"Interview Date: April 19, 2023"

1. You can briefly introduce yourself

Hello everyone, I am Vincent, a partner of AC Capital. I am mainly responsible for investment research and incubation affairs. I joined the currency circle in 2015. Before joining the currency circle, I mainly helped the ASX contact Chinese companies to list in Australia. When I first came into contact with the currency circle, I started doing OTC due to work. I came into contact with many early whales in the currency circle and many demands for cross-border payments using BTC as a medium. Later, it was also a coincidence due to work. I traveled to almost the entire Southeast Asia, including the Philippines, Malaysia, Vietnam, Thailand and other places. I came into contact with the local currency circle and related industries such as the financial industry and international trade. I also helped some ICOs at that time. The project party provides consultation on establishing overseas marketing brands. In 2019, I served as the operating partner of BVNEX, a legal currency exchange in Vietnam. I was relatively early exposed to the Vietnamese currency circle at that time, and became a witness to the development of AXIE and C98, which will be the mainstays of the Vietnamese currency circle in the future. I stayed in China for two years in 2020, and I also had more time to contact domestic colleagues and participate in the early planning of some projects. I joined AC Capital in 2021 and have been there ever since.

AC Capital: Asia's leading investment company focusing on blockchain and financial technology, committed to discovering unicorns in the Web3.0 and blockchain industries. In 2022, AC Capital raised $20 million for its second crypto fund. The fund will focus on early-stage Web3 projects in areas such as infrastructure, GameFi, NFT, and Metaverse. There are more than 200 global strategic and community partners, and the active investment portfolio includes at least 50 start-up projects and protocols, spanning Web3, NFT, SocialFi, GameFi, Metaverse and many other tracks.

2. Can you share how you got into the industry?

In my earliest days, I was helping a Chinese-funded company list on the Australian Stock Exchange in Australia. At that time, the ASX wanted to attract Chinese companies to list and expand the Chinese market. But the actual situation is that Chinese companies want to raise funds or obtain subsidies for listing overseas through capital pools or local policies. After these companies went public, they caused huge losses to local investors.

Therefore, starting in 2016, the ASX introduced policies to restrict the listing of such Chinese companies. The cost of listing in Australia is higher than that of Nasdaq, so this part of the business has naturally stopped. But in the process, I accumulated a lot of early high-net-worth client resources. Many of these people became my private wealth clients, and I helped them manage their family offices. Bosses who are new to Australia have a lot of needs. They want to transfer their money from other places to Australia or other places to invest or do something else. We help them with consultations and achieve their goals. I was introduced to Bitcoin because of demand from these clients. Many of them have high requirements for privacy, so Bitcoin has become a channel for their personal assets to go to Australia.

By 2019, I started working with a cloud exchange. Acquired an exchange in Vietnam and mainly engaged in currency trading business in Vietnam. Local exchanges in Vietnam at that time such as VCC, Coinhe, etc. opened by Kyber Network, the gameplay of these exchanges was very similar to those in the Bittrex era, and there were basically only a few mainstream currency trading options. However, as the industry evolves, these exchanges are gradually eliminated by the market because their operations are too simple and their functions are single. On the one hand, we also do Vietnamese legal currency business to help foreign investors deal with deposit and withdrawal issues. At the same time, we will bring the operational methods of Chinese exchanges to Vietnam, such as IEO and Earn, bringing some small Chinese shocks to the local crypto community. We once became the top three exchanges in Vietnam, with a peak of 150,000 active trading users. When we were in Ho Chi Minh City, Vietnam, we experienced the rise of many Vietnamese projects, including Axie Infinity, Coin98 and Coin68 (Ancient8 incubator, Vietnamese media + VC) team, etc. At that time, Axie was almost in a desperate situation and would even second people from our then local promotion team to do ground promotion. We even helped organize official events for Dash currency, and helped Axie’s Jiho introduce Chinese investors at the event.

Another project is C98. At the earliest, they were actually a Vietnamese media company that ran its own crypto research blog. At that time, they could receive 1,000U in royalties for a research report, which was considered top-notch in Vietnam. Later, their founder Thanh Le started making Super App, which later became the C98 wallet. I was fortunate enough to be one of the first Testflight users. Of course, what happened next is history. Looking back now, it actually feels a bit surreal.

