Latest / Blockchain Germany – Web3 Startups, Crypto Innovation & Venture Capital by Startuprad.io™ / Kadena's Annelise Osborne on On-Chain Finance
Transcript
- WEBVTT 00:00:00.000 --> 00:00:07.920 Music. 00:00:08.782 --> 00:00:14.662 Your podcast and YouTube blog covering the German startup scene with news, 00:00:14.822 --> 00:00:17.362 interviews, and live events. 00:00:20.142 --> 00:00:23.822 Hello and welcome, everybody. This is Joe from StartupRate.io, 00:00:23.942 --> 00:00:26.422 your startup podcast and YouTube blog from Germany. 00:00:26.582 --> 00:00:31.442 Today, I do have a guest from the S, Annelies. Hey, how are you doing? 00:00:31.762 --> 00:00:34.822 I'm great. I'm super excited to be here, Joe. Thank you for having me. 00:00:35.062 --> 00:00:39.522 Totally my pleasure. We may tell the audience we had quite some fun preparing this interview. 00:00:39.722 --> 00:00:46.202 So let's see how this is going. At first, you are a very interesting person. 00:00:47.962 --> 00:00:52.762 Your PR agency reached out to me because you published a book. 00:00:52.902 --> 00:00:55.202 But I found you much more. 00:00:55.842 --> 00:00:58.962 So sorry, no offense intended than just an author. 00:00:59.162 --> 00:01:05.422 You did quite a lot of work before. Can you run us a little bit through your 00:01:05.422 --> 00:01:13.222 CV and what you did in order to arrive at being an author for Wiley? 00:01:13.422 --> 00:01:17.962 And we should also tell your book is called From Hoodies to Suits, 00:01:18.062 --> 00:01:22.082 Innovating Digital Assets for Traditional Finance. 00:01:22.442 --> 00:01:25.062 And at the end, you have to explain what this title means. 00:01:25.582 --> 00:01:32.042 Sure, absolutely. Absolutely. So, yes, I've had a storied professional experience. 00:01:32.502 --> 00:01:37.462 My favorite kind of when I graduated from university, I went over to Ukraine. 00:01:37.602 --> 00:01:39.682 And so that was my first experience in startups. 00:01:40.802 --> 00:01:44.622 I was asked to, I was helping out with a political history project, 00:01:44.662 --> 00:01:49.642 but then I was asked to help start up an advertising agency because Coca-Cola 00:01:49.642 --> 00:01:52.082 was coming to town. So that was interesting because I am not Ukrainian. 00:01:52.602 --> 00:01:56.542 And so I was actually at the time learning Russian while I was there because 00:01:56.542 --> 00:01:58.342 that was the language that was spoken in business. 00:01:58.862 --> 00:02:03.142 And that was wild. It was just interesting trying to figure out, 00:02:03.182 --> 00:02:06.922 I think it teaches you flexibility, which is, I think is super important in 00:02:06.922 --> 00:02:11.642 the startup world about how some things are a lot harder than others, 00:02:11.762 --> 00:02:13.442 but you just figure out how to get it done. 00:02:13.542 --> 00:02:16.262 So I did that. And then I worked in commercial real estate there. 00:02:16.442 --> 00:02:20.522 And then I moved I moved to London with Jones Lang from Ukraine to London. 00:02:20.642 --> 00:02:25.322 And then I went to business school and I came to New York for business school. I have been. 00:02:26.154 --> 00:02:32.094 Here's Sense. After business school, I was trying to figure out I wanted something more corporate. 00:02:32.234 --> 00:02:35.834 And so and I also was super interested in the finance side and I'd done commercial 00:02:35.834 --> 00:02:39.954 real estate, but I really wanted to focus on kind of the money and the flows. 00:02:39.954 --> 00:02:45.594 And so I started, I had a great opportunity with Moody's, which was doing commercial 00:02:45.594 --> 00:02:46.594 mortgage-backed securities. 00:02:46.974 --> 00:02:50.994 Which is a very interesting way of financing that shifts the cost, 00:02:51.134 --> 00:02:53.274 shifts the risk from banks to 00:02:53.274 --> 00:02:57.974 bondholders that were generally insurance companies and large companies, 00:02:58.314 --> 00:03:01.354 for the most part, investors, kind of all the way down the risk, 00:03:01.414 --> 00:03:04.394 up and down the risk spectrum. But it decreased the cost of financing. 00:03:04.654 --> 00:03:09.914 So if I was a building owner, I could borrow cheaper and I could borrow more 00:03:09.914 --> 00:03:14.754 money because of these bonds that took the risk off the bank's balance sheet. 00:03:14.814 --> 00:03:15.594 So that was interesting. 00:03:15.954 --> 00:03:19.014 That was started in 2003. And then I was there 12 years. 00:03:19.254 --> 00:03:24.194 And we did all up and down through the financial crisis, which, 00:03:24.274 --> 00:03:28.114 again, what's the right rating of a bond and what's the right way to look at valuation? 00:03:28.114 --> 00:03:34.954 And then after 12 years, I left and I wanted to go back into kind of the entrepreneurial world. 00:03:35.134 --> 00:03:40.534 And so I did a number of things, kind of consulting with hedge funds, 00:03:40.734 --> 00:03:42.434 private equity, family office. 00:03:42.734 --> 00:03:46.454 And then I did a lot of board work as well. And I was asked to join a regulatory 00:03:46.454 --> 00:03:49.894 task force for ICOs and ICOs were initial coin offerings. 00:03:50.094 --> 00:03:55.434 And I had no idea about them, really. I knew the idea of blockchain and I absolutely 00:03:55.434 --> 00:03:59.754 knew the idea of Bitcoin, which was digital currency. But I was this was not my thing. 00:03:59.954 --> 00:04:02.374 And so it was really focused on regulation, which I understood. 00:04:03.554 --> 00:04:08.574 And this group of this group was so persistent that I finally agreed to meet 00:04:08.574 --> 00:04:11.074 with them. But to meet with them, I had to understand what all of this was. 00:04:11.214 --> 00:04:15.834 And when I learned about blockchain, to me, it was just an eye opener of how 00:04:15.834 --> 00:04:19.214 much more efficient it could make finance and finance being traditional finance, 00:04:19.374 --> 00:04:21.934 being kind of the Wall Street capital markets world. 00:04:21.934 --> 00:04:28.314 And so that launched me into my first startup, which was in 2018, 00:04:28.734 --> 00:04:35.794 which was my partner had a broker dealer and we looked at creating digital assets, 00:04:36.154 --> 00:04:43.174 which is in essence securities, but built on blockchain for traditional financial markets. 00:04:43.174 --> 00:04:51.594 For that, we may add how antiquated the capital markets have been at the time. 00:04:51.614 --> 00:04:58.474 I was myself in capital markets 2008 till, let's say, 2018. Yeah. 00:04:59.058 --> 00:05:05.298 And basically, at the time, it was not uncommon to have armored vehicles driving 00:05:05.298 --> 00:05:11.518 around between banks in London to have like physical paper based securities still delivered. 00:05:11.638 --> 00:05:15.998 It was not uncommon to have somewhere, most of the time in India, 00:05:16.218 --> 00:05:21.098 large back offices where people did a lot of manual work, including a lot of 00:05:21.098 --> 00:05:23.658 faxes for clearing and settlement. 