In this episode of The Blockchain Startup Show, I had the pleasure of speaking with Tim Dierckxsens, CEO and Co-Founder of Venly.

Tim takes us through Venly’s journey since its founding in 2017 and shares his insights into the evolution of blockchain tooling, the importance of simplifying Web3 for developers, and the challenges and opportunities of scaling a blockchain business in today’s market.

From creating developer-friendly platforms to addressing the challenges of blockchain adoption, this episode is packed with actionable advice for Web3 founders and leaders.

Episode Outline and Highlights:

[00:02] Introduction to Tim Dierckxsens and Venly

• Tim’s background as a business consultant and how blockchain caught his attention.
• The founding of Venly and its mission to simplify blockchain adoption.
• Recognizing the need for middleware to address blockchain infrastructure challenges.

[04:05] How Venly Has Evolved Over Time

• The transition from a wallet provider to an all-in-one blockchain platform.
• Lessons learned from scaling too quickly and how Venly adapted to challenges.

[05:46] The Comeback of Enterprise Blockchain

• Observing a resurgence in private blockchain initiatives by companies like JP Morgan.
• Differences between public and private blockchain use cases.

[08:21] Blockchain Maturity and Long-Term Adoption

• Why blockchain adoption mirrors the rise of cloud technology.
• Understanding the Gartner Hype Cycle and blockchain’s long-term potential.

[13:08] Addressing Security Challenges in Blockchain

• Tackling smart contract vulnerabilities and ensuring protocol safety.
• The rise of liability insurance for blockchain platforms.
• Drawing parallels between blockchain security and traditional cybersecurity.

[17:04] Developer Enablement for Web3 Adoption

• The importance of no-code and low-code solutions for businesses.
• How Venly empowers developers with API-based platforms to bridge Web2 and Web3.

[27:32] Building for Web3 vs. Web2 Audiences

• Key differences in targeting native Web3 users versus traditional businesses.
• Why simplified tools and user-friendly interfaces are critical for scaling blockchain use cases.

[47:35] The Role of Regulation in Blockchain

• Why regulation should be seen as a framework for safety, not a limitation.
• Innovations in compliance, such as Cardano’s Midnight and its focus on privacy.

[55:28] Lessons from Six Years in Blockchain Leadership

• Tim reflects on Venly’s journey, sharing lessons from navigating market downturns.
• The importance of resilience, adaptability, and long-term thinking for founders.

[01:00:12] Final Advice for Aspiring Founders

• Why founders must be optimistic yet pragmatic to inspire their teams.
• Leading through uncertainty and seeing the light at the end of the tunnel.

Building Stronger Tools for Blockchain Adoption

Tim Dierckxsens highlights the importance of simplifying blockchain technology for both developers and businesses. Venly’s focus on developer-friendly APIs and user-centric platforms makes it easier for companies to bridge the gap between Web2 and Web3. By removing technical barriers, Venly is playing a key role in accelerating blockchain adoption.

The Value of Resilience and Strategic Thinking

After six years of leading Venly, Tim emphasizes that resilience and adaptability are critical for success in the blockchain space. Founders must navigate rapid technological shifts and market challenges with optimism and determination. By focusing on long-term growth and learning from past mistakes, startups can build sustainable businesses and thrive in Web3’s ever-changing landscape.

00:02 - Speaker 1 (Announcement)

Welcome to the Blockchain Startup Show with Harrison Wright, a podcast dedicated to dauntless blockchain leaders building our new decentralized future. You'll hear stories, successes, trials and tribulations as we channel into the lives of high-performing leaders in crypto and Web3. Whether you're currently a Web3 founder or leader, or you one day aspire to be, you'll gain crucial knowledge and insights to accelerate your learning curve, handle this industry's greatest challenges and make the impact you've always dreamed of.

00:34 - Harrison (Host)

Hello everyone, this is Harrison Wright. Welcome again to the Blockchain Startup Show. I'm very pleased to have a special guest here today Tim Dierckxsens. Tim is CEO and co-founder of Venly, a blockchain tooling provider that enables Web2 companies to seamlessly integrate Web3. So I'm very excited to talk about that in particular, as we I might be being a little bit optimistic here, but we seem to be maybe just about entering the point now where mass adoption seems like a reality and everyone's not just building more crypto things for crypto people to talk about other crypto people about. So, tim, welcome, it's great to have you. Thanks, harrison, happy to be here, happy to have you here. You know, it seems like you've been on the venly journey a while, and I always do this, but before we get into the meat of things, I'm really curious what got you interested in crypto and what's the venly story?

01:24 - Tim (Guest)

02:37

03:56 - Harrison (Host)

04:05 - Tim (Guest)

I would say it's actually more of the same. In terms of positioning and our mission, we do have more of an all-in-one platform. We started out as a wall provider, but then we added tokenization, we added a team marketplace, positioned our products around APIs but grew a little bit too fast in the beginning. So going from one product to a second product to a third product, going from one chain to another chain to another chain. So, as an early adopter, we were fast to market, early to market one of the first. We were fast to market, early to market one of the first. But always we're eating our own dog food and learning at the same time, while the second mover has advantage to see what we are doing wrong and we then at times have to do like a pivot to then rework everything that we built into something that's again sustainable and scalable. So that's actually what we've been doing the last two years is harmonizing all the different features and services that we offer into one platform offering it's been really interesting to see that evolution.

