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Regan Bozman

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59
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2022-07-07
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2022-07-07
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  1. “Think it was really just like how much more output matters than input. I think definitely, especially when I was younger, just like being at the office on weekends, because I felt like it's what I should do when I probably would have been a lot more productive if I was just having fun and was a bit more focused during the week. It took me a long time to learn that. And there were a lot of wasted hours sitting in the office.”

    2022-07-07 · Capital Allocators · Regan Bozman – Defensible Moats in Crypto at Lattice Capital (Manager Meetings, 34) · IDENTIFIED FROM THE TRANSCRIPT · source

  2. “You are going to do anything, like you should do it right and you should do it really well. Venture the path here really requires a lot of, you need to be self-motivated. Your LP investors are not looking over your shoulder, drilling you each week on what you're doing. We need to get it every day and just leave it all out on the court in terms of kind of what we do. And if you're not really self-motivated, I think it's hard to do that.”

    2022-07-07 · Capital Allocators · Regan Bozman – Defensible Moats in Crypto at Lattice Capital (Manager Meetings, 34) · IDENTIFIED FROM THE TRANSCRIPT · source

  3. “My parents and like my family more broadly, I was fortunate to grow up in a pretty entrepreneurial environment, and there was never really any pressure to go be a doctor or some kind of like clear-cut path. And I think that gave me a bit more freedom to explore.”

    2022-07-07 · Capital Allocators · Regan Bozman – Defensible Moats in Crypto at Lattice Capital (Manager Meetings, 34) · IDENTIFIED FROM THE TRANSCRIPT · source

  4. “Think it's unnecessary complexity. I think a lot of people in the crypto love to reinvent the wheel and love to describe these things in just like pretty complex language. And it's generally necessary. And I think a pretty good sign that someone's full of BS.”

    2022-07-07 · Capital Allocators · Regan Bozman – Defensible Moats in Crypto at Lattice Capital (Manager Meetings, 34) · IDENTIFIED FROM THE TRANSCRIPT · source

  5. “Community is a big one. I think integrations is another big thing. You kind of think about who owns the customer relationship in crypto and it's generally wallets, MetaMask is probably, they control the user interface for 80% of people interacting with Ethereum. So it's okay, like if you are like a liquidity protocol, can you get plugged into MetaMask? Can you get plugged into the big wallets? DeFi is composable. All of these protocols can plug into one another. So can you build a relationships with other protocols where either they're paying you for your liquidity or you're able to tap into theirs? And so I think the ability to execute on BD and just go to market strategy is really important. Tokens can be a moat. Like I think if you can figure out some pretty novel token economics and just a way to lock people in, whether it's through subsidizing yield, that can also be a meaningful note, but that one is a little bit harder to sustain long term.”

    2022-07-07 · Capital Allocators · Regan Bozman – Defensible Moats in Crypto at Lattice Capital (Manager Meetings, 34) · IDENTIFIED FROM THE TRANSCRIPT · source

  6. “Or kind of user own networks, right? If you own one comp token, you are a small but owner of comp, but you own a bit of a network, you can vote on governance decisions. And these things are run really openly. There's a compound discord. I bet you could go in there and talk to the core team pretty quickly. So we tend to think of communities kind of giving leverage to the core team and everything they do. If you have a really engaged community, anything the core team is announcing, they're going to help get it out on Twitter and just post there. They're probably a little bit less mercenary in terms of selling their tokens and moving their money, right? If the core team is like hosting community calls every week and they really feel like they're kind of engaged and invested in what they're doing, then that's awesome and they feel engaged. And also, you know, a lot of these teams are not run like a corporation. There's a lot of people working part-time. And so you can actually like get the community to help.”

    2022-07-07 · Capital Allocators · Regan Bozman – Defensible Moats in Crypto at Lattice Capital (Manager Meetings, 34) · IDENTIFIED FROM THE TRANSCRIPT · source

  7. “A good question. I think in general, it's really hard. You kind of think about what companies have relied on historically and none of that really works in crypto, right? Imagine you're building a marketplace”

    2022-07-07 · Capital Allocators · Regan Bozman – Defensible Moats in Crypto at Lattice Capital (Manager Meetings, 34) · IDENTIFIED FROM THE TRANSCRIPT · source

  8. “For some number of founders, just intuitively, it's cool that you're interested in this, but I don't know that you're going to be here in a year or two doing this if the markets slide.”