When the epidemic broke out in 2020, the business of all local Vietnamese firms that relied on offline promotion shrank rapidly, so my team at the time focused more on early project incubation. We have always maintained an attitude of keeping pace with the times, even a little bit ahead of the times. We were incubating DeFi projects long before DeFi Summer (it was still called Open Finance at that time), including on-chain OTC (Uniswap had not yet emerged at that time) and machine gun pools. We also released the first GameFi product in DeFi summer. At that time, we didn’t even think of calling it GameFi. We thought about it for a long time and called it Yield Game. In the process of walking and working like this, we have a deep understanding of the operation, community, and market value management logic of the Defi market. But you know, sometimes timing is everything. The success or failure of many projects is not because the product operation is not in place, but because timing is not on your side. If your project appears at a time that is truly suitable for it, and the market’s recognition and liquidity of you are in place, then your project will be successful. Otherwise, you may be overwhelmed by the flood. This is what we experienced at the time, but I have no regrets. If there were no early attempts, there would be no subsequent experience.

In the first half of 2021, I joined AC Capital. Before this, I participated in a very important project, which was the construction of an NFT platform for a leading exchange. We put a lot of effort into the early construction of this platform, including the introduction of IP, and even designed its on-chain version, providing free on-chain and off-chain collaborative play strategies. However, due to the complex interpersonal relationships and interest relationships of large organizations, many plans were not implemented smoothly. However, this also became an opportunity for me to join AC. After I joined AC Capital, we still actively provided strategies and assistance to the companies and projects we invested in, and some of them were relatively successful.

Core content: I once had the experience of helping Chinese companies go public on the ASX. In 2019, I began to cooperate with a cloud exchange and acquired an exchange in Vietnam to help foreign investors handle deposit and withdrawal issues, and at the same time, I The operational style of Chinese exchanges is brought to Vietnam. When the epidemic broke out in 2020, we focused our energy on incubating DeFi projects and GameFi products, but due to the lack of timing, many projects failed to succeed. In the first half of 2021, I joined AC Capital and actively provided strategies and assistance to invested companies and projects, some of which have achieved relatively successful results.

3. Can you share some of your more unforgettable experiences?

I’ll be honest, I haven’t had any extreme experiences since joining the cryptocurrency space. But in the traditional financial field, a state-owned enterprise once went public, and they entrusted me to help them apply for an Australian financial license. The initial cost and workload were huge. Because they are state-owned enterprises, I choose to believe them. But I was too young at the time, and I didn’t expect that state-owned enterprises could run away, leaving me with a debt of nearly 10 million yuan. Since then, I have had a strong distrust of centralized institutions, especially institutions that appear to be endorsed by the state.

The most fun experience was in the Axie project. At that time, they only had a two-month runway, and Animoca had not yet invested. We helped them promote their teams and found people to attend lectures, which was a contribution to helping them overcome the difficulties. But because of this reason, when I had the opportunity to vote for Axie, I didn't vote. Personal knowledge led me to think that they were a grassroots team. So sometimes the people who make money in the currency circle are really IQ50. Opportunities are given to those who are prepared, but in the end, those who are not prepared are favored. A similar situation also occurred with the C98 project. Their earliest wallet version crashed on my phone more than a dozen times. When they raised the strategic round, I only took 5,000 quota. The memories of these experiences are truly hilarious.

Core content: I don’t have an extreme experience in the cryptocurrency field, but I once encountered a state-owned enterprise running away in the traditional financial field and was in debt of more than 10 million. In the Axie and C98 projects, we have also experienced situations where opportunities were given to those who were prepared, but ultimately favored those who were not prepared. These experiences are deeply moving.