05:23 - Harrison (Host)

05:46 - Tim (Guest)

It's coming back. Have you seen that?

05:49 - Harrison (Host)

A little bit yeah.

05:52 - Tim (Guest)

I just noticed JP Morgan and the Gnexus platform, so that's a private version again and I think, goldman Sachs they just spin up their GS digital asset platform, which is a separate entity, but it is again like a consortium model. So the debate between private and public blockchain is actually picking up again.

06:18 - Harrison (Host)

07:03 - Tim (Guest)

There are a couple I would say but yes, we made it through the bear market and elongated winter quite well, but we still have many more miles to walk.

07:17 - Harrison (Host)

Yes, but it does get better every year.

07:20 - Tim (Guest)

08:21 - Harrison (Host)

Yeah, I mean even now. Again, this might be bull market optimism talking, but say last cycle. If you're just talking about finances, as financial independence is your goal and you work in crypto, maybe you just hold bitcoin right, but but if you actually want to generate passive income, the safe way to do that is withdraw the fiat, get a brokerage account, buy dividend stocks. You know how people normally do it. Probably you could use DeFi, but I think a few years ago it'd be extraordinarily risky. Now I think we're just about at the point where, if that's what I wanted to do, I can't see many good arguments for why I wouldn't just use DeFi to do it. I might spread the risk by using multiple DeFi protocols for staking, stablecoin yields et cetera. I wouldn't put all my eggs in one protocol. But I don't see why I would want the brokerage account. Now I could just use DeFi, but a few years ago I'd be really hesitant.

09:10 - Tim (Guest)

Maybe you still want the best of both worlds, right, I wouldn't knock that brokerage account. Would not make sense. But here, if you really want to be risk averse, you would hedge your bets on have some with your brokerage account. Have something on the crypto account, do some DeFi, do some staking, buy some stocks.

09:32 - Harrison (Host)

Yeah, I do see the two. Maybe you have a different perspective, which I'm definitely curious about. For me, the two obvious things that are really blocking more mainstream adoption of crypto right now. One is smart contract security. I mean the amount of hacks, even with all the money that, in time, that's gone into security recently you ever really trust a protocol? And also the user experience, even for people that work. I know people that worked in crypto for years and have lost all their funds because they did something stupid. Definitely not ready for prime time there.

10:03 - Tim (Guest)

Well, yeah, that's a little bit part of our business, right? So what we tend to do is harmonize smart contract logic, make it leveraging best standards, but then providing that to APIs, making sure that everything is audited, that every change that would occur is audited continuously, having an ethical hacking platform, pushing the boundaries of of safety and, at the same time, um, more and more insurance companies are offering liability insurance, so that's another topic that we also cover. We do happen to be liability insurance on top of our platform, so things like that is moving into the blockchain space, where, five years ago, any type of liability insurance on the protocol level or on sas level was unthinkable in our industry you know that's from a risk.

10:57 - Harrison (Host)

Let's say I'm very risk averse because I've made my money and I don't need to make any more money but I need to protect it. I'm looking at things like, you know, the fdIC insurance for bank accounts. That's a significant factor versus you see what happened with Celsius and FTX and things like that. Personally, I've never trusted centralized exchanges. I will not keep any significant funds on there for any period of time. But DeFi, backed up with insurance, that's interesting.

11:26 - Tim (Guest)

Indeed, as long as it can cover the insurance can cover the risk rate. That's one of the things that is always still a little bit unclear with the rapidness of the protocol and what is really underwritten and how safe it actually is underwritten and how safe it actually is. I think a couple of more steps into that direction, as in how can we simplify, how can we understand these contracts, how they time test it. One of the things we keep basing is, for example, when should we leverage account abstraction, account abstraction, smart contract wallets? Here you're actually doing the same thing. You're going to say, well, I want to simplify the UI, I want to do some form of abstraction and I'm going to create a smart contract wallet.

12:21

But that's a lot of logic that you're putting on the wallet level where, with a normal infrastructure, you have your wallet, you have your smart contract and they can interact with each other, but it's not tied into one piece. So you're de-risking the security aspect of that. So I think Defcon my CTO was with me he was also saying all the talks. It's saying, well, we have to do better on terminal security. That's why we're doing cryptography, that's why we're doing blockchain and you're solving a lot of the infrastructure level. But once you move up in the ladder, for example at the application level, you still have to educate all of the best practices of cybersecurity. So that doesn't matter if it's a decentralized environment or a centralized environment.

13:08 - Harrison (Host)

Security is security. I don't want to get on too much of a divergence for this, because I can easily do that. Good. I'm in rabbit holes that are less and less relevant to the main thrust of the conversation. But one thing I do really appreciate about crypto is the self-responsibility that goes with it, and it's not always there. But really appreciate about crypto is the self-responsibility that goes with it, and it's not always there. But if you talk to DeFi teams that are really serious about what they're doing, there's no central governing authority that's telling them you need to care about security. It's almost like it's their sacred duty to ensure that the security is there.

13:38

And if you talk to people about hiring smart contract devs, especially in DeFi, if you look at what an engineering role normally is, most engineering positions are hey, move fast, break things. The faster we can ship code, the better, we'll fix it later. And smart contract developers it's the exact opposite type of works. The less things you can do the better. Every change we push has to be ordered again, and so on. I think of it a bit like being a train driver or a commercial airline pilot. The actual things that you do in the job are a lot less than in many other sort of similar lines of work, but the responsibility that you have is far greater in a constant sort of getting it wrong, and much more dramatic, which is where the responsibility comes from.