00:05:23.658 --> 00:05:27.238 And there was always a very high probability for those transactions, 00:05:27.758 --> 00:05:30.018 especially internationally, to go wrong. 00:05:30.138 --> 00:05:35.438 So it was at one point in a computer. Then somebody faxed it to somebody else. 00:05:35.598 --> 00:05:37.058 Then they manually put it in 00:05:37.058 --> 00:05:42.058 a computer again. And there was always manual problems with all of that. 00:05:42.238 --> 00:05:46.258 And that's basically where the ICO came in, right? 00:05:46.478 --> 00:05:49.678 Well, that's where blockchain comes in. I'll tell you about the ICO in a minute. 00:05:49.678 --> 00:05:54.278 But blockchain, there still is people, some companies still use faxes. 00:05:54.558 --> 00:05:57.858 So it's crazy that this is still kind of backwards. 00:05:58.098 --> 00:06:02.218 Some companies still accept checks, which is just interesting. 00:06:02.338 --> 00:06:07.038 That's so much easier to transfer money now than it was 10 years ago. 00:06:08.498 --> 00:06:11.538 So it's interesting. It's just interesting at this progress. 00:06:11.718 --> 00:06:15.838 So I always think I have three teenage boys and they are never going to know 00:06:15.838 --> 00:06:19.098 what a pay phone is and they're never going to know what paperwork is, right? Right. 00:06:19.178 --> 00:06:21.978 So because think about we would always talk about paperwork, 00:06:22.138 --> 00:06:24.938 but now everything is digital for the most part, not everything. 00:06:25.238 --> 00:06:31.118 I actually have to go once to a museum with my boys to show them those rotation 00:06:31.118 --> 00:06:33.738 dial phones. Yes. Yeah. Yeah. 00:06:34.738 --> 00:06:40.158 So it's just so funny. But part of this is the is the point that the technology 00:06:40.158 --> 00:06:44.958 increases and it makes our lives more efficient and it will be increased even 00:06:44.958 --> 00:06:48.078 faster with AI because AI will help us program quicker. 00:06:49.018 --> 00:06:53.498 And so it's just recognizing, so it won't take as long. So I think that's exciting. 00:06:53.678 --> 00:06:55.918 So anyway, I got into the startup space, 00:06:57.222 --> 00:07:00.462 I have done three startups prior to me joining a blockchain. 00:07:00.702 --> 00:07:01.942 So now I'm actually at a blockchain. 00:07:02.262 --> 00:07:06.302 So I have done a lot of the in the early stages, too. 00:07:07.222 --> 00:07:11.242 So working with seed financing, working with Series A and B, 00:07:11.422 --> 00:07:16.002 trying to figure out revenue generation, staffing up for growth, 00:07:16.162 --> 00:07:17.522 which is actually what I'm doing right now. 00:07:17.882 --> 00:07:22.062 So a lot of different angles. I've also worked at a family office. 00:07:22.122 --> 00:07:27.002 We invested in companies and then we invested in they kind of merge them in and help them. 00:07:28.342 --> 00:07:34.522 To help them kind of with revenue growth. I also have worked as an advisor to startups. 00:07:34.782 --> 00:07:39.002 I'm currently at Fiat Advisors, which helps startups with a number of different 00:07:39.002 --> 00:07:41.702 things that they're looking to do. 00:07:41.862 --> 00:07:44.262 And then... Sorry, for one interruption. 00:07:45.302 --> 00:07:53.102 A lot of very early stage entrepreneurs, they have the notion you build a good 00:07:53.102 --> 00:07:56.402 product and the customers will be coming. 00:07:56.962 --> 00:08:01.022 I've been working with such startups. You have been working with such startups. 00:08:01.302 --> 00:08:06.462 Would you say that statement is false? A hundred percent, sadly. 00:08:07.682 --> 00:08:10.362 It's also not always the smartest person in the room that wins. 00:08:11.042 --> 00:08:15.322 Even if you go back and look at, or the first mover, right? 00:08:15.402 --> 00:08:20.682 Look at Yahoo, AOL and Google, right? Yahoo and AOL were ahead. 00:08:20.942 --> 00:08:24.302 Look at, you can look at Kodak or Blockbuster. or people didn't change with the time. 00:08:25.542 --> 00:08:28.622 AltaVista, AltaVista. Yeah, right? 00:08:29.542 --> 00:08:34.662 For a lot of the audience, I may need to link the Wikipedia article for the 00:08:34.662 --> 00:08:36.922 AltaVista search engine down here, I believe. 00:08:37.302 --> 00:08:41.382 Right? So you might have a great product, but if you can't get it out to people 00:08:41.382 --> 00:08:43.182 and if you can't market it, 00:08:43.282 --> 00:08:47.862 which is what so much of this kind of startup world I think is focused on, 00:08:47.902 --> 00:08:51.082 but also I feel like marketing is different, takes different channels now and 00:08:51.082 --> 00:08:53.902 it's more direct with all the digital world that we didn't have. 00:08:55.412 --> 00:08:59.712 15, 20 years ago, especially with social media. Um, so yeah, 00:08:59.772 --> 00:09:01.132 so I totally agree with what you're saying. 00:09:01.192 --> 00:09:04.332 So fast forward. So that's kind of how I got to where I am today. 00:09:04.552 --> 00:09:06.672 Um, really I love to learn. 00:09:07.052 --> 00:09:13.092 Um, I wrote a book because I have worked with, my focus is creating, 00:09:13.212 --> 00:09:15.952 um, more better financial structures. 00:09:16.112 --> 00:09:19.832 And to your point, manual error, when I was at Moody's, we would work with, 00:09:19.892 --> 00:09:25.032 um, people that paid out the bonds and they would manually input Excel spreadsheets 00:09:25.032 --> 00:09:25.872 and And they would do it wrong. 00:09:26.112 --> 00:09:30.872 And so then this is ridiculous. This could all be programmed and can be checked by people. 00:09:31.352 --> 00:09:36.812 It's not totally autonomous, but I think I think sections of finance will become autonomous in time. 00:09:36.932 --> 00:09:39.752 But I feel like it's baby steps to get to where we want to go. 00:09:40.952 --> 00:09:44.072 So I've been working with institutions helping use this technology, 00:09:44.252 --> 00:09:48.352 which is more efficient, faster, lower cost. 00:09:48.792 --> 00:09:53.192 It's trans. You can see what happens. You can trace it. So there's so many benefits. 00:09:54.352 --> 00:09:59.112 But it was right after FTX failed. So Sam Bankman Freed, I'm not sure if the 00:09:59.112 --> 00:10:02.472 audience is familiar with FTX. It was an exchange that was also, okay. 00:10:02.892 --> 00:10:04.992 So there was $10 billion of fraud there. 00:10:05.532 --> 00:10:09.452 And a number of people stopped looking at blockchain innovation. 00:10:10.012 --> 00:10:13.552 And one of the banks said, we have a cease and desist, which is a legal term, 00:10:13.672 --> 00:10:17.112 which is a strong legal term to talk about anything in blockchain. 00:10:17.272 --> 00:10:21.952 And to me, that was just an eye opener about cryptocurrencies and fraud are 00:10:21.952 --> 00:10:27.692 not the same thing as this technology that's going to make your banking rails so much more efficient. 