So some of your listeners might know some of the investments like Dollar Shave Club, some other Hail Mary shots on Alzheimer’s and some fun things like that. Then I went and joined Sisense, which was an Israeli data analytics company that has raised about $300 million. I built up the outbound sales team there and grew that team from two folks to about 24 people in a year.

It was May of 2018 that I launched Blockworks group full time. I’m co-founder with Michael Molina, who went to Emory with me. We just had our two year anniversary last week.

Robert Leonard  2:10

You mentioned that the venture firm was focused on technology and life sciences. So I have to ask, where does Dollar Shave Club fit into there? Are they a technology company?

Jason Yanowitz  2:19

Dollar Shave Club was a co-investment with Sequoia Capital. You probably see it now and a lot of the listeners probably see it with Peloton and We Work. I think We Work is the prime example. A lot of these non-tech companies when they filed for their IPO and their S1s, people kind of got access to the company and started to see how they’re describing themselves.

With WeWork, they are a real estate company and property management company. They’re calling themselves a tech platform to change people’s lives. I think Dollar Shave Club was one of the early adopters of this kind of mentality and really marketing.

I love their CEO. I was a history major at Emory and he was a fellow history major from Emory. I think he’s a brilliant marketer, not fully a tech company but I think it was a nice little investment.

Robert Leonard  3:06

Yeah, they’re definitely doing a little bit better than I would say We Work is. So I think it’s worked out for them.

Throughout today’s episode, I want to talk a bit about entrepreneurship, how you’re building your company, your experience in venture capital, and also Bitcoin. Let’s start with entrepreneurship. How did you know you were meant to be an entrepreneur? Why, specifically, did you want to start a Blockworks group?

Jason Yanowitz  3:29

Let’s say so I think those are two different questions, right? I think the Blockworks group starts at the end of 2017. I think entrepreneurship started when I was three years old. Both my grandparents on my mom and dad side were entrepreneurs. My dad was an entrepreneur, my mom was an entrepreneur, they still are.

And so, I think oftentimes entrepreneurship is in someone’s DNA. I think what it translates to is just a lack of conformity to the rules. I think you can trace a lot of entrepreneurs back to non-work related and non-business related things. You can start to see some trends emerging.

For example for a VC firm, we would ask founders and entrepreneurs questions like, “What was your major?” Their answer was I created my own major. That’s one data point. Along a trend of not conforming to the rules. So it’s little things like that.

All my friends were getting jobs after high school flipping burgers, I was launching a network marketing company or working with a network marketing company, instead of going to business school, right? Like all of my friends did at Emory. I studied history.

I think from a young age, I knew I wanted to be an entrepreneur. But I really think entrepreneurship is a risk reward game, like financially. I mean, most entrepreneurs fail. It doesn’t really make sense to be an entrepreneur, unless you love the risk. I think for myself, I need the risk. But I think it’s important to understand that most entrepreneurs fail. But yes, I think from a young age is kind of the bound for the entrepreneurship path.

Robert Leonard  4:57

Yeah, it’s interesting. You mentioned the major because that was exactly One of the things I was going to ask is how did you go from being a history major to being an entrepreneur? I mean, that’s not really a common major for a lot of people that go into business. I

 

Jason Yanowitz  5:11

Every entrepreneur has some of the same traits and I think the biggest one is passion, right? Passion and curiosity would probably be the second one. There’s some other ones like grit, hustle and wanting to make an impact and wanting to have ownership.

But I think curiosity and passion are the two biggest traits of successful entrepreneurs, passion for their business, and just a genuine curiosity about life and learning. I think wanting to major in history is just a genuine passion for it, thinking that I’d be doing business for the rest of my life. And so, I wanted to study something that I was actually passionate about, paying a boatload of money to go to school.

Then I was just genuinely curious about it. I think if you have passion, and you have curiosity, it really doesn’t matter what you majored in, most of my friends are working in investment banking, or consulting or private equity. It’s not like I knew how to build a website out of school, but nobody really does.

