The co-founders’ lament used to be they were stock millionaires in their companies but until an exit event - secondary sale, M&A or IPO - illiquidly so.
Things are very different in blockchain.
Anyone who got into the market pre-2017 in any significant manner is now seriously minted, while anyone who got into the market as late as 2019 has done very well.
Even those 2020-johnny-come-latelies should be sitting fairly pretty.
So, how does this change the dynamic of company value creation?
Previously, company builders had to actually build something at sufficient scale and with proven longevity to warrant a valuation of millions (let alone billions).
In contrast, blockchain company builders have created personal wealth from crypto decisions made a couple of years ago, generally outside of their companies, most of which are still loss-making and hence VC funded.
Too easy money
Of course, we will tell ourselves (and others) these were actually well-thought-out decisions, but as someone who is more thought-out than most, the truth is they were mainly accidental.
As ever, we also neatly forget the ones that ‘went to zero’ as we highlight the smartness that underpinned our +100x performers.
Now I’m no high roller on either side of co-founder/crypto builder debate but I do have some skin across the game.
And, in my experience, I’ve done as well from a couple of lucky decisions during three years as a blockchain dilettante as from a decade of hard slog as the co-founder of a small media company that managed a decent exit.
Less empirically, I’ve also noticed a striking change of mood over the past couple of months throughout the blockchain space - but especially gaming - as attention shifts from the hard work of making products people might use to the daily excitement of seeking alpha in a trending market through obscure yield farming and flipping emergent NFTs.
No hard yards
I’m doing exactly the same thing too, of course.
After all, who can concentrate on work when even the biggest market cap assets are experiencing double digit volatility on a daily basis?
Frankly, the cognitive dissonance is alarming.
And yet, at some point, we will have to give up refreshing our portfolio trackers and get down to creating the companies and products that will underpin some fruity current valuations and perhaps even build the next cycle of growth - you know, the one where we finally have millions of users.
The worry is the current generation of blockchain company co-founders won’t be interested in banging through those hard years building the future because they’re already floating in a sea of personal wealth arising from a couple of lucky token picks.
They’re already wealthy and highly liquid. No exit required.