00:10:27.932 --> 00:10:33.312 And so that is why I wrote this book. The book is really focused on it. It's not a textbook. 00:10:33.472 --> 00:10:38.332 It's really just ideally a light or read for something in digital assets with 00:10:38.332 --> 00:10:40.372 stories and things that we can relate to. 00:10:40.532 --> 00:10:44.092 But the goal is to explain Bitcoin and blockchain are not the same thing. 00:10:44.152 --> 00:10:49.232 Why blockchain is such an amazing technology that's going to help Main Street and Wall Street. 00:10:49.772 --> 00:10:53.192 It's going to be behind a lot of what we do. It's going to affect our lives 00:10:53.192 --> 00:10:58.552 in retail from both a payments perspective and from an investment perspective. 00:10:58.712 --> 00:11:01.592 It's going to give us more opportunities to invest in more things. 00:11:02.012 --> 00:11:05.652 It's going to give us opportunities to actually be able to lend out, 00:11:05.752 --> 00:11:09.772 like to be the bank in the middle. So that's the goal. 00:11:09.792 --> 00:11:14.172 The goal of the book is to be an entertaining and educational read on how this 00:11:14.172 --> 00:11:18.952 technology makes a difference for both us, but also for the big companies. 00:11:21.186 --> 00:11:25.326 And everybody who would like to purchase your book, down here in the show notes, 00:11:25.406 --> 00:11:29.186 wherever you're listening to this or watching this, down here in the show notes, 00:11:29.326 --> 00:11:34.066 there will be a link to a very well-known online marketplace where you can buy books. 00:11:34.646 --> 00:11:37.866 And, of course, it will link your book. Thank you so much. So, 00:11:37.886 --> 00:11:41.546 yeah. So, I'm super – so, it launched a couple weeks ago, two weeks ago. 00:11:41.866 --> 00:11:44.206 And it's been great. I've had great reviews. 00:11:44.646 --> 00:11:48.486 I've had – you know, I feel like they always come from the places you don't 00:11:48.486 --> 00:11:51.266 expect. So it's been wonderful feedback. 00:11:51.486 --> 00:11:54.646 I'm happy for anyone that reads it for feedback. 00:11:54.726 --> 00:12:00.446 It is broader than just digital assets as well, if you think about how an industry 00:12:00.446 --> 00:12:04.266 is trying to move forward and different steps along the way. 00:12:04.266 --> 00:12:10.326 And there's also a bunch of tangential businesses, I think, that can work together with that. 00:12:10.386 --> 00:12:14.726 But, you know, it goes into kind of how PayPal is creating a stable coin and 00:12:14.726 --> 00:12:20.286 a stable coin, if you think about it, is is faster and easier in the sense that we can transfer. 00:12:20.346 --> 00:12:22.806 I can transfer money today to you and you can use it immediately, 00:12:23.046 --> 00:12:26.166 which isn't always the case if you're dealing with like cashing checks. 00:12:26.406 --> 00:12:30.826 I had cash to check. It took five days to cash. And also the company had to 00:12:30.826 --> 00:12:33.046 mail me a check. They couldn't wire it into my bank account. 00:12:33.226 --> 00:12:37.486 So this way you get money right away and you can put it out right away. 00:12:37.606 --> 00:12:40.566 And companies are going to want to do that because you can allocate your money right away. 00:12:40.886 --> 00:12:46.086 Remember when I came back from Texas, I was working on campus and I still had 00:12:46.086 --> 00:12:47.886 a check from them sent by mail. 00:12:48.046 --> 00:12:52.626 And it took something like almost a month until the money arrived in my German 00:12:52.626 --> 00:12:56.826 bank account from this US-based check. Yep. And cross-border transactions. 00:12:58.966 --> 00:13:02.446 You'll decrease fees so substantially with cross-border transactions. 00:13:03.026 --> 00:13:06.846 And so that's where I think stablecoin will make a difference for all of us. 00:13:06.926 --> 00:13:11.646 But also there's a bunch of opportunities from investing is that there'll be 00:13:11.646 --> 00:13:14.486 more wealth is in our hands now than companies. 00:13:14.686 --> 00:13:19.906 From a global perspective, it's 51% in retail hands and 49% in companies' hands. 00:13:22.168 --> 00:13:25.868 Companies that are looking for investors are going to start going to retail. 00:13:26.008 --> 00:13:30.108 And this technology allows that to happen, which actually you asked about ICOs. 00:13:30.108 --> 00:13:31.748 So ICOs were initial coin offerings. 00:13:31.988 --> 00:13:34.948 And then the thought process of like, if you think of an IPO, 00:13:35.148 --> 00:13:38.828 an IPO is when a company goes public and it's a very established company. 00:13:39.048 --> 00:13:42.048 Well, and it's generating revenue and it has a valuation. 00:13:42.328 --> 00:13:47.808 The ICO is at the beginning of the company's ideas. 00:13:47.968 --> 00:13:51.728 You and I can create an idea and we can have an ICO because we have an idea 00:13:51.728 --> 00:13:55.468 and essence and business plan of what we want to do. And then people fund that. 00:13:55.728 --> 00:13:59.728 Well, to me, what was interesting is that globally, it had raised billions of 00:13:59.728 --> 00:14:04.528 dollars for the ice, like the idea of ICOs, because people wanted to find ways 00:14:04.528 --> 00:14:07.648 to invest their money, that they missed out on the tech boom, 00:14:07.748 --> 00:14:10.008 right with the with the original tech boom. 00:14:10.148 --> 00:14:13.408 And they thought, I want to have an opportunity to make money like these companies 00:14:13.408 --> 00:14:14.908 and private equity firms do. 00:14:15.068 --> 00:14:19.608 And so they wanted to invest in an early stage opportunity, which is really venture capital. 00:14:19.808 --> 00:14:22.948 And so that was an eye-opener to me that there's this whole world out there 00:14:22.948 --> 00:14:28.328 of people looking to invest and generate returns that other people have had 00:14:28.328 --> 00:14:29.828 opportunities to, but they've been shut out of. 00:14:30.128 --> 00:14:37.748 Do you think, you've been talking about wealth, institutional versus retail, company versus retail. 00:14:37.988 --> 00:14:45.228 Do you think a lot of those very brave initial retail investors have been burned 00:14:45.228 --> 00:14:49.048 with a lot of the stuff that has been going on with ICOs, cryptocurrencies. 00:14:49.368 --> 00:14:51.968 And so on in the last few years? 00:14:52.288 --> 00:14:55.528 Absolutely. Well, ICOs, there was a lot of fraud associated with them as well, 00:14:55.648 --> 00:14:59.728 which was both probably intentional and then also unintentional in the sense 00:14:59.728 --> 00:15:07.328 that if two people who were 18 years old and had no experience in business decided 00:15:07.328 --> 00:15:11.188 to start a company because they had grand ideas and schemes and Mark Zuckerberg did it, 00:15:11.228 --> 00:15:13.668 and they tried and it didn't work, right? 