    2022-07-07 · Capital Allocators · Regan Bozman – Defensible Moats in Crypto at Lattice Capital (Manager Meetings, 34) · IDENTIFIED FROM THE TRANSCRIPT · source

  9. “What we've seen in pattern matching. I think also some of that is just like, it's very subjective. It's human judgment. I saw a lot of people leave crypto during the last winter. I tried to get jobs out of crypto during the last winter. It sucked. Imagine going to meet up with some of your friends at a bachelor party or birthday and it's kind of like, oh, you're still doing that crypto thing, right? Like, didn't it die in 2018? That's really hard. It definitely wasn't lucrative then. So I think the other thing for us is someone who's like read about NFTs three months ago and thinks it's really cool and comes in and have kind of only experienced this very hyped market.”

    2022-07-07 · Capital Allocators · Regan Bozman – Defensible Moats in Crypto at Lattice Capital (Manager Meetings, 34) · IDENTIFIED FROM THE TRANSCRIPT · source

  10. “Think most of it really comes down to pattern matching. So I think maybe you could example. There's so much happening in crypto. These markets are really meme driven. It's very, very hard to break out and find attention, especially because the market is still pretty defined. If you're building DeFi product, you're realistically going after the million DeFi users. You're probably not going to bring more users in. So I think just as an example, we've seen a lot of more efficient versions of a lot of these DeFi protocols and very few of them have gone anywhere because once these teams have a narrative, once they have people talking about them on Twitter, it's just very hard to come in and break out beyond that, even if you are doing something a little bit better. So I think they're just like, we spend a lot of time thinking about what most teams have, what's their good market strategy. And the truth is very few of these projects can ever break out. So I think really anything we know is kind of just based on.”

    2022-07-07 · Capital Allocators · Regan Bozman – Defensible Moats in Crypto at Lattice Capital (Manager Meetings, 34) · IDENTIFIED FROM THE TRANSCRIPT · source

  11. “Buy something private at 20x at 20 million. It's not because we think we can sell it in six months at 100. It's just not our strategy. So I think for funds that take a long-term time horizon on a 10-year period, we're just in any one. What is the market size of the first globally accessible money market? Compound right now you can buy for about one or 1.5 billion on the open market. Long run, it's probably a lot more than that. So I think long term we remain incredibly bullish and I think for the few leaders that dominate each category in crypto, like the outcomes are really going to be pretty significant.”

    2022-07-07 · Capital Allocators · Regan Bozman – Defensible Moats in Crypto at Lattice Capital (Manager Meetings, 34) · IDENTIFIED FROM THE TRANSCRIPT · source

  12. “Like some famous saying about technology, you probably overestimate what's going to happen in the next year, but probably underestimate what's going to happen in 10. That's kind of how I look at it. I think on one hand, there are like pre-launched games that traded $8 billion valuations. And so a lot of new games then kind of get comp to that. So you have a lot of two guys who worked at Blizzard and they have like a few slides and they want to launch a blockchain game and that's going out at 100. I don't think the liquid markets will support that. I think a lot of people will lose a lot of money in the short term. Fortunately for us, maybe most of our portfolio is not liquid, so we don't know how that's going to play out. But I think in general, our decision process is like, one, we're very valuation sensitive. We don't have a big fund. We need to be very disciplined. And so I think we're a little bit protected, hopefully. And I think the second is we only underwrite things on a multi-year timeline.”

    2022-07-07 · Capital Allocators · Regan Bozman – Defensible Moats in Crypto at Lattice Capital (Manager Meetings, 34) · IDENTIFIED FROM THE TRANSCRIPT · source

  13. “So, if you think about ultimate value, however you want to measure that, you've got two different regimes, right? The regime from a couple years ago, people weren't paying attention, and now you've got a regime where, as you said, entry multiples are 5, 10x what they were. How do you think about calibrating your own expectations when you're making an investment? As on the one hand, maybe returns are just lower, and there was this incredible opportunity because people didn't appreciate the space. On the other hand, is it possible that it's just a frothy environment and people are going to lose a lot of money?”

    2022-07-07 · Capital Allocators · Regan Bozman – Defensible Moats in Crypto at Lattice Capital (Manager Meetings, 34) · IDENTIFIED FROM THE TRANSCRIPT · source

  14. “Quicker funds can't do as much diligence. It's just like structurally a much more competitive environment. In terms of what we're seeing now, I think that was probably about two or three months ago that I was kind of talking about that. I don't think it's radically different, even though liquid markets both in equities and crypto or down a decent amount, especially in crypto. There's still a ton of dry powder in these funds, and these managers didn't raise that money and just sit on it, right? It's still looking for deals. And so maybe valuations have slid a bit. Maybe these deals are taking a little bit longer to get done. But I don't think the market has changed meaningfully.”

