Will Companies Survive the Funding Drought? | Roundup

Transcript

[Music] [Applause] [Music] [Applause] all right so welcome back to another episode of uh about of uh Empire sorry guys um what let me I'll just Jesus Christ I'm just talking to Mike about velcrove I'm sorry it's uh this is what happens your love for you do a couple podcasts I'm just you know I'm in a single relationship here with Empire no no no you don't know this might kicked me out of Belk off Mike Mike uh Mike I did season one and season two with Mike of belkrum he just booted me so season three is all about app chains on Docker people should check it out it's good but I got kicked out as the host Mike put in a guy from yeah we've had a trend in the last episode and we're going to talk

about this episode about Founders and what they go through because you and I have talked to a lot of Founders and what they're under fights Mike and I are in a big shot like there are some issues there that you guys need to resolve you can pick me out yeah we got it exactly so welcome back welcome back to Empire you're at the Roundup and uh Santi I see you rocking thank you today I'm curious what you think of this Nike Tiffany Club absolute fire saw a picture of LeBron wearing this jacket too just man I mean that's the kind of stuff that I would that I love you know because historically like a lot of the nft projects and would you send one ether or I guess it's Point what do you eat that today oh no would you spend just one eighth right

well what are the these you were saying these these secondary market for these shoes is going what 4K 4K the Nike SB dunk low diamond supplies at 1600 because you know Jay pal hike 25 base Points Market loves it we're ripping two and a half eighth on on these shoes I mean I use dirty Fiat but uh uh I I hate to say it but I I and I'm gonna get a lot of [ __ ] for it but I probably will drop on on this just because hear me out just because I I don't know just because I think these are two brands that are moving and aggressively and with a purpose and a mission in in crypto and I think I respect that and so I'm also a huge I

love Nike uh and I I rotten a lot as people know and I love Nike as a brand and I'm very loyal uh so if anyone out there Nike who heads up their nft web 3 department wants to come on the show talk I mean it'll be the easiest interview you'll ever do you know what's funny did you see uh you saw LeBron walking through the tunnel I feel like the the NBA tunnel has become like it's the new uh like it's like Runway like that's where fashion is made yeah yeah that's it's the new Runway like that's where the the NBA tunnel is where fashion is made today and so they kill I think they killed it you know you had a who's the CEO of Tiffany like our node the Sun or whatever I forget his name the young the young guy like he was

sitting at MSG rocking the shoes your LeBron walk out with the leather jacket and the shoes like you know I think like historically I got to ask this question in an interview once it's like if you could just own one stock for the next 50 years which one would it be and why or the next 20 years like really long term and I picked lvmh because I think they're like humans always want to differentiate and this part of my thesis with nfts too right which is like digital identity and ownership like humans love to differentiate and so I really love I mean they've done a fantastic job the stock how lvmh has expanded into so many different brands Hospitality they own like luxury hotels now Shabbat blacks like they've they are just impressive uh in their acquisition strategy and they

and now obviously with in trying to be relevant across all their brands like they're all over like F1 with tech uh sponsoring Red Bull um into nfts like and like it's actually impressive to see because they're like you talk about the inner age dilemma they have they're sitting in a very comfortable position but they also they also put themselves in an uncomfortable position meaning they know that they need to reinvent themselves in the next 20 years they need to appeal to a younger generation and it's super impressive to see how these guys really are like moving um into weather I think it's awesome so lvmh they are one of the I think Bernard or no is the richest guy in the world or top I think he is now now that uh Elon he's the richest person in the world but lvmh

owns Tiffany Christian Dior Fendi uh Marc Jacobs yeah um uh Laura Piana uh Saleem um tag I think they own uh they own a bunch of alcohol as well yeah I mean I think they are I'm not sure it might but nonetheless like they own across the luxury category um Hennessy uh so like anyways huge like they've got basically like these massive brands in like Spirits fashion Cosmetics watches jewelry and uh so Bernard Arno put in place his son I think his name is Alexander it's like 30 years old pretty young to run Tiffany and Alexander super

into nfts yeah like that yeah so yeah they are there's a fascinating story uh we'll link it in the show notes of like how they bought and you get them on like you know Punk pings punk punk ping Punk and like get them on yeah well I'll try I don't have direct contact I've never talked to him but yeah definitely like uh there's a great story of how they like I've done a huge turnaround and like reinvented Dior as a house like I don't particularly love the brand but like I respect like they've just done an incredible turnaround and they're really good at Acquisitions turnarounds just growth and like this is super impressive um yeah so yeah nonetheless this this Nike stuff is pretty interesting though like yeah how how