00:15:13.768 --> 00:15:17.928 So a lot of people invested money in the idea and they lost money. 00:15:18.408 --> 00:15:21.688 Which is why regulation so i think that was unintentional but 00:15:21.688 --> 00:15:24.728 i do think there was a lot of intentional fraud where people took people's money 00:15:24.728 --> 00:15:28.068 and ran away with it so um i do 00:15:28.068 --> 00:15:31.428 think that's why regulation comes in so regulations is really around to protect 00:15:31.428 --> 00:15:35.428 investors but where do you find you know with innovation and how do you find 00:15:35.428 --> 00:15:39.508 a way to regulate innovation when there's more ideas coming out with this technology 00:15:39.508 --> 00:15:43.988 which is something that we're having you know difficulties within the I think 00:15:43.988 --> 00:15:45.308 Europe is much more forward-thinking. 00:15:45.768 --> 00:15:50.928 Talking about US and Europe, that's something we also want a little bit contrasting 00:15:50.928 --> 00:15:54.648 because you're very knowledgeable. And I wanted to... 00:15:56.115 --> 00:16:01.355 Get the opportunity to have like, a kind of a guide for people, 00:16:01.495 --> 00:16:03.615 especially FinTech entrepreneurs from Germany, 00:16:03.795 --> 00:16:10.675 Austria, Switzerland, but also from all over the world looking at the US right 00:16:10.675 --> 00:16:13.115 now. And I have a few questions for you. 00:16:13.895 --> 00:16:18.735 For example, how can FinTech companies in the US navigate and mitigate the risk 00:16:18.735 --> 00:16:22.835 posed by potential economic downturn and funding shortages? 00:16:23.115 --> 00:16:27.495 Of course, the funding funding got less and less, especially in light of the 00:16:27.495 --> 00:16:29.055 recent collapse of small banks. 00:16:29.195 --> 00:16:31.255 You remember all the small banks? 00:16:31.935 --> 00:16:35.895 There have been stories, Silicon Valley Bank, just one prime example, 00:16:36.035 --> 00:16:37.575 and the bank that bought it. 00:16:39.515 --> 00:16:42.295 The background a little bit to the question is, 00:16:42.435 --> 00:16:47.835 it seems like from the outside right now, that in the US, the concentration 00:16:47.835 --> 00:16:53.135 of banks is always working a little bit more and more towards It's Wells Fargo, 00:16:53.235 --> 00:16:56.035 Bank of America, JP Morgan, and so on and so forth. 00:16:56.115 --> 00:17:01.875 And it kind of sucking up like all the small competitors and how could fintechs 00:17:01.875 --> 00:17:05.395 compete there, especially if a downturn is coming? It's tough. 00:17:05.595 --> 00:17:10.595 So if you, well, okay, so we have the big banks, right? And then you have kind 00:17:10.595 --> 00:17:12.655 of smaller regional banks and community banks. 00:17:13.335 --> 00:17:18.635 I do think there was almost a run on the banks before when everyone pulled their money out. 00:17:18.695 --> 00:17:23.495 And that was a big issue with the banks trying to. and increasing interest rates. 00:17:23.575 --> 00:17:26.835 So if they had bought treasuries to counteract their deposits. 00:17:28.335 --> 00:17:31.435 Those treasuries weren't worth as much because there were higher interest rates. 00:17:31.655 --> 00:17:35.775 So the newer treasuries were worth more. And anyway, so a lot of people pulled 00:17:35.775 --> 00:17:37.375 their money out and that was a run on the banks. 00:17:37.455 --> 00:17:40.135 And then I think some banks went under. 00:17:40.695 --> 00:17:45.955 Silicon Valley Bank is still around actually. They sponsored a book event for 00:17:45.955 --> 00:17:47.615 me actually in San Francisco, which was great. 00:17:47.695 --> 00:17:52.295 And they are one of the problems in our space in the kind of if you call it 00:17:52.295 --> 00:17:55.595 the crypto space, even though it's blockchain oriented, is that people don't 00:17:55.595 --> 00:17:57.675 necessarily want to bank you because they're, 00:17:58.240 --> 00:18:02.860 People look at crypto. Crypto is the technology of cryptocurrencies or cryptology of blockchain. 00:18:03.180 --> 00:18:06.560 It's one of the few technologies that any banks in the United States, 00:18:06.640 --> 00:18:09.180 if you touch it, you have to tell your regulators you're going to touch it. 00:18:09.380 --> 00:18:12.840 So you don't have to touch it. Like if you're working with AI or quantum computing 00:18:12.840 --> 00:18:17.140 or any of these other steps along the way, you've never had to tell your regulators 00:18:17.140 --> 00:18:21.420 you're using using this technology, which I think is which is strange. 00:18:21.560 --> 00:18:24.560 Right. It's kind of like if you think about technology, cell phones are technology, 00:18:24.880 --> 00:18:26.820 you know, different things in your kitchen are technology. 00:18:27.040 --> 00:18:30.540 So that I think is kind of a ping against crypto and blockchain. 00:18:30.960 --> 00:18:35.480 And a lot of the banks don't want to bank, don't want to let you open an account. 00:18:35.860 --> 00:18:40.240 And so what happened, what was before is a bunch of those banks actually had 00:18:40.240 --> 00:18:43.100 crypto accounts, were actually banking crypto companies. 00:18:43.380 --> 00:18:47.160 So then it was even harder for startups to open a bank account. 00:18:48.880 --> 00:18:53.540 Or if you had negative, if you had something that had happened in the press, 00:18:53.680 --> 00:18:57.120 like if you were in discussions with the sec then it's difficult that 00:18:57.120 --> 00:19:00.040 you it's even harder to open a bank account so how do you how 00:19:00.040 --> 00:19:02.680 do you make that work as a startup company it's kind of 00:19:02.680 --> 00:19:05.580 you know it's like you have the deck stacked against you but 00:19:05.580 --> 00:19:08.580 i do feel that um there are companies that 00:19:08.580 --> 00:19:13.560 will do it it's just and more now i think especially now if you look at large 00:19:13.560 --> 00:19:17.400 institutions are using blockchain technology for tokenizing funds blackrock 00:19:17.400 --> 00:19:23.520 the world's largest asset manager uh has tokenized funds um and jp JP Morgan's 00:19:23.520 --> 00:19:26.440 the world's largest bank by market cap, 00:19:26.640 --> 00:19:29.660 and they have a lot of blockchain projects as well. 00:19:29.820 --> 00:19:32.460 And they are saving money with their blockchain projects. 00:19:33.440 --> 00:19:40.060 So I feel like that's helping change the tune of this not being about volatile 00:19:40.060 --> 00:19:44.160 cryptocurrency, but more being about blockchain technology, if that makes sense. 00:19:44.280 --> 00:19:47.000 So I feel that, yes, it's been a difficult, like any startup, 00:19:47.160 --> 00:19:51.280 it's harder to get banked than others, especially with using the tech. 00:19:53.721 --> 00:19:56.821 So I think that's, you know, that's you are. Also, let's go back to this. 00:19:56.901 --> 00:20:00.121 The idea of Bitcoin came out in 2008. 