I think a lot of things that you learn in school, whether you’re a business major, unless you study a hard skill, like accounting, it’s not too applicable to launching a business, to be honest.

Robert Leonard  6:11

So why specifically Blockworks group? Why an event and media company?

Jason Yanowitz  6:16

Good question. I think any good company starts with a problem, right? More often than not, it’s a problem in a founder’s personal life, and it was no different for me.

So I got into the Bitcoin and crypto space when I was actually living in Budapest, Hungary. Someone I knew out there introduced me to Bitcoin. That was 2015. I moved to New York in 2016, went deep down the Bitcoin rabbit hole, and really realized over the course of two to three years that there was no real source of information and education to help, whether it’s a newbie a 22 year old interested in Bitcoin, or a 60 year old gray haired family office investor who’s allocating from their $300 million portfolio. There’s no good place for them to go learn about crypto and Bitcoin.

If you’re a 70 year old, you sure as hell not going to learn from crypto Bobby on Twitter and crypto panda on Reddit, right? That’s all the sources for information that existed.

So I started looking around, and didn’t see anything in the market. I actually launched Blockwork originally just as a side hustle. I went to a meetup on a Sunday, I came home, I was living with four friends actually. I said, “I’m launching a consulting firm for the Bitcoin space, does anyone want to get involved?”

Two friends said no and two friends shot their hands up and said, “Let’s do it.” One friend ended up dropping out. The other friend was Mike, who’s the co-founder. The consulting firm quickly transitioned into an events company, which since has grown into an events and media company, and so took about six months of working with bloggers group as a side hustle, and then eventually launched it full time in May of 2018.

Robert Leonard  7:24

That leads exactly into my next question, because I wanted to talk about why you decided to have a co-founder. A lot of people who are starting side hustles or startups or just a small business in general, they’re trying to decide do I want to be a co-founder or do I want to go it alone? Why did you decide to get a co-founder rather than doing it yourself?

Jason Yanowitz  8:04

I don’t even think that the idea crossed my mind to try to do this myself. I think for any first time entrepreneur, you should have a co-founder. I feel really, really strongly about that.

I think there are a few things that you need to look for. But just hands down, I could not have done this alone. I feel really strongly about that. I don’t think it was an active decision. Should I have a co-founder or should I not? I think it was just how can I blink up with somebody who has different traits than I do? That’s what I found in Mike.

So I manage all the sales and marketing at the company. Mike does a lot of things like strategy operations, content creation. He came from a consulting background, I came from a sales and VC background. So no, I think you just want someone who has very complementary skills, right?

When you think about finding a co-founder, you want to think about one thing, which is, how do you two combined have an unfair advantage? And so, I think there’s this narrative, actually. We’d love to talk about this for a second, there’s a narrative that founders have to be like college friends, or work together, as was the case for us.

But for any of your listeners, think about launching something. I think this is less true than we think actually, right? Like, let’s think about dating. People used to be embarrassed to say they met their spouse via an app. They instead prefer saying they met at college or at a bar. But I think that’s going to be a lot less true moving forward.

I think that there will start to be networks created and apps created to find your co-founder. They’ll help you find people who agree with you on first principles of company building, find people with complementary skills, find people who are aligned on your values and on your mission alignment. What does success look like? Then find people who are aligned on a company basis who make the decisions, what trade offs you will and won’t accept.

And so, those are kind of company alignment, value, mission alignment, complementary skills, and someone who agrees with you on first principles of company building. I think those are the four things everybody really needs to look for and co-founder and I was lucky enough to find that.

Robert Leonard  10:00

Another big decision that you made early on was to bootstrap the company rather than take on capital from outside investors. It’s interesting because you worked in venture capital. So you almost had a sneak peek as to what you had to do to raise money if you wanted to, but you decided to bootstrap it.

