On this episode of the CoinGeek Weekly Livestream, entrepreneur, author, and venture capitalist Brad Feld shared his views on investing, the blockchain space, and much more.
Who is Brad Feld?
Feld is a venture capitalist, author, and serial entrepreneur who co-founded Techstars in 2006 and the Foundry Group in 2007. He has been an investor in Harmonix, Zynga, Fitbit, and Coinbase (NASDAQ: COIN), among others.
Feld says he has been on a “long arc,” starting his first company in college, then having his first big success at 28 before reinvesting in 40+ companies as an angel. He says he loves four things: spending time with Amy, writing, reading, and running.
In response to host Kurt Wuckert Jr.’s question about whether some success is down to timing, Feld says timing and luck are one and the same. Every successful entity has had a near-death experience, he says.
Feld advises founders and investors to spend time getting to know themselves lest they spend time doing things that don’t feed them. Knowing yourself allows you to lock in on what you care about, but most people don’t do that work.
The lack of value in the blockchain industry
Wuckert gives Feld his main criticism of the blockchain space: basically, no value bridges itself into the real world. Every dollar that could be used to build a real company is being used to speculate on tokens. He asks Feld when and how we can create real value.
Feld remembers how, in the Dot Com bubble, lots of capital funded conceptually good ideas that weren’t very useful. Capital was rewarded for doing so, and very soon, it funded 10 such ideas. A handful of those ideas survived the Dot Com crash.
In ‘crypto,’ many people are trading magic beans, which has consumed lots of mind space, he says. There are borderline religious believers around various protocols like BTC. In time, there will be a reckoning for all of this.
The value proposition of on-chain data and companies in the industry
Wuckert says that data is the only commodity he is aware of that becomes more valuable as it becomes more abundant. Ensuring it is properly understood, valid, and tradable is a huge opportunity. Blockchain introduces transparency and makes everyone’s data footprint monetizable.
Feld responds with a rhetorical question: why do you think they’re not giving you that transparency now? They’re motivating you with a minimal amount of money to get you to keep up your efforts. Transparency brings in market power and value gets traded more fairly.
As for the value of companies in the blockchain industry, such as Coinbase and Strategy (NASDAQ: MSTR), Feld puts them in two broad categories: one, Coinbase, is a centralized storage mechanism for decentralized things, and the others, like Strategy, are trading at multiples of their value by purchasing a fixed asset.
Of the latter kind, he asks what will happen when everyone wants to extract value from them.
Advice for Web3 founders trying to raise their first round
Feld gives sage advice to Web3 founders looking to raise their first round: don’t pitch. Instead, find something you are truly passionate about and make that come across. There’s a category of investors who will get excited about this and will respond. These investors are looking for a signal, and while passion is easy to fake, obsession isn’t.
As for the people who laugh and dismiss people like Wuckert, who believes he will be one of the best-known entrepreneurs of his generation, Feld says, “they don’t matter.” The majority of the companies he invests in don’t make it, and that’s OK. Your job as a founder is to believe, run experiments, fail, and keep trying until you win.
To hear more about red flags in partners or investors, Feld’s ‘Give First’ book, and much more, check out the live stream via this link.
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Gavin Lucas