Author: Nianqing, ChainCatcher
Earlier today, Fortune reported that Yida Gao, founder of crypto venture capital Shima Capital, was suspected of misappropriating assets by creating secret offshore entities to transfer assets belonging to his venture capital firm to companies registered in his own name without the knowledge of other investors in the company. If true, this behavior has violated the Investment Advisers Act.
According to RootData data, Shima Capital is a crypto-native fund established in the United States in 2021 and is registered with the U.S. Securities and Exchange Commission. Although Yida Gao has not yet been charged, his performance and behavior clearly violated the investor protection rules of the U.S. Securities and Exchange Commission (SEC).
In addition, the report also mentioned that Shima Capital has also experienced a wave of resignations of senior employees in recent months, including Chief Technology Officer Carl Hua, Research Director Alexander Lin, Chief Operating Officer and Platform Director Hazel Chen, etc. Its official website shows that the team currently has a total of 13 people. Despite the resignation of many employees, Shima Capital has not yet made any new recruitments.
Shima Capital's investment advisory form registered with the SEC in April showed that it managed approximately $158 million in assets, a figure lower than the $200 million it raised in 2022.
As of press time, Shima Capital and Yida Gao have not responded to the relevant reports. Yida Gao's X dynamics remain in December last year, and he was still active in various media and public relations platforms last year. In April 2023, Yida Gao succeeded Gary Gensler, chairman of the US Securities and Exchange Commission, to teach a crypto finance course (15.492 Crypto Finance) at MIT for the second consecutive year.
Last September, Yida Gao was asked in an exclusive interview with Cointelegrap "How did Shima Capital convince investors to participate in high-risk industries in the early days of its establishment?" He replied that "both in traditional and Web3 industries, I have accumulated ten years of good records and credit in finance and venture capital, and played a key role in winning the trust of investors."
Yida Gao: From a small town in Fujian to a Wall Street financial elite
Yida Gao is a young Chinese American who immigrated to Atlanta, USA from Fujian Province with his family when he was very young. Out of nostalgia for his hometown, Yida Gao founded Shima Capital and named it after the town where he was born, Shima Town.
Yida Gao has a similar resume to many crypto star founders: graduated from a prestigious university, majored in mathematics and computer science, and has experience working for major Wall Street companies.
Yida Gao holds a Bachelor of Science degree in Mathematics and Computer Science from MIT. He has held research and programming positions under Professor Paul Asquith at MIT Sloan School of Management and at McKinsey & Company in Boston. During his undergraduate years, he also had two special identities: a college pole vaulter and a member of the Phi Beta Kappa Society.
After graduation, he started his career on Wall Street as an analyst in the M&A group at Morgan Stanley, providing advice on transactions with a total value of more than US$15 billion. After that, Yida Gao worked as an investment consultant at New Enterprise Associates (NEA).
In 2017, Yida Gao dropped out of Stanford University's business school to engage in crypto investment full-time. According to his personal website, he co-manages venture fund Struck Capital and multi-strategy crypto fund DDC (Divergence Digital Currency) as a managing partner. During this period, he was selected as a general partner of Struck Capital and the founder of the fund, Adam B. Struck, as one of the "Forbes 30 Under 30".
In 2021, Yida Gao founded Shima Capital. In August 2022, Shima Capital raised $200 million for its first venture capital fund. Shima Capital Fund I focuses on pre-seed and seed stage investments, with participation from many well-known investors such as Dragonfly, hedge fund billionaire Bill Ackman, Animoca, OKX, Mirana Ventures, and Republic Capital.
In 2022, Yida Gao was invited to teach at MIT's graduate course on cryptocurrency and finance, a position that had just been vacated by Gary Gensler, chairman of the U.S. Securities and Exchange Commission.
Shima Capital: Focusing on startup projects, investing in more than 200 projects in three years
Shima Capital has invested in more than 200 projects in the three years since its establishment (the number was still over 100 in September last year). Well-known projects include Wombat Exchange, Berachain, Monad Network, Polkadot, Solv Protocol, Meson Network, Galxe, 1inch, Coin98, etc. The most recent disclosed investment was on June 4th. It ranks sixth on RootData's list of active investors, and is also one of the VCs with the most investments for two consecutive years in 2022 and 2023.
Shima Capital mainly invests in pre-seed and seed-round startups. More than half of the team members are responsible for the post-investment operations and support of the invested companies, including engineering design, community management, token design, etc. According to RootData data, Shima's main investment areas are games, infrastructure and DeFi, and its investment amount is generally between US$500,000 and US$2 million.
Currently, RootData has a total of 236 Shima Capital investment projects, of which 96 projects have issued tokens. Shima mainly invests in SAFEs (Simple Agreement for Future Equity) with token warrants, and sometimes pure tokens. The projects invested usually have a lock-up period of two to four years, and the average holding period is about four years.
Shima's investment philosophy is "We run through walls for our founders". Yida Gao once mentioned in an interview that Shima considers three aspects during due diligence: team, product and market. Among them, as a seed fund, the team is the most concerned, because in this fast-growing industry, products and markets are always changing. In addition, the investment team will actively look for transactions and investment opportunities through hackathons, accelerator demo days, universities and even social media such as Twitter.
