The metaverse, a digital universe that mirrors our own, is attracting significant interest from investors. This article explores the two main types of funds investing in this emerging space: exchange-traded funds (ETFs) and venture capital (VC) funds. ETFs primarily invest in established, publicly-traded companies, while VC funds support businesses at various stages of development, often with a focus on early-stage financing. While VC funds are typically closed to the public, they can provide valuable networking opportunities and significantly increase a project’s chances of success.
Funds that invest into metaverses come in two major categories: exchange-traded funds (ETFs) and VC funds. ETFs deal with already public companies that have matured for longer, while VCs fund anything from angel rounds to later stage financing rounds. Most VC funds are not open to the public, though. Nevertheless, the involvement of a top-tier VC usually boosts a project’s popularity and chances of success. Good VCs also bring a considerable network to the table that portfolio companies can tap to get ahead.
We found the following ETFs investing decidedly into metaverse stocks:
- Fidelity Metaverse ETF (FMET)
- Roundhill Ball Metaverse ETF (METV)
- Global X Metaverse ETF (VR)
- Ishares Future Metaverse Tech And Communications ETF (IVRS)
- Evolve Metaverse ETF (MESH)
- Subversive Metaverse ETF (PUNK)
- ProShares Metaverse ETF (VERS)
- Horizons Global Metaverse Index ETF (MTAV)
Most of these ETFs contain Nvidia, Microsoft and Meta, but some have interesting additions, such as TMSC or Block Inc as well as Cloudflare. It would be easy to portray these efforts as bandwagonning, but they do offer decent exposure to a relevant portfolio in one easy swoop. What’s not to like?
Regarding VCs that invest into metaverse projects, we can finally bridge over to the Web3 and token world. Many VCs had invested into token based projects even before Facebook rebranded to Meta and a flurry of others followed shortly thereafter.
The top funds are:
- a16z
- Polychain Capital
- Sequoia Capital
- Archetype
- Dragonfly Labs
- And many exchange investment arms like Binance Labs, KuCoin capital and others.
These funds invest into token-based projects like The Sandbox but also into GameFi and other VR projects. The beauty of the VC model is that only one in a couple of checks has to make it big to validate a fund, which allows this kind of capital to finance multiple pathways to metaverse adoption at the same time.
Recently, investors have not looked upon Facebook’s rebranding as Meta with favor, but we the jury are still out if the claim staking by CEO Mark Zuckerberg was not a great move in the end.
In conclusion, the metaverse represents an exciting new frontier for investment, with both ETFs and VC funds playing crucial roles in its development. Despite some skepticism regarding Facebook’s recent rebranding to Meta, it’s clear that many investors see potential in the metaverse space. With diverse portfolios that include both established tech giants and innovative start-ups, these funds offer multiple pathways for metaverse adoption. The future of the metaverse is still being written, but one thing is certain: investors who understand this space will be well-positioned to benefit from its growth.