00:20:00.301 --> 00:20:06.301 In 2008, you had Occupy Wall Street sitting downtown trying to take the power 00:20:06.301 --> 00:20:09.181 away from the banks because the banks were in such control. 00:20:09.181 --> 00:20:15.921 And so Bitcoin and this cryptocurrencies actually offered you a way to get rid of the intermediaries. 00:20:16.021 --> 00:20:19.281 Right. It was a peer to peer payment system, which is how it was set up. 00:20:20.221 --> 00:20:24.921 So I think the idea of Bitcoin and which is kind of the idea of cryptocurrencies 00:20:24.921 --> 00:20:27.261 was kind of anti anti banking. 00:20:27.401 --> 00:20:31.201 But it's interesting kind of how that actually helps the banks, too. 00:20:31.661 --> 00:20:36.521 But it will help put the money back in your hands. So if you if I hold if I 00:20:36.521 --> 00:20:39.921 hold stable coin and I hold it in my wallet, which is technically like an account 00:20:39.921 --> 00:20:43.661 that I've opened, but I'm holding say I have a million dollars in stable coin. 00:20:44.161 --> 00:20:47.401 Otherwise, I'd probably have a million dollars in the bank. And the way the 00:20:47.401 --> 00:20:51.681 bank makes money is the bank lends out that million dollars to other people 00:20:51.681 --> 00:20:53.581 and they make a spread on the interest. 00:20:53.981 --> 00:20:58.821 Right. But if I'm holding it in my wallet, then I'm holding that million dollars. 00:20:58.821 --> 00:21:02.361 And I can actually there's there's opportunities in different companies that 00:21:02.361 --> 00:21:06.001 you can lend that money out to other people. And I make that spread. 00:21:06.161 --> 00:21:10.981 Right. So I can make interest on my stable coin. So then I'm becoming the bank. 00:21:11.261 --> 00:21:15.341 So I do think so. I'm kind of going to the side of the question that you asked, 00:21:15.401 --> 00:21:17.201 but I tried to answer that and then kind of extend. 00:21:17.521 --> 00:21:21.361 But there are ways that this current this technology can cut out banking. 00:21:21.581 --> 00:21:24.841 But I don't think everybody wants to be the bank. 00:21:25.571 --> 00:21:28.951 And lend the money out themselves, sometimes, you know, they might just want 00:21:28.951 --> 00:21:31.891 the little bit of interest they can get by putting their deposits in a bank. 00:21:32.431 --> 00:21:35.831 Because my mother, for example, is 80 years old, and she does not want to be 00:21:35.831 --> 00:21:38.151 the bank herself. She'd rather have someone manage her money. 00:21:38.571 --> 00:21:43.611 So I do think that banks are going to have to figure out how to work with this 00:21:43.611 --> 00:21:45.631 technology, or they're going to lose revenue streams. 00:21:46.171 --> 00:21:50.911 I was really smiling when you said, now I'm holding it in my private wallet. 00:21:51.451 --> 00:21:54.731 As you said, they make money on the interbank market. 00:21:55.031 --> 00:22:03.851 But also what I realized there were a lot of people listening at Finanza and IRS right now to this. 00:22:03.951 --> 00:22:08.371 And their toenails were rolling back because they were not sure if they could 00:22:08.371 --> 00:22:11.291 tax it properly if it's in your private wallet. 00:22:11.571 --> 00:22:15.631 So I do believe there will be some challenges to this in the future. 00:22:16.071 --> 00:22:21.751 Maybe also the requirement to hold it in a bank's wallet or something like this. 00:22:21.951 --> 00:22:28.211 But I get your idea. Yeah, it's something different, and you can really, 00:22:28.271 --> 00:22:31.231 really accelerate international transactions. 00:22:31.331 --> 00:22:39.411 You can make them more reliable, but you also have to do some more steps privately 00:22:39.411 --> 00:22:43.631 to keep them secure than with the bank would do. 00:22:44.231 --> 00:22:51.071 Yes, I agree. But I also will say that the IRS has been working with the wallets 00:22:51.071 --> 00:22:53.031 in the United States, like Coinbase, for example. 00:22:53.031 --> 00:23:00.351 So there is a tie to be able to, it wasn't that way before, but now it's much 00:23:00.351 --> 00:23:06.291 more for income reporting of gains, so they can be taxed. 00:23:06.711 --> 00:23:11.231 But there are a lot of like, this is a global, this makes us even more global. 00:23:11.971 --> 00:23:17.351 And so that is, you know, there's always been kind of money in different places, 00:23:17.431 --> 00:23:20.131 but it's harder to track when you're using international companies. 00:23:21.197 --> 00:23:28.377 Mm-hmm. Talking about fintechs here, competition, how can they differentiate 00:23:28.377 --> 00:23:32.037 themselves and compete against the banks? 00:23:32.137 --> 00:23:34.697 Well, you've been talking about growing revenue. 00:23:35.057 --> 00:23:39.857 You cannot do this if you're like a product like everybody else. 00:23:39.917 --> 00:23:42.497 You have to be different. You have to be differentiated. 00:23:42.737 --> 00:23:49.017 Can you spell a few secrets, like one or two tricks, how it worked for you clients in the past? 00:23:49.337 --> 00:23:51.617 Sure. So FinTechs is a very broad term. 00:23:52.217 --> 00:23:56.197 I think FinTechs has a lot of the payment space has been FinTech based. 00:23:56.277 --> 00:23:57.817 I haven't worked in the payment space. 00:23:58.017 --> 00:24:01.677 I will say that. But I do feel like the people that were able to differentiate 00:24:01.677 --> 00:24:07.497 themselves in the payment space, it might be something that's less sexy, but obviously needed. 00:24:07.717 --> 00:24:10.357 I feel like that way, if you look at Plaid and the way Plaid created, 00:24:10.597 --> 00:24:12.977 which is really the banking, 00:24:13.017 --> 00:24:16.117 anything in banking system now you can i can transfer money 00:24:16.117 --> 00:24:18.777 because it connects through plat uh which is really kind of 00:24:18.777 --> 00:24:22.437 like apis for a difference so i think that was that was super interesting um 00:24:22.437 --> 00:24:25.217 so okay so how do you 00:24:25.217 --> 00:24:28.057 one i think partners are 00:24:28.057 --> 00:24:32.157 super important you get a lot of business from partners uh right your partners 00:24:32.157 --> 00:24:36.577 in the space as in like you everyone's doing slightly different services uh 00:24:36.577 --> 00:24:41.477 and so when you have bigger companies coming in they'll talk or paying clients 00:24:41.477 --> 00:24:45.177 right they'll talk to one and And they'll introduce you to someone else that 00:24:45.177 --> 00:24:47.137 provides a different service. 00:24:47.297 --> 00:24:50.897 That, I believe, is how the community is so important. 00:24:51.237 --> 00:24:54.737 I think it's very difficult. No one is on an island that's going to go out and 00:24:54.737 --> 00:24:58.097 make a whole bunch of money by themselves, unless you're day trading, right? 