does one buy you you were telling me this but like like what's a what do you think is a long-term Vision if you're a Nike if you're Tiffany these collabs but also just thinking broadly of like nfts are they going to use that to like give like their loyal members axes because like today for instance Nike like launch some new sneakers running sneakers and because I'm a member I've been a member for a long time I was like I got Early Access are they going to use that these as like gateways to like here here's what I'd say like nfts are no nfts there is one thing on the mind of every brand in in the world right now how do I plug in to the cultural Zeitgeist and specifically like maybe making that more tangible how

do I get my brand to survive as this new cohort of people age you know 12 to 22 they come into all the wealth younger and younger people are making more and more money as they move their as their lives become digital they spend all their money in in a digital world and you know the first person I saw do this really really well was John Malone right so John Malone Liberty one of the largest landowners in in uh in America I think it's like I think he might be the largest landowner in America behind um Bill Gates we might have talked about this already but uh landowner in America and he you know he's very famous for doing all these media Roll-Ups in the 80s he basically identified Formula One yeah as this like kind of crusty older brand that you know had the same

sponsors like the same Democrat Graphics but their demographics were getting really old their demographics were eventually going to die out so he acquired them and what did he do he linked up with Netflix and basically did a Content marketing play so some people think of content marketing as like oh we're going to create a blog or we're going to launch a brand podcast with what formula one did led by John Malone is he said no we're going to actually create a show and that's how drive to survive on Netflix came to be and I think what you see Tiffany doing right now is you know that you don't think of I think Tiffany which is like 150 Old brand as doing these big Mass Market as even doing Partnerships in general but what's super obvious is that their partnership with Nike is their attempt to basically move into a mass become

this mass-market brand but really become a brand that like engages with like a broad group of young consumers and like I think every brand today is like how do I breathe life into my brand so that young consumers see me as a as a brand that kind of gets it so that that's I think what's on the top top of mind for a lot of products let me ask you a question so if you buy these sneakers it's super slick like black with like the the Tiffany uh color which is like uh like a mint color would you if you buy the sneakers what would you ascribe more value to the sneaker or the

nft if you have like a an nft that represents the physical item for the so it's funny so like I would never because you're not the question is are you gonna wear them I have I have one I have one pair of like collector sneakers okay and you know what I've done with them no I have kept them in the box in my closet and I have never worn those so funny you see the value of them keeps going up yeah and so I'm like I'm not gonna the question is are you gonna sell them at some point this is the conundrum I don't know no I won't because like they're uh they're uh I've got they're they're a piece of history in my mind and like they're uh they're these Bitcoins but I do get anxiety because it will depreciate it will deteriorate right are you are you

keeping them in good conditions like you move places like accumulating physical stuff gives me some anxiety I love collecting certain stuff but I do think about that a lot whereas digital is great like I love Legos for instance I have my in my parents house that I spent the full like month you know true to crypto bear Market mini bear Market that we had I was actually living with my parents uh attic uh which is my room uh and I have it's all Legos but I don't build them because I I think that they're like I just there are certain pieces that I just don't want to build but I also historically have never sold anything that I've collected I've only sold one nft actually which was an FT Island like rare thing that the team gifted me and I said I'm

not gonna sell it but there was someone who wanted it so like I ended up selling it yeah um so in this case you're right like I don't think like this particular sneaker I'm not gonna like wear it here here's what I would do I would do what I did with all nfts when the nft market was booming I'd buy two but I what I did with most nfts is like you buy two nfts you when the price goes up a lot and you're like I want to sell I want to sell go ahead sell it but then you can still hold on to one that's that's a good idea so like uh crypto big butts which I know that you're a big fan of we had a great episode with Melton you talked about that a lot I do have one or a few actually

how many do you have I I actually own this I'm just calling you up because I know that you have more than two right no I actually only have one uh yeah but I was I was just shopping the other day so I'm I've got I've got my eyes on one that's like okay it's a beauty and I'm gonna probably pull trigger on the second this is a good um like a framework buy two and then you get rid of one yeah yeah so nice um what should we talk about today there's not much news surprising putting together a new stuff with our producer shout out Garrett and like the least crypto news I've ever seen it's interesting because the market it's one of those times where like there have been weeks where we have so many news and the market does nothing it's choppy

