Behind Crypto Conferences, Taking More Risks, and Crypto's Private Equity Frontier | Roundup

Transcript

I genuinely believe that Protocols are the new institutions like protocols will be larger than any Bank any software company any big company that is out there any Web Two company protocols will eventually be bigger than them we need to go out to the real world and actually just you need to buy you need to have control of these businesses to transform them that is abundantly clear to me and you go even talk to a lot of the major companies in the space the ripples the coinbase commer of the world they're like the tech is kind of there but no one cares scale is the blockchain that is Simply Built different other L1 networks have costly transaction fees clunky user experiences and lack true adoption in Ai and onchain gaming

explore the gas free ecosystem at scale. spacecosmos Ed l1s or expensive l2s is just not going to unlock the next generation of applications super containers offers dedicated customizable app spaces running on supra's 500 ktps layer one blockchain giving you complete control over gas tokens and fees get notified when super containers are ready for Builders at super.com containers tired of losing track of all

your tokens Unis swap wallet is designed to easily manage store and swap your crypto all in one place access thousands of tokens across ethereum and more than 10 other chains instantly by using Unis swaps wallet today download it today it's available on Chrome IOS and Android hit the link in today's show notes to get started what's up hello everyone it's been a while yeah tough uh uh you know I'm an an eternal optimist so I always think that we can keep our podcast schedule going when we do these conferences right did you shave your

beard do you just have a fan shoe oh no no the lighting a f what is it a f man Sho a Fu man Sho because the way the light was hitting your wait what made you think that right side of your yeah right there it looked like there was no beard because the light is like shining down on it so I thought about shaving I'm like it's winter I should definitely not shave not Gro look like have you seen have you seen those uh animals that have like a bear Google bear without hair oh my God so what's the lesson for for us and our personal grooming behaviors I think we need more hair oh God look at that parrot yeah I

know it's it's it's bizarre uh great question sir really you know it doesn't really matter what you think it matters what your significant other thinks in your in your situation so um as much as you want to think about what you do or what you don't do I don't think you have much of a choice here that's true just we have an hour and 15 Yano just told me he has the what I heard the most important pitch that he's ever had yesterday I'm in Amsterdam in case you have noticed um I was at a conference and someone said hey Yano is building an empire over there I'm like uh have you noticed the name of the podcast let's go let's go go so we got an hour 15 what are we talking about

today um yeah we did no no no prep I actually think some of our best apps are no prep so okay so we could talk about so we launched our advisory business sometime I feel like sometimes people like the behind the scenes of that so we could talk about that we came off permissionless um so I can give like a very honest I think my take on the conference like there was there were good things but I mean there were bad things like um the attendees were like smaller than I thought it was going to be so like there I I can get very honest with that if people find that helpful um let let's switch rols most of the time I'm doing the talking I'm going to do most of the questions in this episode scary scary San should let Yano talk so I hear you we're gonna do that this

episode so okay let's start from the top permissionless give me a rundown what was the expectation number of attendees highlights low lights okay so I I think I I will risk being too honest and too open here but I think it ends up being helpful because we get feedback from people about we're we're actually currently figuring out permissionless for our 2025 strategy so at the risk of being too open I will be too open but I would ask for people to give me feedback about what they want to see for permissionless next year so permissionless um to to set the scene conferences are a really tough business model because you have to outlay all this cash up front and you're basically

taking a bet on where you think the industry is going and what type of cycle that we'll be in at that time so when we're booking conferences it's not like it's you know the beginning of the year and it's January and we're like hey let's go host an event in Salt Lake City great let's book Let's book the venue in Salt Lake we have to book these things years in advance so our events team right now is pushing us to book they have a sign they have a contract for 2026 and they're pushing us to figure out 2027 venues so if you think about that that that means it's not about actually signing a venue we have to think about what's the size of the market in 2027 are we going to be in a bull market will we be in a bar market so one of our advisers is Matt Hogan we

were gonna Matt was like look there's you know we we basically went to Matt we were like we want to do there's like a Bitcoin track and like a macro track and a defi track and Matt gave us the advice he said look go all in on defi just pick a niche and try to own it and we picked the right Niche actually so in 202 we launched this big defi conference and host it in 2022 and that that was the right thing to do we had 5,500 attendees um there were probably several thousand more who like came down and it was a crazy it was like an amazing event the problem with picking defi is that doing a defi conference in the US was amazing in 2022 in 2023 we got absolutely smoked um because when Gensler and the SEC and

all those folks are cracking down on crypto you know guess what guess what else happens stonnie says you want me to come to the US and speak at a US crypto conference Kane says you want me to sponsor uh The General Counsel at Unis swap says Hayden you you think I'm letting you go on stage you think I'm letting Unis swap sponsor a booth at a US crypto conference yeah right so 2023 40% of our speakers said no 40% of our usual speakers said no and dropped out um and probably 70% of our sponsors their legal teams wouldn't let them sponsor so that was a real low for us 2023 permissionless was tough okay 2024 my takeaway from permissionless

was it was a much smaller conference than I think we originally wanted to have and that like when I envisioned permission list at the beginning it was kind of like consensus token eth Denver big feel so we ended up only and I put quotes on only we end up only having a couple thousand attendees which I was very nervous about going into it because you know we were coming off the back of token 2049 with 20,000 it's like oh my God if we only have a couple thousand everyone's gonna think we're this tiny event the it actually had an inverse effect which was I think I mean token I'll give a lot of love to token because Alex and the token team just do a worldclass job hosting

conferences the but the industry has gotten I think a little bit um not the industry but like some some people when you come off a crazy Asia trip you're very tired right you don't want to go to a 20,000 person conference anymore you just kind of want to be with your friends and Industry Executives and so the byproduct of of the of of all the Asia travel in Singapore uh in in September was that people loved the intimacy of permissionless I think um you know we do NPS scores of both attendees and sponsors we're getting some of the best feedback we've ever had in the history of Hosting conferences so I'm hearing small intimate High imps people felt that the quality of the