00:24:58.277 --> 00:25:02.277 But you're probably getting information from other people as well. 00:25:02.457 --> 00:25:07.117 So maybe you're not on an island. But anytime when you're in the startup ecosystem, 00:25:07.397 --> 00:25:09.917 networking is super important. it. 00:25:10.137 --> 00:25:15.717 And finding those people that provide similar, like different services that plug into yours. 00:25:15.817 --> 00:25:19.637 That's how I've gotten a lot of, a lot of different business because it's also, 00:25:19.717 --> 00:25:22.637 they're vouching for you in essence, when they recommend your service. 00:25:22.657 --> 00:25:24.997 So that I would say is probably the number one. 00:25:26.397 --> 00:25:32.257 The number two is making sure that you, making sure that you know what you're talking about, right? 00:25:32.357 --> 00:25:35.577 You put together kind of a good pitch. You recognize how, when you approach 00:25:35.577 --> 00:25:38.497 a client, you recognize how you can add value to that client. 00:25:39.057 --> 00:25:44.217 And everyone I call a client, right, with a mindset to think of how can I provide 00:25:44.217 --> 00:25:46.917 them a good or service that benefits them. 00:25:47.177 --> 00:25:50.957 So I feel like that is helpful to getting in touch with the right people and 00:25:50.957 --> 00:25:53.937 then making sure that I'm looking at that when I'm sitting down with them, 00:25:53.997 --> 00:25:58.877 with my team, so it's not just me, as in it shows like there's more people focused 00:25:58.877 --> 00:26:00.477 on this and it kind of builds credibility, 00:26:01.277 --> 00:26:05.017 then you're showing how you can help them. And I think that also, I think those. 00:26:06.757 --> 00:26:09.677 Are probably the two main like when you're approaching this 00:26:09.677 --> 00:26:13.117 recognizing that that you're offering you're 00:26:13.117 --> 00:26:16.597 doing something for them thinking about it that way um 00:26:16.597 --> 00:26:19.457 and i think you have to be flexible right as a startup 00:26:19.457 --> 00:26:26.917 um i've we've pivoted i've pivoted uh and people my first my first startup i 00:26:26.917 --> 00:26:30.177 was told that was a dirty word but i don't think it's a dirty word right because 00:26:30.177 --> 00:26:34.637 you have to recognize what you thought was the right business line and then 00:26:34.637 --> 00:26:38.057 maybe you have more more interest on another side. 00:26:38.197 --> 00:26:41.597 So, Hey, let's use the same technology, but approach business this way. 00:26:41.957 --> 00:26:46.617 And so a bit of a pivot. And so I think that that's what that actually shows 00:26:46.617 --> 00:26:51.817 that you have done your research and that you, you know, you've put yourself behind it. 00:26:51.957 --> 00:26:54.937 And the other thing I would say is don't be afraid of failure because failure 00:26:54.937 --> 00:26:57.697 is what we learn from and build off of, right? 00:26:57.797 --> 00:27:01.377 If you couldn't, like, I wouldn't be where I am today if I didn't, 00:27:01.377 --> 00:27:04.197 if it, if it had worked out the first time, right? 00:27:05.397 --> 00:27:09.017 That would have been different. But we were way too early. Like in digital assets, 00:27:09.137 --> 00:27:12.777 we were way too early in 2018 to say, this is what institutions, 00:27:13.077 --> 00:27:14.637 this is how we can change capital markets. 00:27:15.697 --> 00:27:19.837 But I think it's a slower crawl because you're dealing with big institutions 00:27:19.837 --> 00:27:21.057 and you're turning a tanker. 00:27:21.797 --> 00:27:28.497 It's not kind of as maneuverable as a bicycle, say. And so it just takes longer. 00:27:28.697 --> 00:27:32.557 And so I feel like we're moving to get there. But I definitely say say, 00:27:32.557 --> 00:27:35.637 work together with other people, recognizing the benefits you add, 00:27:35.897 --> 00:27:39.097 and then be flexible and don't be afraid to pivot. 00:27:39.537 --> 00:27:45.337 You've already talked about a lot of stuff that I have for you for my next question. 00:27:45.457 --> 00:27:51.177 I was just curious because we just come out of a pretty tough downturn, 00:27:51.217 --> 00:27:55.197 especially for startups and especially for fintechs here within the startup space. 00:27:55.677 --> 00:28:02.177 How would you recommend Recommend startups building resilience for the next downturn. 00:28:03.077 --> 00:28:08.197 I know tip number one is raise more funds. I know, but besides that. 00:28:08.397 --> 00:28:12.517 It's budgeting, right? It's also recognizing, I know a lot of startups, 00:28:12.617 --> 00:28:15.937 and I have worked at Sun generally after this has happened, but when they raise 00:28:15.937 --> 00:28:17.537 a bunch of money, they spend a bunch of money. 00:28:17.697 --> 00:28:20.817 And so I think that you have to have the mindset of how are we, 00:28:21.317 --> 00:28:25.337 what do we need and what would be the nice-to-haves and the must-to-haves. 00:28:25.337 --> 00:28:32.897 Um, but I do think like budgeting and understanding, I think growing too quickly can be, growth is tough. 00:28:32.977 --> 00:28:36.377 You have to manage it so that you do grow quick enough, but you don't overgrow. 00:28:36.677 --> 00:28:40.917 Right. So how do you, how do you find that? How do you have that fine line? 00:28:40.997 --> 00:28:44.877 Right. You need to have people in place to for growth. Um. 00:28:46.601 --> 00:28:52.101 So what else? Funding. I think funding has been, you know, it obviously slowed 00:28:52.101 --> 00:28:54.181 down. I feel like it's coming back now. 00:28:54.921 --> 00:29:00.581 Valuations. I feel like it ties in with valuations. There's a lot of money looking 00:29:00.581 --> 00:29:03.141 for investments in the U.S. for sure. 00:29:03.361 --> 00:29:08.061 I've worked with venture capital as well, and I've invested in a few venture 00:29:08.061 --> 00:29:13.261 funds and some startups, but it's finding the right, you know, 00:29:13.281 --> 00:29:16.361 it's finding the right partners, because also if you take money from someone, 00:29:16.441 --> 00:29:18.221 they are your partner, you are married to them. 00:29:18.301 --> 00:29:22.901 And you also have to recognize how, how they think I was at a family office 00:29:22.901 --> 00:29:26.881 and we invested in companies and there is, there was a company I said, 00:29:26.961 --> 00:29:31.581 you know, don't take our money because they think a different, 00:29:31.661 --> 00:29:33.321 like the family office thinks a different way than you do. 00:29:33.401 --> 00:29:36.001 And it would, it would be, it wouldn't, you wouldn't work together. 00:29:36.081 --> 00:29:40.641 That marriage wouldn't work very happily. So remember that whoever you're taking 00:29:40.641 --> 00:29:42.601 money for, ideally, are strategic partners. 00:29:42.881 --> 00:29:44.721 Who can they help introduce you to? 00:29:45.681 --> 00:29:50.121 Obviously, everybody wants kind of money, but people that invest money also 00:29:50.121 --> 00:29:52.481 want to work with other people they know that are investing money. 