch of the first women in VC DAO goes, and that will help us refine our processes — voting, processing deals, and then we’ll figure out how we can open this up to the broader community.
More than 50% of Syndicate DAOs are either women led or are all women DAOs. Why do you think that is?
The DAO structure really allows people to leverage the power of communities, so it’s really emblematic that these DAOs are being set up by women, because it’s representative of how leaders in crypto are saying, “Let me bring my community with me” vs. “Let me have a seat at the table, and no one else is allowed.”
Some people are more lone wolves, and some are building their own bags. I think people who’ve elected to work with Syndicate and these DAOs are more community-focused.
I think the reason 50% of the Web3 investment clubs launching with Syndicate are led by women is that women are earlier than men to realize that the power of community can be leveraged to form these investment clubs.
Why do you think there are many fewer women than men in crypto?
Part of it is just a reflection of tech in general. Web3 is one of the more frontier areas that you can invest in or participate in, so there are just correspondingly fewer women there. But I do think that, in web3, people are actively thinking about this and saying, hey, “We have an opportunity to change the gender imbalance.” Women saying, “How do we get more diverse perspectives?“ That was less of an active conversation with the first dot-com. We have this opportunity because Web3 is so early now, so we can create more diversity at the outset.
What do you think can be done to increase the number of women in crypto?
So many things — first: creating better ways to onboard. Right now it’s not a super seamless user experience. You’ve got to create a MetaMask wallet and have to figure out how to transfer ETH into it. It’s not as easy as checking out with a credit card.
Second, better education: This is what the space is and why it matters.
Third, it’s creating communities, where there are people that resonate with you and you want to go hang out. It’s for products and experiences that resonate with women. There’s a lot of interesting stuff happening within the NFT world, where NFTs create a really great consumer onboarding ramp for people who haven’t been in crypto before, because you can see NFTs, vs, yield farming in DeFi, which won’t resonate with everyone. Whereas with NFTs, it’s art. It creates this moment of, Web3 is for me.
Cover photo: a recent Global Coin Research event (Valerie Caviness)