conversations was high the panels from what I could see I haven't seen the videos seemed like really good discussions just the the format as well more debates you had it it's an election year so you had politicians there so how was that like who uh anything interesting in the political front that surfaced in conversations or just in the panels themselves yeah maybe I can pull this tweet up from um from Senator Mike Lee so this is Senator Mike Lee um he's the sitting senator from Utah so we had both Mike Lee as well as uh congressman John Curtis John Curtis is most likely taking Mitt Romney's seat in the senate in Utah I mean unless

something was catastrophically wrong he's gonna become the next Senator so we had both uh the sitting Senator and then the most likely incoming Senator yeah I went I went to a fun for John Curtis um for Congressman Curtis very impressive guy really really really uh you know he he actually used to be a Democrat which was the interesting thing he was a Democrat for six years and so he's probably one of the most he will be one of the most Liberal Republicans in the Senate um very open-minded very interesting guy Mike Le is not liberal uh mikele is very uh conservative I would say um yeah he talked a lot about you know saving the Fourth Amendment keeping the government out of our bank accounts uh you know he he's potentially

in line to be the attorney Attorney General if Trump wins so uh really interesting I mean yeah Tom Emer gave a standing Standing Ovation conversation um yeah was very yeah really good event very good um there was also a health theme so actually I do have to credit you um the health theme was one of the highlights of the conference so I tweeted about it here we had a pickle ball tournament golf scramble rock climbing axe throwing uh SE hosted this awesome thing called SE slam which was a basketball tournament uh yeah crack so Kraken host today like a pull-up bar competition a

hanging competition we host a pickle ball tournament where you could actually bet on the teams um which was a lot of fun so there's an app built on BAS uh where you could actually bet on the teams ton of fun um and then obviously we hosted karate combat which was a really before we go there I saw you hanging like in the Kraken Booth um I people were attacking me because I made a ridicule of myself in the Jambo booth at breakpoint trying to impress people as most people when you try to impress people you'd make a fool of yourself at least I do and I did like 22 Pull-Ups which were not pull-ups and then people were commenting on the form

and then I subsequently posted two videos at the gym and the hotel like okay I did I saw those yeah yeah so hopefully I redeemed some of my dignity that I just threw away and left at the conference but you were just hanging so yeah yeah I mean mine weren't pull-ups I didn't do a single pull-up it was a very you can't compare pull-ups and hanging so P I would be lying I would be lying if I didn't say that I try to just for all shits and giggles at my gym just hanging and be like what was your hang time I'm not going to say I'm not going to say all right all right so let's just say there a couple of a couple of Banger songs went by and I was still hanging sure sure so no no I mean pull-ups work your what your back and your shoulders

and yeah your back and it's very tiring so hanging it's only about grip strength so your shoulders don't give out your forearms tighten up a little but your grip strength really goes so I got one a minute 4 minute 42 okay that's that's a beat you know why my grip strength is so so much higher y why Diamond hands baby like what dumb comment is about to come uh yeah so you know you know it's coming it's coming for you know it's coming when I played baseball we used to do these things you just put your hand into a bowl of rice into like a bucket of rice and you just go like this my my

grip strength is actually pretty good um Ben LOF bankless Ventures got 230 I think anyways good yeah good event the hackathon was really good um I don't know what did this guy say Jesse E day one of permission list is already my favorite event favorite conference I've ever attended no fluff people are the top 1% in the space um yeah I mean the content was really good like Jill said this too permissionless is undefeated is my favorite conference I think if you here here's what happens at every conference in my experience and I'm assuming it's same with you is you you have a very strong divide between the Insiders and The Outsiders so the big

conferences are actually really good for The Outsiders because it's a place for them to go and start to meet the industry however the because of all the side events the Insiders go to the side events so then there are no insiders and Executives and good invest investors stuff at the actual conference permission felt like none of The Outsiders but all of the Insiders in one place so you know how you get stopped at conferences you're like oh God I actually don't really want to have this conversation there were there was none of that yeah that's yeah yeah so it was good um anything you do differently next year um you know I think basically so I really like salt it was

super clean it was really nice to not have too many side events I think it was too tough to get to and I think it was too candidly for me it was a royal Nightmare and I had a meeting back home that I couldn't change and I it was just made it impossible it was to three days coming yeah it was just too tough for the Europeans so we lost a lot of you know if you think that our com like you know I I bet we lost about 700 people from Europe cuz I was looking at our attendee demographics and we probably lost about 700 people who usually come and would have come and they would have been from Europe um but we also lost a lot of people from New York right who it's they're like ah look I just don't

want to go to Salt Lake City um I did like how clean it was that was nice um but as I think about permissionless I don't think blockworks wants to be in the big BC event space um anymore I think that was a fun thing in 2022 I don't think that's our bread and butter and I don't think we will be the world's best at that I I I really think token even coind dest has a good job with consensus like they we I think we're going to leave the big events to the to the other players um there's also a business model risk of doing those big events they actually spit off a lot of cash in Bull markets but they're really the only thing that can blow up your your business at this point like the

thing that could kill blockworks is if we tried to host let's say a 20,000 person event in Vegas or something next year which like Kane and stonnie were trying to convince me to do uh which sounds super fun and it would be pretty epic if it didn't go well it could kill the business so I think what we'll end up doing with permissionless is we'll we'll do it again I think we'll do it in a place that's more accessible for people on the East Coast yeah and I think we'll lean into being a B2B like permission list really what it was was a B2B event for like crypto Executives crypto investors the people that matter um and the thing I do differently is

like probably lean into make it a little more technical yeah um a little less like retail conversations a little more Technical and try to get some of the developers to come yeah here's an idea I've been listening to Founders podcast keep saying this over and over again and in the earlier episodes a couple years ago he it sounds like he organized these events these events where you would go in he would rent out a particular venue it was like a hotel and you would never you would not have a reason to leave this place and I think there are versions of this like Mountain Dow in Denver I think they do like a ski thing uh then there's others in Tahoe there's obviously salana is doing like the their