00:29:52.581 --> 00:29:56.261 So it's almost like a club that if you find somebody that's really interested, 00:29:56.621 --> 00:29:58.401 ask them who they like to partner with. 00:29:58.581 --> 00:30:01.941 And then it could actually, that could help you fill out your fundraising. 00:30:02.601 --> 00:30:06.061 A little different than the question you asked, but it's just kind of different approaches. purchase. 00:30:06.141 --> 00:30:10.121 The other thing is I would just be show up and be around, create those networks 00:30:10.121 --> 00:30:13.321 because those networks are going to help you when it comes to finding financing. 00:30:13.921 --> 00:30:17.781 Also, when you're in a downturn, those networks are super important if you need 00:30:17.781 --> 00:30:19.061 to find some sort of bridge loan. 00:30:20.063 --> 00:30:23.803 Um because they're the ones that are gonna because in 00:30:23.803 --> 00:30:27.083 the venture world it's people right it's like people and ideas for the most 00:30:27.083 --> 00:30:32.643 part right and uh you just want to make sure that you have that that connection 00:30:32.643 --> 00:30:36.123 because whatever we're doing in technology is fantastic but it is still people 00:30:36.123 --> 00:30:40.743 that are making the decisions because these decisions are fiduciary and you have to trust, 00:30:42.343 --> 00:30:47.083 um i know so those are those are a couple ideas you actually answered already 00:30:47.083 --> 00:30:54.283 the next question that I had that there's only one left on the US fintech side. 00:30:55.783 --> 00:31:02.883 The role that regulatory changes and government policies will play in shaping 00:31:02.883 --> 00:31:08.023 the future landscape of fintechs in the US, especially how can they foster innovation 00:31:08.023 --> 00:31:09.103 and customer protection? 00:31:09.423 --> 00:31:14.263 That is one of the hardest questions, right? Because how do you regulate? 00:31:14.443 --> 00:31:15.943 Yes, Yes. How do you regulate innovation? 00:31:16.303 --> 00:31:19.943 It's really difficult because you're continuing to innovate. 00:31:20.023 --> 00:31:22.423 You don't want to overregulate. So you can't actually innovate, 00:31:22.643 --> 00:31:25.003 but you still need to have rails in place. 00:31:25.063 --> 00:31:31.843 So I think Micah in Europe has done a great job for kind of the blockchain industry 00:31:31.843 --> 00:31:37.363 to give ideas, blockchain slash crypto, give ideas of this is this is what you can and can't do. 00:31:37.423 --> 00:31:40.523 Right. You need you have to be black and white as opposed to gray. 00:31:40.523 --> 00:31:44.703 The problem in the US right now is that if there's no rules, 00:31:45.163 --> 00:31:48.423 then you don't know if it's black or white. You can't play in the gray. 00:31:48.703 --> 00:31:54.383 And so I do think it's difficult, but I do think that what regulators should 00:31:54.383 --> 00:32:01.083 do, and now this is becoming political because it's an election year with crypto regulation. 00:32:01.223 --> 00:32:04.463 So I think you just need to talk to industry leaders, right? Right. 00:32:05.103 --> 00:32:10.403 That's another reason I wrote the book is to educate. So so regulators can understand 00:32:10.403 --> 00:32:14.923 the thought process here and not be afraid of it. I think people are afraid of change. 00:32:15.663 --> 00:32:18.883 And how can you regulate this innovation? 00:32:19.443 --> 00:32:23.303 Learn more about what it what it is. Right. And what it does and doesn't do. 00:32:23.623 --> 00:32:27.703 So I feel like there's a very there's very negative mentalities in the US. 00:32:27.703 --> 00:32:31.183 There's something that came out with custody that there are a number of banks 00:32:31.183 --> 00:32:36.443 that are custodians that were looking at actually offering custody services for for cryptos. 00:32:36.743 --> 00:32:41.043 And there some legislation came out that said or actually was an accounting 00:32:41.043 --> 00:32:44.643 standard that came out and said, if you hold if you custody a crypto, 00:32:44.743 --> 00:32:47.643 you have to hold the same cash on your balance sheet, which makes it not work. 00:32:47.923 --> 00:32:51.263 Right. That's it's just it's just onerous. 00:32:51.443 --> 00:32:54.923 And so I feel like that's not listening and understanding the technology. 00:32:54.923 --> 00:32:58.703 I think it makes much more sense to work with. 00:32:59.682 --> 00:33:03.062 Industry leaders to figure out what's best for this industry and how do we move 00:33:03.062 --> 00:33:05.842 forward? Because the US is a superpower, a financial superpower. 00:33:06.282 --> 00:33:10.962 And I think they're hurting themselves right now with having not clear regulation. 00:33:11.262 --> 00:33:15.962 And there's a lot of regulation by enforcement, which is horrible, right? 00:33:16.142 --> 00:33:19.082 They say, you can do this. And then they say, oh, no, you can't. 00:33:19.082 --> 00:33:19.742 We're going to charge you. 00:33:21.102 --> 00:33:23.482 Actually, they never really tell you you can do it. They tell you you can't 00:33:23.482 --> 00:33:27.762 do it. But then you think that you've worked with them. 00:33:28.102 --> 00:33:31.142 Coinbase, for example, had just gone public, so they got an SEC approval, 00:33:31.302 --> 00:33:35.122 and then they get a Wells notice from the SEC saying they're doing it wrong. 00:33:36.782 --> 00:33:40.462 But there's not the conversations in the middle. That's the problem. 00:33:40.682 --> 00:33:42.622 Just yes or no, one and zero. 00:33:43.282 --> 00:33:46.542 Yeah, it doesn't work that way. it needs 00:33:46.542 --> 00:33:49.682 to be kind of an oh if if let also another thing 00:33:49.682 --> 00:33:52.862 is a lot of the legislature is older 00:33:52.862 --> 00:33:55.862 or regulators are older and this technology is newer 00:33:55.862 --> 00:34:00.162 right if you look at gen z and millennials grew up with this technology or just 00:34:00.162 --> 00:34:04.162 technology in their hand whereas if you have people that are you know in their 00:34:04.162 --> 00:34:08.962 70s that is not the case and if it's not fit if it's not broken why fix it which 00:34:08.962 --> 00:34:14.302 is a terrible idea um in today's age but it's you know you're comfortable with 00:34:14.302 --> 00:34:15.062 what you're comfortable with. 00:34:15.122 --> 00:34:17.222 Why do you want something else coming in and messing it up? 00:34:17.302 --> 00:34:22.062 But we would still be riding horses if that were the case. So all things to think about. 00:34:22.302 --> 00:34:27.142 Going a little bit from focus on the US to a little bit comparing the US and Europe. 00:34:28.662 --> 00:34:33.022 Given that FinTech companies in Europe need to file for regulatory approval 00:34:33.022 --> 00:34:39.242 just once and then just notify the national regulator that they're doing business there. 