For those who aren’t familiar with what bootstrapping is, please explain what it means to bootstrap a company and then why you decided to use this strategy.

Jason Yanowitz  10:28

First, let’s talk about bootstrapping and what it is, pros and cons, and then we can talk about why I actually really strongly believe that most companies should not raise venture money right out of the gate. Not to say that they shouldn’t ever, but I think right out of the gate, they shouldn’t.

To touch on the first part of bootstrapping, basically, it’s a term that has its origin in the early 19th century, actually, with the expression pulling up by one’s own bootstraps. That kind of meant, “I’m going to do it myself.”

Bootstrapping a startup just means starting lean and without the help of outside capital. It means continuing to fuel growth, internally, from cash flow produced by the business.

There are a couple reasons that we decided to do this. The first one was just control. This is our first business that we built. It was really important to us not to quit our jobs, go full time with the business, and then immediately start working for somebody else, right?

If you’re a founder, and you raise capital, you’re not your own boss. You’re working for the venture firm that invested in your company, or really, for the board, actually. You can get fired at any time. So I think that’s something that a lot of first time entrepreneurs don’t realize is that as soon as you take outside capital. The second that term sheet is signed, the money hits your bank account, you have a boss. We really didn’t want that.

So the pros, there’s ownership, right? Literally, our equity stake is bigger now than if we had taken outside capital, there’s control. If we want to promote someone to our executive team, we want to make a big hire, if we want to fire those are all decisions that we want to have the control over. Instead of having VCs who are going to meddle in the business, there’s decision making tied into what I just said.

There is longevity. VC firms’ incentive structures have big exits after 5 to 10 years. We didn’t want that incentive structure kind of looming over us. We wanted the option if we wanted to sell in two years to have that option. Or if we wanted to make this a family business that runs for 200 years, we want that option.

The other thing that bootstrapping forces you to do is it forces you to build a business model that actually works. We’re recording this May 2020, we’re starting to see some of these VC-backed companies completely blow up. The reason is, they never built a profitable business model.

You have companies that are Uber and Airbnb starting to IPO. That isn’t profitable. They never built a business model that actually works long term and sustainable. And so, I think all of those reasons, when you look at it, it’s kind of a no brainer not to take venture money right out of the gate.

Robert Leonard  13:03

Yeah, I really like two things you said there. The first thing is about having a boss. I’ve never raised venture capital but I’ve read a lot about that. That’s an idea that really stood out to me and that I talk about a lot is when you raise that capital you took on your boss, and that’s almost exactly the opposite of why you became an entrepreneur.

A lot of people become entrepreneurs because they don’t want a boss. And so, when you go out and raise money, you’re kind of defeating that purpose. I have some friends that have started startups. As they were trying to decide to bootstrap or raise money, one of the big things that I explained to them was, “Well, this is what’s going to happen. You’re going to have a boss, X, Y, and Z.”

I think that’s a really good point you made. We’re also seeing a lot of companies, like you said, blow up right now because they’re not profitable. It seems in the startup space and venture space, a lot of companies think that a business model that isn’t profitable, as long as you keep throwing money at it, it’ll eventually become profitable, somehow, one way or the other.

I mean, you just can’t do that with bootstrap. You have to get to profitability and grow the business organically that way. So I think those are two really good points you made.

Jason Yanowitz  14:00

Yeah, I think there’s a myth. No entrepreneur starts out unless you’re like one of the digital nomads, who goes to like Southeast Asia and does their web agency or something like that I see all over Instagram. But there’s this big myth that if you want to build a billion dollar business, you have to go raise hundreds of millions of dollars. It’s just not true.

All your listeners should look at Qualtrics, right? It’s an awesome business. It is started by a couple of brothers and their dad. They bootstrap for a decade then over 10 years, after refining their business model over and over and over again, then they raised hundreds of millions. They’ve got an awesome lifestyle. They’ve got an awesome business, a lot of great companies.

