By Nancy Dahlberg
Magdalena (Mags) Kala is announcing a web3 venture capital fund today. This former Bain Capital investor and new(ish) Miami resident says the $30 million fund is all about mainstream consumer adoption, and the Magic City is a fitting launchpad.
“I got passionate about thinking through consumer behavior, why people buy what they buy,” says Kala, a Harvard and Stanford graduate who has been investing in the consumer space for 10 years. “When the consumer dimension of web3 started coming into shape in 2020 or so, I thought it was such an interesting alignment with consumer behavior because of the incentives of ownership. We intrinsically know that ownership makes people behave differently because they care more.”
“Thinking through what I wanted to do with my career, I started with what is the future of consumer and I concluded that the future of consumer is web3 and the future of web3 has to be consumer because if we don’t have early adoption, none of this matters, none of this is going anywhere,” she continued, in an interview with Refresh Miami. “Once I realized that, I couldn’t get myself excited about working on anything else.”
Today, Kala announced the closing of her $30 million web3 fund, raised in about four months despite the crypto downturn. Double Down is her early-stage venture firm investing in mainstream adoption of web3 through consumer culture. She is the solo GP.
The Miami-based fund has a roster of LPs and advisors who bring a mix of crypto, tech and consumer expertise, including big names like Chris Dixon and Marc Andreessen of a16z, Alexis Ohanian of Seven Seven Six, Paris Hilton and Sara Blakely.
“I want all these people around the table because I believe mainstream adoption of web3 will happen through consumer culture. It’s about things that humans already care about, like sports and gaming and music and fashion, and how web3 can make it better.”
Kala’s fund has already invested in nine web3 startups, and three of them have Miami connections: OnChain Studios, creator of Cryptoys and led by Miami tech OG Will Weinraub; Tally Labs, best known for their Jenkins the Valet project; and Swoops, founded by Alpaca VC’s David Goldberg.
“Mags is without a doubt one of the best consumer-focused investors in the industry and delivers a ton value to us every time we speak,” Weinraub said. “Simply put, if you’re at the intersection of consumer and web3, then Mags is someone you need on your cap table.”
That a third of Double Down’s investments are Miami-centric was accidental, Kala said, but speaks to the web3 energy in the Magic City.
She reports that her LP base is over 30% female and 30% people of color. That’s quite a feat. In the VC world, women and people of color represent only a sliver of funders and the funded, Female GPs are an even rarer breed. So far, crypto and NFT startups are also dominated by men.
“I did actually want to hit 50-50 and so I was a little bummed,” she said. “I had to take a little step back and acknowledge that it’s much better than the industry and I have so many amazing people around the table to join me on the journey.”
What does Kala look for in Double Down investments?
No. 1 is mainstream orientation, she says. “I don’t want startups to be just building for the crypto OGs. I want them thinking, what is the value of this technology for regular people and why should they care? I feel like somehow in web3, people frequently forget about that.”
The team, of course, is key. “Have they built things before? Do they understand web3? How native is their technology? But also I love the profile of repeat founders as great operators who have built traditional types of businesses and know what it takes to build for scale. And now they have reached a scale that goes beyond a few thousand users, which unfortunately has not been the case for a lot of crypto and web3 projects.”
Beyond investing, Kala works with her portfolio companies on marketing and go to market strategies, including on storytelling, channel positioning, and working with influencers. “I want to back great utility for real people built by amazing teams that want to work with me on go to market strategy to help them reach their full potential.”
Most of her investments will likely be seed stage but she’s not limiting the fund to that. Checks will typically be $200K to $500K, Kala said.
Kala moved to Miami last December after spending a couple of stints in South Florida related to her work as a VP with Bain Capital on the consumer, retail & restaurants private equity investing team in Boston for seven years. “I just can’t get over how happy I am here — waking up and it’s sunny outside and I have this whole community of people that I can count on and do things with.”
She says Miami will be a native web3 epicenter but in a web3 context. “There will never be one place that is the Silicon Valley of Web3, because web3 starts from the notion that there is a great talent and great contributors everywhere virtually and across borders.” So why does she think Miami is so special?
For starters, Miami has always been very crypto friendly and the early crypto community has compounded over time.
Kala believes compared to other cities, Miami can flourish as a place for web3 native culture. “In other areas it is web3 of media or web3 of the creative economy, or it’s about web3 and finance. Here, there’s actually room for it to be just web3 — and there’s a lot of people building interesting things across all different sectors.”
Also, she said, the Latin American connection is so strong here and now so many of the benefits of cryptocurrencies and blockchain-based technologies have greater reasons for being in infrastructurally less developed countries. “I am very curious about so many markets in Latin America as far as they clearly have more needs for some of these solutions than the US does.”
There’s also the spirit of optimism here, she said. “You cannot be trying to build something early stage and not be optimistic and I love being part of this city.”
Kala is launching a newsletter serving up actionable advice for entrepreneurs about marketing, branding and go-to-market strategies in web3. Sign up at www.double-down.com. You can also follow her on Twitter @magdalenakala and @doubledownfund.
READ MORE ON REFRESH MIAMI:
- Web3 Equity lights the spark, and Miami’s female creators and builders are taking it from there
- Spindl grabs $7M to enable Web3 founders to better understand their customers’ purchasing behavior
- Pair of VC reports are chock full of local data and insights. Here are some highlights
Follow Nancy Dahlberg on Twitter @ndahlberg and reach her at [email protected]
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