it's a crap market now Market tripping because Jay Powell did us all a favor uh it's a really priced in uh but then it's not you know uh and so yeah it's interesting I mean there have been some news on the side nft wise some like soft rugs by rally I guess and a few things here and there the we can talk about this I mean the Celsius like 400 in page dot like that's your like whatever like report had so much stuff in there that it's like you read there's a great thread in there like all you have to do is like read like five pages you're like this is this is sickening um and so yeah there's some cells out there here's my one-liners that Celsius is royally screwing over their users by

what's going on but I feel like I can't say more right now and well it has historically you know right they were yeah using customer funds machinsky was selling his own personal stake like up to 40 million or so here's what I'd say Santi is um there's no leaders there's no I think that if Celsius leadership was still in place they would actually do the right thing and they'd be like let's sell this business and um you know or let like let's let's take care of the users there's no celsius leadership left over it's basically just the bankers and the lawyers running this thing and I don't know what's going to happen with Celsius but I can assure you when lawyers and bankers are in charge uh the users will not be taking care of no this will extend out as long as humanly possible because they're raking

I mean uh lawyers in the Enron case made over a billion dollars um I have something I want to talk about actually so last week on the Roundup we talked a lot I had those three calls with Founders and I want and I talked about that I actually had similar calls with um different Venture firms in crypto this week and uh they were kind of it made me realize that like I think that we've probably hit a bottom in crypto markets like the public market side of crypto I think you know we've probably seen a bottom in Bitcoin in each I have a feeling we'll we'll get back down to those lows at some point again this year but we've probably seen a bottom but that doesn't mean there's

not a lot more pain to come and what I mean by that is like some of these calls with the Venture firms they're talking about their portfolio companies and they're like look we have some Port codes we love like we are all in on these poor codes where they're going to raise again we're going to back them they're going to raise it you know probably a lower value a lower valuation or like a flat round but that's okay we'll we'll double down on them but a lot of a lot of these funds have companies who are not doing super well and they're not going to be able to and and the funds I talk to are not going to back them again and what happens then the dynamic that occurs there is when you have a company who's all the VCS who have invested in them already are not

willing to back them again there's no way they can raise another round from outside investors because that's a huge red flag or if they can raise it's going to be at like a you know 90 down round which just kills the esops of uh which then kills the employee morale and it just you know if if you have a high liquidation preference it means the founder might never make any money again so it's a pretty high likelihood that you're going to see a lot of companies I think in the like 5 to 20 person range a lot of those companies are just kind of quietly shut down later this year and it won't be like public pain but it there's there's more pain yeah it's interesting you say that I want to comment a few things one I think public public markets are faster to respond

private markets you know valuations took a bit of time to to go down whereas the public market was much faster right um a lot of these deals got announced later like I'm an out I announced two deals this week that I participated in these were like you know we closed like a month or two ago um so it was a bit of a delay um I also think you're right in the sense that the problem with crypto like in bull market I always caution Founders which is even if you can raise a huge round a huge markup like a few like some of these deals were like a month later another fund would have come in and like offered them like way more money at a huge markup

and you know it's great like sometimes you take the money and and it's an insurance policy but what you just said about like the morale of a company when you do a Down Round it is very very difficult for a lot of employees and retention and it sucks to do a Down Round And so the hope is that sometimes these these rounds were not large in capital but huge in valuation and so it's a really tricky position for a lot of these companies that have hired to aggressively had had to cut down and are probably gonna have to do a Down Round the SEC the third and last thing I want to comment on is I'll be really interested to talk about this just in general which is the the kind of the rational psychology that goes on in an investment Committee in crypto which is crypto historically has

been a market that has really fast evolving narratives and people love to chase new narratives it's all about what's an extra narrative you know and so if you're a sitting in committee you have a portfolio of companies you have a say a 50 million dollar fund we've already deployed half of it in you know a couple companies would you rather back and do another round of those companies might have been like an area that's not really in favor now or were you gonna back to new companies with a new hot narrative zero knowledge proofs flap whatever your next nice you know uh term is and I'm not sure I think a lot of funds

are not very sophisticated or just going to like chase some narratives and they're gonna because they might think that that's like gonna be what what like gets them out of being underwater I'd be curious if you agree with that like I think some funds are more disciplined but like the cohort of funds in crypto is very diverse and some are more professional than others the reason I the only pushback there would be that like there are a lot of funds who are running out of money right now in terms of like they raised you know let's say let's say you raised in like summer of 2021 you're almost two you're almost like two years since you've raised or like you're you're at least a year and a half since you raised