Apple and Facebook didn’t go raise money right out of the gate. They bootstrapped. They created a profitable business and then they raised money. What that allows you to do is if you raise on your terms.

Imagine if you go to a VC and say, “I’ve got this idea. It’s going to be big.” You walk into their doors and you share the pretty PowerPoint that you put together. For a month, well, you might raise money, but it’s on their terms. They’ve got the liquidation preferences, they take 30% of the company, right? They get a board seat.

Now what happens if you run a company for five years, you go into that same VC firm, you go, “Look, we’ve grown 100% year over year, revenues 20 million a year, now, we’re profitable. We’d like to take some money so that we can grow, but we don’t really need your money, you’re going to get much more favorable terms.”

Robert Leonard  15:26

Do you think having worked at the venture firms helped or hurt you wanting to raise capital?

Jason Yanowitz  15:31

It severely skewed my idea of raising capital. I would say it just showed me that raising capital doesn’t solve any problems, right? There’s a really well known VC, Fred Wilson. He’s at Union Square Ventures. They’ve invested in a “unicorn” like every year for the last decade or something, right? They’ve invested in hundreds of companies over the last 30 years or whatever, a lot of your listeners might know him…

He wrote something, which was, no matter how much money you take, you still spend money, at the same burn rate. That’s what he’s seen.

Say we raised a million dollars, we’re going to make sure that million dollars lasts us for the next 12 to 18 months, say we raise $100 million, we’re going to make sure that money lasts for the next 12 to 18 months.

On top of that, it doesn’t solve any of our problems. I think that was the biggest thing I saw at the VC firm is these companies would think that once they’ve raised the money that they’re done, and that’s just the game has just begun.

Then the other thing that was important that I noticed is once entrepreneurs raise money, they don’t get as stingy. They felt like they had the money. One of the things that’s so fun about being an entrepreneur is like, you’re negotiating all day long, right? You’re taking inputs and you’re negotiating all day long. I think you lose that once you take in money, right? It’s just psychology. You just can’t keep that mindset.

Robert Leonard  16:56

Yeah, that reminds me of a book I read not too long ago by Daymond, John, the power of broke, where he talks about how you just don’t have that grit or that hunger in you win, you just have all this money being thrown at you. I mean, you don’t have to be resourceful. You could just throw money at problems rather than trying to be creative and actually come up with a solution for the problem. So yeah, definitely a good point. And I think it’s really interesting, because I would have thought that working at a VC firm would have made you want to raise capital and kind of give you the inside scoop as to how to do it, how to be successful with it. And it sounds like it actually turned you off from it, which is really interesting.

Jason Yanowitz  17:31

Yeah, I mean, look, we’ve talked about raising. We have spoken to folks before. We’re a profitable business. So why go take outside capital? We really don’t need it. Then there’s the other thing that’s really important, which is, VCs are incentivized to get their portfolio companies to billions of dollars, right?

There are many companies out there that shouldn’t be a billion dollars. But they’re amazing businesses. Let’s take The Investor’s Podcast Network, for example. TIP is probably never going to do a billion dollars in revenue, right? But it’s an amazing, amazing, amazing business that Preston and Stig have built. They’ve got amazing partners, like yourself on board, who are making a decent chunk of change and living a really great life.

But if they had taken VC money, the VCs would be unhappy with how TIP is being run right now because it’s not growing quickly. The incentives are messed up. So I think that one of the biggest fatal flaws of a lot of companies is that VCs kind of step on their neck and say, “grow, grow, grow,” even though the founder knows that they shouldn’t grow any faster.

Robert Leonard  18:37

Yeah, that’s a concept that I’m actually really passionate about because everybody, when they start a business, they want to become a billion dollar company. That’s mostly because of societal pressures and things like that. Not necessarily, because that’s what they need to reach their goals.

