TLDR:
- Yida Gao, a young crypto VC, raised $200 million for his fund Shima but redirected portions of it to a secret overseas company without informing investors.
- Shima’s assets under management have fallen to $158 million, and Gao is struggling to raise more funds despite the booming crypto market.
Summary:
Yida Gao, a promising young venture capitalist with an impressive background including prestigious institutions and a successful fundraising campaign for his crypto fund Shima, has fallen from grace. Gao raised $200 million for Shima from well-known backers but redirected some of the funds to a secret overseas company without disclosing this to investors. This has led to a decrease in the value of Shima’s assets under management to $158 million and difficulties in raising more funds amid the flourishing crypto market. Despite Shima’s explanation of the unusual arrangement as a form of “warehousing,” some have suggested it could violate SEC laws, highlighting potential integrity issues. Additionally, Gao’s struggle to secure an auditor in the past reflects poorly on the firm’s behavior and raises questions about its credibility. It appears that Gao’s association with reputable institutions and backers may have overshadowed his lack of experience and ethical lapses, leading to a crisis for both Shima and its founder.
