- Brock Pierce, the crypto investor, plans to launch a VC fund aimed at investing in Puerto Rican startups
- The crypto billionaire outlined his plans in a wide-ranging interview with The Block
Brock Pierce has his hands all over the crypto world.
As an investor, he’s been involved with some of the most noteworthy investing firms, including Blockchain Capital and DNA.fund, both of which he co-founded, as well as Unicorn Ventures. He advises more than a dozen crypto firms, spanning trading tech companies like tZero and token projects such as Metronome. He’s also a major backer of EOS. But these days Pierce is focusing much of his energies on the island of Puerto Rico, he told The Block in a wide-ranging interview.
Pierce, the child actor turned crypto billionaire, moved to the Caribbean U.S. territory over a year ago to build out a crypto utopia and reinvent the floundering island into a hub of blockchain innovation. Now, he says he is seriously considering launching a venture capital fund to spur innovation on the island.
“Now clearly for Puerto Rico to continue to be successful there will need to be some venture capital, and so I’m focusing on setting up a small venture firm in Puerto Rico,” he said. “Probably just a little five million dollar firm.”
Puerto Rico’s economy has struggled in recent years, exacerbated by Hurricane Maria, which left many on the island without power for almost an entire year. Puerto Rico lags the U.S. in many economic indicators, including the number of those living in poverty — 40% — and its median household income stands at just $19,000 per year, approximately $30,000 less than the median income of someone living in the U.S. Still, Brock says there is a strong economic spirit on the island — but a lack of investors to tap into it.
“Puerto Rico didn’t have any investors,” he said. “It didn’t have an angel investors. There’s no venture firm even there today.”
To be sure, there are a few investors in Puerto Rico, including Moro Ventures, which raised $17 million for a fund at the end of 2018, as well as a number of family offices. Venture Capital Alliance, which is based in New York, launched a $45 million Puerto Rico Fund for Growth.
Still, there is certainly a need for new companies and jobs on the island, which has seen a mass exodus of manufacturing companies — specifically big pharma firms – since the early 2000s.
“There’s not a lack in talent there,” Pierce said. “There’s tremendous talent. The problem is there’s a lack of opportunity.”
Pierce is right. The 2012-2013 Global Competitiveness Report from WEF found that Puerto Rico ranked third in the number of scientists and engineers, but 60 to 70% of its STEM graduates leave the island, as TechCrunch reported.
As for the fund, Pierce plans to invest in seed-stage companies and it won’t be limited to crypto.
“So the idea would be to set up a fund and probably put a $100,000 into 25 companies over time,” he said. “That might be sometimes $50,000. Maybe as high as $250,000.”
“I’m gonna have to brush the dust off of my AngelList syndicate and start tapping into the crowdfunding channels and tools that I’m familiar with,” he added.
Pierce’s ambitions on the island have been met with some criticism, to be sure. Specifically, that Pierce and his band of crypto-dreamers — dubbed Puertopians — represent a blockchain brand of new age colonialism. Pierce said he understands where the criticisms come from, citing the island’s history.
“The Spanish had basically conquered them for hundreds of years, and now the Americans for the last 125 years,” Pierce said. “So culturally you have a lot of fear in the people, and their first reaction to everyone is to be afraid of the newcomers, because historically they’ve been conquered for 500 years.”
“Clearly we’re not conquering Puerto Rico,” he added. “It’s not even a realistic idea.”