Bootstrapping an ambitious idea in crypto

Andrew: Hey, they’re freedom fighters. My name is Andrew Warner. I’m the founder of Mixergy where I interview entrepreneurs about how they built their businesses. Joining me as someone whose business, I feel like it’s phenomenal already, but it’s going to be way bigger in the future.

And here’s why it solves this problem that I couldn’t stop complaining about for a while. And I think people on Twitter just told me, Andrew, just shut up. You have to accept it. Um, but I’ve been Soto, right? Did not want to accept it. Here’s the issue. The one that he solved. If you want to buy something online, that’s like crypto denominated.

It’s such a freaking pain in the ass of wallets of going over to Coinbase of moving money in and then waiting seven days or whatever, until they say it’s okay. And then you get the buy it. Like, I just want to buy this stupid. I remember what it was. It was a zap gun gift that I wanted to buy and I had to do all that.

It was such a pain in the ass anyway.

Ivan: Okay.

Andrew: I’ve been soda, right. Is the founder of moon pay. What they want to do is say, all right, just pay. What do you want to use your credit card? Great. Here’s a simple box. Enter your credit card information. You get the thing that you’re looking for. We’ll take care of the backend.

We’re not going to force you to, to understand all this and convert to the cult of crypto yet. And it’s an amazing business. And I think the part that’s even more amazing about it is that the whole thing is bootstrapped. I had no idea. I thought these guys were backed by some real heavy hitters. I thought the Winklevoss twins board behind it in some way, they’re not all right.

I invited him here to find out how he did it and where this is going. And frankly, also to also complain a little bit about some of the issues with crypto today and in an understand how Ivan sees the solutions coming, coming together in the future. And we can do it. Thanks to phenomenal sponsors. The first, if you need a host, a website, hosted, go to hostgator.com/mixergy.

The second, when you’re ready to start charging for some of your content, go to dot com slash Mixergy. I’ve been good to have you here,

Ivan: Awesome. Thanks for having me.

Andrew: dude. What’s the revenue right now. Hmm.

Ivan: to get going right into numbers. No, we’re, we’re doing well. Uh, I’ll, I’ll leave it that much. You know, we’ve done over a billion dollars in transactional volumes since inception. So a billion dollars has been spent on debit and credit cards into cryptocurrency that much I can say.

Andrew: And your percentage is what, like 5% that you charge. And then from that you have to pay the credit card processing fees.

Ivan: Yeah, that’s kind of how it works. I mean, there’s a lot of fees, uh, underneath the hood, you know, obviously you have the fees by using the, like the traditional card networks, like these a MasterCard. There’s nothing we can get around that. Um, we have fees obviously when we source the cryptocurrency, uh, sometimes there’s withdrawal fees.

If we get the source of that asset from a particular exchange, uh, there’s network fees. So there’s a lot of different components that basically plug in. And then on top of that, You know, one of the biggest challenges that we have to solve is we’re combining a non final payment method, which is using your debit and credit card or using a Fiat bank transfer or a, and then combining that with a final payment method, which is delivering cryptocurrency.

So that essentially makes it very challenging for us from a fraud perspective, right? So let’s say use your credit card and you say, Hey, I didn’t make this transaction. Uh, and you call your bank, you can do something called the charge back, and I will deliver the Bitcoin or Ethereum or whatever asset that you’ve purchased.

And I can’t get that back. Uh, so you, obviously we have to price that into the risks that we’re taking because

Andrew: Ah, that’s what it is that is possible today. You price it in, but you also mitigate against that risk by doing things like asking me for my driver’s license. When I sign in,

Ivan: So, so that’s part of it. Obviously, you know, the other component is cryptocurrency is regulated in many different parts of the world. There’s different regulatory standards that are applied. And so there’s something called KYC, which means know your customer. So we have to follow those rules, but I will say, you know, obviously as part of that, it does make it a little bit safer, right?

In terms of combating money laundering, in terms of controlling that risk of someone issuing a chargeback because we’ve collected that info. Number one uses wallets. Right. Um, you know, there are a ton of different cryptocurrency wallets. And I remember, uh, when we started this business, you know, back in 2018, uh, which feels like a really long time ago. Uh, it’s not. Uh, but, um, I remember, you know, there was a bunch of wallets that you could download on the app store.

Um, but they had good functionality for like setting up your private key. They’re non-custodial a lot of cases you can send and receive money, but there was no way to just buy and top up to these wallets. So, you know, as exactly as you explained before, where you had to go to an exchange, buy some cryptocurrency, then move it into your wallet.

So it was a super cumbersome process. So really, I think the number one use case today is people just want to top up.

their wallet right there. And then so they can use their crypto.

Andrew: What. One purchase that they’re making with that top, top wallet.

Ivan: Right now it’s Bitcoin, right? Um, I think Bitcoin obviously

Andrew: Also, what they’re doing is no way they’re buying Bitcoin, they’re coming through. Moonpig just to buy Bitcoin or what’s the end thing that they’re trying to buy in my case, uh, when I used Moonpig it was because I wanted to buy an NFT. Like I said, it was some gun. That was a gift. What’s the number one thing you’re

Ivan: So today it’s Bitcoin, right? People just want to own Bitcoin. That’s like the number one thing. They want to Hodel Bitcoin. So they just want to buy and hold it and they don’t want to necessarily have it on an exchange. They want to have it in their noncustodial wallet where they control the private key.

That’s the number one use case of Moonpig today is they want to own the actual Bitcoin, which is what makes us a little bit different than, you know, something like, you know, if you go to Robin hood or you go to the cash app and a lot of cases like you don’t own your Bitcoin, right? We, we help you fit. We physically deliver the Bitcoin, uh, on chain.

So that that’s, I think the big distinguishing factor.

Andrew: Got it. So what you’re seeing is people will get these wallets and all they want to do is just own Bitcoin because they believe the price of Bitcoin is going up. And the way they do it is they buy on their credit card. Through moon pay moon pay, takes the money out of their credit card account and puts, converts it into Bitcoin and puts the Bitcoin on their wallet.

And that’s it.

Ivan: Yeah, exactly, exactly. But not only just credit cards, debit cards, uh, we have bank transfers in different parts of the world. Um, United States, we’re very, very soon going to launch a us bank transfers, which we’re super excited about. Um, but really our goal is we want to connect every single legacy payment method across the world.

So It’s hugely ambitious, but you know, every single part of the world, uh, you know, there’s different penetration rates based on the country, you know, visa and MasterCard isn’t necessarily the most popular in every country. Some local countries have local bank transfer methods or each transfer bank transfer methods, and we want to support all of them.

Uh, on-demand pay.

Andrew: So I don’t want to, well, to me, one of the uses of a, of a service like yours is on bit cloud where I’m on big cloud. It’s like Twitter, but if I want to chat with someone, if I want to pay them a compliment, I basically have to have the currency to big cloud currency and to get the big cloud currency, I either send them a Bitcoin, which they then convert into bit cloud, which then I get to use to pay, to do things like communicate with other people there.

Or I just want to put a credit card and if I put a credit card, they’ll convert it, they’ll take my money, converted into Bitcoin, then convert that into big cloud. And then I get to do the thing, but you’re seeing the people aren’t looking at to do the thing with the, with the cryptocurrency. Now it’s mostly just

Ivan: W what I th I think that’s whole, that’s definitely what’s starting to happen. Um, so we’re starting, you know, really for us, it’s about this next phase of adoption and cryptocurrency, which is all about utility and this application layer. So like NFTs, right? You want to have really simple access to Ethereum, so you can interact with the smart contract and essentially get your NFT, or like just what you mentioned there.

I think tipping is going to be a huge use case, right? You know, the fact that anyone can just spin up a QR code and get, you know, a microtransaction done over the blockchain is going to be huge. What I would say is the biggest limitation that we have today to really take crypto to the next level is transaction costs.

I really believe we’re going to tend to zero, but we’re not there yet. Right. The problem is, you know, Bitcoin and Ethereum today. You know, Bitcoin, you have high network fees, uh, Ethereum, you have gas fees, there’s a bunch of different things being done to try to improve the scalability, uh, of these blockchains.

And you can see, you know, there’s already alternative blockchains that can almost do it at a kind of zero, uh, you know, transaction costs. And I think, you know, there’s obviously trade offs, right. Uh, in order to be able to achieve that. But I think Bitcoin, you know, what’s great about it. And same with Ethereum is you can wrap it into other blockchain.