you know Thailand thing and there's Mega E is doing it in in Thailand as well Zulu or susulu or something like that might you be able to create like different tracks like imagine like a a broad event but like in certain days you have like a particular track but like very intimate event where you do more of a curation where you maybe even have to apply but like the best part of conferences why I keep going is because of the spontaneity like sometimes I meet every so often in these dinners or these events it's someone says Hey I want you to meet so and so um it's really like the random interactions that you meet in the big floor um for me at least yeah but anyways the founders podcast guy did

that and apparently like to me I was like I would go to that like he's like you need to apply all the founders apply and then he just kind of he does a lot of the curation and then set up sets up these events like the Allen conference you know what I mean in tech like for sure like Davos I guess but DAV is no longer cool um I don't know that that for me be really interesting like I would actually pay a premium if you curate people that you think I should meet that I haven't met yeah so you could actually you could actually do something really interesting the portfolio company of mine called called time.fun which is tokenizing time time fun yeah and I think it's just something cool about that I don't know so the answer is yes we're actually going to do this in 2025 and we did an

experiment at permissionless and we didn't really Market it or promote it or anything like that but we actually went to Deer Valley for three days before Sunday Monday Tuesday we went to um really nice resort called the Montage in Deer Valley St there is amazing amazing Resort and ZK syn um basically we we we got like a like ZK we basically blockworks and ZK sync co-hosted this thing and from ZK sync's side of things we only got their like most executive people so Nana who's their president Alex who is the co-founder of ZK sync and like two other people on their team and then we invited just a worldclass attendee list so Samara Cohen the CIO of

Black Rock ETF business came uh Rich you know the head of crypto at Google we just invited like tier one Founders cre conference for deal making there will be more deal making in crypto I'm starting a private Equity Fund to and deal making is going to be more and more important I want to go to an event where I can meet targets or meet potential um like I'm interacting more with like okay what's the infr stack I want to talk to coinbase Commerce I want to talk to about the potential acquisition here that stripee is acquiring uh what is it uh bridge bridge bridge like I I want to I want to like create a deal flow conference so to speak so we're gonna do this so our next conference is digital asset Summit in New York D which is like

very buttoned up institutional event I think we're either going to plan it's in March so the Hampton won't be good but I think we'll probably do something Upstate in um like George I don't uh I don't know where it's going to be maybe like pretty good actually uh you know sweater you know like it's actually I was thinking like Hudson Valley do like yeah somewhere in Hudson Valley probably you know an hour and a half north of New York and I think what you there's two ways to monetize it we could either charge you like $10,000 and we've done this or you know whatever me yeah we because we and we've actually done this once before which there was an event in 2021 one called Breton Woods

that we hosted oh that's good it was so good Breton Woods agree this is where we went off the dollar uh the gold standard yeah so in 1944 there was a all the world's most powerful Nations gathered at this secret conference in New Hampshire to basically rebuild the global monetary system and we rented out the hotel where they hosted secret conference in New Hampshire and we called it brettonwoods the realignment and we said the system is no longer working we're Gathering the best economists macro analysts and investors to basically say what is the

future of money and we charge people we charged people a lot of money it was 3200 and we sold out the whole event uh and then we got four sponsors so we got blockchain.com copper elmax and Luca and it was a phenomenal event we did you know hiking we played golf we did you know fishing we did like trail running we did horseback riding more deals came out of that that event than than than like any of our events however there's a total pain in the ass to host could you could you crack into uh inviting people that are not interested in crypto like the challenge would be somehow you it would be really nice to get some of the top Executives

or leaders of outside of crypto and get them in right you know you have black rocks of the world but I think that may might be an opportunity over the next like two three years like you know to get uh traditional Banks traditional tech companies to come in and be an opportunity to learn about the industry in in an intimate setting with really high quality very curated yeah I think we'll do this I think we'll do that so I think we're going to I mean I think we'll try to do this at um at Hudson in Hudson is that picture Mike yeah Mike looks like Andy from The Office go back there Mike you listening yeah he's definitely gonna be listening

because I've never met someone that listens to more podcasts I don't know how he consumes it Mike you look like Andy from The Office that's a hilarious Halloween's coming up so he should dress up like Andy the he's just like perfect Andy from The Office right there that's a hilarious picture tough tough for Mike look tough look anyways I love um oh man that's funny um okay so yeah we're going to do this in Hudson Valley around D if you are a sponsor and you want to we we we want one company I want one good brand like a coinbase an abdos a salana um you know someone like that if you are brand and wants to take a risk and do this let me know so talk about the advisory business yeah the advisory

business um I mean first off check out this beautiful headline couldn't pay for that I'm gonna read it uh crypto media darling blockworks launches Consulting business uh this is semor never thought someone would call us a a darling very kind that's because I'm an investor in the business yeah yeah like Crypt media darling invested in by Santiago launches crypto launches Consulting business um yeah we launched we launched blockworks advisor so let's see if I can pull this up here yeah so we launched our advisory

business uh the tldr is that so two and a half years ago you know we're coming up on our seveny year anniversary of block works first five years was just median events two and a half years ago May 2022 we launched our research business um the byproduct of the research business so so our anal we have you know we have team of 20 20 analysts uh our analysts have gotten more into the weeds than than any analyst than basically anyone in the industry uh they're they're in all the governance forums they're in the chats they're talking to the builders they're talking to to the developers they're talking to the investors they're talking to the founders um they're seeing like the narrative changes they really have started to understand what works and doesn't work when you're building a protocol so the byproduct of that is

that these teams like you know Athena and arbitrum and polygon and optimism and Unis Swap and Avalanche different people inside different org of different parts of those organ organizations um sometimes it's the founder sometimes it's the head of data sometimes it's the governance lead um they started coming to our team and they said hey um we need we need some help this is hard I have no clue how to build a a protocol and so we said um uh you know I'm sorry we we can't really help you with that and that was like a year and a half ago and then we started saying you know what maybe we can help you with that but we're going to charge you for that and so we started doing work with some of these protocols and it went really well and The NPS and

