A fascinating story of making a $300K investment into $2.4Billion

Do you know Garry Tan? If you don’t, you should. He is the Co-founder and managing partner of Initialized Capital, an early-stage venture capital fund that was earliest in Coinbase and Instacart.

I think you have heard about Coinbase. Coinbase is a platform that makes it easy to buy, sell, and store cryptocurrencies like Bitcoin and others.

Garry Tan was one of the early-stage investors of Coinbase. He founded the company in 2012, and now he is a billionaire! Recently in a video, he has described the amazing story of investing in Coinbase.

It was March 2012. Brian Armstrong, the founder of Coinbase, sent an e-mail to Garry Tan. He sent .05 BTC to Garry through his new startup Bitbank. This interesting mail got the attention of Garry.

Brian’s vision was simple. Making a clean wallet for buying and holding for bitcoin. Bitbank later named after Coinbase.

Bitcoin’s total market cap was less than $1 Billion, and now it’s worth more than $1 Trillion. That .05 BTC Brian sent was valued at only 2 cents then. And Now!! You can calculate!

Right after sending the bitcoin, Brian sent another mail to Garry. Asking for finding a co-founder for his company from Garry’s network. Garry replied with a wonderful suggestion. Garry wrote him the following message:

The hardest part about finding co-founders is actually you probably already have people you’d like to work with, but they might be doing other things. Part of being a great founder is being able to show people that what this could be is much bigger than what else they’re doing. It’s about transferring your belief in a market and a product to others.

Brian is an extraordinary founder who could really see the future. He was the sole founder of building something brand new.

No one believed in Bitcoin back then. But fortunately, Garry heard about Bitcoin much earlier.

He was primed for the problem

He knew how hard it was to buy bitcoin back then. After hearing about Bitcoin in Hackernews, he tried to buy some bitcoin on mtgox.com.

It was a terrible experience for him. The horrible user experience, bad design made him realize that it couldn’t be the platform that could bring bitcoin all the way.

He was primed for the idea (An essential understanding)

Here, you can learn about Garry’s knowledge and his visionary mind. He believed that fiat currencies might fall.

Fiat money is a government-issued currency that is not backed by a commodity such as gold. Fiat money gives central banks greater control over the economy because they can control how much money is printed. Most modern paper currencies, such as the U.S. dollar, are fiat currencies.

In 2005, He was an engineer working on software for Peter Theil’s hedge fund “Clarium Capital Management”. Every employee had to read “The Dollar Crisis” by Richard Duncan.

He learned about the madness that happened in 1971 from that book. In 1971, Richard Nixon took the United States off the gold standard. You can no longer trade your dollars for gold at that time.

Dollars were already the reserved currency of all other central banks, suddenly became a fiat currency, printable at will.

Can you imagine that 25% of all dollars in circulation today were printed just in the last year, in 2020, thus bitcoin?

As Louis Pasteur once said,” Chance only favors the prepared mind.”

Garry was prepared for this idea when it came.

Brian was a builder

“Founder” is one of the most important parts of every startup. A good founder can make a company 0 to 100 and vice versa.

The founder of Coinbase, Brian was a great founder, a builder. And Gerry loves funding builders. It was very powerful for Brian to build that first version of Coinbase and, most importantly, secure it by himself.

Security is a fundamental issue here. With Physical banks, you protect physical money with physical bullets. But with internet money, you protect it with great software engineering and secure systems.

Why Brian was the perfect person to do it? Because he already had a perfect experience in security. He was an engineer and head of antifraud at Airbnb. Antifraud at Airbnb was actually like being part of the special forces.

Brian had been put through the paces by hackers daily. Garry’s direct words about Brian is:

It takes that kind of builder to walk away from that kind of opportunity to show you what the real future will be. That’s what Brian did for me.

Send smart and super compelling email

When Brian sent Garry a .05 bitcoin, it was worth only 23 cents, but he sent him free money!! It got Garry’s attention, and it also showed how serious Brian was!

If that mail was any normal mail, it might not even get Garry’s attention! So take time and send a super compelling email to your potential investors or even customers!

Do something different

Can you find something that is fringe but ultimately right? Is there something from history, or psychology, or first-principles bottom-up thinking that can help you justify your crazy idea and why it’s going to take the world by storm? Then Do It.

If you don’t start, someone else will

Sooner or later, every crazy idea will have its day. But only if it has a truly compelling pitch.

Don’t wait and see someone else is working on your crazy idea.

Be a builder

Build something. Something great!

The more you can do, the less you leave to chance. Then you will see more people will want to fund you, join you, or use your product or service.

Do those things yourself to the extent you can.

Resource: Garry Tan’s video

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Source: https://medium.com/business-teaching/how-garry-tan-gets-a-6000x-return-on-coinbase-ac2be7c39705?source=rss——-8—————–cryptocurrency