So, you know, Bitcoin itself, right. Can then live on another blockchain. Right. So I think there, you know, there’s definitely, uh, you know, a long way we have to go to make that easier for people, because the reality is you don’t want to be sending money if it’s, if it’s more expensive than the existing system, what’s the point.

Right. Um, and So we have to make the transaction cost go down to zero and then it’s going to be a lot more useful.

Andrew: So you imagine a world where I might have a membership portion of Mixergy, where I charge and want crypto, I might want just Bitcoin and you will just bring up that payment, uh, uh, that payment box and people can pay with whatever they have or whatever you accept in their part of the world. So if they’re in a part of the world where you accept debit cards, they could pay with the debit card, take us dollars out.

I ended up with Bitcoin in my account. If they’re in a part of the world where they could take money out of their bank account using ACH, you’ll do that, convert it into Bitcoin and send that over to me. And that’s where you imagine that’s what moon pays goal is.

Ivan: Yeah.

And what’s, what’s beautiful is, you know, I think we just need to, you know, I look at visa and MasterCard, we really need to innovate, right. Especially in the wet in the Western world. Like we, haven’t done a lot to really bring down the cost for consumers when it comes to payments. Like, you know, I think we’ve been a little bit addicted to our credit cards.

It’s all these awards that we get, uh, and we’re willing to put up with the fees. Right. But the reality is like, we’re moving files around. Why Is it so expensive? it doesn’t really make sense in Asia. A lot of people already pay by QR code, which is linked to their bank account. You know, I think the next step from there is you pay directly through your cryptocurrency.

And what’s, what’s amazing is, you know, you don’t need to have a, a bank account, like, you know, crypto, you know, essentially the public and private key, you can set up a wallet and basically accept money from anyone anywhere in the world, which I think is the story that often I think gets missed. Right?

There’s billions of people. Don’t have bank accounts, but immediately now, as long as they can act at access to the internet, uh, immediately can go from bank to bank, which I think is, uh, you know, hugely transformative,

Andrew: a bank? If it’s a wallet, they’re not getting interest. If it’s a wallet they’re not there. They’re not getting the safety. No

Ivan: Aye, I’d argue it’s the next generation bank account for sure. Um, you know, a bank account that you can control and, you know, you can still get interest, right? There’s going to be all these applications built on top of your cryptocurrency wallet that are going to be just like a bank, if not better. Right.

But we’re still early days. Right. So I’m not saying, uh,

Andrew: to be easier to create a bank account? The part that frustrates me is maybe I’m impatient, but it

Ivan: course it will be

Andrew: it feels if I’m patient. Here’s why? Because it feels like this, this technology has been out there for a decade now. Right. But coins it old about.

Ivan: yep.

Andrew: Okay. So

Ivan: About a decade old yet

Andrew: we, so we’re looking at technologies that,

Ivan: a decade.

Andrew: sorry, the connection I could see as a, is just going a little bit weird on us.

Oh, I see. Why, let me, let me shut this down. So it’s, it’s just, it’s still full of delays in sending and receiving money. It’s still full of fees. It’s still just so clunky and it’s, it’s just frustrating. Isn’t it. As somebody who is in the

Ivan: I mean, I think it comes down to solving the a hundred percent. I mean, it comes down to solving that problem that I mentioned earlier. Right. It’s just gotta be fast and it’s gotta basically the transaction costs have to come down. Right. Um, but I’m, I’m very confident we’re going to get there. Uh, and, and the thing is, it’s not like your, your debit and credit card or your bank account are going to disappear.

You know, the analogy that I use, um, that I think, you know, it makes, it, makes it come to life a little bit more is, think about telecoms, right? Uh, right now we’re on this zoom meeting, uh, we’re using voice over the internet protocol, right? So we’re using the internet technology, which dramatically reduce the costs.

Do you remember how, how expensive, long distance phone calls was that that, you know, and that what’s interesting is like your phone number, hasn’t disappeared, your phone, you know, at and T and all the existing networks haven’t disappeared, it’s taking a long time, but over time we opt into the system that is more efficient.

And I think the same thing is going to happen with cryptocurrency, but right now, you know, it’s not more efficient. Right. So that’s why we’re seeing, uh, all this friction, but I’m confident we’re going to get there. It’s just going to take, you know, I’m, I’m, I’m thinking, you know, five, 10 years until we really start to see kind of more, but, but it’s starting to pick up, you know, that’s the good news.

And I think it’s also becoming culturally, culturally relevant in a way that it wasn’t in the past. I think NFTs are a big part of that as well, which is really exciting.

Andrew: So imagine five, 10 years from now. If I want to send you money, it’s not going to call the fee is going to be minor insignificant, much less than credit cards it’ll happen instantly. I’m not going to have to wait and it could be directly in your wallet. You don’t have to put it in a bank account. And, and

Ivan: You can hold me to that. That’s sort of that’s the future. I’m trying to Delt.

Andrew: And, and then if you want to buy Mixergy premium without wallet, you can take out just the right amount through moon pay and moon pay. We’ll send it to Andrew. And that’s, that’s the world that you see. And if you want to start earning interest on it, there’ll be ways to do it there too. And that’s the world that you envision.

That’s the world that you’re going to become a part of. And I, I, I agree with you. It’s got to go there. It’s just so frustrating that it’s not there considering how many smart people are on it and how, how directly connected it is to finance. You imagine the things that are far away from finance, where there isn’t the financial incentive to improve.

Well fine. You can imagine that they could be stuck in, go and, or just slow with their progress with cryptocurrency, with Quip, with money, I would have thought it would be faster.

Ivan: It takes time and, you know, you have, uh, you know, also, you know, regulation hasn’t necessarily been making it easier, right there isn’t clarity on regulation in many different parts of the world. Um, you had a lot of mainstream media, you know, really putting a lot of negative spin and news around cryptocurrencies and money laundering.

Although if you look at the raw numbers, like under 1% of transactions are elicit, and the reality is like, if you’re trying to launder money, you know, launder money through crypto, you’re an idiot in my opinion, because, uh, there’s a digital breadcrumbs that can be traced. So it actually is way safer. So a lot of it has been having to combat kind of a negative media portrayal.

You know, when I started, you know, people thought I was. Like, you know what you’re doing, those Bitcoin crypto stuff, like, what are you doing? Like, you know, I came from a, I guess, more buttoned up career in my past. I used to do portfolio construction for big pension funds, insurance companies, you know, moving billions of dollars around and making a very interesting strategic asset allocation decisions and, you know, hedging out risks.

And then, you know, moving into crypto people like, well, what are you doing? Like you’re throwing away. Like you could have done well there. Like what, what are you thinking? Uh, and so, you know, and I remember when I first started. You know, even to become a merchant to accept debit and credit cards and the crypto, I had a spreadsheet and I literally remember calling all of these acquirers, right?

And these acquirers, ultimately the ones that approve merchants to basically be on visa and MasterCard. I had something like 80 rejections. Like I literally was calling up every single day. I had a client that wanted to work with us. It was bitcoin.com, a huge client. And it was just impossible to get, you know, a first relationship up and running.

Eventually we got one. Yes. And that one, yes. Was our saving grace to basically turn on the business. And, you know, the reality is we had to turn it on first in Europe because in the United States, it was just extremely hard, like even getting bank accounts, uh, for crypto. I mean, now it’s getting a little bit better, but even getting, you know, getting bank accounts related to cryptocurrency, I mean, you would get shut down.

And a lot of cases, banks just didn’t want to take on the risk. They didn’t understand it. It was too complex. Uh, but my, that was kind of the reason why I saw this as such a huge opportunity, because I felt that in the longterm banks would change their tune. And that’s exactly what you’re seeing now. Uh, something that was, can kind of consider it.

Uh, sketchy or, you know, I’d say like red or Amber on kind of like the traffic light, uh, is now turning green. You know, I think more and more, uh, you know, banks and financial institutions are waking up and realizing shit, this is the future of finance. Uh, we need to, you know, either innovate or die. Right.

Um, and so, you know, I think that’s, uh, you know, it’s changed quite a bit, but, you know, I think all of these things are, you know, contributing factors to why it’s been a little bit slow. Um, but, um, I’m confident that we’re eventually going to get there.

Andrew: I’m too. And moon pay so well positioned for it. You started to mention your background. Let’s understand how you, you ended up here, you doing what for pensions and why did you, why were you doing it for what looks like three years?