I think that puts startup founders at a huge disadvantage because if you go into this business, saying, “I need it to be a billion dollar company, otherwise, I’m not successful,” I mean, that’s a much steeper mountain to climb.

Whereas if you say, “If I can get this to a one to five to $10 million business, then that’s a massive success.”

I think it really impacts your psychology and if you looked at companies that had from the beginning a goal of one to 10 million, I bet they’re a lot more successful than companies that go in and try to go right for a billion. I think that that’s a really important thing for founders to get their mind wrapped around. There’s nothing wrong with having a $5 million company. You can live a very good life with a $5 to 15 million company, even a million dollar company. So it’s still a very successful business, even if it doesn’t get anywhere near a billion dollars.

Jason Yanowitz  19:36

Look, we live in a world of instant gratification, but in the entrepreneurial community, I open up my emails, and every morning I’ve got TechCrunch saying this other founder just raised $100 million dollars and it’s natural. It’s just psychology to be, “Are they doing something better than I am?”

However, I think we live in this world of instant gratification. As an entrepreneur you need to remember to hold out, you need to take the time to build the business into something actually worth funding.

Then when the funding comes, you can actually use the investment to scale your profitable business, not to figure out what you’re trying to do. I think too many folks raise capital to figure out what to do, saying, “Oh, if only I had this money, then I could create a business.” I think that’s the reverse of how they should be thinking.

Robert Leonard  20:23

Although you haven’t raised capital, and you’re doing it bootstrapped, you mentioned you started just in 2018, you guys have grown pretty quickly. So just two years later, you have a team of 10 people, how have you scaled your company already, so successfully, what have really been the different makers when building out your business?

Jason Yanowitz  20:39

I have gotten lucky or more than that. I wish I had something revolutionary to say, but it boils down to two things. First one is talking to our customers, you read it in the blog posts, and then the articles and you hear it on the podcast, you read it in the books. Talk to your customers, talk to your customers, talk to your customers.

Then you get into this founder world and you learn how many people are actually doing that, right? It’s fascinating to me. From day one, we’ve always prioritized. If we host an event, we need to be on the phone with the event attendees the next day. If we host an event, we need to be on the phone with the event sponsors the next day. We need to be talking to our podcast listeners, our podcast advertisers, our podcast hosts to make sure that we’re providing the best network for them.

Talking to your end users and your customers has just been crucial. It’s allowed us to launch new businesses or new product lines that we never would have known that our customers wanted, if we didn’t talk to them. So that’s one thing.

Then the second thing was just I’m an average guy, right? And so as Mike, we just hired people who are better than us and put a lot of trust and faith in them. Let them run with it. That’s been one of the hardest things to do as founders is give up control of the business. But we’ve hired folks who are much smarter than us and who have much more experience than us and said, “Look, you’ve done this before, run with it.” That’s paid unbelievable dividends.

So we’ve hired experienced people, we’ve also hired people who are younger than us and hungrier, and just having faith in them that they would grow into top talent. Even though it might be a few months, maybe even a year or something that they’ve grown to top talent and that’s really proven true.

So for anyone just starting a business out of two things, just talk to your customers more than you think you need to and hire people who are smarter than you and give up control faster than you think you have to.

Robert Leonard  22:27

What have been some of the big struggles that you faced, while building your business, both for yourself personally, and for the company?

Jason Yanowitz  22:35

It’s a tough question. There are so many, but the company I would say early on is the decision making. I think when you’re an employee somewhere, whether you’re at a VC firm, or work in finance, or work in tech, or work in sales, or marketing, whatever it is, there aren’t a tremendous amount of decisions. No one can prepare you for the amount of decisions that you have to make as a founder, all day long, right?

Hundreds of decisions with incomplete data and I think you’re kind of trained in school and in your life to make decisions based on data and make a decision once you have the whole picture. Once you talk to both parties, that’s not how the world works. And as a founder, you just have to make so many damn decisions every single day, whether or not it’s for the font size, be a tiny bit bigger on the website, or all the way up to should we launch this new product yet? Is it ready? All the way up to like should we pivot the business?