14:16 - Tim (Guest)

Okay, do you need to agree more?

14:20 - Harrison (Host)

The thing I like about it is, again a little bit esoteric. The thing I like about it is again a little bit esoteric, but I think this goes to why people enjoy working in crypto so much is the agency on autonomy. If someone's telling you always what you have to do, you kind of switch your brain off and just do the thing. But if you take it upon yourself to do what needs to be done, I think there's a lot more reward that comes from that. What I did want to talk to you about was the bridge acquisition by Stripe. What do you think the implications here are for Web3 and adoption in particular?

14:59 - Tim (Guest)

Well, if you look at the bridge acquisition, it actually acquired the wallet provider before that, right before that, and end goal is really to do stablecoin settlement right. So we're going to see a lot of transactions are going to move on-chain and they're going to use blockchain technology as an infrastructure and Stripe as a household name in simplifying anything banking related. They're saying well, we are, I would say, almost the biggest and the baddest tech provider offering simplicity of payments in a digital environment. This is the radical shift where you can see, well, it's not just about payments from banking environment, it's payments from a decentralized environment. So they're actually expanding their scope of operations as a tech provider. And it is a billion dollar acquisition, right. So, okay, for Stripe, maybe a billion dollars is not much, but it is actually the largest acquisition within our space over the last four or five years, so it just legitimizes that.

16:00

16:49 - Harrison (Host)

Nest through our architecture to enable a business to use it. Yeah, it's almost like I'm sure this is before my time recruiting in tech, but I'm sure there was a time where people would describe themselves we're a cloud company. Cloud is just something you don't even think about. Cloud it's just something that exists in the background.

17:04 - Tim (Guest)

That's actually a funny anecdote. For me it's funny. One of my first pitches five or six years ago is blockchain is like the cloud. 10 years ago, as in, cloud replaced proprietary technology, on-premise technology and you moved into the cloud. But in the beginning you never thought that you would move your server in the basement into something like a cloud environment, right? But if you then look at where we are today, not many companies have their database in the basement or in the file cabinet. They actually have it in a data center on the cloud cabinet. They actually have it in a data center on the cloud. So that just gives you some perspective of history of technology shifts over a longer period of time, where cloud was mocked and laughed away, but it is now the household technology that everybody is using and that shifts in terms of payment execution, transaction execution, while you're using infrastructure like blockchain. That is bound to happen in the same depth and timeframe like cloud technology.

18:19

19:07 - Harrison (Host)

It's a really good point, and I think I include myself in this. A lot of people working in the industry, especially this last bear market, can get frustrated with where's the real use cases. What are we actually building here? Is any of this?

19:19 - Speaker 1 (Announcement)

actually useful.

19:21 - Harrison (Host)

19:53

And back then we had the server in the office. It was a small company, there were five of us there, but there was a server in the office. It ran our CRM directly off that server. All the other computers in the office were physically networked up to it. Whoever left the office at the end of the day had to physically take the backup drive and take it home. And then there was the ones that stored in the office, but we had the one at home in case there was a fire, and that's just how things worked.

20:16

20:38

21:19 - Tim (Guest)

21:27 - Harrison (Host)

Henry Suryawirawan, and maybe it's not a coincidence that I was then talking to you about hey. Now this year it feels like I could finally use a DeFi to provide passive income the way I would use a traditional sort of brokerage account.

21:39 - Tim (Guest)

Ben Follett, I think all of the puzzle pieces are there, but especially on the decentralized side, on the heavy Web3 side of things, it's also like the habit of I want to do everything myself there. You're seeing that you're going to have to scramble quite a lot to get all of these ducks in a row, while when we're then targeting the businesses that are a little bit slower to the adoption curve, they have something that is already catering to having, like all of those puzzle pieces what's important. So I would say, on our side, we're I don't like the term but Web 2.5. But from a technology point of view, defi is like two or three years ahead of what we're doing. But we're doing that with the sense of most businesses are not ready for that element yet, are not ready for that element yet they're starting to get ready for the first wave of blockchain utilization in a scalable manner that's safe for their business.

22:54 - Harrison (Host)

Exactly. There's a trend there as well, which is stablecoins. We're talking about stablecoins. That's a great case in point. Would anyone have imagined 10 years ago that the main use case for crypto right now would be stablecoins? It's the complete opposite of what the people that created the industry would have envisioned. But that is arguably I'm not going to definitively say, but it's arguably the primary use case of crypto right now. I think MakerDAO with DAI.

23:22 - Tim (Guest)

It was one of the first ones that existed, right? They were in the first initial wave of dApps. So I would just say that I think a lot of people, when they're talking or looking at the volatility of things and you're talking about utility of something, you need a stable core element to work right. For a lot of use cases, whether it's paying employees cost for the payments, stable coin just makes sense, because how can you then account for it? Like I'm going to pay Bitcoin to my employees Some people do that right but on the one hand, it's going to be like how are you going to bring it into the books?

24:10 - Harrison (Host)

It's a case of usefulness over ideology, and you can see the same thing with Ethereum and Solana. From a decentralization perspective, ethereum is the superior technology, but Solana is the more popular one right now because if you use Solana apps versus Ethereum apps, they're just much easier to use and the end user does not care about the same thing that the brains behind the industry necessarily care about, and I think that's been a big lesson, yeah absolutely, I think, looking for adoption, you do need to look into the UI and I think the Solana Foundation and community have spoken to to really bring that network to life right.

