Bankman-Fried invested in enterprise capital backers of his FTX trade

Sam Bankman-Fried invested tons of of tens of millions of {dollars} into enterprise capital funds run by corporations akin to Sequoia Capital which additionally backed his struggling FTX crypto trade, in keeping with paperwork seen by the Monetary Occasions.

The 30-year-old entrepreneur, who has been in search of to boost billions of {dollars} in emergency financing, has a $200mn funding in two funds run by Sequoia, the US enterprise capital investor, held by way of his Alameda Analysis crypto buying and selling group.

Alameda additionally had smaller investments in funds run by FTX enterprise capital backers Paradigm, Altimeter Capital Administration, Sino International Capital and Multicoin Capital, the paperwork present.

The revelations make clear Bankman-Fried’s dealings with blue-chip buyers whose assist helped lend his enterprise empire credibility earlier than its sudden collapse this week.

FTX raised $1.8bn since its launch in 2019 and was most not too long ago valued at $32bn. The trade’s fast fall this previous week was pushed by considerations about its hyperlinks with Alameda.

The buying and selling agency, which Bankman-Fried mentioned on Thursday can be wound down, owes FTX $10bn, in keeping with two individuals acquainted with the matter. Alameda’s belongings embody cryptocurrencies in addition to billions of illiquid non-public fairness investments like enterprise capital funds, one of many individuals mentioned.

Sequoia was a distinguished cheerleader for Bankman-Fried. In September it printed a prolonged hagiography of the FTX boss, saying his “mind is as superior as it’s intimidating”. This week Sequoia wrote its $210mn funding in FTX all the way down to zero and deleted the article.

The California-based agency is among the many most profitable US enterprise capital buyers and is cautious about who it permits to put money into Sequoia-run funds. An individual near Sequoia mentioned the agency had some funds wherein the founders it backed might make investments. Alameda had invested in numerous Sequoia funds to those that Sequoia invested in FTX.

Sequoia declined to touch upon the Alameda funding.

A FTX spokesperson didn’t instantly return a request for remark. A spokesperson for Alameda couldn’t be instantly recognized. The fund shut its web site this week.

Alameda’s enterprise capital investments included $60mn in a fund run by Sino International Capital, $20mn in a Paradigm fund, $10mn in two Multicoin funds, and $2.5mn in an Altimeter fund, in keeping with the paperwork.

Paradigm declined to remark. It additionally wrote down its $278mn funding in FTX to zero this week. The opposite enterprise corporations didn’t instantly reply to request for remark.

Bankman-Fried’s hedge fund additionally invested $300mn in K5 International, the enterprise capital agency co-founded by Michael Kives, in keeping with the paperwork. Messages revealed throughout billionaire Elon Musk’s court docket battle over his acquisition of Twitter this 12 months confirmed Kives texting Musk to recommend Bankman-Fried as a co-investor in Twitter. K5 didn’t instantly reply to a request for remark.

The Data earlier reported Bankman-Fried’s enterprise capital investments.