00:34:41.442 --> 00:34:47.042 The understanding of many startups is you have to file for 50 approvals in the 00:34:47.042 --> 00:34:50.562 United States for each state where you want to do business in. 00:34:51.102 --> 00:34:58.542 What do you think is the impact there in terms of cost and speed for fintechs in both regions? 00:34:58.842 --> 00:35:03.902 Very slow. So it depends on what you do if you have to file in every state. 00:35:04.042 --> 00:35:07.822 So obviously banks have to file in every state. Securities have to file in every state. 00:35:08.902 --> 00:35:12.062 But there's also more, like, I guess when you're starting up, 00:35:12.062 --> 00:35:14.582 you're starting up smaller. So you're not starting up from a national level. 00:35:15.482 --> 00:35:18.722 But I think it's tough. It's onerous. It's, you know, you're dealing, 00:35:18.802 --> 00:35:22.382 every state has its own government, which is why it makes it just difficult 00:35:22.382 --> 00:35:23.962 to get through the government and that process. 00:35:25.922 --> 00:35:28.962 Finding partners is a great way to help you, but then it's how to, 00:35:29.002 --> 00:35:30.082 you know, how do you find partners? 00:35:30.622 --> 00:35:34.582 You have to, you know, start somewhere, right? Start somewhere and figure out 00:35:34.582 --> 00:35:41.102 what's the best and biggest market for me and start making inroads there and 00:35:41.102 --> 00:35:44.362 then it is expensive and it's a lot of legal fees. 00:35:44.582 --> 00:35:49.922 There's a lot of legal money that goes into startups, which is good and bad. 00:35:50.022 --> 00:35:53.202 You want to work within the laws, absolutely, but then it's kind of ridiculous 00:35:53.202 --> 00:35:57.342 how much money a startup has to pay because every startup is paying that same amount. 00:35:59.097 --> 00:36:02.497 Um, so yeah, it's difficult. It is difficult to work within regulation, 00:36:02.777 --> 00:36:05.037 uh, as in from a financial perspective. 00:36:05.157 --> 00:36:08.677 Absolutely. We work within regulation, but when the regulation doesn't necessarily 00:36:08.677 --> 00:36:13.797 make sense, but if you're providing it like a SAS product, then you're not having 00:36:13.797 --> 00:36:15.237 to register in all the different States. 00:36:15.437 --> 00:36:20.257 So if it depends on what service you are providing, if you are a money transmitter, 00:36:20.457 --> 00:36:24.957 then you need to register, uh, in, in the different States. 00:36:24.997 --> 00:36:29.977 So it's just that defines what you're doing what the registration is and and who your regulator is, 00:36:30.677 --> 00:36:34.457 because there are many different regulators and banks there's 00:36:34.457 --> 00:36:38.037 even different regulators for banks it depends on how you fall uh bottom 00:36:38.037 --> 00:36:43.937 line i do believe talk to a smart lawyer yeah yes and you know what also i think 00:36:43.937 --> 00:36:47.737 i you know there's lawyers are different prices but i would i would prefer i 00:36:47.737 --> 00:36:51.797 have learned that i would rather not pay my lawyer to learn so if you if you 00:36:51.797 --> 00:36:55.317 have usually the lower like a cheaper lawyer, you're paying them to learn. 00:36:55.517 --> 00:36:59.537 And I would rather have someone, I'd rather pay more money for less time when 00:36:59.537 --> 00:37:02.497 they already know it. So food for thought. 00:37:03.677 --> 00:37:08.477 Okay. And the last question to kind of close this interview, 00:37:08.757 --> 00:37:14.317 do you think there are lessons that you as based fintechs can learn from the 00:37:14.317 --> 00:37:15.037 European counterparts? 00:37:15.797 --> 00:37:21.437 Absolutely. Look, I think, well, I think regulators, US regulators can learn 00:37:21.437 --> 00:37:25.337 from European regulators, but both, right? 00:37:25.397 --> 00:37:30.197 I feel like there's, I think that regulation helps encourage innovation in Europe. 00:37:30.337 --> 00:37:34.537 So right now for blockchain, I'm looking to a lot of companies in Europe and 00:37:34.537 --> 00:37:40.577 what they've created and actually working on focusing, focusing on Europe because 00:37:40.577 --> 00:37:43.817 there's more, there's more guidelines in Europe, there's more regulation. 00:37:44.117 --> 00:37:48.037 So institutions are more comfortable working within that. 00:37:48.137 --> 00:37:52.317 So there's, you know, there's a lot of loans, loans, debt, corporate bonds that 00:37:52.317 --> 00:37:56.797 are being created on chain in Europe digitally that aren't in the US because 00:37:56.797 --> 00:37:58.697 of that regulatory question. 00:38:00.477 --> 00:38:03.097 There's stablecoins that are launching. I think there's a lot of innovation 00:38:03.097 --> 00:38:04.077 that comes out of Europe. 00:38:04.637 --> 00:38:09.357 If you look at telecommunications, cell phones were much bigger in Europe than 00:38:09.357 --> 00:38:12.197 they were in the US. It took a while for US to adopt. 00:38:14.276 --> 00:38:18.756 But what can we learn? You know what? I also try to always find smart companies 00:38:18.756 --> 00:38:22.056 and see what they're doing and kind of what can I learn from them, 00:38:22.136 --> 00:38:24.776 even if they're slightly, they're not exactly the same thing. 00:38:25.736 --> 00:38:29.016 And then getting to know them, right? 00:38:29.616 --> 00:38:33.356 Getting to know, reaching out. Because again, it's that community. 00:38:33.556 --> 00:38:37.656 I would rather learn from someone else's mistakes than have to make the mistakes myself. 00:38:38.016 --> 00:38:43.256 So I'm happy to, I have made mistakes myself, but you know, we can help each 00:38:43.256 --> 00:38:44.516 other by learning from others as well. 00:38:44.616 --> 00:38:46.916 I think that are amazing closing words. 00:38:47.056 --> 00:38:53.136 So as long as enough people here on StartupBright.io share their mistakes, 00:38:53.396 --> 00:38:55.616 I do believe there's always opportunity to learn. 00:38:56.496 --> 00:39:01.936 Absolutely. Absolutely. And I think this podcast like yours are super important. 00:39:02.156 --> 00:39:06.756 I listen to podcasts all the time and I think that's sharing of ideas and knowledge 00:39:06.756 --> 00:39:07.396 and thought leadership. 00:39:07.616 --> 00:39:10.236 So thank you, Joe, for doing what you do and sharing this. 00:39:10.496 --> 00:39:13.896 Thank you very much. Annelies, It was a pleasure talking to you. 00:39:14.256 --> 00:39:17.836 Best of luck. And as always, we'll link your LinkedIn profile, 00:39:18.096 --> 00:39:21.196 the website of your book, as well as the book itself. 00:39:21.456 --> 00:39:23.756 Fantastic. Thanks so much, Joe. And thanks, everyone, for listening. 00:39:23.956 --> 00:39:25.716 My pleasure. Have a good day. Bye-bye. 00:39:25.680 --> 00:39:31.280 Music. 00:39:30.976 --> 00:39:40.016 That's all, folks. Find more news, streams, events, and interviews at www.startuprad.io. 00:39:40.016 --> 00:39:42.536 Remember, sharing is caring. 00:39:43.440 --> 00:39:56.245 Music.