4. Can you tell us about AC Capital’s investment strategy?

Our investment strategy is based on several basic cognitions: The essence of Web3 is to make assets. The success or failure of a project lies in the liquidity of its main assets. Only by increasing liquidity can we obtain the maximum absolute return from a capital perspective. There are only two types of participants in Web3, one is similar to debt investors (who earn interest), and the other is similar to equity investors (who earns gains). But no matter which one, the nature of this market is driven by emotions and narratives. In a sense, all tracks, products, and technologies can be regarded as some kind of narrative or emotional guidance. In the end, the strong player in this market is not a business giant like a technology company, but a religious leader with unquestionable value. (You wouldn’t ask the church in the Middle Ages if indulgences were discounted at 20%). If you use this thinking to understand Bitcoin and Ethereum, it will all work. In a sense, we at AC don’t value the track that much. This is our macro investment philosophy.

Based on this concept, AC mainly invests in early-stage projects and invests in early-stage teams. Looking at the team, we don’t care too much about whether the team has a stellar resume. We are more concerned about whether this team has sufficient product delivery capabilities. The so-called "enough" means delivering just enough for the market to understand and buy into the story they tell. Therefore, the second thing we value about a team is whether they are good "leaders and missionaries" and whether they have the ability to raise their arms and respond to the team like the heroes of Wagangzhai. A developer who doesn't preach is not a good project owner. Finally, it is whether the project party has a concept of market value. In the end, the success of a project is determined by the assets. No matter how well you tell the fundamental story in the early stage, if you don’t know how to play with market value and have no concept of secondary market mentality, you may end up with a “Super Mario” in market performance. Of course, the team cannot be perfect, and we will strengthen the shortcomings through our own intervention. This can also reflect our value as an organization. After all, we can look at the project party from the perspective of the project party, and I can also help the project party from the perspective of the project party.

From a track perspective, we have two main directions. One is Mobile-first. We believe that mobile phone-based cryptocurrency products are an inevitable trend. This determines whether you can sell your narrative to more people. In Mobile-first, we can also see more possibilities, such as plug-in types that are attached to existing high-traffic social networks or even e-commerce networks and cut the existing value transmission chain through token economics. application. The second is the emerging new public chain with relatively weak official authority. We focus on Move and Cosmos. For example, Sui, which was launched recently, is one of our current key directions. Technically speaking, the logic of move is different from that of Ethereum and is closer to the logic of the real world. We believe that under the new technical framework and way of thinking, some different projects will be born. For example, functions such as sponsored transaction can natively implement account abstraction, contract wallet and other functions that are still not well implemented in Ethereum at the L1 level. Second, we believe that the current development of the entire Ethereum is essentially formulated by Ethereum’s vested interest groups to serve Ethereum’s monetary policy. If you are not part of this group, the benefits you receive will be very small, regardless of whether you are L1, L2 or L3. In the new ecology, vested interests have not yet been formed, the vast world has a lot to offer, and the princes and generals will have their seeds. Downside is limited, while Upside is unlimited.

Secondly, we believe that ecosystems like Telegram Open Network also have great potential. Telegram itself has a very large user system, and most of its developer groups are based in Eastern Europe, Russia, and Asian countries. They have the opportunity to reap the arbitrage dividends caused by the division of local politics or inconsistent regulatory attitudes between the East and the West. Some unique features Application types are possible, and these factors make development on Telegram Open Network extremely attractive.

Core content: AC investment strategy is based on some basic cognition, investing in early-stage teams, the ability of "leaders and missionaries" who value the status of the team, and the concept of market value. It mainly invests in two tracks: Mobile-first and new public chains. Special attention is paid to the development potential of Telegram Open Network.

5. What did you learn or gain from this trip to Hong Kong?

In this experience of going to Hong Kong, I think everyone can regard it as a big gathering of domestic ecology. After all, we have been in China for two years and have never had an opportunity to vent like the previous Vientiane Conference. We can understand that this is everyone's desire for a new direction. In the past two years, the entire industry has experienced a serious East-West divide, and there is a complete mismatch in the direction of thinking between the East and the West. The East is also more eager to contact the Western ecological world and understand what they are doing. Therefore, in terms of institutional sentiment, it is very FOMO. But I think for VCs, our main concern is the constructiveness of projects and builders. My main task is not to network. We held an event by ourselves on the 12th, but I still stayed in Sui's hacker house most of the time. This is the last ecological gathering before going online, and you can also get first-hand ecological information.