Ivan: Yeah. So, so kind of crazy story there. Like if I, you asked me when I grew up and said, oh, it’s gonna work in pensions. Like that was probably the last thing I would have ever said. Pensions just sounds boring. Right. When you say the word pensions, I don’t know. There’s there’s like just some, like, in your mind, you probably just don’t think that it’s definitely not like a sexy part of finance.

Uh, you know, ultimately, uh, I’d spent a year at Oxford. I was super lucky. I was, uh, I was a rower in college and so part of my dream was to, uh, you know, participate in kind of rowing and England and an Oxford. So that was super cool. So I spent a year there. And, uh, I met this incredible entrepreneur, this guy named Robert Gardner who had started a firm called Reddington.

And, uh, pretty much I just got excited by his energy and, you know, had an opportunity to go work for him in London. Uh, so that’s, I kind of jumped on that, you know, not many, uh, Americans, you know, immediately get their first job in London, right out of college. And so, um, that was like a huge opportunity. I couldn’t say no to.

And it was more just from, from my side, even from when I started, I always knew I wanted to be an entrepreneur, but I just felt. It was a really interesting place to learn. You know, ultimately pensions are the whales and our financial system, right. You know, these are billions of dollars, uh, that we need to protect.

And obviously there’s a, you know, post the financial crisis of a way, a lot of these pension funds were in bad shape. And so really our job, it was a company called Reddington was to help, you know, get these pension funds back on track. And we were doing something called liability driven investing. And so what that meant was we would hedge out the biggest risks on the liability side of the balance sheet.

So namely interest rates and inflation. So we take care of those risks. And then we would focus on the strategic asset allocation and that? was kind of novel at the time. And now that’s kind of like the fact away

Andrew: How do you do

Ivan: are, are doing it. So

how do you have

Andrew: against inflation risk? And what was the other one

Ivan: interest rates and inflation? Cause that’s, what’s kind of governing your liabilities over time. It’s like, if you’re having to forecast your liabilities, you’re going to be forecasting that based off inflation and based on the interest rate

Andrew: pension funds? liabilities are what they borrow money to make the

Ivan: have to pay the pension. They have to pay the pensioners. Same as like an insurance company that has to play, pay their claims. It’s like they have to pay these pensioners pensioners. And what’s interesting is, you know, obviously this has shifted like the whole landscape, right. Defined benefit. Like people would have this golden egg when they retired, uh, their employer would contribute into it.

And then what happened was these employers had these schemes that they wanted to close. Right. Because it became unsustainable. Um, you know, and essentially they, some of these pension funds were under. Like they had too many pensioners that they needed to pay, not enough assets. So basically it’s this game of trying to match your assets, your liabilities, so you can pay out those pensioners.

So a lot of them are underwater after the oh eight financial crisis, right? Because their assets side of the balance sheet got hit. So really what we will try to do is let’s control the risks on the liability side of your balance sheet. So hedging out interest rates and inflation. We do that with derivatives.

So a lot of the people I work with or kind of ex investment.

banker. Folks that were working in structured products and fixed income, which is, you know, I think what was really cool about that was this was like hardcore technical, nerdy finance, which probably not like the F like definitely my brain isn’t necessarily geared towards that direction.

So it was definitely a challenge for me, but it was just an incredible place to learn. I call, I call it like my MBA on steroids. Uh, and also I think the way, you know, why was important was it helped form my view on the asset universe, like how all these different assets kind of fit together. And I saw cryptocurrency as one bucket within that portfolio in terms of the alternatives bucket.

And so I always saw Bitcoin and cryptocurrencies in general, having a ton of longterm potential because if you look at it, Bitcoin, you know, under a $1 trillion, right. Intro intro in terms of total market cap gold at 10 trillion. Right. Uh, and so, you know, it’s so small in the grand scheme, the asset universe.

And if you think that it’s an uncorrelated diversifier to your portfolio, right. And you know, part of the portfolio management theory is right. you want to diversify and reduce your risk. Um, it made sense that over time as the asset class became more established, more institutional investors would want in.

So from that view, you know, I, I knew that there was going to be something here. I

Andrew: Did you buy Bitcoin at that point?

Ivan: Yeah. So I bought my first Bitcoin back in college. Um, one of my friends wrote his thesis on Bitcoin and that’s what convinced me to buy it, uh, for the first time. Uh, you know, I kind of didn’t pay attention to it.

Uh, really again until kind of 2017 is where it was staring me in the face again, you know, actually after, after I was in, uh, you know, that portfolio construction gig at Reddington, I, I quit my job to start my first startup, uh, in 2015, which was trying to solve savings. So, you know, rather than, you know, label it as pensions, I want to take all my knowledge and help people save their money, then invest their money.

Uh, that was, uh, an interesting journey for me. It didn’t work out so well. It’s called

Andrew: Saveable the idea was, if I understand people are, are spending at a consistent level, somewhat consistently, you say, let’s take the money that they’re not, that they’re not spending month to month and put that into a savings account for them.

Ivan: Exactly. So, you know, our animal brain just wants to spend all the time. Uh, and if you look at Western economies like the United States, uh, we have a negative 2% savings rate, meaning that we spend more than we stave compare that to Asia, where it’s pretty much ingrained where people put one third of their income directly into a savings account and invest it.

You know, we don’t have that mindset or mentality at all. So how do you combat that? The only way that you can overcome the Chimp brain as you put an artificially intelligent robot to make those decisions for you. And that’s essentially what we built. Uh, so, so basically connected to your bank account.

The problem was, you know, we started this in Europe, in the UK, And open banking wasn’t ready. It was a really cool technology that I thought made a lot of sense. Like you connect your bank account, but people were sketched out in the same way that people are sketched out using their credit card. Like, wait, I’m going to give this random service that I’ve never heard of access to my bank account so it can read my transaction history and then move money around.

Uh, no thanks. So yeah, I think I learned that the hard way, uh, you know, and it wasn’t, and that’s what I think is so interesting about cryptocurrency. Is it. It’s it’s compelling. It’s exciting. It’s culturally relevant. It’s making people engage in their, with their finances in a way that never happened before.

Like, you know, moving people into a savings product is kind of like flossing your teeth. It’s like, you need to do that. Right. But it’s like, it’s not like crypto is exciting. And I think that’s so good because people are now getting financial education in some way. Like, they’re gonna make some mistakes.

They’re gonna invest in stupid stuff. They’re going to invest in meme coins and shit points. And, you know, the reality is part of that, you know, we need to do our job, uh, in terms of a fiduciary to make sure that the people are doing their own research and, uh, diligencing what they’re buying. But, you know, at the end of the day, um, people making these mistakes in the long-term, it’s gonna make them more aware.

Uh, I think, and, and part of that is, um, you know, I think it’d be hugely, uh, democratizing for the world of, of, of, uh, individuals getting, uh, you know, participating in finance. So that’s, what’s so exciting to me about.

Andrew: Okay. And so when you did this, why didn’t it didn’t work because you didn’t get customers or it didn’t work because you weren’t able to establish the bank relationships. You got regulatory approval, right? You just weren’t able to get enough customers to say, great, I’ll connect my bank. You look at my finances and then you put the money out.

Okay. You sold to a company called plume,

Ivan: plum, So like from like the fruits.

Andrew: right. You know what I keep saying? Plume and I searched for plume it’s because my wifi router is Palm. And

Ivan: Oh yeah. I know Flynn.

Andrew: they’re pretty good. So you sold to.

Ivan: Yeah.

Andrew: Why, why are they able to do it? I’m on their site right now. It says the AI assistant that grows your money there.

They’re essentially doing the same thing, right?

Ivan: Yeah, they were just better. They, they executed better than me. Uh, well, you know, it was my first startup. Right. Um, you know, so I think you make a lot of mistakes,

Andrew: a mistake that you made.

Ivan: Yeah. I think, I think the reality was, um, you know, we focus too much on the regulatory side of getting our regulatory approval versus building the very best product.

Right. And I think the product experience like, you know, they, you know, plum did a really good job. Originally was, you know, everything comes down to distribution, right? That’s the hardest thing to solve for when you’re building a building, a new company is getting distribution, getting those customers on your platform.

You can build the coolest mouse trap ever, the coolest gizmo, but no one is going to care unless you can get them to people. And people actually want to use that. Right. And so what was cool about plum, where they started with. Their hook was, we’re going to be the very first Facebook bot for your finances.