And so, there’s just so many decisions, that was a real struggle at first but we definitely have gotten better at that.

Then the second thing is that I still struggle with not going after shiny objects. I think not going after shiny objects is the toughest thing for entrepreneurs, and especially first time bootstrapped entrepreneurs.

What I mean by shiny objects is ways that you can get paid and make a lot of money, but that go away from your mission and your values of the company. For us, we’re an events and media company that helps institutional investors understand the emerging digital asset space. There have been so many times where we might do podcasts, and a dentist company would come to us right. We would run an amazing marketing campaign for that dentistry company. But does that align with our mission, our values? If not, we probably shouldn’t do it. So that’s what’s been tough as a company from a company level.

Then from a personal level, I’ve struggled with this my whole life and still do struggle, just saying no to more people and saying no to opportunities, and just really trying to understand the opportunity cost of saying yes.

Robert Leonard  24:29

AsI’m building my podcast business with the TIP team, one of the big things that I’m struggling with myself is that shiny object. I mean, there’s just so many different things that we can do and so many different products or services we can offer. It’s just one of those things that you get to really decide what’s going to be the best. It’s hard to make that decision and it’s hard to say no.

Jason Yanowitz  24:49

I was just going to say it really is and especially with limited resources. I think it’s easier to turn down shiny objects if you’ve raised capital actually, but if you’re bootstrapped and you see something If you’ve got revenue of 5 million year and you see something that could make you an extra 500k that year, well, it’s easy to want to go after it. But long term, it’s not a smart decision.

Robert Leonard  25:09

Now I want to transition and talk a bit about Bitcoin. For someone who may not be familiar with Bitcoin or cryptocurrency explained to us what Bitcoin is and what cryptocurrencies are.

Jason Yanowitz  25:20

It’s a big question. I think there are 100 different ways that you can describe Bitcoin, its importance, and its relevance kind of lies in the eyes of who’s looking at it, who’s buying it, and who’s holding it.

I’m going to maybe take three minutes here and go through the whole shebang. I think a simple definition of Bitcoin would be that it is, first and foremost, a new form of money. It’s a new form of thinking about money. It’s a new form of storing money, transferring money, just dealing, organizing and understanding money, and then all kinds of second order financial effects that come out of that.

However, just to kind of like what Bitcoin is in one line: It’s the world’s first cryptocurrency. It works because of the world’s first public blockchain network. Right?

What does Bitcoin do? It lets you send and receive value to and from anyone in the world, using nothing more than a computer and an internet connection.

Why is that revolutionary? Because unlike every other tool for sending money over the internet, it works without the need to trust a middleman, right?

And so, the lack of any corporation sitting in the middle in between means that Bitcoin is the world’s first public digital payments infrastructure. By public, I just mean, available to all and not owned by a single entity. So when you think about it, you know we have public infrastructure for information. We have public infrastructure for websites for email, and that’s called the Internet, right? But the only public payments infrastructure that we have for money, and for cash is paper money, and it only works in face to face transactions. It’s pretty damn outdated.

Before Bitcoin, if you wanted to pay someone remotely over the phone, or the internet, you couldn’t use public infrastructure. You had to rely on a private bank to open their books, enter the debit, enter the credits, the person that you’re paying. If you both don’t use the same bank, there’ll be multiple banks, multiple ledger entries in between.

With Bitcoin, the ledger is the public blockchain. Anyone can add an entry to that ledger, transferring their Bitcoin to someone else. Anyone, regardless of their nationality, their race, their religion, their gender, their sex, their credit worthiness, in for absolutely no cost, create a bitcoin address and receive payments digitally. For those reasons, I think it’s pretty damn cool.

Robert Leonard  27:33

We’ve had the US dollar for a while and other fiat currencies, and they’ve treated us well. Why do we need cryptocurrencies?

