The Inquisitive VC: Oleg Mikhalsky , Partner at Fulgur Ventures

Oleg Mikhalskys’ experience prior to starting Fulgur Ventures was in software and product management. The most recent industry Mikhalsky worked in prior to crypto was the cloud space, having joined a company called Acronis in 2010. Mikhalskys’ experience before cloud was in cybersecurity, when it was also a very nascent industry. He worked for Kaspersky Labs for seven years.

After finishing with the cloud space Mikhalsky stated that he “was looking for the next technology to possibly spend the next decade on and I met some people, from whom I learned about, Bitcoin.”

Mikhalsky learned about crypto in 2017 and decided to focus on Bitcoin. Since he is a self-described product-focused person and decided to spend time on the lightning network, as it’s a productization layer, which enables applications to be built on top of Bitcoin. According to Mikhalsky, he was introduced to the lightning network through Andrey Samokhvalov, who was then working for Lightning Labs.

Prior to entering the Bitcoin and blockchain space, Mikhalsky was an angel investor typically investing in startups where he thought he could add value by advising on product strategy, go-to-market, fundraising, and company growth.

His first angel investment in the crypto space, prior to forming Fulgur Ventures, was in Andrey Samokhvalovs startup Bitlum, which was focused on Lightning Network research and development. The startup is now no longer active.

Fulgur Ventures followed shortly after. “We started the fund as our curiosity and our engagement with the industry increased after we made an angel investment in Andrey’s startup,“ Mikhalsky told BraveNewCoin. “We thought we could develop a value-added fund for entrepreneurs who are working on Bitcoin specifically. There’s a lot of first-time founders entrepreneurs who are either engineers or product designers, but less often they are marketing or business people. So we thought we could add the business development and go to market expertise to Bitcoin and lightning network startups.”

The reason they focussed the fund on Bitcoin and the lightning network was that they believe that Bitcoin is a powerful candidate for building a neutral, decentralized monetary system, and that it needed the lightning network as a scalability layer to increase adoption.

According to Mikhalsky, the firm was behaving like angels, writing small checks to follow founders who share the Bitcoin lightning network values and were committed to the long term development of the lightning network ecosystem.

“They knew ahead of time that it would be difficult to find a business model around it, that it will take a long time to get traction and they were prepared to weather the storms. This is not like the founders in which typical VCs invest because typically VCs invest in founders who generally know how to iterate quickly to prove product-market fit, then to get traction and scalability,” stated Mikhalsky.

One of the goals for the fund is to support nonprofit activities, so the firm has sponsored conferences and has supported different communities by giving grants to developers. Mikhalsky believes that supporting these kinds of nonprofit initiatives may give the firm some additional visibility, as the ecosystem is starting to see a large number of venture firms.

When the team was trying to map out the ecosystem, Mikhalsky decided that the gaming industry seemed attractive as gamers are typically early adopters of technology. In Mikhalskys’ opinion, payments over the lightning network could become very useful in games because of the ability to pay for microtransactions. “That could come with the possibility to do streaming payments or instant payments to change the gameplay for example,” he states.

Another area associated with the gaming space that interests Mikhalsky is the potential to issue and store assets on the Bitcoin blockchain using the lightning network, through RGB technology.

The RGB Project is a free, open-source, non-profit and community-oriented effort, aimed at the development of standards and best practices to issue, transmit and store "Bitcoin-based non-bitcoin assets."

Aside from the gaming space, Fulgur Ventures is closely following bitcoin security applications and bitcoin rewards. Mikhalskay says that securely storing bitcoin keys still presents issues, “as well as the problem of giving users easy access to their first bitcoin, or sats, rather.”

According to Fulgur Ventures website, the firm’s portfolio consists of companies including Bitrefill, Fold, Blue Wallet, Zebedee, and Casa.