Fintech
Billionaire Steve Cohen’s Point72 Ventures lays off fintech team to pivot to artificial intelligence
Steve Cohen, founder and CEO of Point72 Asset Management and owner of the New York Mets.
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Billionaire Steve Cohen’s Venture capital arm Point72 Ventures is moving away from fintech and cryptocurrencies after firing its five investors focused on those areas, Forbes has learned. The company will instead shift more focus to investing in artificial intelligence and defense technology startups, according to two people familiar with the situation.
The departures include three fintech-focused investors and two investors in Point72 Ventures’ digital assets team. Partners Tripp Shriner and Sugam Sarin are also likely to leave, the sources said, although another said there was a possibility they would remain on the team to support existing portfolio companies. Punto72 had announced Sarin’s promotion dates back to May 1st. Shriner and Sarin did not respond to requests for comment.
“We always evaluate our portfolio performance and market opportunities and optimize our strategy and resources around what we believe is the greatest opportunity,” a Point72 spokesperson said in a statement to Forbes, declining to comment further .
Point72 Ventures, a multi-stage venture fund funded by Cohen within his $30 billion hedge fund Point72 Asset Management, closed a $1 billion fund in 2017. It has since invested in more than 100 startups, spanning fintech, AI, consumer, enterprise and defense. Of those investments, 65 have been in fintech startups. company website.
Fintech startups have promised to disrupt old-school banks, insurers and credit card companies with modern technology, sleek designs and new financial products like access to earned wages or early direct deposits. In 2021, the category hit its funding high, raising more than $140 billion in 5,474 funding rounds, according to CB Insights. However, since then fintech startup evaluations have decreased dramatically; venture financing in the sector is down 70%.
By comparison, funding for AI startups has surpassed that for non-AI startups in recent months, with 6 billion dollars and $1 billion funding round for xAI e unicorn for data labeling Scale AI in May. At the beginning of June, Bloomberg reported that Point72 was looking to raise its own $1 billion hedge fund for AI investments in the public markets.
Notable fintech holdings for Point72’s venture capital arm include Forbes Fintech50 listeners MX Technologies AND Vestwell. One of the big winners expected for the fund is digital trading startup DriveWealth, which lifted up $450 million at a valuation of nearly $3 billion in 2021.
The cuts to the fintech team come seven months after the departure of Pete Casella, founding partner of Point72 Ventures and former partner on the fintech investment team. Point72 Ventures may still invest in fintech opportunities selected by its remaining teams, such as its consumer startup group, a source said.
But the departures will still prove an inhospitable complication for the startups that took Point72 Ventures’ money into fintech and cryptocurrencies. For companies in those sectors looking to bounce back in the future, the moves also bring a warning that at least one capital allocator is (mostly) closing the doors on them.