and so now you're starting to think about raising your next fund but you need to stay as a veteran I mean you you know this from your time at parify and even just as an angel investor like one of your jobs is being in the narrative and being in the you have to build a brand as a venture investor you have to get in the deals you have to like people have to know you you have to go on the podcast you have to do your Tweet threads and your medium articles and things like that and if you run out of money too early in a cycle you people will forget about you a people forget about you but B you'll miss a lot of the the great opportunities that'll happen later this year so I think actually I am seeing a lot of venture

firms be really conservative right now because maybe they raised 150 million they only have like 20 million left to deploy and so they're being super conservative because they before they can raise that next fund they you know they don't you never want to be fully out of money essentially as a venture yeah it's true you say that so uh you remember Katie Han former a16c partner she like was a prosecutor of the Silk Road and then was in the Corn based board she raised left a16z and raised 1.5 billion at least committed I don't know how much he's called Venture fund strictly Venture I'm not sure how much they hold in public

tokens um they just announced a deal actually this week which is why I bring this up because I saw her on CNBC basically saying look we're in no rush to deploy this Capital we think that we're going to see lower valuations and this was like two months ago three months ago so you know we're kind of like bottoming out um and now they they're now redeploying they did like a I think it was a seven million dollar uh series eight or so and so it's interesting that these funds are now you know I think chiha a fun like that has plenty of capital to deploy you know it's really you know because there there's a few funds that raised like last year uh that have decent amount of capital the question that I

I've been consistently seeing from people that wonder is how much of that Capital has actually been called meaning you can announce inventor is fairly common and I'm an investor in a few Venture funds crypto not crypto so basically what says is you commit say ten dollars and they'll say we're going to call up to half of that no more than half usually and so you you basically shell out five five bucks and then the other five in this case they're going to call over some time Horizon usually two years while they'll deploy or maybe up to five um it's and a lot of people say hey how much of theirs actually this this idea of there's so much dry powder in crypto a lot of and just generally in markets

in private equity and Venture and crypto um and some people are wondering how much of that is actually going to be there to deploy my understanding is if you look at these subscription agreements they are very like it's pretty hard to back out if you made this commitment and they call Capital it's pretty tough to back out um and so I what I'm trying to say is I would think that I would probably haircut conservatively like up to 25 percent of that like aggregate number so if Katie Han you know Kate Han Ventures had one and a half billion committed to them and

they called call it 400 million in their first like close or whatever the rest of that I think reasonably speaking she's gonna have like probably like over a billion to deploy and maybe there's like one or two LPS that drop but the large the really large LPS I think will not drop because it's one of the more important questions that you get asked when you when you invest in these funds is when you do like the subscription questionnaire is what percentage of the assets of whatever vehicle is investing through or your personal assets I think it's if you're investing through a corporation which most people do anyways what percentage of the assets

are committed to to this opportunity and I think there's it needs to be below a certain threshold like if it's just like 100 or 80 like you get asked more questions um but a lot of these large LPS you know it's a fra it's a very small percentage of their allocation when we think about like large institutions allocating one percent of their Capital Pension funds Calpers of the world you know uh it's a relatively small number for them hey everyone quick break from Empire to tell you about another blockworks Channel that I know you're gonna love I've been in crypto full-time for five years and have always struggled with one thing which is keeping up with the next

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hopefully you can make more than 208 dollars a month by using the platform if you can't you're probably in the wrong business but if you're not ready to subscribe to the platform today you can subscribe to the research team's free newsletter you can follow their Twitter handles today links in the show notes trust me once you do that you're going to want to subscribe to the platform if you are ready to subscribe right now I got you guys with a little hookup Empire listeners get a 10 discount for the first 50 people who use the code Empire 10 got your back check out the links in the in the description to find out more now let's get back to the show yeah I think that brings up a good point so even though you're con contractually

obligated to send this money like if you're a pension and you committed 10 million you're contractually obligated to send the 10 million to the fund when they call it there's a there's a I think there's a dynamic too so actually it was Vance from framework who mentioned this to me which I think is a good point which is if you're running a fund you have two roles you are an investor which is finding good deals and and investing in the right things but you're also and that's what people think of as like a VC but then you're also a fund manager oh yeah which is like running the fund and like managing relationships with the LPS and like when [ __ ] is hitting the fan like calming your LPS down and so there's this element of like yes the pension told you they'd give you 10

