Venture firm Cadenza closed its first fund for early-stage artificial intelligence startups with $50 million last week. It is also raising its third blockchain-focused fund, according to Managing Partner Max Shapiro. Some crypto entrepreneurs turned to the booming AI sector as an alternative during tough times in the most recent crypto downturn. Others saw efficiencies in how AI and crypto could be applied together. Cadenza, based in San Francisco and New York, by contrast, is pursuing AI and crypto deals as distinct strategies. “There were a lot of peers in our market who said that there were overlaps,” Shapiro said. “We disagree.” He added that, “They are two fundamentally different technologies.” So how does Cadenza straddle them? The firm, which has focused on crypto since its founding in 2018, made its first generative AI deal in early 2022, before the frenzy in the market caused by the release of OpenAI’s ChatGPT. Cadenza took part in the 2022 pre-seed round of Together AI because firm Managing Partner Kumar Dandapani had known Together AI CEO Vipul Ved Prakash for many years. Together AI, which sells tools to companies using open-source AI models, was valued at $1.25 billion in its most recent round earlier this year.
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Full analysis : Do AI and Blockchain Go Together? One Venture Firm Backs Both.