just the reviews of these people was like through the roof people said it's the like the most helpful outside Consultants or outside team they've they've ever had basically and so what we started to do over the last couple months is is is start to actually formalize this instead of saying hey let's go have one of our analysts like throw them on arbitrum for a month and like tell tell them to go help arbitrum with this thing let's actually formalize this team and the thesis I don't know if you agreee with this Santi or not but I I genuinely believe that Protocols are the new institutions like protocols will be larger than any Bank any software company uh any any big company that is out there any Web Two company protocols

will eventually be bigger than them so if you look at how big the Consulting industry is uh you know there's there's a massive need for outside basically outside information um and basic things that can like hack growth at your company or solve a problem and the what's going to happen as these protocols grow is you can't go to a BCG you can't go to an Accenture you can't go to a McKenzie right for for this help you can't go to deoe you know if you go to BCG and you're like hey I'm designing an incentive program to bring tvl into my protocol BCG looks at you like you're crazy you go to us and we're like oh my God we've studied the last 30 incent programs I know exactly what works and

what doesn't work we've got this idea on how you can make an incentive program and do all this stuff uh let's work to other on that so that so that's the advisory business so there's a couple buckets that we do you know there's kind of like pret tge um work which is like Foundation launch partner figuring out like what is the right structure for like Labs Foundation launching governance all that kind of stuff there's more like go to market help so what are your distribution channels like how do you tap into uh like this network of marketing Partners there's economic design like fee optimization risk parameters incentive design there's managing and running a dow like grants programs uh co-authoring critical

proposals things like that uh there's there's dashboards um which is basically helping them build like a robust data ecosystem which we think is really important and then there's some help with like finance and treasury management so yeah that's that's the biz it's been we've launched a lot of businesses at blockworks we've never had so much inbound interest from from from one single launch um so yeah if you're if you would like to work on this team hit me up we we need some help yeah what um how do you think about the I mean advisory can mean a lot of things where have you seen most of the protocols appreciate uh an outside perspective where do you think they need

the most amount of help there's like four four four timelines in a protocol we think so there's Foundation launch this is um you know I met a lot of people at permission list they're like oh my God I'm launching a I'm I'm launching a token in like six months I've no I'm a Founder right I've I've no I've never built I've built something in web to I have no clue how to do like a Labs business Foundation all that kind of stuff right so that's Foundation launch the second is pre tge this is in like the months leading up like how should you talk about your token what is the marketing what is the Dow structure the token structure the distribution mechanisms uh why do people get you know kind of roasted at the stake for tokens and other people people love their token

how do you do a successful token launch then there's post tge Dow management data services onboarding new service providers risk management incentive programs grants programs all that kind of stuff and then there's like steady state which is making sure you have a robust set of service providers well-defined Dow processes strong brand awareness uh like a really good flywheel around marketing and customer acquisition um so yeah those those are the four buckets that that we think people will need yeah yeah so and then that you know we thought about this a lot because from a business model perspective uh Consulting I mean even even you as an investor actually I'd be

really curious to get your take as an investor in blockworks when you see something like this the Enterprise value of a Consulting business here here's here's our thesis and I'm curious what you think the Enterprise value of a Consulting business sucks right they might trade for like one times revenue or two times revenue or something like that right you're not building this multi-billion dollar like exit thing from a Consulting business probably maybe however um what this allows us to do is actually a similar thing that events allows us to do which is it spits off a lot of cash flow it's a very high margin business um and so with this if you look at a lot of our

competitors you I won't name names but a lot of the data and research platforms they're stuck on this VC hamster wheel where they just have to keep raising every 18 months and Mike and I have always believed you know we've only raised one outside Venture round in seven years we've always believed that like the The Venture model is actually pretty warped and that most companies should try to get to profitability within a couple years um and you want to build a self-sustaining business and so advisory helps us build the self- sustaining business where it spits off a bunch of cash and we can then invest that cash into building the data and research business um so that we don't have to raise another round dilute employees

dilute you as an investor so yeah yeah curious what you think of that I mean certainly from uh when I first looked at your business without disclosing anything uh I the primary question for me the as you alluded to earlier the event business is very volatile especially in this industry um it could and so the multiple that's quite low um but it serves and complements your business like it's sort of like a necessary evil so to speak sometimes businesses have these kind of captive funnels so to speak I think the said differently like I don't think you ever give up the events business if you're not running it at at a loss it's fine um you want to and then when we talked OB see the you guys rolled out the research

platform that's really nice over time the business becomes more of a recurring Revenue business Consulting I think is again one of those business lines that because you're in a position where you be you sort of start becoming a platform like someone will do it you might as well capitalize it because you have that distribution already and and you know people are already coming to your platform for research and they're already coming for news and they're going to your events and so logically why wouldn't you expand into this right and certainly obviously Consulting doesn't have as much of a like multiple as like a pure research subscription you know like a recurring Revenue but uh it moves you closer to a higher margin

business right yeah it's Capital it's human capital intensive um but if you're already again if I think it's a logical transition if you're already doing a lot of the research and you have good analysts then why not capitalize right on then logical subsequent step is just become you know really help these protocols do it right yeah and I I I would agree with you there is there is a need to help a lot of these businesses as they scale and think about opportunities or have a partner that is kind of um can objectively tell them things that they should do best practices opportunities so I think it's

a I mean my perspective like I think it's a I can understand why you're moving in this direction yeah so yeah we're excited I mean McKenzie does 10 to 12 billion in Top Line a year iida assuming like a what 20 to 25% e margin a 20 30% margin business yeah so that's two to three billion a year BCG I've heard is like8 to 10 billion Top Line so that's what 20 to 25% is 1.6 2.5 it does to your brand in your business are also hard to quantify uh right I mean I guess it just further solidifies your position in the space as a um a trusted partner across a number of you know it just just you

become I mean Bloomberg doesn't have a Consulting business I think um but but I think you're becoming you're not just Bloomberg in my opinion like there's there's more opportunities to like capture a lot of the white space and opportunity in cpto and it will help our SAS business too like Morgan Stanley comes to us using not them as a real example but for example Morgan Stanley comes to us and says hey look we're pushing into crypto we we need we we need you guys to figure out like the best strategies for us we say great byy the way buy buy 50 seats to the platform yeah the upsell opportunity is great right if you're already consult again it it widens your funnel and and you can acquire more users that way yeah

so in an you don't necessarily have to run a lot of these like but every for since every software company has Professional Services some more than others and as long as you're not running it a cost or or like as long as you're not running it at a huge loss it is a dragon margin but it's a it's a necessary component to grow um and acquire and and grow the Top Line right AR yeah so yeah very good man well I'm excited about that scale is the blockchain that is Simply Built different let's face it other L1 networks have costly transaction fees that increase as the network gets busier scale has solved this problem with a gas-free scalable infrastructure where users never pay gas