And some people don’t like Facebook bots for their finances, but some people do. And so they had a very niche audience, which they were able to, uh, do a very good job for those people. And then they grew organically and now they have an app. Um,

Andrew: What did their bot do?

Ivan: Uh, so the bot just, it was very similar to me.

It’s very similar to saleable. It just connected to your bank account and then with sweet money into a savings account. So very similar business. Um, they just essentially had an executed SN you know, I always respected, I had a good relationship with the, uh, founder and CEO there. And I said, look, I’m waving the white flag.

Uh, you know, you need our regulatory licenses. So why don’t you buy saleable? So you can skip the, the pain that, that I went through 13 months at the financial conduct authority. So I could hold client money and move money into security. So, uh, that’s what happened. So it wasn’t like, it wasn’t a win for me, you know, it was more just, you know, Trying to do right by the people that trusted me into this first company.

Um, and so, you know, basically.

Andrew: their money back.

Ivan: get get the messages, their money back.

you know, unfortunately they got, they got equity in, in plum, but, you know, unfortunately they, you know, they didn’t win. Uh long-term I want to make sure they do win. Uh, and so basically it was a really tough thing as an entrepreneur, like you just want to win.

Right. Uh, and so in 2017, I was kind of like back at the drawing board, you know, pretty much broke other than the fact that I invested in crypto. So

Andrew: money did you have in crypto?

Ivan: I didn’t have a time, you know, I had, you know, I had probably, you know, a couple of hundred thousand dollars tops, right.

Andrew: Enough to live and not sweat. Where am I going to do? I have to get a job right away. Am I

Ivan: Yeah, exactly. You know, and, and, and for me it was, um, yeah, I think, I think that was just like super, uh, yeah, I guess it was kind of like what what’s working well in my life right now. And it turns out to be crypto. So maybe I should focus my energy there. And then that’s where I started to really research and kind of look at, you know, what are the ecosystem look like?

You know, where could you buy Bitcoin? And cryptocurrencies Coinbase was the leader, uh, at the time. And I just thought, you know, first it was actually, I almost made the same mistake as my first startup. I actually was starting to build a wallet. And then I realized that I was going to have the same problem acquiring customers.

And, uh, what ended up happening was someone decided to share the wallet that we bill, uh, with the owner of bitcoin.com. Uh, he shoots me an email. Roger. bear shoots me an email, says, Hey, I’ve been heard about, uh, you know, what you’ve built here, uh, would love to see if there’s a way to work together. And that essentially turned into me, flying out to Tokyo.

And recognizing that there is this huge opportunity. Um, you know, at the time it costs 10%. So there was already someone doing something similar to moon pay. They were charging 10% on each credit card

Andrew: let me pause for a second. At the, this is still at the wallet phase that he liked it.

Ivan: This was, the wallet days.

Andrew: This was, he just, he liked the, why didn’t you like the wallet? It’s it seems like there were enough wallets out there.

Ivan: Cause, cause what we did was, it was actually funny with the wallet we had had basically connected to we’re using Stripe, um, and Stripe at the time it was against their terms and conditions to enable transactions into cryptocurrency. So you’re not allowed to use Stripe, but it was a really slick demo.

So the demo was like face ID into Bitcoin and no one had ever done that before, uh, instead of a wallet.

Andrew: Meaning from PayPal. I mean, sorry, not PayPal from, um, apple pay, using face ID to confirm it, taking money out of the credit card account, converting it into Bitcoin and putting it into the moon pay wallet and

Ivan: Well, it wasn’t the main pay wall at the time, but it was just a wallet that we had built. Right. And so that, that was it. And that

Andrew: how did he see it?

Ivan: uh, well, someone I was at a party and someone decided, you know, downloaded our test flight. So he could take a look at the demo that we had and then shared it with them like the following week.

And then I got an email. Uh, and so that’s where kind of the light bulb, one of my head, which is what, what was cool there, wasn’t the fact that we really built a wallet. What was cool was your topping up that topping up functionality to wallets, which is now the most popular feature and kind of a reason why, uh, Moonpig has thrived.

Right. And so we then said, Okay.

well, why don’t we build an API from scratch for, for bitcoin.com so they can accept debit and credit cards and really try to solve conversion Because the solution that it had before, it was just a little bit clunky. So I said, let’s make this like a nice, beautiful

Andrew: Because what Roger wanted was anyone who bought Bitcoin on bitcoin.com to just be able to have that smooth experience, put a credit card in, get the Bitcoin and not have to pay a huge fee in order to do that. That’s what, all right,

Ivan: Exactly.

Andrew: so let me take a poll. Let me take a pause here and talk about my sponsor.

It’s HostGator. If, let me ask you this I’ve in fact, if you were starting today, let’s say. Since you’re so far ahead of other people, your age, let’s go back to when you were in high school, when you were still admiring Richard Branson, when you were still like in the world of going to be simple bootstrap entrepreneur and Andrew Warner walks into your life and says, Tara, I’m giving you a HostGator account.

You can host any type of website. We’re not going to do heavy coding. We’re not going to change cryptocurrency, but you got a site come up with an idea, kind of like, um, what was that called junior achievement used to say, create something from this. What would you create if that happened to you today

Ivan: Uh, well, and, and, okay, so funny in high school? so yeah, junior achievement. And you mentioned that so junior achievement, I think is an awesome, uh, initiative, essentially teaches kids to run businesses, uh, at an early age.

Andrew: one of the, it’s one of the best parts of high school for me. I loved it.

Ivan: Oh, it, it taught me so much. Um, so I was the president of my junior achievement class.

Uh, you know, I remember basically commuting out to MIT, which is a really cool backdrop, uh, in high school. The, basically the building of business and the business that we have is called Kita pockets and he’d have pockets. The idea was Boston was freezing cold and, uh, especially in the winter time and your hands would get cold, like really cold.

And so what we did was we would go, we went on Amazon, uh, and bought hand warmers, uh, in bulk. And then we also bought gloves, like really cheap, you know, the, the cheapest gloves that you can possibly find. We combine them together. We put them in a Ziploc. We had a little logo that said heater pockets on them.

And then we would sell them at football games and it was a hit, like everyone wanted them at the football games. And, uh, so I think we were the highest grossing junior achievement chapter that year. So, you know, it.

was kind of also a lesson in terms of, if you bundle things together, you can charge a premium, uh, which is some of the lessons that I’ve taken forward, obviously a noon pay.

And my future businesses is bundling right. Bundling products and bringing that convenience. You know, it makes, you know, enables you to have a premium because people don’t want to have to find all those components themselves.

Andrew: Uh, I wonder what would even find a bundle that needed to happen? You know, no Kagan just, uh, talked about how, if you need to

Ivan: Love Noah Kagan, by the way.

Andrew: you know him, I feel like everyone fricking knows

Ivan: well, he reached out to me, uh, about loving minivan and I was like, well, awesome guy. I was like, I was like, and I was, I was like, kind of like, wow, I can’t believe that he’s using it. Uh, which was super cool. So Yeah.

Andrew: Yeah. And I don’t know how he has the patience to do that. I, I said, I’m struggling to buy this NFT. He goes, let’s get on zoom. He gets on zoom with me and he walks me through buying an NFT. Alright. So one of the things that he said was he said, go to the Reddit, D I do it yourself, DIY section, see what people are doing themselves and showing off and look in the comments to see if there’s someone says, I want to buy that and do that.

So maybe you take one of those ideas and you, and you start selling it on your site, or here’s another interesting place to get started. Just start putting out some of these best bundles, best DIY projects that you see on your site. See what people are getting excited about. And maybe those are the ones that you start to sell.

Whatever your idea is. If you’re listening to me and you need a website, go to hostgator.com/mixergy, and you’ll be able to host a website quickly, inexpensively and reliably, and they’re just phenomenal company to work with. Host

Ivan: love that.

Andrew: Do you like that idea?

Ivan: I love it. That, you know, people that have side hustles or ideas. Right. I think it’s just, you can pursue it way more easily today than you could, uh, years ago, right? Like building a website was a pain right. In the past. So it’s just becoming so much easier

Andrew: And he used to be such a distraction to have a side hustle. What I’m discovering now is. I used to be super focused. Now I’m discovering, I should give myself time to do things that have, that are stupid side hustles. That it’s not about the money. It’s not about the time. It’s not about the result. It’s just, what are you going to learn in the process?

All right. Um, let’s come back to this. So now Roger veer says, I love this. I want it on Bitcoin and bitcoin.com

Ivan: Yeah.

