Bitcoin Bet Pays Off for Peter Thiel’s Founders Fund

Investing, News | January 4, 2018 By:

Founders Fund, the venture-capital firm co-founded by Peter Thiel, reportedly invested $15 million-$20 million into bitcoin last year. Those holdings are now reportedly worth hundreds of millions, as bitcoin has risen by almost 1,400 percent since January 1, 2017.

It is unclear how much bitcoin Founders Fund currently owns, but the Wall Street Journal reported that the initial investment by the venture capital firm has increased by more than five times, citing sources familiar with the matter.

At an investment conference in October of last year, Thiel said that while he is “skeptical of most cryptocurrencies,” he believes bitcoin has a promising future depending on the trajectory it takes. He said that bitcoin’s critics are underestimating the cryptocurrency’s great potential to become the cyber equivalent of gold.

Thiel co-founded PayPal in 1999, and served as CEO until its sale to eBay in 2002 for $1.5 billion. Thiel became Facebook’s first outside investor when he acquired a 10.2% stake for $500,000 in August 2004. He sold the majority of his shares in Facebook for over $1 billion in 2012, but remains on the board of directors.

In 2005, he created Founders Fund, a San Francisco-based venture capital fund. Other partners in the fund include Sean Parker, Ken Howery, and Luke Nosek. Founders Fund has investments totaling around $3 billion. The Founders Fund portfolio boasts a good number of prominent tech names, including Stripe, Facebook, Lyft, Affirm, Airbnb and more.

In 2016, Thiel was appointed to Donald Trump’s transition committee. He was tasked to deal with vetting presidential appointments and selecting which of Trump’s campaign promises will become the policies.