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10 plus chains including base arbitrum optimism and more Unis swaps wallet has built in me protection and zero gas fees with swaps that go through Unis swap X you can also swap with the peace of mind that the code is completely open- source and independently audited download it today it's available on Chrome IOS and Android um how's your private Equity Biz well I'm in Amsterdam there's a a conference organized here by one of larger family fun of funds in Europe they're an investor in in a number of crypto funds and so I was here kind of socialize the idea I took this as an opportunity to just socialize the idea with a few people in person and see

their reaction a lot of them had heard about it just because I've been teasing about it on you know just I posted about it on Twitter um and and talked about it here in the prior episode uh people seem to to like the idea but you know they can tell you like to your face nothing like raising I don't know uh I just wanted to get also an understanding of the fundraising environment and whatnot so um I mean people have been reaching out to me oh I totally forgot to respond to this guy whoops someone uh actually multiple people are trying to invest in your invest in it someone's like so I don't know if you're taking outside I think I'm I'm uh I've been

very focused on putting together materials doing a lot of like I think of the name of the fund will make a lot of sense when I disclose it but I put myself in a position of what would I need to see to invest in this fund and for me it's very clear um I I want to see actionable opportunities and there's nothing quite like going to someone say I've identified two or three very tangible concrete immediate opportunities to put the money to work um I think the timing is very right I think we're at a point where infrastructure is there you know you could look at stripe acquiring Bridge as

an example like this stable coin API right I mean these businesses are going to be transformed and over the last couple of weeks like I've met with like the CEO of Apollo I I saw the guy the CEO of Vista equity and I'm like well what do they have that I that that I don't want to replicate I never want to compete against them but what do I have that they don't and to me it's like they don't appreciate how crypto can transform in their mind crypto is a token it's like a Bitcoin they don't really appreciate how they can transform their businesses and I was talking to a a guy in operating partner at KKR yesterday and he's like I love crypto but it's hard to convince these Executives and the companies that we're acquiring how they could really use it but I really want to convince him I'm

like okay and then you go talked to a lot of you know most yesterday was mostly crypto funds and again they're trying to just invest in as I do you know companies that are building you know technology that would eventually be used by those companies but I think at that intersection I UND you know being an investor in in a lot of the kind of leading crypto companies and then haven't done private Equity before I just I think the biggest opportunity and and we're at a point where we need to go out to the real world and actually just you need to buy you need to have control of these businesses to transform them that is abundantly clear to me and you go even talk to a lot of the major companies in the

space the ripples the coinbase commer of the world they're like the tech is kind of there but no one cares like it's hard to convince a company I'm like yeah it's either a family run business or it's uh you know too big and they don't necessarily care to trim a lot of the fat yeah and so I'm very excited about it I and so I've been doing a lot of work I haven't formally gone out and pitched it to anyone but I will soon yeah little soon I mean you've got the wins at your sale right you've got IM Imron had this tweet uh that I thought was a good one which is with all the chest pieces being moved by stripe

coinbase Circle tether and many others I'd be remissed not to say that 2025 is our year and he was making point that crypto is going to achieve Global adoption etc etc but I was thinking about your private Equity tweet or your private Equity idea in light of this which is when companies get pitched by someone to do something they don't need to do anything because they're big they're like when Fortune 500s do in big companies they don't they actually don't need to do anything because they're the incumbents but when they feel when two things happen they are forced to take action one is they feel a lot of pressure by upstarts who are starting to eat into to their business that's not actually happening right now but the other is when people like stripe

their existing Partners start bringing them things so when a stable coin provider brings lvmh you know says look let's onboard you onto stable coins they say why why why would we do that when you know Aion or stripe says let's on board you onto stable coins they say oh okay if our if our existing payment processor is doing it sure that works yeah we're um if if you believe in crypto then you fast forward and then you believe in a world where most businesses will will use a lot of this infrastructure and it might not be very visible to the end consumer but they will use it payments

rails uh some things are more visible than others you know nfts for customer loyalty engagement you know blackb birds of the world for for restaurant management and loyalty programs uh you know lbmh is sort of te's with nfts digital twins uh so so some crypto elements are more visible than others I don't think you need to underwrite a token I'm actually not underwriting a token for this transformation but the the the the point is if you believe in you're investing in crypto then you you're here because you believe that this is going to become mainstream and it's gonna like the Internet it's gonna this is a continuation of the internet like a digitization of businesses and it will make them more efficient so that might take 10 years

might take 15 20 years and so if you invert and you say well how can I compress that because the tech is there in many ways well for me it's this is a strategy you go in a buy business and you roll this out and I'm not looking to buy small businesses I want to buy medium or large businesses and it might like the first couple of ones might not be like multi-billion doll businesses but I generally think that that's where the real opportunity is right like you you know you you you go and trim fat and every basis point counts yeah and it's a massive transformation imagine it's like removing I said in the episode with Jack in in Singapore that went out this week it's the way I think

about it is a lot of these organizations are bloated they have a good product they have a lot of really good distribution but along that think about those pipes right along that Continuum of goto Market or just servicing customers and and within the organization there's friction points all you need to do is go in change the pipe and and just let the water flow through it and I'm looking to buy good businesses and make them great Again by removing friction points it haven't been by the way when you think about how competitive private Equity is in asset class Financial engineering doesn't work right in a normalized rate environment but a lot of these operators like a lot of these funds have like massive Consulting arms that are pretty good operators and they understand how to

