Earlier in March, Luno –a wholly-owned subsidiary of Digital Currency Group– introduced Luno Expeditions, its early stage investment arm that aims to support fintech and crypto/Web3 founders.

In a press statement, Luno Expeditions said that by building on DCG’s seven-year track record in early stage crypto investing, it will now spearhead all of DCG’s early sage investing (seed and pre-seed). Its dedicated team will scale up investments –targeting 200-300 per year– and expand the focus beyond crypto into the broader fintech space, globally.

The firm will be led by its CEO Jocelyn Cheng, who is known for her works with global startup founders over the last six years as Managing Director at the impact investment VC, Global Innovation Fund.

In this feature article, we will dig into the investment philosophy of Luno Expeditions and how they plan to seize opportunities in the highly promising fintech and crypto space.

Helping early stage founders hit the ground running

Before understanding the investment philosophy of Luno Expeditions, first of all, we need to understand the specific challenges that early stage fintech and crypto founders faced –that the firm intends to help tackle.

In an email interview with e27, Cheng identifies several of the challenges that they tend to face: hiring and scaling a team, effective engagement with regulators and identifying investors who share the same vision.

“Luno itself was once an early stage startup and understands the challenges on the journey to building a global company, so we’re equipped with the knowledge and experience to help startups navigate the challenges ahead,” she writes.

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“Our ethos is to let founders focus on their companies without us interfering, and help when we’re asked. We aim to support founders by sharing our experience building a fintech business across five continents and many countries, with unique insights on both scaling global organisations and hyperlocalising them,” she continues. “In addition, we provide access to an unrivalled global network in financial services, fintech and crypto across everything from talent and investors to relationships with regulators and banks. We also invest with permanent capital, which means we can truly support founders over the long term.”

When it comes to supporting entrepreneurs, Luno Expeditions see a “real need” for more tailored support for fintech and crypto founders.

“By tapping into Luno’s market expertise, we can provide localised support to the businesses we invest in. We believe this will help accelerate the development of the broader fintech ecosystem in Asia and across the world,” Cheng says.

As an early stage investor, the firm is looking for ambitious founders who are looking to disrupt all or a specific segment of financial services, with the belief that this massive change will be driven by the rise of crypto.

“Our long-term hypothesis is that crypto is going to revolutionise our financial system and there are many companies working directly and indirectly towards that same goal, whether as pure crypto companies or fintech companies. There is still a lot of work to be done in building the infrastructure that crypto will rely on. Our goal is to be supportive of this broader ecosystem and invest in companies across the fintech, crypto and Web3 spaces that match long term thesis and can truly make a positive impact on people’s lives,” Cheng says.

Crypto as the centre of the revolution

When asked about the ongoing trends that Luno Expeditions wants to tap into, Cheng highlights the role of crypto as a driver of innovation, as she highlights in the discussion regarding investment philosophy. More importantly, as agreed by various players in the industry, she also notes how traditional investors have begun to look into crypto.

“We are seeing a strong intersection between some of the traditional fintechs and crypto; we expect this intersection to only increase over the next three to five years,” she says.

“For instance, many fintech companies are enablers for crypto – payment gateways, fraud and compliance companies, or challenger banks that heavily promote crypto adoption. There is still a lot of work to be done in building the financial infrastructure that crypto will rely on, and we plan on investing in businesses that support the broader financial ecosystem as well as crypto native companies.”

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According to Cheng, there is also a greater openness towards diversity and inclusion that the firm wants to tap into.

“Additionally, we see a huge opportunity for increasing inclusivity in fintech. Women are often an under-targeted audience in this space, and Luno Expeditions wants to challenge this,” she points out.

“We have a diverse team in terms of gender, geography and experience – we want this diversity to reflect in the investments we make. In our portfolio, we have already invested in companies focused on making the financial ecosystem more accessible to women. For example, there is a business in Pakistan we have invested in called Oraan. Oraan is Pakistan’s first women-led alternative financial solutions platform to make money management simple for women. They use a human-centric philosophy to craft solutions that are socially and religiously accepted in order to ease access to financial services.”

By March, despite having been in stealth mode over the past months, Luno Expeditions stated that it has invested in over 20 leading crypto and fintech companies globally, including a crypto compliance solution in Israel, an NFT marketplace in the US, a bank dedicated to women in Pakistan, and a ground-breaking remittance solution in Tanzania.

As for Luno, the global crypto platform owned by Digital Currency Group, the platform recently announced that it has surpassed 10 million customers across over 40 countries, gaining an additional one million customers in just six months.

It said that since being founded in 2013, Luno has enabled over US$52 billion of crypto to be safely transacted and its customers have stored in excess of US$1 billion.

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Image Credit: LUNO

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