Paradigm raises $1.2B fourth fund, expanding from crypto into all frontier tech

Speaker 2: Let me tell you about public.com, investing for those who take it seriously. They got stocks, options, bonds, crypto, treasuries, and more with great customer service. Our next guest is Alana Palmino from Paradigm. Hey, What's up? What's up? Going on? Welcome to the show. Our last guest raised 1,000,000,000. You had to one up them. You had to two up them with 1.2. Tell us about the new fund. Oh,

Speaker 10: man. Thanks for having me, guys. Really great to be We're super excited about it. We we raised 1,200,000,000 to go after the new opportunity set, Frontier. Thanks

Speaker 2: for warming that up for me. You're welcome. It sounds nice and warm. Fantastic.

Speaker 1: Sorry. Continue. Continue. 1,200,000,000 for

Speaker 10: Invest. Alright, guys. We're we're going big. We're we're going after all frontier tech. We're really excited about it. Obviously, you guys know we got our our, start in crypto back in 2018. This is our fourth fund. Yeah. Pretty

Speaker 2: pretty excited about it. But I feel like I don't know. This is being somewhat positioned as, an expansion of the vision or the thesis, but I feel like Paradigm's been investing in broader frontier themes for years now. Like, can you talk about some of the the history of expanding beyond crypto and and the key moments in the fund's history that sort of woke you up to broadening the thesis?

Speaker 10: Yeah. Well, I think in 2018, crypto was the most interesting frontier to be investing into. And, like, that really was the heart of how we started building the firm. Mhmm. And it was the it was the thesis behind being the sort of researchers, builders first. How do you get really close to the tech to be able to understand and underwrite these things from first principles? And then I think over time, it's become pretty obvious that it's not the only frontier and really hard to ignore what's happening in AI. But actually, like, I would say it's more than that. It's like the world itself has started to blend together. Yeah. And drawing these concrete lines is, like, no longer applicable. I think that, like, even something that called itself a crypto project years ago today, like, things that are right on the periphery,

Speaker 2: tech is just all touching each other. And when you think about trying to separate it, it just doesn't work that way. How are you thinking about the early stage? There's been some chatter on the timeline about, oh, like, every VC just wants to pile more money into the biggest private companies, the trillion dollar private companies. Why would I waste money or time talking to an early stage founder? How are you thinking about opportunities at early stage, mid stage, late stage? What even is mid stage now? Is that 10 a mere $50,000,000,000

Speaker 10: company early stage at this point? Who knows? Yeah. I think well, I think stages is a hard thing to define because, like, what are we really talking about? Are we talking about the stage of the company, the valuation? Like, I think it's impossible to not be backing some of the earliest founders and folks who are coming out with new great ideas. And so for us, it's like talent led, would say. You find great people, oftentimes they're in their early twenties. So I don't think you can ignore the early stage, but you also can't ignore the dynamic that you're describing, is like the power law of what's happening with these larger later stage companies and how much they're able to capture in the compound rate of growth. So I think it's like you have to do both. From

Speaker 1: an actual product standpoint, are you breaking out the fund? Is there some amount segmented for the early stage, some for growth, some for incubation? Incubation? How should founders be thinking about the new vehicle?

Speaker 10: It'll be truly stage agnostic. So we're gonna invest in everything from super early seed stage, even pre seed in some cases, all the way into growth markets. We also, you know, are we have a core flagship fund which is an open ended vehicle and so we invest into public markets too. Oh, interesting. Very cool. What is the effect of this year's IPOs? What have

Speaker 2: internal learnings from the the the the height of the opening of the y of the IPO window? It feels like it's sort of open, but maybe not fully wide open. We've got a lot of exciting IPOs that have done well. But how is that affecting the fund and your your feeling around the market right now?

Speaker 10: That's a good question. I think it's a hard thing to answer. One of the interesting dynamics happening in IPOs is like hyper liquid and some of the trading activity we've seen in advance of the IPOs. Been pretty fun to see like the 20, three sixty five markets really come alive, which has been a long term thesis that the crypto markets have had. I think Jeff Lowe at Hyperliquid has just done an incredible job pulling it off. Jeff Lowe at trade. Xyz and Jeff Yawn at Hyperliquid. Yeah. And so like the Cerebras IPO, SpaceX IPO, like all of these now, like we had all of this trading activity going into those. And so there was a lot more transparency on pricing in advance of the IPO event itself.

