Having emerged from the shadow of former parent company FTX, Serum is now looking to soar.
The team behind one of Solana’s largest projects is midway through a $100 million raise to expand operations. According to a press release provided to CoinDesk, the Incentive Ecosystem Foundation, the legal entity staffing the team behind the orderbook-based decentralized exchange, is raising the funds to hire and move into new product verticals, including “NFTs, gaming, metaverse and DAO tooling.”
So far the round includes participation from Commonwealth Asset Management LP, Tagus, Tiger Global and executives at Golden Tree Asset Management.
According to pseudonymous Serum core contributor JHL, the Incentive Ecosystem Foundation is an entity used to give contributors salaries and benefits. It will also manage the Serum Ecosystem Fund, which holds tokens in the Serum and Solana ecosystem, including projects like Raydium and Bonfida.
Buyers in the round received both Serum’s SRM tokens as well as a portion of the ecosystem fund, with 85% going into the fund.
Ecosystem funds are a growing trend among major projects. The funds source deals within their particular ecosystem, fostering early-stage companies and sending tokens from those projects to fund liquidity providers. One recent example is Avalanche’s $100 million “Blizzard Fund.”
JHL told CoinDesk that the raise is still ongoing.
“In committed capital, we’re right around $70 million,” he said, adding that the investments are locked for one year with a linear vesting schedule over an additional five years.
The raise comes at a time when Serum is attempting to “further decentralize from the Alameda and FTX family,” JHL said. It also comes as the crypto markets are tanking, with Solana’s SOL among the top losers in recent days.
“Serum was originally founded by [FTX founder Sam Bankman-Fried], and at the time most of the contributors to Serum were employees of Alameda and FTX. Over time, both due to the evolving regulatory landscape as well as the desire to include the community further in Serum’s future, we’ve now decentralized Serum – it has its own employees, it’s completely separate in a legal sense and in every way possible,” he said.
The Incentive Ecosystem Foundation will use the funds to help Serum become a self-sufficient entity and expand operations. Per JHL, the team is currently “five-to-10 people, really,” and a major use of the funding will be to expand the marketing and technical teams.
Amid a broader crypto selloff, SRM is down 2.3% on the day to $3.15.