Andrew: you then say, okay, I’m not going to force people to use my wallet. What you want is the payment experience. They bring a credit card. They end up with Bitcoin. Is Bitcoin, or did he want Bitcoin cash or

Ivan: Uh, he wanted both?

he wanted, uh, uh, both Bitcoin and Bitcoin cash. And so we supported. Uh, and so yeah, it was an incredible first client to have. Right. Um, you really going to ask for a better client in the sense that, you know, it already had incredible distribution, incredible reach. Um, you know, we had to convince them, obviously they didn’t want to turn on and it was actually, you know, to our advantage, like they didn’t want us to turn us on and all countries immediately and we weren’t ready.

Um, so we just started with the UK initially UK and Europe, and then eventually moved into more countries. And that enabled us to constantly iterate on the experience and just make it a little bit better, a little bit better, a little bit better. And that’s kind of, one of the biggest mindsets that we have as a business is, uh, we use the word Kaizen, which means change for the better, uh, or continuous continuous improvement.

And, you know, if you think about it, if you improve 1% every single day, Uh, over the course of a year, you get 37 times better, um, over by the, by the course of the end of that year. And so the compounding

Andrew: You’re not even taking compounding into account. If you’re doing 37 times, right.

Ivan: uh, well now you’re taking comment. That’s the math, right. Yeah. So, uh, it’s like 37 times better is also 3700%.

So You can take 1% every single day. And then it’s 3007% improvement over a year, which

Andrew: I want to understand the improvement and that’s one of the things that before we got started, I said, I had this issue and a lot of people would feel so uptight. You actually fricking smiled. I’ve got it. I think I’ve got it on, on video. Cause I look at people’s faces when I talked to them and I said, I’m going to tell them about a problem that I had with Moonpig.

Let’s see if there’s going to be a fraught issue. It turns them off or it’s not. And you had this smile of almost like of happiness. It’s weird. Um, but coming back to that initial thing, you then said, I need a credit card processor to let me process credit cards. And so you started calling up and down the list that you put together.

One company said yes, but it’s not as easy as take credit card and then offer, offer Bitcoin or Bitcoin cash or any other crypto. What are some of the issues? What are some of the things that you have to promise them that you would do in order to process credit?

Ivan: Right. So there, I think there are three pillars to kind of unbundle what’s happening. So if we unbundle all the different components that have been paid, let me just go through them really quickly. Uh, the first one’s identity. Um, so obviously. Um, you know, based on the different geographic region, there’s different restrictions and requirements that we need to fill for, uh, onboarding those customers through the KYC process.

And so,

Andrew: Okay. Why C know your customer? You’re

Ivan: know your customer.

Andrew: so it’s not like you’re taking your processing credit cards to sell me a coffee mugs where you don’t need any information about me. You’re selling me an asset. Is that what it

Ivan: We’re selling financial, we’re selling a financial instrument to some extent, right? So you know, that that’s the reason why and different, you know, different countries have different policies around how they want to regulate this. And part of it is they want to combat money laundering. So that’s why it exists.

And so we use different vendors and different regions, you know, we basically will scan your passport, we’ll scan your driver’s license and make sure that it’s valid. Um, but you know, it really just depends. It’s a risk-based approach that we have to take. And different countries have different requirements.

So that’s one key challenge that we solve is that onboarding process, right? The second piece that we solved is? the payments experience. And so really our vision is connecting every single payment method across every single geography, as I mentioned before. Um, and so, and part of that as well is when we’re, uh, doing that, we want to cover off that risk of fraud, right?

So we have to basically use as much intelligence as possible to determine whether we accept or reject a transaction. And then if there is a transaction that does do a charge back, making sure that we have the evidence to dispute and win those chargeback cases, right? So that’s the second piece of what we do.

The third piece of what we do is the crypto asset delivery. So, you know, we’re crypto native. We will go source this liquidity from, you know, one of the top, uh, exchange venues. Uh, we’ll buy it at cryptocurrency and then we’ll bring the convenience of it directly to the end customer and we’ll deliver it to them.

So we’re combining all those steps in one, uh, when you’re making a purchase on impact.

Andrew: And you built this all by yourself. The first version.

Ivan: Uh, I had a, co-founder an amazing co-founder. His name is Victor Fairmont. Uh, who’s my co-founder and CTO. Uh, incredibly gifted software engineer, uh, spent, uh, you know, basically found them on a website. Uh, I found on a website called talent.io. Uh, so the most ironic, uh, I guess name, I mean, it’s. It’s kind of like a, um, it’s a service where they, they basically find software engineers that are looking for work and he had just, he was actually the featured candidate of the week.

I remember getting this email, uh, from talent.io and, uh, it said, oh, Victor Fairmont he’s just, uh, spent, uh, he had an internship in apple. Uh, he was working in an apple and Silicon valley and he’s moving back to France and, uh, you know, he was like the top candidate the week. So a lot of people were trying to, uh, convince vector.

I don’t know how I managed to convince them, but, uh, he joined my first startup saveable as a software engineer. And then I found that he’s just one of the most talented people that I’d worked with in the past ever, uh, in terms of, uh, software engineers. And so, uh, he became, uh, my co-founder and CTO on . We both had this passion for crypto.

Uh, so he was kind of the chief technical architect. Of the first solution. Um, you know, for me, I’m definitely more of the problem solver side of the equation, right? Um, yeah. I think everything that we try to do at moon page is really around solving problems. Right. And, you know, I think that’s what gets me excited.

Uh, and, and for me, it was just clearly a problem. It was hard to, uh, buy cryptocurrency on bitcoin.com or any of these other venues or wallets. And, you know, there was just such a big opportunity for us to, uh, solve that problem.

Andrew: By the way he’s not listing, um, S what is saveable on his LinkedIn profile.

Ivan: Yeah. Well, he was there, he was there for a very short period of time before we moved and pivoted like, you know, uh, into, uh, moon bay and yeah,

Andrew: All right. And so,

Ivan: that a story we should be celebrating.

Andrew: but he built, he built the whole thing, the whole first version on his

Ivan: they built, built the whole thing from scratch really impressive. We had a team of five people up until the pandemic, and then we basically went from five people to now we’re almost a hundred.

Um, so we grew the team 20 fold. And so this business story has really taken off during the period of the pandemic, uh, which is pretty crazy. Um, you know, and, and at one point, you know, I was staying up all night, you know, and, and you know, when you’re telling me about those issues before, it’s because I love hearing from customers.

I love hearing the pain points. I love thinking about how we’re going to make the project experience better. And the only way you can learn is having that really good feedback loop with a customer. So I actually. Doing customer support was super humbling. Like I spent hours and hours, uh, responding to tickets.

Uh, you know, a lot of my team compelled to remember, uh, I was in there in the front lines, uh, responding to tickets. Uh, I wasn’t as fast as some of my team now, just some of my team are absolute wizards if they need to respond quickly because obviously yeah, we’re, we’re moving, you know, they’re, there’s millions of transactions that have happened on impact. So you know, part of it is a mixture of automation, right? You have to use smart automation to help customers have a good experience, but then obviously the. personal touch when things go wrong. Right. So it’s a, it’s a combination of both.

Andrew: The issue that I had was I, I have an account, I think where I, where I, I bought Bitcoin in the past, on, on moon pay, but I said, I’m going to start from scratch. I want to see how easy it is, because I’m about to talk to Ivan. Let’s do it a few minutes before the, the, uh, well, actually before previous meeting earlier today, and I was asked for my email address and you confirm my email address before.

So first of all, it’s just a simple payment page. I love the design. You guys nailed the simplicity of the design. My eye doesn’t wander, no add fully focused, fully clear, very trustworthy. And I don’t know, I don’t know why, but I felt trust. So then you asked for my email address and go, oh man. Now my email address, first five, put my email address.

You say, go confirm the code that we gave you because we need to confirm the email address. That for some reason takes a while, even though I’m using Gmail, I lost the connection there to you. For some reason. That code sent back again. To me, that was fine. Then I had to put in my address, thankfully, that was already preloaded into my iPad.

So I could just hit a button and have a go. But then I thought, all right, now we’re looking at a real process here where I have to put a lot of information. Let’s see what comes next. And then you asked for the, for my driver’s license and I don’t have it on me because lately I don’t need to have any cards with me when I go out, everyone

Ivan: Yeah, it’s it’s, it’s super literary not to carry your card,

Andrew: so liberating and I used to have it in Evernote.