24:54 - Tim (Guest)

I would say I was quite hesitant to support Solana in the early days, especially because there were more and more outages. If you look at the last couple of years, it's really getting to that stability where you would not see that happen, as we can.

25:13 - Harrison (Host)

Yeah, this is really a broad question. It could go in many directions, but user experience must be a key consideration for Venly's business model, since you're targeting people coming from traditional businesses to use Web3. What have you learned about creating a better user experience?

25:30 - Tim (Guest)

So we focus on the developer experience and then on how they can create a user experience on their UI front right. So for us, it's looking into the best practices of what you would do for traditional software and then bringing everything decentralized into a framework that a traditional developer would understand. Where then, if you're a business, say, I finally understood the power of decentralized technology and I want to tap into that. I now have my business analyst, I have my product owner, I have my developer. I want to tap into that. I now have my business analyst, I have my product owner, I have my developer. They can just take the revenue platform, build on top of that because they understand the abstract usefulness of blockchain and they can implement it to the API.

26:22 - Harrison (Host)

Makes sense. So it's almost enabling the developers, which in turn enables the users.

26:26 - Tim (Guest)

Yeah, indeed. And then you have to look at what do they need? If you look at the infrastructure layer, right, you have your layer 1, layer 2, where you want to start from the industry. Well then, you need data APIs, or data from the chain, if you want to call it like that. You need your rpc nodes, you need, um, your wall technology, you need your tokenization technology or smart contract technology, uh, your fields, uh to crypto on-ramps or off-ramps, because usually you are going to have an element of coming into the space or going out to the technology. What else? Kyt, kyc processes I don't know how to embed all of that into it. These are just like a whole list of elements that you need just to get something working for your business use case.

27:32 - Harrison (Host)

Yeah, and it's the idea here that you're creating a system so the developer is not an expert in blockchain can make these things work well.

27:41 - Tim (Guest)

Indeed and where they can find the best in class technology through our systems. Right, we are not developing everything ourselves. We develop core elements and then we aggregate best in class APIs from other businesses, like, for example, a partner and a client of Alkery or Morales or SimpleHash or a couple of others that you can name, or SimpleHash or a couple of others that you can name but we're setting one level on top of them and add additional services. So it's where you can say, well, we're offering more resources and capabilities one level up which is closer to what you would need from a business point of view.

28:22 - Harrison (Host)

It almost. This might sound like a strange analogy, but it reminds me of were you into computers back in the old DOS days.

28:31 - Tim (Guest)

Yes, but no, I was probably like still playing soccer with my friends in Thailand.

28:41 - Harrison (Host)

Nice. Now, I had a misspent use with computers. I think I don't know what he was thinking, but my dad literally sat me in front of a computer when I was two years old and I could type before I could write.

28:52 - Tim (Guest)

Oh lucky you.

28:54 - Harrison (Host)

It's weird, I can type 140 words a minute. I literally do it with two fingers and a thumb. People look at it like what are you doing? No one ever taught me to touch type, I just taught myself I. People look at it like what are you doing? No one ever taught me to touch light, but I just taught myself.

29:07

I think I write some things backwards as well, but I remember back in the DOS days, interacting with a PC with DOS was very similar in a lot of ways to interacting with crypto products. Now there was no layer of abstraction to make it easy for you. If you wanted to install something I remember you had the days of install this thing 27 different floppy disks Then it invariably wouldn't work. You'd always have some driver problem you needed to fix. And then Windows came out and I remember you see the same thing now.

29:36

Actually, a lot of the purists me included hated Windows. Windows is for idiots. If you're a real computer user, you use DOS. But the reality is, you know you would never see mass adoption of computers with an interface like DOS, and the initial versions of Windows were not very good. But over time, you know, we moved to graphical interfaces. You know things being done automatically in the background now and you want, sometimes you need to get technical with it, but for the most part the computer will sort out all these things itself, the drivers and so on. I can imagine even with, say, defi, for example. Surely we're not long now from a place where, hey, the system will just. You don't need to know anything about what a smart contract is, it's just going to tell you what that contract does in a simple format.

30:20 - Tim (Guest)

Absolutely, especially with AI. In the beginning of the conversation you were also saying you're a big fan of self-management of keys. Right, you also not do anything on a centralized exchange right. I'm wondering do you use any password generator or connector to help you remember going into any application, like 1Password or LastPass or anything like that?

30:52 - Harrison (Host)

I should use something like that, but I don't. I have in the past and you stopped Long story. The reason I used it in the past was before I set up this business. I was doing some freelance stuff and I had clients that would plug me into their LastPass. So that's the context. I used it in a past was before I set up this business. I was doing some freelance stuff and I had clients, so they would plug me into their last past. So that's the context I used it in.

31:11 - Tim (Guest)

But I would still generally assume for every application you're making sure that you have a different password set up for anything that you're using right.