Jason Yanowitz  27:41

It’s a good question. I will respond to that question with another question, which is how long have we really had the US dollar? The real answer is we haven’t had it for that long. The US Dollar was backed by gold for a long time. It was really valuable then. You could exchange your dollars for gold. It’s backed by something.

But in 1971, Richard Nixon took us off of the gold standard. Any history nerds out there, if you remember the speech, he took us off the gold standard, and said, “Yeah, but it’s just temporary guys.” It was at that public conference that he did for all of America, where he said, “Look, we’re going off the gold standard. It’s just temporary.” Well, it wasn’t temporary. It’s been since 1971.

This fiat system that we’ve created is really an experiment. It hasn’t actually been going for that long. So it’s been less than 50 years that we’ve been doing this. But actually, let me double up on that because the second part of your question was, why do we need it?

I think the “we” is the most important part of that, because the “we” is very different for different people, right? A lot of your listeners are in the United States. America is the hardest place for folks to understand Bitcoin. Why? Because money works in the US and the government works in the US, right? That’s not true for the entire world. Actually, for the majority of the world, that’s not true.

Some people might like Bitcoin, because it’s not manipulatable. Some people might like Bitcoin, because it’s not feasible. It’s not censorable. It’s not debasable. And so, I think when you say like, why do we need it? Well, are you a citizen in Venezuela? Are you a US investor looking to allocate 1% of your portfolio during the week? And then you can start to understand why it’s valuable.

Robert Leonard  29:26

So if someone is ready to buy a cryptocurrency, whether it’s Bitcoin or a different one, this is a question I actually got after a lot after our last episode on Bitcoin… so I want to walk through with you. How does someone from the very beginning to the end go about actually acquiring a crypto asset?

Jason Yanowitz  29:47

Great question. It’s and it’s cool, right? Because when I got into the space, there wasn’t really any way like there were some websites right like Coinbase. But now, there are mobile apps and it’s even integrated with like Robin Hood. A lot of brokerages like TD Ameritrade and Fidelity are allowing their customers to buy bitcoin, which is pretty damn cool.

But for all of your listeners, I would recommend, first think about what’s the amount that you’re going to be buying? Are you someone who should be allocating 100 bucks a week to Bitcoin? 1000 bucks a week? Are you big investors, allocating $100,000 A million dollars to Bitcoin? Because that will determine what platform is best.

Though I think for most of your listeners, there are a few things that shouldn’t be important, right? Low fees are really important. The ability to dollar cost average into bitcoin is really important. Dollar cost averaging is just buying a set amount every single week, kind of having it you know, buying it passively on an automated regime rather than just buying a whole bunch at once.

So dollar cost averaging low fees, and then the ability to send from your wallet to another person’s wallet instead of selling and then having to buy again, to get more concrete with the answer. I would look at Voyager.

Voyager is a phenomenal app. I would like it with really low fees. I would look at Gemini, which folks might know because it’s the Winklevoss twins that started that company. I would look at Coinbase. I would look at Cash App. So those are the four I’d look at if you’re more of a smaller investor buyer: Voyager, Gemini, Coinbase and Cash App.

Then I would look at if you’re a bigger investor, I would look at River Financial. If you’re a much larger institutional investor, I would talk to the folks that Panthera, Morgan Creek Capital, Galaxy Digital.

Robert Leonard  31:31

There’s a lot of different cryptocurrencies out there. What do you think is the best long term investment?

Jason Yanowitz  31:37

Bitcoin is the only one I would recommend someone buy. So let’s zoom out and let’s think about why Bitcoin is so revolutionary, right?

One of the biggest reasons is that the founder is anonymous. So Ethereum is the second biggest cryptocurrency. It’s the one that most of your listeners, if they don’t take my advice, would probably buy after they bought Bitcoin. They wanted to buy one more, they probably bought Ethereum.