My, my, uh, driver’s license for situations where I needed to send it over. I just didn’t have it. And that’s where I was stopped. And what you’re saying to me is Andrew, we could save a lot of, we could solve a lot of problems. That’s when we can’t solve, because we need to identify you in my right.

Ivan: Yes, so that that’s, you know, unfortunate, that’s the KYC piece that I mentioned before. Right. So in the United States, um, for all customers, they’re required to provide, um, their identity documents. Um, you know, it’s, it’s, it’s, it’s tough, right. Because, you know, we’d love for it to be just like, uh, a very simple, easy, like e-commerce transaction.

Right. But, you know, just today, the nature of where it is in the United States and in different parts of the world, um, it’s becoming more regulated. Um, so, you know, there’s, there’s always that friction between, you know, trying to optimize for the conversion, right. Because obviously less screens, less fields, less information, uh, you’re going to complete the purchase now that’s just, you know, simple math. right.

Um, and so, you know, between that, and also making sure that we’re compliant with the local laws and regulation.

Andrew: Okay. And so when you said that you started evolving CA I love the word Kaizen people used to like study it years ago, back when they love the Toyota way. And when they admire the Japanese way, and then it just disappeared, like nobody cares about it. What, what, what are the improvements that you made early on?

And what’s the process that you went about to improve?

Ivan: Yeah, I think, I think it was just the, you know, the product experience even today. I mean, there’s still so much improvements that we need to have out of it. And we have, you know, we’re constantly studying, how do we make the user experience even better? Um, you know, I mean, the product has. Uh, evolved a lot, right.

More payment methods, more complexity, um, you know, in terms of being able to cover, uh, you know, different, uh, you know, all these different payment methods, as well as, you know, trying to make it more clear to customers, uh, based on certain circumstances, for example, like if you put a large amount in, we’ll give you a scam warning, right.

So at least you can know, Okay,

am I, you know, have I done everything correctly? You know, doing a little check mark, when you put in a wallet address that we recognize. Um, so all of these little touches, right? Um, so there are things you don’t necessarily even think about. Um, and that’s just born from, you know, doing a lot of, uh, focus groups and speaking to customers.

Right. And just getting a sense of what would they like to see, uh, improved. So we’re just constantly just listening to that

Andrew: you do focus groups.

Ivan: We do focus groups. Yeah.

Andrew: do you do focus groups,

Ivan: we’ve emailed customers and said, Hey, would you be open to a short telephone interview? And we reward those guys,

Andrew: one one-on-one or

Ivan: Uh, we still, we have our product managers will host them and they will do, uh, sessions one-on-one, uh, do calls and basically take notes. Uh, which is, which has been really cool.

Andrew: What’s the process that they go through with it

Ivan: uh, what, what, like, in terms of, asking someone to do

Andrew: is it just because it’s it’s I was thinking, do I show Ivan my screen? I thought, well, there’s something kind of weird about that. I think I could trust Ivan, but am I being stupid for doing it? Um,

Ivan: we’ll never, we’ll never ask you, we’ll never build for it for the purpose of this call. We will never ask you for personal or sensitive information. so if you, ever hear him in

Andrew: can you watch? Yeah, no, no, right. Let’s be clear if anyone says I’m for moon pay and I’m doing some kind of

Ivan: Yeah, exactly. That what I want everyone to hear, that’s listening to none of that, like do not.

Andrew: So, how do you do it? I feel like for, for many products you can say, share your screen, even share your iPhone screen, and I will watch you and we’ll learn.

Can you do that with Luna? Hey, can you find

Ivan: we’re not, yeah, we’re not, we’re not doing like screen sharing or anything like that. We’re just typically asking, we’re just asking questions, just behavioral questions. What do you think about it? What, what, what don’t you like? What do you like? Uh, and so it’s more, more kind of like qualitative stuff that we’re picking up.

Right. Um, you know, when we’re listening to those, like What why do you use men pay all that stuff? Right. So I think that that’s been really interesting, um, from us to, to learn, um, and, and kind of translate that into a great product experience.

Andrew: Okay. And so before what you discovered was you needed to think about distribution, right? With your previous business. How do you get the most customers? You are about to create a wallet which would have had a distribution issue. It’s a solvable issue, but it’s an issue you instead said, no, we’re now Moonpig, we’re going to be kind of like Stripe the payment system for anything that’s crypto.

You now have distributions through these sites, right? Is it, is that the large part of how you do it?

Ivan: Yeah. So, I mean, I think for us, it’s like trying to identify where do people have the intention where they’re going to want to acquire cryptocurrency? So a good example is open seat, right? Uh, people there want to acquire an NFT. They need Ethereum. They don’t want to have to go to Coinbase and basically buy their theory and then move it into their wallet and then interact with the smart contract.

They want it right there. And then, uh, so that’s one area that moon pay should be right. Another one is you’re going to bitcoin.com bitcoin.com. Obviously, if you search Bitcoin, uh, one of the very first websites that’s going to come as come up as bitcoin.com, the other ones, bitcoin.org, which we also work with.

And, uh, in both of those scenarios, people that are going there are learning about Bitcoin, but then probably have the intention to purchase. So it makes sense rather than directing that traffic to an exchange and then creating friction for the customer right there, and then it can embed moon pay and that customer can check out and get Bitcoin right there.

Andrew: And that’s what I see on their homepage. Now, if I’m on bitcoin.com, there’s, there’s a way for me to buy or sell crypto that’s you powering it.

Ivan: Yes. Exactly.

Andrew: Ah, okay.

Ivan: So, so yeah. And then, and then obviously the other big areas or all these wallets that I mentioned before. So if you searched by crypto on your phone, right. In the same way that you’re thinking about SEO on web, like you searched by crypto on your phone, there’s obviously SEO within the app store.

And you know, I think we power five of the top 10 biggest wallets today. Um,

so those, the wallets use Moonphase infrastructure, so they can top up the wallet, uh, immediately in real time.

Andrew: and so what else you hired a former CEO of a Coinbase, right? The UK guy, the guy who ran their UK operation.

Ivan: So he ran their international operation.

uh, mainly focused in UK and Ireland. Uh, but he had experience, uh, all over all of coin bases, work internationally, uh, Zetia and us. he’s an awesome guy, uh, has a really good payments background and yeah, I think we both had kind of similar visions for kind of where crypto is going next and about this kind of utility phase for the crypto economy and

Andrew: he’s your growth guy?

Ivan: So he’s our chief growth officer. Um, he first was an advisor to me. Uh, and then we found that we got on really well together, uh, and, you know, asked them to come in full-time and he’s really helping us grow the business in a sustainable way. Think about all the different opportunities, uh, that we have strategically that we want to execute on, uh, over this year and over the next couple of years.

But, you know, we’re starting to become, you know, uh, you know, it’s definitely going from. Kind of baby phase. We kinda almost skipped like the awkward teenager phase. And now all of a sudden like we’re adults. And so having more adults in the room that had been through hyper-growth before I knew that was going to be super invaluable.

And when I think about like, most of my time today, it’s all about people, right. Everything here, the way I think about moon pay is we’re, we’re trying to be like a formula one for our sports team. Uh, we want to work, uh, you know, as efficiently as possible as a team, it’s all about teamwork. Um, and I think, you know, a lot of people talk about culture, uh, and these things, and they can sound soft.

But I think in my S in my view, it’s really important that we get that right. I really think we can do a lot with fewer staff and a lot of cases. Um, we’re trying to be, you know, and be a part of the, I think it was just that bootstrap mentality, right? When it’s your own money, um, you, you just have a different mindset, uh, than when you’re given a ton of money.

And then, you know, I think a lot of companies, the big mistake is to scale too fast. And then when you scale too fast, you can lose your culture. And so we’ve tried to be really pragmatic around thinking, uh, thinking about our growth and, um, you know, the, the people that we bring into the business.

Andrew: All right. Uh, I’m going to talk about my second sponsor. And then I’m going to ask a couple of closing questions to close it out. My second sponsor is memorable. Anyone who’s selling con anyone who’s creating content Ivan online should be thinking about how do I sell it? And more and more we’re seeing platforms are enabling that like sub stack.

I don’t think member full loves that I compare them to sub stack, but I will because sub stack created this whole environment where you feel like if you want to sell your email newsletters, Town, but you know what? You could do it on other platforms, own your relationship with your customer, not pay a lot of money for credit card processing and metaphor allows you to do that and go beyond you could, you could do.