million you called five of it on day one now you're going back to them at the absolute bottoms saying hey super opportunity we're being super opportunistic really exciting time to buy and if you are not a good fund manager and you have not managed those relationships in the right way even though they're obligated to send you that money if I'm a pension and I don't trust you I'm like okay I know I I know I'm obligated to send this money but like I don't love that you're buying into crypto at these at these prices and so I think there's like some I would assume there are some fund managers who like are better at that element of the game than others I mean this is a I really enjoyed my time to verify and I think this was a good Dynamic that we had uh

who who seated verified was it was it KKR do I remember it was Henry Kravitz personally so Henry Kravitz is one of the three founders with 10 million do I remember I don't know details I don't think there's a Bloomberg this is all public record Bloomberg article is reference Henry Kravitz was an anchor investor because you know Henry carries a lot of weight Ben used to be um uh at KKR and so and Bane Capital Ventures it was a big part of that too so that made a huge Splash obviously um someone like Henry who basically invented an asset class which is private Equity did one of the first buyouts uh KKR is one of the best not the best private Equity Firm out there uh someone like that who kind of was a big part of

the invention of an asset class called private equity um discover and believe in cryptos and as an asset class maybe it didn't fully appreciate the technology but you know as a NASA class like that was a huge validation I think that article Bloomberg article kept like it's still probably like really popular getting a lot of hits um but yeah you're right I mean I terrified like Ben was great at that and I had the liberty and luxury of just focusing more on the investing side but it's a big part like uh I it's not to say that I don't enjoy it I'd much rather have more time just to think about like investing but it is a big part of and it's very time consuming especially if the script is such a volatile asset class you know people

when you're doing great it's like it's like go watch The Big Short I think they really summarize what running a fund is like right because Michael burry by the way is interesting because Michael Berry now deleted his account because he was telling people to short the market yesterday you feel like one two it's itself he deletes his account every time he gets a bad call like this guy's like he's volatile like look we're all kind of eccentric in some way but you know he very much visibly like shows that shows his hand but the big short really kind of gives you an inside scoop into what running a fund is right you use like you know a lot of his investors like were like trying to sue him and one of the lead investors was calling him all the time

Lawrence I think his name his name like this guy Lawrence it's his anchor investor was like you're you're breaching all these Clauses like you're you're like basically gonna run out of money you're crazy for betting gun thousand like yada yada and then of course like did a huge one of all so yeah all this like no difference it's really not like by the way I think which is like I I don't know what the I've had a lot of disco by the way someone hit me up yesterday from another big fan and said oh I heard there's a rumor that you're going to start a fund and I'm like like now I'll publicly say this no and all of this and then I got to thinking like you know it has been it's difficult to run a crypto fund like a lot of the a

lot of people one the community always liked to like vilify Venture AT different parts of the cycle um and look some Venture funds are better than others some fund managers are really vocal and can polarize the community and others are not but like sometimes there's a broad stroke of like oh this is a VC project and visas are bad and they get you know what they don't see is it VC is also like grind out and really help Founders especially in tough times like you're basically like talking to Founders all the time because you really need your help and some funds are fund managers are they don't want to talk to the analysts I want to talk to you right I was spending

half more than half of my time just talking to the portfolio all the time on call like cryptos 24 7 365 like you get hit up on Sunday you know so I heard this from college money actually I know Kyle gets a lot of [ __ ] out there from a lot of people but one thing I think that he said is very true we said basically when we make an investment my criteria is can I drop everything if I'm on vacation and pick up the phone for this matter do I really want to work with him to be fair I think multi-coin is a fun has really helped some of their portfolio like a lot of their portfolio companies like if you hear from Founders energy multi-coin has helped more than more than pretty much any other fund out there multi-coin is helpful I'll go on

the record saying like Salon like you may they are very helpful helium yeah yeah you may not love the project you may not love other things I'm not asking you to but I will I do I will give them credit because they are very helpful so anyways all this to say running a crypto fund is really hard folks and so next time you criticize a lot of these funds just wonder like they do play a huge role like they're they're investing in I thought I thought I thought Chris bernicki had a good take which is like everyone ever the reason people criticize crypto Venture funds is because like they get Insider deals and like they're you know they're able to buy at these low prices as Chris put it on Twitter the other day which is really well put for anyone anyone criticizing you've got