Speaker 1: Yeah. How accurate was the on chain pricing relative to what these IPOs actually opened at? And do you feel like Surprisingly accurate. Mhmm. Yeah. Surprisingly, like, quite accurate, actually. Interesting. And have you heard of any institutions, like, starting to, you know, bigger, like, firms on Wall Street that you think will, if they're planning to invest in the IPO or or trade it after it opens, actually start their activity on chain? Is that something that you see happening in the future as we get sort of more evidence that on chain trading tracks, you know, real life after these IPOs actually happen?

Speaker 10: Yeah. It's a good question. I mean, if I were them, I would be doing that. I don't know what the rules are and and what the playbook is for them today and, like, what the liquidity and depth of those books looks like. But I mean, I think that's the thesis for what twenty fourseven, three sixty five markets look like in the future is you're going have a lot more institutional activity. Certainly we're seeing that in perps as a derivative product themselves. I think they're just a much more efficient pure play product for big hedge funds to come in. I would even say like the same thing can be true in prediction markets. Like what we're seeing is some people are relating to prediction markets as an institutional product for getting exposure to things and bets that they wanna place that is much more precise than we've had in the future, or excuse me, the past. And so the future I think holds like still a lot of white space in terms of how these markets are gonna evolve, but we continue to be really excited about it. That's great. What do your internal meetings look like? Do you have like,

Speaker 1: you know, a meeting once a month where you guys pitch new frontiers that you're Mhmm. Kind of kicking around? Like, at what like, what what is what is forming a thesis look like? Is it is it all partner driven or is it more collective? You guys have kind of a general idea of a category that you're excited about and then you work together. Mhmm.

Speaker 10: Well, I'd say top down, like thematically we're investing into areas where that are structurally long AGI first So and what are the things that are gonna have a natural tailwind to come out of that? We don't run like necessarily a top down process down to an investment and say, let's go do a deep dive or a particular theme. I think that oftentimes we try to gain conviction and do sprints on individual areas in the market that were maybe like there's a particular founder that we are excited about. But the process, yeah, I would say it's more organic. Like each individual partner may have a different thing that they're excited about and digging in on. I do think fundamental to our thesis is we have to be close to the tech. And so we ourselves have to be able to go really deep and understand these things down to lines of code. And a lot of folks on the team are computer scientists or physics What about down to the metal? You guys have a little data center

Speaker 1: in the office? Just humming away. No data center in the office.

Speaker 10: Yeah. I mean, like, orbital data centers, that'd the future? I don't know. What do you guys think?

Speaker 1: I don't know. I think you guys should should get some get on get on the next SpaceX rocket and

Speaker 2: run a little experiment. I think it's all just yeah. I I'm on the Elon timelines, which is take whatever he says and multiply it by three, and that's probably true, which is still going to happen, but just not next year.

Speaker 10: Yeah. I think I think Elon will will things into existence. I I agree. Time, he will get there. Yeah. Almost always. Absolutely.

Speaker 2: But it takes time. Anyway, thank you for taking the time to come chat with us, congratulations on the new fund. Yeah. And excited to meet all the new founders Yeah. Joining the portfolio. Great portfolio. Yeah. Yeah. True anomaly. Got some great folks. Zip line. There. I love Zip line. Evan Rogers. Keller is amazing at Zip line. Yeah. Yeah. Fantastic. Super excited. Have a great rest of your day, and we'll talk to Great to have you on, Lana. Cheers. Bye. Let me tell you about Codex. Codex is a powerful workspace for getting work done with AI agents, whether you're writing code, analyzing data, creating content, or automating business workflows. Codex helps you move projects forward from start to finish. Our next Next up is Byron Boots. We got Boots on the ground. Boots. Let's bring in Byron Boots from Here he is. O Overland AI. Welcome to the show. How are you doing?