I haven’t imagined do a podcast. You do a podcast, you offer episodes for free, and then you charge for some exclusive content and members will allow you to do that. Or if you do a community where you’re doing, you’re not going to do any of these. You’ve got to focus on Moonpig. They’ll do not take your eye off this ball, but someone who’s listening to us might decide I’m going to create a community while you want to charge for membership into this community.

So you can have a good group of people and actually earn enough money to manage it. Number full will allow you to do it. Go to dot com slash Mixergy to go try that for free member full.com/mixergy bit. Mark seems to be a big source for you guys. My right bit mark.

Ivan: Yeah, they’re, they’re one of our, one of our awesome clients. Um, they have an exchange, but they didn’t have a functionality to buy crypto with your debit and credit card. And so, uh, we service that for them and that’s becoming one of the most popular, uh, payment methods, uh, for them. Um, so it’s been a, been a great partnership.

Andrew: Because you could pay by with a bank account with them, right.

Ivan: Uh, they actually were, uh, in that case, no, I, I, you know, most of their business was crypto to crypto. Um, so that’s where they started. So they actually didn’t really have many Theatro rails. And so really we were, uh, one of those solutions for them to, to enable, uh, everyday people to be able to interact with it.

If they don’t already have, um, crypto.

Andrew: Why is it so hard for you to add ACH

Ivan: Uh, so, so, so the reality is ACA, um, you know, it’s, it’s kind of like a credit card in a lot of ways in terms of a fraud and risk profile, um, because you can do ACH reversals and there’s all sorts of nasty things that can happen. Uh, you know, in terms of, uh, ACS reversals. And, you know, I’ve heard all these horror stories at a bunch of, uh, you know, businesses that turn on ACH and then were just completely clobbered by fraud.

And so we really wanted to make sure that we took our time before we launched that feature, um, to make sure that we’re doing it in a safe way. And then on top of. Yeah. We also felt that the existing solutions in the market, a lot of them take like three days. We wanted to offer as close as possible to an instant ACH product, uh, so same day.

Um, so we, you know, cause part of the big value proposition, the other reason why I think a lot of people choose to use and then pay is we’re really fast. Like I think 80% of people get their crypto under 30 minutes. Um, and so, you know, that won’t be necessarily as replicable with ACH, but we wanted to make sure speed was a important factor.

And when we turn on that, that payment method, you know, three days, isn’t going to cut it.

Andrew: And you’re actually buying it in real time for.

Ivan: Yes. So, so what we’re, what we’re doing is we’re taking on that risk. Right. And so, um, you know, that was one of the biggest problems when we were scaling the business was I remember very, very clearly, uh, kind of black Friday. We were seeing huge spikes in transaction volume and we were running out of cash.

We were out of money because essentially we had all these orders and we were out of treasury. And so thankfully I had some friends in crypto that I could call up to, you know, make some short term, uh, loans, uh, to help us. Right. And we’ve relied on that. So, you know, we were bootstrapped. Right. But we did take working capital loans, so that did help us.

Andrew: Wait, wait. So then you’re saying that first you bought the crypto, then you wait how, then you have to wait for the credit card processors to give you the money

Ivan: Right. Exactly. So, so this is the important thing. So when you, when you use your credit card, it’s not settling in real time. it

settles T plus three in most cases, right.

So it takes three days for that money to clear into our bank account. And then you add bank holidays and you add weekends, and then you’re like, Oh, God, like you need to now front a lot of cash in real time for the customers.

And so that’s one of the. The biggest pain points was coming up with that liquidity when we were going through hyper-growth. Uh, and thankfully we were able to secure, um, some help, um, to help us, you know, essentially scale that side of the business. And now what we’re trying to do is trying to get an institutional credit line.

Um, and that was challenging because, you know, banks, weren’t lending to crypto companies, right? As soon as you say crypto, although that’s starting to change that. And that’s what we’re really excited about. Hopefully getting a deal with a major bank done by the end of this year, that’s one of our key objectives and that’s going to help us obviously, uh, in terms of, uh, scaling the business and making sure that customers don’t have their orders delayed for any reasons.

But that was like the that’s the terrifying thing, you know, all these customers DM-ing me, or getting angry, sending me all sorts of scary messages and, you know, just trying to do the best that

Andrew: Did that happen? It happened because it took you too long to

Ivan: oh, it’s happened. I’m regularly DNS with people that are upset about not getting their crypto on time.

Uh, you know, if you look at Trustpilot and some of the reviews that we get. Most of them are around, you know, moon pays too expensive or moon pay is taking way too long. And, you know, I think that’s part of the challenges that you deal with in hyper-growth. And for us, we’re just trying to do it as best as we possibly can.

I really care about our customers and making sure that they have a good experience, but we can’t be perfect. We can’t please everyone, but we can just try to do our best when things go wrong.

Andrew: You know what true. I do see exactly what you said on Trustpilot it’s those two issues. Um, I was looking to see what else you’re getting your traffic. It looks like according to SEMrush, GAM, dom.com is another big user. This is an online, I guess, um, pay. I can’t see it because they won’t open it to the U S but they offer roulette and other games gambling.

Ivan: Yeah. Th th there’s some, there’s some gaming platforms that reader like basically have the link, but we’re not embedded in those directly. So we do get re random, like you’re looking at a traffic, we do get a lot of referral traffic from a lot of these platforms. Um, but yeah, that’s not really a big

Andrew: Oh, because what they do is they send people out to go get Bitcoin. They get the BA, they get Bitcoin, and then they send it

Ivan: Yes. Exactly. So, so that, that happens, right? So people say, they say, Hey, you should try out moon pay. And then they linked to moon pay. And then, uh, you know, people go to men pay and then buy their cryptocurrency. So kind of similar to like, you know, the analogy is like an ATM, right. Um, people put their debit and credit card in, you know, if they’re, I guess, on a gaming site, uh, you know, they’re going to uh, you know, an ATM somewhere taking a debit credit card, getting cash, and then going in and, you know, part of me it’s, I can’t control, uh, what they do with their money.

Right. Uh, after the fact that when they get it.

right, that would be wrong, uh, in my opinion. But, I, you know, we obviously don’t want people, uh, immediately, you know, taking all of their money and throwing it on a red or black. Uh, that’s not what we’ve

Andrew: you know, for what, from what I could see, that site seems to be operating legally, just not in the U S but I don’t know

Ivan: Right. And, and yeah, and outside the U S I think gaming and gambling, you know, that that will change. Uh, you know, I think, you know, it’s starting to change already in the United States and Europe and UK and different parts of the world. They do have tight regulation on it. It is

a, an activity that is permissible.

Um, but you know, when I think about it, it’s actually, you know, this can make it a lot Safer Um, for a lot of these websites, a lot of these websites used to be a black box. You had no idea, you know, there was no KYC, you know, whatsoever. Whereas like with Mim pay, it’s actually safer. Right? If you think

Andrew: Safer for the sites to accept money, because then they’re not risking people using their sites for money laundering,

Ivan: Exactly. Exactly. So, so yeah, and that’s the reality is like, that’s, what’s so crazy when crypto gets painted with this brush of, you know, oh, money laundering, money laundering, money laundering. But you know, the reality is if you know, the on-ramp provider, it’s our responsibility to combat that money laundering.

And we’re doing a lot of things that make it a lot safer than traditionally commerce or traditional experiences that have lived in the web before.

Andrew: Your, uh, your Trustpilot rating is actually pretty high. I thought maybe we thought with that negativity that it would be low. No, it’s, uh, you’ve got 34 plus 34,000 reviews and it’s 4.5 out of five stars. Let’s close it out with this. What’s that, that helmet in the

Ivan: Yeah. Uh, I don’t think your viewers are gonna see the video, but, uh, behind me is a helmet, uh, that is a replica. It’s a NASA replica space helmet, uh, and obviously Mente, uh, you know, we’re, we’re crazy about space and a kind of crazy story there. I don’t want to give away too much. Um, but we’re doing something with buzz Aldrin.

Um, and, uh, yeah, I had him wear that helmet temporarily. Uh, so the fact that his head was in that helmet. Uh, to me makes it super special. Um, so yeah, excited to share more of that, uh, stay tuned, uh, you know, love for you guys. If you’re listening to check us out and then pay.com, I’d love to get your feedback, uh, you know, in the spirit of Kaizen where we’re continuously trying to improve.

So, uh, you know, love, love getting feedback from, from everyone that hears and learns about.

