What It Takes to Build in Crypto Now: How Lucas He of tmr Ventures Picks Startups

Despite recent price pressure, crypto continues to gain adoption as the technology moves deeper into mainstream finance and market infrastructure. That shift is central to the thesis behind tmr Ventures, an early-stage venture firm based in Boston and founded by Lucas He to back crypto companies building practical, durable businesses at the intersection of blockchain and capital markets.

He brings more than a decade of experience in blockchain, dating back to 2012, along with a background that spans roles as a technology analyst at Merrill Lynch, a quant trader, and a Corporate and M&A strategist at State Street. 

In this interview, He discusses where he sees the strongest opportunities, why he believes tokenization and real-world financial applications will define the next chapter of growth, and what advice he has for founders trying to build lasting companies in the space today.

Startup Boston: Can you tell me about tmr Ventures and the gap you saw in the market?

Lucas He (LH): tmr Ventures is my first fund as a sole GP, but it’s the culmination of years of experience and conviction built over multiple cycles. I started in crypto in 2012, so this is my fourth cycle, and I’ve seen a lot of iteration in the industry.

Historically, the space has been very retail-driven and hype-driven. Many investors focused on supporting projects that could quickly launch tokens, generate excitement, and get listed. But as the industry becomes more institutional and more serious, the future lies in equity deals – investing in companies with sustainable cash flow and real businesses. That’s still relatively rare in crypto.

Another gap is that after years of building infrastructure – layer ones, layer twos, faster and cheaper chains – there hasn’t been enough focus on the next generation of applications. We need to shift attention back to real use cases instead of constantly reinventing infrastructure.

Finally, coming from a traditional finance background, I see an opportunity in bridging crypto with deep financial expertise. As regulation evolves and use cases like payments and stablecoins mature, there’s a need for investors who understand both worlds. That’s a key part of the edge we’re building at tmr Ventures.

SB: Does that mean you’re more focused on DeFi (decentralized finance)?

LH: I’d say “DeFi” is a broad term, but what I’m focused on is reimagining capital markets over the next 10 to 20 years. That includes the entire financial services stack – front office, middle office, back office – and how blockchain can improve it.

We’ve already seen major shifts from paper to electronic trading. Now we’re looking at how blockchain can augment traditional systems through things like tokenization. Stablecoins are an early example; they’ve made payments more efficient and reduced costs, especially for cross-border transactions.

Going forward, tokenization will expand into equities, bonds, real estate, and private markets. That creates opportunities for startups building platforms, infrastructure, and real use cases around trading and payments, across both developed and emerging markets.

This is where my experience in both crypto and traditional finance comes together. Large institutions are already leaning in, and there’s growing recognition that tokenization is still early, similar to where the internet was in the late ’90s.

SB: How does market volatility and lower crypto prices affect how you think about investing right now?

LH: It has both positive and negative effects. From a fundraising perspective, it’s more challenging. Market sentiment tends to follow prices, and during volatility, capital often moves toward safer assets.

But for venture investing, it’s actually a better environment. When there’s less hype and less hot money, founders tend to be more rational. The ones who stay are building with real conviction.

It also creates better entry points. Valuations are lower, and you can be more selective. In my experience, some of the best investments are made during bear markets.

Our approach is contrarian: we deploy capital when others are hesitant. By staying disciplined and focusing on long-term fundamentals, we believe this environment creates a strong advantage.

SB: When you evaluate a startup or founder, what are you looking for?

LH: At the earliest stages, there’s often very little data – minimal revenue, small customer base, sometimes not even a working product. So the focus is primarily on the founders.

I look for founders who are ambitious but grounded. They need to deeply understand the problem they’re solving, what makes them uniquely positioned to solve it, and what resources or advantages they bring.

Equally important is flexibility. Early-stage companies almost always pivot, whether it’s the idea, the market, or the business model. So I value founders who are coachable, self-aware, and willing and capable to adapt.

Ideas are cheap. Execution is what matters. That’s the core of how I evaluate early-stage opportunities.

SB: What advice would you give to early-stage founders building in crypto today?

LH: Crypto is no longer as early as it once was. We’ve already built a lot of infrastructure, and now the focus needs to shift to solving real business problems.

Founders should avoid building something just because it’s trending. Instead, they should think deeply about what problems actually require blockchain, and what unique edge they have – whether that’s technology, distribution, or regulatory access.

Another key shift is moving away from relying on tokens as the core business model. In the past, teams focused heavily on token promotion and short-term demand. That approach is no longer sustainable.

Founders should prioritize generating cash revenue, even if it’s small at first. That creates a more durable business and reduces reliance on token-driven funding, which can give a false sense of traction.

SB: Is there anything we didn’t cover that you’d want to emphasize?

LH: Even though I have strong conviction in where the industry is going – more institutional adoption, more tokenization – this is still a long-term transition.

Financial systems don’t change overnight. There are structural challenges, cultural inertia, and long adoption cycles. That’s normal.

We’re investing with a long horizon: five, ten, even twenty years. There will be hype cycles, but adoption takes time. Our role is to support that transition and work with both crypto-native and traditional financial institutions as the space evolves.

This is a long-term effort, and that’s how we approach it.

About the author: Randall Woods is a former Bloomberg journalist and currently Senior Vice President at SBS Comms, a communications agency for technology companies.