Well, a few years ago, some folks who’ve been in space for a while might remember there was a rumor that Vitalik Buterin, who’s the founder of Ethereum got killed. Ethereum’s price tanked 20 to 30%. That tells you a lot about that public blockchain and about ether and about Ethereum, which is that it’s pretty damn centralized.

If people are so worried that the founder of Ethereum is going to get killed, and then the price of Ethereum goes down, then it’s pretty centralized Bitcoin. Its founder, Satoshi Nakamoto, could be a man, could be a woman ,could be a group of people, we still don’t know. He, she, them. They’re anonymous. That’s one of the most important things about Bitcoin that no one can ever replicate.

Then the second thing is there’s a cap supply. That’s what makes Bitcoin more than it’s not debasable. It’s not seasonable, it’s not censorable. There’s a hard cap supplying 21 million Bitcoins. There will only be 21 million Bitcoins.

And so, in a world where we’re so damn worried about inflation and the Feds pumping trillions and trillions and trillions into the economy, aka leading to inflation, inflation, hedged assets, Bitcoin is really, really exciting. We know because it’s built into the algorithm into the computer and we trust it because there’s no team or founder running this thing that it can’t be changed.

Bitcoin is kind of the only one I would recommend. There are 1000s of cryptocurrencies and are probably going to be 10s of 1000s of them pretty soon. But Bitcoin is the only one that’s survived the test of time.

Robert Leonard  33:31

When we talk about there being a fixed supply of Bitcoin at 21 million, like you said, how is that still so important when a Bitcoin is almost infinitely divisible? It can be divided into almost like an infinite supply. How is that still a valid reason for Bitcoin?

Jason Yanowitz  33:49

Yeah, good question. That’s important to understand. So it’s divisible right? To Buy Bitcoin? Bitcoin is trading at like 9000 or $8,000. Today, you don’t need 8000 or $9,000 to buy one Bitcoin, it can be divided and you can buy $2 worth of bitcoin $1 worth of bitcoin, right? So it’s divisible into little things called Satoshis.

But the amount that will be released into the system is hard capped at 21 million. So let’s compare it to the US dollar, right? The US Dollar is divisible, it’s divisible into quarters, nickels, dimes, and pennies.

Same thing as Bitcoin. It’s divisible into smaller units called Satoshis. The difference is, if the Fed knows we need more money as a country, we just go to the printing press and the red button starts printing out more US dollars, but Bitcoin, every 10 minutes, there are more blocks that are basically created every 10 minutes every block. There are more Bitcoins that are added to the circulating supply, but that 21 million fixed supply never changes.

Robert Leonard  34:53

Okay, so that makes more sense. That’s the biggest thing I get from people that know that Bitcoin is capped, and people that use it as an argument. They always asked me well, why does that matter if it can be divided into a ton more coins, if you will, or fractions? I’ve never really had a great answer for it. I’m a beginner when it comes to Bitcoin so I’m still learning myself. So that’s why I wanted to ask that question.

Jason, I’ve really enjoyed our conversation today about your background, your company, Bitcoin and cryptocurrencies. For those attending that want to connect with you further after the show, where can they go?

Jason Yanowitz  35:26

I would love for folks to DM me on Twitter. My DMs are open. It’s just @JasonYanoqirz. Our website is Blockworks Group. If you’re listening to this podcast, you probably like podcasts and we have 20 podcasts right? Go check out some of our shows on our website and subscribe to our newsletter. Hopefully some of your listeners take me up on that and would love to have a conversation with some of them.

Robert Leonard  35:59

Awesome. I’ll be sure to put links to all those different resources in the show notes. Everybody listening today can go reach out to you and ask some questions if they have any. Jason, thanks so much.

Jason Yanowitz  36:09

Thank you. Appreciate it.

Robert Leonard  36:11

Alright guys, that’s all I had for this week’s episode of Millennial Investing. I’ll see you again next week.

Outro  36:17

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