the same opportunity right now public markets these tokens are down at the same price as that Venture ones are getting them at and so go for it pull the trigger what most people want grits are back to the initial statement you said which is you know a lot of these projects have launch the token they're trading below Market but also Venture funds of a huge lockup like some of these rounds are being done where the community is there's a huge allocation of the community and they're getting it at like roughly the same price as Venture funds sometimes with way better terms and things will walk up and so you know that's some of the things that don't get discussed but like Venture funds have to hold the bag for years for years and yeah and so yeah it's uh a lot of a

lot of the new things that have been happening is when Venture funds like dragonfly and some of these funds like had to go and ask the community they can invest in like lito for instance and convince a community to sell tokens from the treasury and so yeah I don't know it's a bit of a bit of a tangent here and uh but I think it's an important topic to discuss especially as in Bear markets Venture funds do play a huge role I think there's one other thing that people don't see um if you haven't raised or if you haven't invested in some of these private rounds which is I think the thing that hits the media that hits the like the headline is the valuation X company raises this much at this valuation what

it what most of these deals is really about though um are the terms on the timesheet right what are the liquidation preferences do you what do you have veto rights over like those are those are things that are not in any story but oftentimes are much more important so like I saw something the other day it had a 3x liquidation preference there's no way that there's no way the founder of that company and the employees are going to make any money and that's just a shame but on TechCrunch it looks like it's a super successful race and stuff like that so this is very true not encrypted that much actually like historically these rounds have been fairly fatter friendly

terms but I do wonder if now that you have more professionals yes and and the Market's going down like I think the liquidation preferences that I'm seeing right now are like yeah I think I think a lot of it a lot of the traditional funds ventured into crypto did like the block by Celsius uh FTX they basically were very soft on the terms in a Raging Bull Market yeah like no boards together like I understand like One X liquidation preference is standard like 3x is like you're basically in the worst bear Market in the history of the world uh but like Noah board seed is like shameful one of the things that I do want to observe is

of the FTX stuff and I know that we don't want to touch too much on that but I think it will be really interesting to see the repercussions for Venture funds that invested with some of which are being investigated of like did they actually uphold their fiduciary responsibility to do proper due diligence on the on this company and companies in general some of these deals were like struck lightning round deals crazy valuations no terms now the the when we talk about the the you know like lessons and the positives that come out of something like that as painful as it is is that I think a lot of VCS and crypto now are

going back and being way more disciplined asking for board seat let's talk about liquidation preference we'll talk about information rights just standard nbca natural Venture Capital Association like terms that like apparently we're not even in in some of the more flashiest rounds and this is true for traditional venture too like I remember looking at Uber's like pre-ipo rounds they had a huge ratchet liquidation preference like basic like it was very favorable for those investors and so you're absolutely right I think people should assume that you know not everything is people just take the the headline valuation but there's a lot of stuff that goes that that you know goes into that number

yeah anything else you want to cover uh it's a pretty pretty slow Newsweek so I could be okay wrapping it here we could also talk about Rally or these Bitcoin nfts but I'll also be okay wrapping here so no I mean I I don't want to talk too much about macro the only thing I want to say is like and I'll I'll keep saying this as well for the rest of the year because it's an important thing to maybe just like I'm I say this probably because I want to remind myself I'm not sure we're now in a full back up only mode prices have rallied quite a bit since the bottom it's just still really really important to correct the fundamental issues that persisted and

like specific to crypto strip away all the macro noise there were some fundamental things in crypto that need to be improved on and let's not lose sight of those let's actually focus and make sure that we don't make the same mistakes as before and this is we just talked about FTX board seats you know being more rigorous and diligence um publicly you know calling out a lot of you know a lot of the stuff not like glorifying people just because you know just important to like remind ourselves of the things that we were talking about two months ago even a month ago um and and that should always kind of like we should always learn about those mistakes you know Mike had your your founder had a really good tweet yesterday the day before it said like

you know there's some really bad ideas in the last cycle and I asked him okay what were the worst ideas that you saw because he said a lot of venture funds back to this discussion are gonna like you know look back and you know a lot of these ideas were fairly dumb and I'm actually really curious and I'll leave it I'll leave it here I don't have a perfect answer for this and I'd love to hear people comment on on YouTube and some of the other channels on Discord it's like what were actually those really dumb ideas that you consider because I think there are two counts two two categories of dumb ideas one which is too early because the infrastructure is not there and a perfect example of that is cryptokitties you know at the time cryptokitties