31:22

Or you write everything down or you use a system like that to help you log into everything that you have using, right, yeah, or you write everything down or you use a system like that to help you log into everything that you have. That's kind of like the key point you have to consider where a service provider would still make sense. And if you look at what we're doing, it's not the same type of business, but it's actually quite similar, right? We're providing a service enabling to create wallets in a simplified manner, helping a user to then have wallet for themselves and then making sure that it's available. So, yeah, I think there's always like a middle ground, as in what you want as an end user, what you want as a developer, what risk exposure that you're ready for. And businesses like ours. They exist because we want to see a massive doctrine of infrastructure. We want to see a massive doctrine of a better business with the use cases that it involves, but don't see it happen without better support.

32:26 - Harrison (Host)

It's actually a really interesting point involves, but don't see it happen without better support. David Pérez it's actually a really interesting point. I'm dawning on it a little bit, but I hadn't considered it from the angle before that a lot of the adoption piece is actually about enabling developers, not end users. But the more I think about it, the more true that appears, and I imagine this will even go further. So say, for example, with websites, you websites.

32:45

Back in the day you had to hire a web. Only web developers could build websites. They had to be experts in all sorts of things. Now, when I started this company, I did it on a shoestring budget, so I built my own website. It wasn't the website. It took me like 50 hours to do and things kept breaking and I had to spend ages figuring it out. But I could build it in WordPress and people said it was a good website. I've got a new website now, but I could do that. I wonder if we'll find a time, say 10 years from now, where a motivated amateur could build their own Web3 application.

33:18 - Tim (Guest)

Absolutely. If you look at our integration in Shopify, that's literally an app that you install as a Shopify admin. You have a no-code solution to then create your collection, create a contract, list that product for sale and enable any buyer to purchase your digital assets, which is on-chain. So from a user perspective, as in a brand or a store owner, you don't even need to understand any coding. So more and more examples like that integrating into platforms that are no or low code is just going to continue building using blockchain in the backend.

34:04 - Harrison (Host)

Yeah, and then another perspective to add to that. So last time I had a search for I had a DeFi protocol that wanted a let's call them an OG Solidity Dev, the kind of person who'd built something like MakerDAO. When you actually look through it, this was relatively recent. There aren't that many people who do this In the entire Western hemisphere of the world. People that have actually been doing this for at least a couple of years have built something of significance, still working in a space we're talking less than 150 people. That is not scalable to need that level of extreme expertise to be able to build.

34:38 - Tim (Guest)

It's just not. That's exactly why services like ours would make sense because we do the translation right. It's going to the API level where almost any developer can understand it, but everything more complex that is related to blockchain itself. You either don't need to understand or you can understand a lot behind it, but you don't need to be able to build it.

35:04 - Harrison (Host)

Exactly so. Let's talk about this from a business point of view, from the perspective of founders. If we see there's a sort of a divergence starting to happen, where you can build a Web3 company that is a Web3 native business model aimed at Web3 native people, or you can build a Web3 company for a Web2 audience, how would you say what makes those approaches different? How do they need to be approached in a different way?

35:31 - Tim (Guest)

If you're really targeting Web3, you're then also going to leverage all the tools. That is very crypto and decentralized in nature, right? So you're going to say we're never going to do wallet creation from the accolades of you, or you're always going to integrate using a third party wallet provider, such as Metamask or anything that is trusted by the industry mode of people that says this is fully decentralized, this is something to self-manage. If you're then looking into an application that says I'm either hybrid, I want you to a Web3 business, but also to a Web2 audience, there you have almost no choice than to say, well, I'm either going to create files for my users because I'm doing user identification, user authentication, using systems like Okta or something like that, or Google SSO. I need to connect an application log for my end user because they're not going to generate that somewhere on their end. So that's where we need to have a facilitating service to bridge that gap. And it's perfectly possible to say, well, depending on my user preference for the application or business use case, you can say, well, I have a gateway for somebody with three can say, well, I have a gateway for some of the Web3s, so inject MetaMask. Or I have a gateway where you can say look, I will onboard you and I will enable you to leverage blockchain technology in the backend, but I will create the user interface and the experience for you.

36:57

But everything is API-based. So in the end, you are then still creating a saved blockchain wallet for the end user and the business. You're not owning that right. Still creating safe blockchain wallet for the end user and the business. You're not owning that right. It's still like, from our point of view, if you're creating a wallet using our non-custodial subcustody route, it's still making sure that the end user gets onboarded and then they add security systems like to a face so that they can have, like a recovery mechanism that makes sense for them. Henry.

37:26 - Harrison (Host)

Suryawirawan. Yeah, I can completely see that. What about from a go-to-market perspective, as well as, strictly, the user experience in tech?

37:33 - Tim (Guest)

Yeah, I think for a long time, we're putting the cart before the horse, as in pushing technology, while for me, technology is more the lubricant. As in, there are benefits of blockchain, but you're not going to sell more because you're using blockchain. The values of blockchain is what's most important, right as in, you have a better store of records. You have a better proof of transaction compared to a centralized database. If you would say I want to build a business where I use cases involving transactions, I have a choice to say am I going to do this using a centralized system or a decentralized system or infrastructure, then I'm confident that over time, the benefits of blockchain will outweigh the benefits of doing it fully centralized.

38:32

And if you're then on building a business application or a use case, in the last five years we're trying to say well, this is a better business because it's blockchain, buy into blockchain, buy into crypto, buy into all of this and you need to be tech-savvy to get it. But I don't think that way. I think I want to do cross-border payments. What is the most efficient way to do cross-border payments? It's using blockchain technology. So I want that to work just as seamless as it would like a banking experience, just not with the delay time, the ability where the bank will actually be using that for other purposes, right.