make these Transformations but there are where they just haven't because the Tech's not there you just haven't been able to streamline um but crypto that's like the on very clear areas of friction points crypto does unlock that friction Payment Processing yeah is the the immediate One customer retention and loyalty like advertising rates have gone up dramatically over the last 10 years it's a monopoly right you either you need to advertise on meta Google Amazon or Tik Tok cpms have gone through the roof so we're spending more time online but it's harder to capture attention acquire and retain customers there's a better way to

do that especially for younger cohorts that have higher LTV so anyways I think I'm gonna I'm gonna do this if it's how they gonna as I told people yesterday how much you look get to raise I'm like hold that thought I don't want to set the expectation I don't want to ideally have a number in mind if I if if I can't get there I'll just front my own money and just do this case study but what does success look like for me success looks like for me and that I would want to maybe buy one or two companies and have that be a huge win it becomes a case study at HBS or for anywhere you know but for HPS and then everyone everyone else starts doing it and then this industry goes from one trillion to 30 trilli

well you know like I would uh Prav as I like to quote Prav time and time again we're on the way to Singapore uh to the airport and he said hey have you ever thought about like doing this exercise of writing your obituary I'm like well this is kind of a weird question asked when we're about theard who someone brought that up recently where did I hear that I think I maybe Prav said it to you yeah and I said um no but it's a really good exercise and I said I have 12 hours to think about that and in that I was already thinking about this and I was like yeah I think I'll I don't know if this is going to there's appetite for this strategy in the market it's sort of new uh but I would uh I would not forgive myself if I

didn't take a hard run at this and tried it if I'm in my deathbed whenever that may happen and I think that's the opportunity and I'm going to go hard at it and if it doesn't work okay people don't like it fine I'll put my own mind in it uh I won't regret it it's like the biggest errors errors of yeah not of commission so if I don't do this I'm going to regret it yeah it's what bezos's regret minim minimization thing it's like make decisions based on uh what what you will not regret so any I am looking I am I'm gonna need a team I'm gonna need um people that really understand the tech how to

implement it perhaps people that have worked at coinbase Commerce or have experience there or People Bridge or I have I have the perfect guy for you so this is this is a call to action if this sounds interesting to you please reach out because I'm going to need smarter people to execute on the strategy so I'm looking for that um yeah we we interviewed actually obviously you couldn't make it but yesterday interviewed Antonio from dydx about his return to dydx oh yeah and it was one of the most interesting conversations I've ever had I think on on Empire because we didn't talk about

dydx once we just tal you would have loved the episode actually we just talked about risk-taking and life and what the life of a Founder is actually like and why he stepped down and how and just how his reflections over the last five months went and how it's given him a different perspective on life and what one of those things to your to your point was about risk taking and people think that they can people should take way more risk in their life than they than they are currently taking because it it'll be okay it'll be okay on that point I really like your perspective as a Founder because I think that you've gone pretty far out on the RIS Spectrum you

know as as you've liked to said you know you bought crypto credit cards you were living on you know canned beans and sardines like you know the full the full founder kind of Arc archetype um when you say people like when you when you tell when you say take risks how do you think about that and and and are there might you be able to take a lot of risk in one dimension but but actually no risk in one part of your life does it mean like because often times when we say you ought to take risk people might say you know it's it's like all-encompassing but how how do you actually think about that because I think you could you could perhaps may

may take a risk in one area of your life but not on another to give you some stability and actually put you in a position of strength like because I think listeners will probably appreciate that I don't know if you've thought about like how in your life and in your company and your personal life and just the things that you do like how does a risk manifest itself and how do you actually like go about this like taking a lot of risk right it's a really interesting question um I'm thinking about that as you think about that a lot of times people say Yan you're in a great position right now because you have now you know your business is grown a lot it's it's the risk but maybe the answer to that is no we're actually taking more risk in one

particular area because like as you look as I look at since over the last couple years you've actually I I would argue maybe you've taken even more risk in in particular areas because I mean the the riskiest thing we did that people maybe didn't saw as success but was risky was Raising outside money right because Mike and I could have just run the business as a bootstrap business I mean we're doing eight figures in Revenue while bootstrapping it and spitting off a boatload of cash and so we could have just probably done that and either just I mean we weren't doing distributions lifestyle business so the easy thing to do would have been take distributions and then maybe one day sell it for like I don't know 100 million like 50 or 100 or something like that like that would and that'd be like a life-changing

amazing outcome the risky thing was taking outside Capital because now you have a obligation to outside investors um but to to go back to your out your other question there are different types of risk I've actually really never thought about it like this um because I consider myself to be if you invert the name I'm G find is Inver in capital because you always invert you're it's inversion yeah capital okay I'm gonna say it you always I hope you've got the domain and trademark I got it I got it I got it I got it okay okay okay all the squatter's out there I got it I got it got it got it get the ens too you know a lot of ens squatters out there I guess You' get the dot soul but yeah okay so there are different question question on that point couldn't you invert and you

say not taking money and not getting more dry powder resources is a bigger risk because you have the opportunity to really capitalize on this Market from the position of strength that other media businesses are going away so the bigger risk more invisible one is not going hard enough to capture the market when you think about not raising money you could just R the scale and the growth looks like this raising money looks like that and that's a risk oddly enough I think it has nothing to do with expected value and EV and like risk reward for me the biggest risk in my life is loing losing motivation in something and I know that about myself because if I am really

motivated by something and really passionate and curious I you know in the least going to try to say this in a humble in the least egotistical way I genuinely think I can be the best in the world at it and outcompete anybody else if I am not passionate about it and I don't really care I am God awful at it so I think there's a dispersion right um or let's say there's a spectrum of like there's a you know there's the xais a x axis and then there's like um or let's say there's the y- AIS here anyways I'll actually people are listening on podcast I won't show anything with my hands but like let's say there's a spectrum and yeah boom