Andrew: All right. And the reason people would go to moon pay right now is because a, they want to buy cryptocurrency and directly put it in their wallet and control it themselves. Or B. They want to accept crisp cryptocurrency as payment on their site, and they want it as easy and smooth the process. All right.

Thank you so much for doing this interview and thank you to the sous two sponsors who, uh, who made this interview happen? The first will host your website, right? It’s called HostGator. Check them out at hostgator.com/mixergy. And the second, when you’re ready to start charging for your content, when you’re ready to start really selling on your site, go to member full.com/mixergy.

I think that’s such a like boss glass. You’re drinking out of that’s a

Ivan: Oh, yeah. That’s obviously

Andrew: car guys. Yeah,

Ivan: the crystal glass.

Andrew: you’re just drinking water.

Ivan: Yeah. Just like a water that may get cool. Put sparkling water in there. Yeah. I’ve actually kind of come up alcohol to extended. I mean, I guess I, I mean every now and then, right. But I’m actually so invested in it. Uh, cannabis water drank, which is pretty cool.

It’s called Ken and it’s essentially a cannabis infused water It’s doing really well in California, but it gives you a light buzz. with no hangover. Um,

Andrew: infused water gives you a buzz.

Ivan: Yeah, cannabis infused water. I mean, it’s a, you can look it up. It’s one of my buddies from high school started it. That could be a cool interview.

Uh, I could definitely set that up if that’s interesting. I, don’t know if you cover cannabis stuff, but

Andrew: I cover cannabis stuff.

Ivan: yeah. I,

mean that, and these guys are there, you know, drink of the summer by Vogue. They have incredible celebrity sponsors. They have. It was that really famous, a YouTuber, um, Casey Neistat.

They have, uh, Gweneth Paltrow.

Andrew: are they doing with Casey Neistat?

Ivan: uh, well, he’s an investor, so there’s just this really good investor community behind it. And it’s now the number one roasting, uh, you know, can, um, in a dispensary’s and the reason why I mess it was all about distribution. Like there was not many people selling, uh, you know, Budweiser isn’t inside the dispensary.

So I was like, well, they can own the distribution and be the first kind of a de defacto brand, which they’re starting to become, uh, that could be valuable. And so, um, yeah, they’re, they’re one of the, there are definitely cool startup and it’s a interesting background of founders. They’re both, um, LGBTQ, so they both, um, are promoting, those initiatives.

And I think it’s just like a cool story for, if you, if you’re interested, I’m

Andrew: I’d love. I’d love the intro. I’d love to just, I’m not a cannabis person, but I would try it in preparation for the interview. Just to

Ivan: Oh, this is, and that’s actually brilliant because they don’t want to go after Canada’s people. what they’re trying to do is it’s such a low dose of it. It’s basically they call it social tonic. So it’s just trying to make you a little bit more sociable. It’s not to make you high. The goal is not to make you high.

There is one.

Andrew: that. Oh, I wonder if I could bring it with me this weekend. I got to try it.

Ivan: Oh yeah. I mean, I I’ve, I’ve brought that to parties and I have friends that just never smoked weed in their entire lives. And they’re like, this is awesome. Like I get it. Why? And they don’t. And the, the amazing, it kind of makes you a little bit giggly sometimes. And then, uh,

Andrew: to try it. I have to say every cannabis experience, every weed experience I ever had was just like, ah, this is it. It’s never really interesting.

Ivan: Yeah.

Andrew: fricking dispensary’s look beautiful here in San Francisco.

Ivan: Oh, they’re doing a great job.

Andrew: And for people who enjoy it, they just love it so much. They won’t shut up about it. I want to see what that experience is like.

And I’d like an alternative to alcohol also. Um, oh, I’m totally down for both of them. I guess I can come. Right. I can go to the dispensary here in San Francisco and he, one of the ones here in the mission and try to get

Ivan: can, you can try it.

happy to I’m an investor. I can introduce to Luke who’s. One of the co-founders is his background is also super cool. He used to work at, Uh he used to work at Bain. Uh, so he was a consultant in the BC in the, uh, he’s a Harvard business school guy went to Bain.

Uh, so he’s like the lot, he’d never tried cannabis before. And then all of a sudden, you starting at Canada’s beverage company and it’s because he just looked at the numbers. He saw that there was an opportunity to have an alternative alcohol. That was, that was the rationale. So it’s a cool story.

Andrew: Fricking a hell. Yeah. I’m going to follow up. I’m gonna ask you for that introduction. I’m

Ivan: Okay. I’ll do it.

Andrew: on Moonpig. I feel like you did it, dude. You did it right. Don’t you?

Ivan: That was fun.

Andrew: you can relax. I, I like that. You’re not relaxed at all. You feel like there’s like the more problems things aren’t where you want to be, but you’re also, you’re also appreciative of where you are.

Maybe it’s because you had that setback before. Maybe it’s because I don’t know because you’re riding now. Rollercoaster, not a roller coaster. You’re you’re on a rocket ship. That’s the, that’s the stupid analogy I’ll use

Ivan: Is there a rocket ship for men fav, but yeah,

Andrew: When things start to take

Ivan: Yeah. I think the, you know, think the reality for me recently, it’s like, I think we can build a bigger business than Coinbase. right. And that’s what I think that burden of that opportunity in your mind. Right. It’s, it’s a, it’s a lot, but it’s exciting.

Um, because you know, I, I really think, uh, they’ve missed the boat in some ways on this phase, two of the adoption. And so I think that could be the AOL, right. They’re competing against the Robin hood is such, I think the next version is it’s all about getting your NFTs, uh, interacting with DFI, uh, you know, doing cross-border remittances.

Um, you know, and, and the thing is we can, we’ve grown faster. So we’ve actually grown faster than Coinbase. And the reason why we did that. We didn’t have to acquire those customers ourselves, you know, we’re inside of all of these other places and, you know, w we’re we’re in, uh, we’re in one of the big, an app that is bigger than Coinbase wallet.

Right. And we’re creating all of those customers directly through there. So it’s the PayPal analogy is probably the best one because eventually, you know, it’s, um, the network effect, it’s not like there’s 10 paid files. There’s going to be one or two. Right?

Andrew: And the network effect for you comes from you being on all these platforms. They’re not going to have three different

Ivan: exactly. It’s like, it’s kind of like the Facebook login. It’s like the crypto login and it’ll be the crypto login everywhere. And you’ll be able to take, you’re not going to want to KYC a million

Andrew: That’s, that’s what I feel like is the big advantage that once I’ve given you my driver’s license, I don’t want to give it to another person. And then another person

Ivan: you got it. So that’s where the growth hack is going to come in. and that’s why we’re thinking about raising venture. Now finally is because what we want to do is kind of like PayPal, where it grew unsustainably, where they’re giving away free money to everybody. We want to do something similar and, you know, first transactions free basically.

And, uh, you know, basically that for us, once they’re KYC and we know they’re going to come back and buy more. So it’s kind of like first coffee on the house type thing.

Andrew: Oh, I see it. I see it. Imagine like Elon Musk says everyone should go buy it. And this is the place where they go buy whatever his next cryptocurrency recommendation is. Right.

Ivan: Yeah, well, we got, we support dojo now, so we didn’t have doge when you

Andrew: dojo on there.

Ivan: Yeah. Well, so I mean, deluge is a controversial one, But you know, my, my view is uh, you know, it’s not our job to be like the full, you know, part of it, is if it’s, if it’s listed by Coinbase, then we should probably support it is kind of our mindset or it’s listen, it’s done.

It’s basically passed the master of the top exchanges. And I think Coinbase has opinion now is do your own research. If you want to buy

Andrew: But is it, is it going to be the, the buy and hold place where Moonpig is going to help people buy it to hold it? Or is it going to facilitate transactions? It feels like to me, facilitating transactions is, is the big win.

Ivan: Yeah, well, it’s going to be both. We’re going to have a wallet play, uh, at some point where it’s kind of like similar to like PayPal, where you have a balance and then you can move it anywhere. You’ll have a balance, right. Because you know, the friction point is you might not want to transact right there and then you might want to transact later.

And so that’s why we got electronic money licenses, so We

can do that. So we’re going to be regulated to hold Fiat balances. So there’s, there’s lots to come in. We’re just at the beginning. Uh, you know, the, yeah, so lots of, you know, I’d love to catch up in a year’s time and, uh, you know,

Andrew: I’m down. I’d love it.