39:31 - Harrison (Host)

And I'm kind of going back to an old point here, but just to briefly mention this divergence between hey, here's what we have as an ideology and here's what the user actually cares about. I think Bitcoin is actually a classic case of this, because the Bitcoin true believers care about decentralization, sound money, all these things, but those are not the things that make Bitcoin adoption happen. The thing that makes Bitcoin adoption happen is number go up. It's almost like the prospect of people getting rich from Bitcoin is like a Trojan horse that drives Bitcoin adoption. The reason that it gets adopted is not the purpose that it actually serves.

39:59 - Tim (Guest)

I would argue that people don't care about Bitcoin because it's decentralized. If you look at Bitcoin, I would care about it because one it's depletionary. You know there's only 21 million Bitcoin that are going to be more. Well, if you don't put that against the federal government and just IMF or anything, printing money on the fly whenever the economic rationality program makes sense, the care about decentralization, it's just making sense that from a rational point of view, this is more safe than having a government that can print money on the fly. So what is actually the thing that you value? I think four or five years ago, bitcoin was called a store of value, right as in. It was a better store of value than money. It was a better store of value than money. It was a better store of value than gold. I don't see those terms being highlighted as much as it was in the past, but it still makes sense.

40:58 - Harrison (Host)

Yeah, I guess what I'm driving at is. So the true believers in Bitcoin which I would count myself one we care about the sound money principles, the deflationary aspect from a philosophical standpoint, but the vast majority of people who own Bitcoin don't philosophically care about any of that at all. They just know, hey, if I keep fiat, I'll get poorer, If I buy Bitcoin, I'll get richer, and that's the thing that drives the adoption. I think that's a good principle to keep in mind for any business.

41:36 - Tim (Guest)

Yeah, exactly, I think there is still a risk that if there's no more belief that Bitcoin is a good store of value, that it will eventually go to zero, right? I'm not one of those people that would believe that, because you're seeing digitalization in more and more sense over time, technology is undefeated for a large extent. Bitcoin has just shown over the past decade that it is robust and stable like that.

42:01 - Harrison (Host)

And the more inertia it gets, the harder it is to dislodge. Yeah indeed. Although that was my theory for Ethereum as well when, then, solana came out of nowhere, but would you consider Ethereum dislodged or would you consider that it's fighting for market share?

42:16 - Tim (Guest)

but it's still very much an ecosystem of fiber.

42:22 - Harrison (Host)

Maybe dislodged is overstating it, but I thought whenever you see something that's reliant on network effects, there's usually one winner. There's no Facebook competitor. Facebook got made obsolete by something else, or Twitter serves a completely different niche than does LinkedIn, and so on. There's no two-horse race between these kinds of global network effects-based platforms generally. I thought the same thing would happen here. A lot of layer ones would try, but Ethereum would have most of the market.

42:48 - Tim (Guest)

Well, yes and no, right, Like when you're saying you have Tencent Cloud, you have AWS Cloud, you have Azure, you have probably like 10 or 15 others and there are probably more competitors, but maybe we're just losing sight of them, Like there's no, there's no, uh.

43:09 - Speaker 1 (Announcement)

Facebook alternative.

43:10 - Tim (Guest)

You have TikTok, you have, uh, twitter, just saying it's a different niche. We have LinkedIn. It's it's a different type of social media platform, but there are still quite a few numbers of the very large and if you're going to look into all the others of smaller social media platforms, there's just a lot that exists out there.

43:33 - Harrison (Host)

Off our normal radar.

43:35 - Tim (Guest)

Just off our normal radar. Indeed, Maybe not talked as much, but maybe leveraged quite a lot, there you go. There's another one.

43:45 - Harrison (Host)

Yeah, staying on the go-to-market and what's useful to founders theme, a lot of people will say, and I was resistant to this idea for quite a while, but I eventually came around to this way of thinking. A lot of people would say everything about go-to-market BD, sales, marketing and crypto is flatly different from other industries. The things that will work in a traditional industry context don't work in crypto, and maybe vice versa. Do you see that there's a fundamental difference that needs to take place in terms of how go to market is approached for Web 2 and Web 3, not necessarily from a sort of technical or strategy perspective, but from a vibe I can't think of a better word than vibes. But you know the community aspect, the way things are presented, the personality of the brand.

44:36 - Tim (Guest)

It's hard, but I would want to be able to go back in time and understand how the vibe was back in 97, 98, right before the dot-com bubble. And my assumption and I would have to talk to somebody 15, 20 years older than I am am that it's pretty similar to back then, as in. You have this new industry, you have this new technology. If you look at the articles or not the articles, but, um, I think it's either letterman or, uh, bill gates on letterman, believe, where he's trying to explain what the internet is like the radio, and Letterman not getting it at all right at the time. And you have to be part of the community, you have to be a technologist, you have to be really following that wave and my rationale is this is the same point in time as it was back then, but just a different technology piece. And once you go into the maturity, you're going into real-world adoption as in beyond the community phase.

45:55

Everything that's important now in a Web2 environment is for it to still be important in a Web3 environment. Go to market. You have to measure everything. You have to understand your ICP, you have to understand how you can grow. You have to be able to say last month my metrics was an extra Y percent and it has to grow into Z percent or stuff like that. A lot of these capabilities are seemingly not important or available in the Web3 market, but that's just because we are not there in terms of maturity and having all the tools at our disposal to do that.