boom boom around find out um yeah you read my I think I am like on output like way above the average when I'm passionate about something but I actually think I'm way below the average at output and execution when I'm not passionate whereas if you take someone who's like working a 9 to5 maybe they working banking like honestly if they're super passionate or they're not passionate like they can kind of just get the done that's not how my brain works so you know maybe people are investors won't like to hear this I wasn't thinking about EV when we when we did our race Mike and I weren't thinking about EV or any because Mike is the exact same way almost even more than I am we were thinking about will this make the next five years of our life more fun

or less fun and the challenge is fun so the risk was losing motivation in a in just this boring bootstrap business like that that was the risk in my mind and do you feel like you need to put yourself in an uncomfortable position to reignite and keep you hard at at the full intensity yeah I do I wantan to constant as I think about it just I never felt it until very recently that I'm I'm just bored and I had it sort of just one day I was like I have this growing desire to get out of like it just the investing side of it just became I love it

but it's I gotta do more so you you you love David senra like the if you listen to these Founders the founder stories there's a theme which is as soon as a Founder feels like they've made it like a real like one of the differences between a founder and like a quote normal person is like once you feel like you've made it or once you feel like you've like achieved the top of the mountain normal person's like let's go I'm chilling I'm chilling I'm taking my vacation I'm chilling I get to work 9: to5 other people think where can I inflict more pain where how can I push inflicting pain he talks about pain a lot I mean blockworks

is Max pain like there is like the running a company I mean an people should listen we've got Antonio episode coming out on Tuesday this is the hardest yeah there is a new problem every day that I think if I wasn't running a company would feel like the hardest problem I'd ever encountered so you would you describe yourself as a as a maniacal masochist with work I mean maybe it seems like it but like with work yeah ladies and gentlemen this is yeah with work yeah there but but this is your original question the scene of billions different layers of you said different

layers of risk maybe it's different levels of masochism but um different layers of risk like there's Financial Risk now that I think about it there's Financial Risk there's like strategic risk there's actually in crypto there's a lot of compliance and Regulatory risk there's um there's like credit risk like how much like debt like how how comfortable are you being levered up financially there's um there's probably political risk um there's reputational risk like like I I'm not very comfortable with rep reputational risk like like when I saw what cus was doing yeah on on that Spectrum yeah I was going to ask you like which which ones are you most really comfortable taking risk which you're totally risk averse so

you said reputation absolutely not and I agree with you because that puts you out of the game yeah like my like I okay so talking about cus for a second using this as an example I I know people think he's like gone off the deep end or whatever and all this stuff I actually have a I I disagree with him on so many things I do have a layer of like a pretty deep layer of respect for him because I could never do what he's doing which is risk my entire reputation on something that yeah I like I just could never risk it or maybe I could one day when I'm older I mean he's older maybe maybe that's something you learn as you get older but at this point I'm not willing to risk my entire reputation

um and maybe it's because I care too much about what other people think about me I I don't really know I haven't really done that that internal work to to learn why I don't want to take that reputational risk but like other things like Financial Risk like if I if I didn't have a you know if I wasn't married 100% of my assets would be in crypto like I would have no 401K I would own no stocks except for coinbase stock I would have I I would be 100% in crypto because when crypto goes down 90% like I I genuinely don't feel 1% of like oh my God I this this sucks I I have zero feeling of that so Financial Risk um and actually that's a difference in my personal life Financial Risk totally fine

business-wise I don't I don't like I don't love Financial Risk um yeah like we actually run block works pretty conservatively I'd say financially yeah I think um on a couple of things you said reputation risk I think there are types of like never control how people individually might perceive you but I do think you always understand that if you're compromising or doing things that are questionable from a principal value standpoint in the aggregate that that can really jeopardize your your in your integrity and then Therefore your reputation but it's inside out as

opposed to doing things that you know I don't think you ever want to be a people pleaser as a Founder you do things that inherently are going to be cont you know are not going to be necessarily consensus and anytime you I think you go closer to the truth it triggers people and you never but I wouldn't call that reputational risk reputational risk is I think one of those things where you just know when you see it it's like this is questionable Behavior this is against value core values ethics you could un you could like discuss all day long what are those but I think people normally have a good standard of what that is um if you're hurting people yeah definitely not right yeah if doing things that are like you know you could argue that a lot maybe some people during the Contin of

the last 10 years thought that you were you know you had reputational risk crypto's had reputational risk because people think that crypto's a SC when we launched in 2017 you know I was incessantly posting on LinkedIn because I didn't have a Twitter then or I wasn't like active on it and PE you know I was still working at my old company cense I was posting about back then it was like blockchain every day on LinkedIn and my boss was like s down like you're embarrassing yourself right you're actually was my boss not my boss he was very supportive my boss's boss he's like you're you're embarrassing yourself and you're starting to embarrass company and I had friends from college being like dude you got to stop posting on link cut it out man like shit's embarrassing like don't be posted on LinkedIn every day um

I guess that that was reputational risk so yeah don't yeah something to think about like there's a guy Christian Christian angerer who who started um a a lot of very successful things but uh uh map uh Compass is one of them they're a sbin company um billionaire investor from Germany he's uh yeah he kind of runs a holding company um called I think it's airion but yeah billionaire investor out of Germany he he talks about this Nuance between risk in business and risk in personal life and so in Risk in business he is one of the biggest risk I've ever met like he got deep into crypto before most

people were comfortable with it and allocated in size he um started the first I mean he started the first publicly traded siloc cybin company which was a big both reputational risk and P and business risk at the time put a put hundreds of millions into that company personally he he has never drank he will he like doesn't even like get really like getting on planes he will never do like he doesn't ski because he's worried about like the risk I think I think it's skiing or something like that he is he won't go in sports cars right like he is so worried about the one thing that you can't get back he's like you can get back money can't

only got one shot at life so yeah I I definitely think that's a really good way to put it um should we talk about any crypto stuff uh like just thinking about that like there there two things and I I have to jump in a few minutes but one was uh uni chain right pushed the pulled forward the app chain narrative and it's kind of the only thing that people can talk about right now on Twitter is like every app's going to get a chain um and I actually I tweeted this thing the other day um or yesterday about about that which we can talk about and then um avalanche's Off the Grid game so this grid called off the grid has brought in

