Former FTX US President Manages to Raise Funds From Coinbase, Circle for His New Firm After Publicly Blasting SBF
Brett Harrison, former president of FTX US, has managed to raise funds from major crypto investors such as Coinbase Ventures and Circle Ventures after publicly blasting FTX founder Sam Bankman-Fried.
According to a Friday report by Bloomberg, Harrison has raised $5 million for his new crypto software startup from Coinbase and Circle. The move comes just days after the crypto boss complained association with FTX has hindered his ability to raise funds.
Called Architect, the venture aims to build trading software to make centralized and decentralized crypto markets easier to use for large investors like institutions. Harrison has said he hopes Architect “will allow people to get their confidence back in trading in this industry.”
The crypto software startup is projected to launch in the second quarter. Harrison said he hopes Architect will be eventually incorporated into Coinbase Global and Circle’s platforms. He said that the funding he raised from investors will be primarily used for recruitment.
The venture has an advisory board of directors that will transition to a formal board and help create corporate transparency, according to Harrison. He said he also wants to create a work environment that allows “people to give and to accept criticism.”
According to a report from research firm Pitchbook, venture funding for crypto startups plummeted 75% in the last quarter of 2022, the lowest since 2020. Only $2.30 billion was invested into crypto startups in Q4 2022 while a record $26.7 billion was invested in blockchain startups in 2022, the majority of which came in the first quarter.
Aside from the record drop in crypto funding, Harrison also had a hard time raising funds due to his association with FTX. In a long Twitter thread on Saturday, he said nearly every venture fund he had reached out to refused to invest citing SBF and FTX issues. He said:
“After that, many conversations eventually came around to the same kind of apology: “We know you weren’t involved in what Sam and others did, but we can’t take on the PR risk of associating ourselves with FTX, no matter how capable you are or compelling your idea is.”
43/49 The last few months have provided me with a valuable character study of the industry. Some treated me like an entirely different person overnight, some immediately offered sympathy and support. It will be a difficult experience to forget.— Brett Harrison (@BrettHarrison88) January 14, 2023
As reported, Harrison also revealed that he left FTX US due to a deteriorating relationship with Sam Bankman-Fried and his deputies over management practices.
Harrison joined FTX as president of FTX US in May 2021 and announced his departure in late September 2022. At the time, he didn’t disclose why he is leaving his role but said he will remain as an advisor at the company.