46:36 - Harrison (Host)

That's a really interesting comparison. Do you think the likely future here is that as crypto becomes more mainstream, crypto culture itself will become watered down on, less distinct than it is now into sort of the wider society and business world?

46:49 - Tim (Guest)

Well, for me, yes, because I'm talking about blocking 99% of the time. Let's talk about crypto.

46:59 - Harrison (Host)

Yeah, that's an interesting point. I'm going to have to think about that some more. I can see that happening, looking forward in other ways. Um, I'm kind of rolling three topics under one here, but you're, broadly speaking, other things for founders to consider and the industry to consider for adoption, regulatory challenges and interesting how that might change now, especially in the US, tokenization, cross-chain development. I'm going to leave that floating in the air, sort of broadly for you to pick up. No specific question for you. But what do you think would be really pertinent to discuss there?

47:35 - Tim (Guest)

You have to embrace regulation, right. Regulation is there to keep us safe. It doesn't matter if it's for centralized or decentralized. It is, in most cases, a good thing. The point to consider is regulation curbing innovation or enabling innovation. So we're rapidly all becoming technologists, right? Even though if you're not coding, everybody's using something digital. Everybody has a digital twin, as it may. Right? You have a persona on social media or something like that, and you still need a form to protect that. And when you're looking at regulation, we just need to make sure that regulation supports technology and does not kill it. And I think, if you look at Trump being president, I'm not going to say I'm for or against it. One thing it does support blockchain and crypto adoption, because he has a more innovative stance in moving forward with it.

48:53 - Harrison (Host)

From a pragmatic standpoint, what do you think founders should be taking? Let me ask in a slightly different way. So there was a, and I think this mentality still exists, but for a long time in particular, the way a lot of founders approach regulation was hey, those guys are the enemy. I'm going to build this in a way that it can't be regulated Screw you. Do you think that particular approach is becoming less viable as time goes on?

49:19 - Tim (Guest)

To be frank, I never understood it, because, if you look at the basics of blockchain, it's about to provide more transparency, to provide more trust, to make sure that you might say that you might not need regulation because everything is tracked until the end of time to the ledger right.

49:39

But that's then bringing technology and regulation into a bigger picture, because I understand that if you're using Bitcoin to buy drugs and drugs are illegal that's a problem that you still need to solve and that's making sure that you're using technology in the right format so that you're complying with regulation. What I like a lot is, if you're looking at midnight I'm not sure if you know about midnight that's one that I keep following as a spin-off from Cardano but they're focusing on data privacy but also adhere to compliance. So how can you make sure that everything that you're doing in terms of data sharing and stuff like that, or transaction data that you're providing it's fully private, but we can please the regulators and say, well, we can be fully compliant, even though that reflects in privacy? So that's a very big topic and use case where I would say a lot of ZK is focusing on that, but we're getting the compliance piece on top of it.

50:58 - Harrison (Host)

Yeah, i've've noticed adjacent trend and I can't speak too much about compliance itself. It's not something I personally have had much cause to have experience with, but I've noticed this interesting trend where, say in the last cycle, go back three or four years it was very common to see crypto companies that were completely disorganized. Left, left hand doesn't know what the right hand is doing. They grow to 50 headcount. They don't have anyone in operations. They don't have anyone who understands anything cross-functional. You know technical founders they don't understand the business side.

51:31 - Tim (Guest)

I don't think that's about crypto or blockchain or traditional.

51:36

52:00

There was a certain moment in time that that happened. Yeah, then you're given so much cash and you're pushed to grow as quickly as possible, but you're not mature enough as a founder, as a business, to grow into that skill as quickly and as rapidly as where you'd be in an industry where you would have VC backing, but the amount of deals that would go into that. There's a lot more due diligence being done to make sure that the companies that they bet on in a traditional setting have more chances to survive. As to the double-edged sword, I don't think it's blockchain-related versus traditional-related. There's not too much money going in and a lot of companies like ours got funded. I think we were one of the lucky ones to get funded at the time.

52:48 - Speaker 1 (Announcement)

And we had the same problem.

52:50 - Tim (Guest)

We grew very fast, the market cut off and we needed to reinvent ourselves. Lucky for us, we were in a position where we had to make hard choices to survive and adapt to the market itself.

53:08 - Harrison (Host)

Something that it brings to mind is I had not considered the point that that might just be a VC startup thing and not a crypto thing. Because crypto I've recruited in about five or six different industries now, but crypto is the first one that is VC backed. So I didn't work in VC funded. I've recruited in about five or six different industries now, but crypto is the first one that is VC-backed. I didn't work in VC-funded industries before, but what I've noticed is this cycle, especially this year, it's a lot more common for small teams to have someone running operations and being the glue that ties everything together, which sometimes includes compliance.

53:40

And I've also noticed I don't have any hard data on this, just pattern recognition from observation the teams that have sort of operations organization, that side of things sorted out in an early stage tend to do much better. Uh, in every way you know they retain people better. They they hit the market better. They're not making 50 layoffs every time the market turns um. But now you bring up the point about the vc funding. I wonder if that is a function of the market being more mature or just bear market survival.