7 million wallets in the past I think week or two um right so those were the two biggest news stories of the week I would say yeah yeah nothing to add there obviously I think it would be really interesting to see how avalanche's perception changes how the narrative on gaming changes because it's been pretty out of favor people just been critical of it because of play to earn but clearly the traction has been these are the new as we talked about it before and this is actually a game and it's fun and so it would be really interesting to see how that might change the entire meta around just gaming as a category crypto and what that does for other projects the other thing is um quite interesting and full disclosure I do have a position in

Goat uh it's just been this uh uh not this coin that uh Mark andrion gave a 50k Grant to um this this guy and Andrew I believe and then he then this bot this AI agent then went out and bought this particular meme coin called goat and it's been tweeting about it like um Non-Stop and it's sort of become I find it quite interesting like this truth terminal account is it is it this S no it's goat just go not go trading goat and it went from like 40 30 40 million to like now like 400 million in the span of a week uh I think uh this

this AI agent put in like $5,000 or something like that and now it's like it probably becomes the first millionaire AI bot millionaire oh this thing yeah this was on the back of Andre saying I'm putting 50k into a but he did that I think he my understanding is he give that grand to this um holy 50% today yeah t g of is I I it's gone off you know people are chilling about it and talking about it but I think it's the count truth terminal so if you on Twitter truth terminal is really interesting because it's it's the AI it's like the AI tweeting about this stuff and uh it's kind of a fascinating experiment uh I think what I'm most interested in is

like yes truth terminal yeah exactly so wait so let me ask you this because I saw the mark andri like the day he tweeted that I saw this I was like that experiment I saw this whole truth terminal and go thing and stuff like that when did you decide to put money in to this uh I think it was last week uh someone brought it to my attention and I looked at it was it the tweet that was like so oh my God they've made like 150k like there was that no it was it was the it was the idea of an AI like U at the time I was actually I was under the impression that it was like launched by the AI agent like basically the The Narrative back then which has changed

was the tldr was Mark andrion gave 50k Grand to this AI oh my God look at what they're sorry go ahead so it gave 50kk 50,000 uh USD equivalent Bitcoin to this agent and it said go do stuff and what it decided to do was to launch a meme coin and then optimize like just just run through it it turns out that it didn't launch the meme coin as I understand it it actually bought it it like it bought this thing called goat and goat is uh actually I wouldn't recommend you go and and and Googling but it's it sort of makes reference to this meme go goatsy from the like early 90s like early internet culture don't don't don't uh for it but uh I found that

interesting it's like okay this is probably one of the first experiments for an AI agent is just deciding what to do and it's just really interesting to like I I decided to buy it just to pay attention to like how it was going to interact and I tweeted today like what happens if like how does this how does truth terminal terminal of truths like taken feedback from users because now everyone's like tweeting about to to the terminal of truths like hey you know you should look at this other meme coins or you should buy this or that and I'm like really curious to see how it takes in feedback how it behaves like what happens if it you know it's sitting on a huge position of goat like what happens once it reaches a million like does it dump on humans does it double down does

it sell does it what does it do after like I don't know it's like a pretty fascinating Evolution I think the llm is trained on like four Chan I mean look at these look at these tweets I'm not even going to read these out loud but oops it's kind of like the the true sci-fi in real time and what's what's quite interesting is the financialization component of it like how does he how does a bot like just behave as it makes more money like what does it do are you so your strategy here do you none of this is financial advice obviously etc etc do you hold please please don't go and like just your own research like like do you this in any way I how do you know when to sell something like

this is it a gut feel yeah like I I size it in a way where if it goes to zero it doesn't matter I don't like obviously losing money but it's an experiment and I think you always want to I always want to make it clear in my brain of what is an experiment and what is like I'm not willing to lose on like I'm not willing to lose in size but I sized it in a way where it's like all right this is an experiment I don't think it's going to be the last one I think it's a interesting sector of them and quite differentiated in the meme coin category overall there's like animal coins which are like obviously

tried and true and people are doing more experiments here they feel very incremental whether it's a hippo coin or another catcoin or another dogcoin but what it's driving to is is the fact that AI agents will be the biggest consumers on chain correct it's like in real time I'm actually really and that to me felt very differentiated yeah uh of course I sort of like bought and then do re more research later you know buy now and do more research later uh but I'm I'm um I need to put money on the line to uh pay attention to it I went to yeah I feel the same way put money into things to pay attention to it um I went to Pary the Pary LP day on Tuesday it was great it was all like very off

the Record so I wasn't I you know just because it's all their LPS are there and stuff like that so don't want to say too go can't say too much about it but the they did these big predictions for 2030 and a lot of the things were were were they talked a lot about AI making up a lot of the onchain activity yeah what so so couple of open questions that I have how does this bot Behavior change as people try to influence Its Behavior um there's this like really interesting psychological experiment called the um the ash Conformity experiment which is this they ask they

show like three different lines they show people three different lines and there's they they hire these fake people in the experiment and they tell you which line is is the biggest I think they show you one line and then they show you three different options like which line matches the the length of the line that I'm that I'm showing you here there's obviously clearly one that is exactly the same but the other paid actors show it the wrong one and 33% of respondents like it's so obvious but 33% of respondents are not willing to go against the consensus and they choose the wrong one but as soon as someone detracts and says the truth like they they go back to it whereas like normally

in un experiment without actors per of people like would just get it wrong because just maybe have visually impaired um so again like what you're already seeing now like a lot of these K's are trying to like influence the bot and the bot's like off yeah how the bot goes through this experiment one go ahead what happen the other is like obviously AI coins like tows in the world like are in my as I see them like also memes yeah um what happens to that and how does the meta shift for next time for next time ladies and Gentlemen please please do your own research and again I'm not yeah not endorsing this in anyway shape or form all right enjoy Amsterdam sir yeah thank you sir take

CareOne hey everyone thanks for watching today's episode just wanted to quickly thank today's title sponsor scale scale really is one of the best chain experiences out there today and I've used so many different chains there's a reason they are gaining so much adoption in both gaming and AI use cases hit the link in the show notes to explore the scale ecosystem [Music]