congested the ethereum network and people are saying like what is this stuff people are saying now about Bitcoin for other reasons but like nfts is a category in 2017 was deemed discarded and said this is really dumb and then they re-emerged two years later and now here we are right um it's it's very much here to stay and it's a very important piece of crypto it's vertical that was a dumb idea that was just not ready for its time the infrastructure was not there there's other dumb ideas like recursive leverage and you know algorithmic stable coins which actually I'm not fully sold on I mean one of those ideas that I had like I think I think there's a good lesson here which is whenever you have like a like a really bad emotional reaction to something like I had this with nfts when

the nft market was ripping like do you remember when um people sold his uh like 75 tens of millions 68 million yeah and then you know like board Abe started ripping Punk started ripping like all the I had a very like emotionally negative reaction to that and I was like this makes no sense this is so dumb this is ridiculous this is a huge bubble and uh and I was wrong and it took like months to come to come to that realization and honestly like come to the acceptance this is like I remember this episode it was like January February of last year and you were saying like Mike and I have this like constant heated debate of like how high the nft volume market and prices floors are gonna go you're both like a 20 and then they ripped to like

100 plus like I was I was so like that was one of the most wrong I've been in crypto probably is like I had no idea these pfps were gonna be worth a million dollars each and uh you know yeah Miss missed that one but but you were saying like so today I had a very visceral reaction to that but what do you do with that yeah yeah and like when you have a visceral reaction to something I think you should lean in and like I actually think like I would maybe apply that to something like the Solana ecosystem today like I think people are having super negative super emotional reactions to the Solana ecosystem because of like you know they were engaged with STX or you know I think multi-coin's also getting a lot of crap and multi-coins big investor in Solana like when you have a really

really negative emotional reaction to to Something in crypto it's usually a good sign that you should lean in a little deeper um yeah yeah and uh and and investigate I think so the last important it's like yeah you know there are certain things that you know it's always better if you can take more time to process new information and delay judgment it's always kind of worked out well not chasing stuff and just like taking your time crypto markets are General like every time I feel like I'm missing out on something I always kind of see it at that price maybe it takes six more months maybe a year maybe two but it always pays dividends to actually do the work and be ready because crypto markets will really really kind of test your conviction and I think if you do the

work you're kind of Fairly more calm in that environment so um yeah I think that's really it uh the only thing that is really exciting coming up is drive to survive I think comes out next week right yes nice hi I got some travel coming soon yeah I watched the time what did you think about it yeah it's like whatever I didn't think that entertainment's kind of um you you mentioned people are asking you about uh people are asking you about um if you're launching a fund yeah I'm gonna I'm gonna ask you one question Jesus Christ it is February 2nd 2023 by the end of the year December 31st 2023 have you started to build something whether

that's a fund a company yes something that I am built resemble a funder RDS I am building something right now it's a lot of fun will it be okay will it be launched in 2023 what if I told you it's already a launched but no one knows about it like well it's launched what if I told you it's already launched and everyone's using it but no one knows that santi's behind it that's actually really cool uh here's the thing guys we're gonna have an episode of one of the in this journey in crypto I met some of the most remarkable people just want the reason why I'm still here um and one of those persons gonna come on the Pod and you're going to hear a story and you're gonna I think it's gonna be

one of the best episodes we're gonna have and I won't actually hint that maybe at the end we'll disclose that we're working together but um to me it gives me a lot of confidence and like I just get talk about like a brand like lvmh when are you gonna tell people what you're building like you know there's like not much to report on yet so I'd rather like you know take some time but I promise it will come before permissionless before permissionless if we do a big coming out party at permission list you know the Robin Hood the Robin Hood Founders announced their crypto wallet for Robinhood at permissionless on stage so if you know yeah and there's actually another huge company announcing some stuff at permissionless this year so maybe we get you up there with this yeah no I I want

to go to building yeah it's not it doesn't involve a fun but uh the reason I did this is because this person I think is a is an incredible operator someone that the crypto ecosystem has benefit like will benefit a ton from because he has just so much knowledge and experience so I'm just really fortunate to be able to work with him cool we'll leave it at that thanks for listening folks and uh we'll see you guys next week yeah thanks everyone for listening take care