From Sui's previous participation in hacker houses, you can clearly feel that the ecosystem is constantly correcting itself and becoming mature. At the beginning, Mysten Labs hoped to use games to open the market and build different web applications, but as time went by, they began to realize that it would be difficult to do these things without assets on their own chain. Therefore, they began to support the development of related DeFi applications and even personally developed applications on the chain. At this summit, the works submitted by developers also included many aspects of content, and more mature teams joined in. For a project, it is not enough to just have technology. It also needs to be completed and run by the community. This is also one of the biggest challenges for various project parties in Sui Ecosystem. However, the entry of mature teams or the growth of existing teams will gradually dilute this problem, and the ecosystem will gradually move out of the "grass team" stage.

Core content: This experience of going to Hong Kong can be seen as a get-together between Eastern and Western ecology. The East hopes to know more about Western ecology. At this summit, developers also submitted various content, but the biggest challenge still lies in community operations, so we look forward to new teams joining to promote the development of the ecosystem.

6. What potential development tracks do you think Web3 has in the future?

Again, we do not play around the track, especially in the bear market. Many of the "tracks" that everyone took for granted at that time will be falsified before completing a cycle, and you as an investor are likely to lose money as a result. So I try my best to consider the problem from its essence, such as LSD. This track paradigm was created to solve the problem of monetary policy. This is true for Ethereum, and it is also true for other public chain coins. Even more magnified, the U.S. dollar and the euro have all been looking for ways to increase currency consumption and liquidity lock-up, repeatedly jumping between credit expansion and contraction, and rewarding the departments that cause the most lock-ups. From this perspective, the LSD track will definitely continue to be popular (locked), and all tracks related to trading and leverage will also be popular (consume) other tracks. If it can definitely lead to more ecology per unit time Local currency consumption, such as Blur or even Xen, will definitely become popular.

Core content: We recommend not to make plans just around the track, especially in a bear market, but to consider the problem in essence, because monetary policy itself is a long-term issue. Therefore, tracks such as LSD, as well as tracks that can deterministically lead to more ecological currency consumption per unit time, such as Blur and Xen, are expected to be well received.

7. What are your prospects for the future?

Our current job is to make our company more like a venture builder. We are not only an investment institution, but also actively participate in the construction of many projects. We will provide product direction and even provide code and equity. Because we have the ability in this area, we also have rich experience in operations, including the operation of exchanges and Defi and other products, as well as the operation of primary projects to secondary markets. We can also provide great help to teams that are technically strong but not very good at the operational side. Therefore, we hope to build ourselves into a venture builder, not only an investment institution, but also a part of project construction. For example, I can go to Hacker for three days on behalf of our vc team and provide them with practical help.

Core content: As a venture builder, our company not only provides investment services, but also provides practical construction assistance to the team, including providing product direction, code and equity, as well as operations from primary projects to secondary markets.

8. Do you have anything you would like to share?

I think that in the past year or two, especially from the last bull market to now, a variety of products and assets have emerged, whether they are good or bad, they have provided us with a lot of enlightenment. For these products and assets, we need to have our own judgments and opinions, such as "What is the key point, whether the game is fun, or the key is the good performance of the gamefi asset and this model?" But I think one thing remains constant, and that is that the essence of Web3 returns to the assets themselves, because no matter what method we use to support it, it ultimately comes back to the issue of assets. For an asset, the final consensus and opinion are the most important. This consensus is not only our internal consensus, but also the consensus in the market. For example, in CSGO, a knife is not a consumer product, but a real asset, and the market will give it its own endogenous logic. The market is smarter than us, so there is no dimensionality reduction attack. Even technologies like AI cannot reduce the dimensionality and impact the entire industry, because the market has learned how to deal with such technologies. Therefore, we need to maintain an open attitude towards Web3 and the various products and assets involved in it, hold an empty cup mentality, and constantly absorb new information and insights.

Core content: In Web3, the ultimate key is the consensus of the asset itself, including consensus within us and in the market, so we need to have an open attitude, an empty cup mentality, and constantly learn new information.

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