54:04 - Tim (Guest)

54:45 - Harrison (Host)

54:54 - Tim (Guest)

55:01 - Harrison (Host)

Henry Suryawirawan, no, you're still here, yeah we're still here, indeed For years to come. Absolutely, I guess. That brings me to probably my last question is you know you've? I guess it's six years, not not many people can claim to have been running a blockchain company successfully for six years. If you had to do it all over again, what would you do differently, knowing what you know now?

55:28 - Tim (Guest)

apart from the funding, I would do almost everything differently in hindsight. That's because you're forever learning and you don't know what you don't know. And if you have the ability to take everything that you've learned now and apply back to what you've done six years ago, yeah, you'd be in a very difficult position. So do I regret anything? Absolutely not, because it's a journey of learning, a continuous learning and improve and making sure that in the, the goal and the mission is to create adoption for the technology right, because we believe so much that technology has so much merit for businesses and that we're a gateway drug to enable that. But for us as a business to be able to thrive in any market condition and I would say there are so many things that we could have done better in the last six years and in the next six years or 10 years to come, there are other things that we would have thought if we had known this by then it'll be even different. But yeah, just building a business is not easy.

56:43 - Harrison (Host)

57:20 - Tim (Guest)

That's good.

57:22 - Harrison (Host)

Running any business is challenging. I think running a funded business must be especially challenging. I know I'm self-aware enough to know I don't think it would be for me. I have a lot of respect for people that can do it. It's exceptionally below the success rate.

57:37 - Tim (Guest)

Once you go through series B and series C, I think the rate drops even further Will we like a challenge.

57:45 - Harrison (Host)

I guess the philosophical thing I'll tie up with that, you know, looking at our whole theme of adoption and market cycles and so on is actually I don't know if you've noticed this, but on Twitter it's become popular to slate VCs lately, in the past year or so, and everyone, like everyone, loves talking about meme points. Oh yes, the meme points are where the real everyone loves talking about meme points. Oh yes, meme points are where the real people want to buy meme points. We're talking about retail here, but actually, if you look at the function of VCs and funded founders, imagine the amount of money and resources that's going into creating all these millions of experiments that need to happen in order to create all this scaffolding that we can build a real industry on.

58:18

If you didn't have VCs, it would not be feasible to build all this infrastructure and, yeah, only 1% or whatever is going to still be there in the end. But you needed to have those 99 other failed experiments in order to create that 1%. So I think everyone involved in doing that is doing a tremendous service to everyone and should be celebrated, perhaps more than it is. Well, tim, it's been an absolute pleasure having you on. Any final words of advice for founders? You would have, I think, twice.

58:48 - Tim (Guest)

If you're an entrepreneur and you want to be a founder, you really want to build a business. There's a difference between really going for it and being able to see the end of the tunnel. Especially talking to founder CEOs, one of the hardest things that I have to do is always be able to be the last man standing and see the light at the end of the tunnel. And this can be sometimes a day, weeks, months or even years on end where you're always that rational optimist and everybody is saying it's not possible and that's from most big turning points that actually happens. So as a founder, you really need to be one that is rationally optimistic, where you can convince your fellow co-founders, your fellow employees, that the end is in sight, right as in the end, as in the light at the end of the tunnel is in sight. And there I would say probably 10 different moments where you say, if we take a wrong turn, we would be out of business by now, and that is one of the hardest things while you're being a founder.

At the same time. If you can't believe in your company, why should anyone else? Exactly?

You have to be the rational optimist in that case, right so? Is it then where you're that naive that you're the only one believing it at that point, or are you seeing something that somebody else cannot see at that moment in time? And it's really the balance, right? So? Because sometimes you're thinking like, how's it possible that in 2023, entire market is gone? Do we have to stop and move away from blockchain altogether? No, of course not. The market doesn't disappear overnight like that, but it does feel like it. So there, we then have to strategically look into where are we now? Which changes do we have to make? We didn't do that overnight, so we didn't instantly say, okay, let's just put everything into neutral, because a business, especially the larger you get, is like an oil tanker. You can't just cruise like a sail ship.

And I think one of the key takeaways from this is no matter how much you think you're prepared, you're never going to know enough. You just have to do it and learn as you go. Yeah.

And then I would say the more that you're like a serial entrepreneur and redoing the startup phase right and say I can do from zero to one or I can do from one to two, like I'm, I would say I'm quite confident, from zero to one, I can do that over and over again, but for a long time time we're doing from one to two or from one to ten, but that's a very different discipline and skill. So we're learning that on. How are we building a bigger business? How are we building a sustainable business? And it's a very different skill set and you have to acknowledge that either you're going to do it yourself or you're going to have to hire people that are going to do it with and for you, that become, to a larger extent, the team that will make that shift forward.

Also, we keep diverging, but I just thought that was a really interesting point. It's like Zuckerberg, for example. Zuckerberg is actually extremely rare. It's not normally the case that the founder is the right person to run the company when it gets to that size. Usually, the founder takes it to a certain point and then it's probably wise to hire a CEO to take it to the next point, because it's a completely different skill set to run a big company than to grow a small one. I think there's a lot of truth in that. Yeah, A lot of crypto companies never get a big enough headcount to get to that point, but I'm sure we will get there in coming years.

We have a number now, right. So as more as you mature, the numbers will go up.

Absolutely Well, tim. Thank you so much. It's been a real pleasure having you here. It's been really insightful.

Thank you, Harrison. I appreciate the time that you've given me on your podcast today.

It's been a pleasure to everyone listening. Thank you, this has been the Blockchain Startup Show and we'll see you soon.