    2022-07-07 · Capital Allocators · Regan Bozman – Defensible Moats in Crypto at Lattice Capital (Manager Meetings, 34) · IDENTIFIED FROM THE TRANSCRIPT · source

  15. “Huge amount of LP interest coming into crypto in the last few years, but I tend to think if your framework for return expectations is based on funds in that last cycle, I think a lot of LPs are going to be disappointed. And I think there's a few things that drive that. One is everything has been repriced five, 10, 20x upwards since that cycle. There were DeFi seed rounds that got done at like $5 million network valuations in 2019. Today, that would be 50 and maybe higher. So just definitionally, right? Like returns are going to be, say, 5 to 20x lower than they would be from last cycle. These funds have gotten really big, right? And it's just kind of the law of big numbers. It's a lot harder to 100x a billion dollar fund than it is a $20 million one. Just the third thing I think overall, the markets are way more competitive. Funds are getting cut back. These things happen a lot.”

    2022-07-07 · Capital Allocators · Regan Bozman – Defensible Moats in Crypto at Lattice Capital (Manager Meetings, 34) · IDENTIFIED FROM THE TRANSCRIPT · source

  16. “Background for probably the 99% of people listening who actually don't follow me on Twitter and kind of talked about how I think we're coming off of having a lot of investor conversations and it's really what drove it. But a lot of investors, the sort of saw like the flashiest crypto funds and multi coins first venture fund is probably the best example of this where a lot of managers from the last cycle, I think that fund is 80 to 100x, right? And there was actually just like a big coverage of multi-coin's first fund in this newsletter called The Generalist that kind of went into detail, right? But understandably, you're an LP, you're an asset manager, you're trying to earn the old 100 assets and you see a fund that could 100x in three years, you obviously want to chase that, right? Even if multi-coins competitors can only generate 20% of that yield, that's like way better than what you're getting in most things. So I think you've seen”

    2022-07-07 · Capital Allocators · Regan Bozman – Defensible Moats in Crypto at Lattice Capital (Manager Meetings, 34) · IDENTIFIED FROM THE TRANSCRIPT · source

  17. “And almost price themselves out of the earliest stages of the market. You look at most crypto funds call it like 2018, 2019, I think multi-coined 1KX. These guys have like 30 to $50 million. The funds weren't massive. So I think for us, we've intentionally kept our funds small. We like working at the earliest stages Lot of teams want to raise one 1.5 million dollars out of the gate if you have a $400 million flagship fund writing that $700,000 lead check in that round is just not a good use of your time. And so I think there that's kind of where we focus differently than a lot of other funds in the space.”

    2022-07-07 · Capital Allocators · Regan Bozman – Defensible Moats in Crypto at Lattice Capital (Manager Meetings, 34) · IDENTIFIED FROM THE TRANSCRIPT · source

  18. “One of it, especially when we started, was really just like driven by our backgrounds and what we had done in this space. A lot of people ask us, all right, some of our LPs, for example, want to do more direct investments. All right, like how can I do it? And the feedback we give them is like, there was so much money chasing deals right now. It is so competitive. Unless we can tell a team, you should talk to XYZ asset manager because they can help you with A, B, and C, it's not going to happen. You really should just give us money and let us do it. So for us, it's like, hey, we know this Web3 growth stuff really well. You want to launch a token, right? We've worked on four of these. We have more data planes than most people. It's really leading into the growth narrative. I think we have a deeper but a narrower focus than most funds. So it's really, that's what we leaned into. I think now maybe it wasn't obvious when we raised the first fund, but structurally, every fund has kind of gotten really big.”

    2022-07-07 · Capital Allocators · Regan Bozman – Defensible Moats in Crypto at Lattice Capital (Manager Meetings, 34) · IDENTIFIED FROM THE TRANSCRIPT · source

  19. “A thousand X bigger than it is for eGens. I also think there's a lot of markets where crypto is weird. It is like venture and it's also not because these assets can be liquid three, six, twelve months after you invest. And so I think a lot of markets where you kind of have to underwrite an exit strategy, for example, all right, like we're investing in Polkadot-based chains because we think the narrative is there's going to be a lot of hyper on Polkadot and are going to be worth a lot more in a year. You're running a trading strategy where you want to exit in and out of these positions, I think that's fine. But for us, we don't. We look at these through a venture lens. We kind of never want to sell anything. And so they are, I think, just the timeline we look at things is different from a lot of funds in the space.”

    2022-07-07 · Capital Allocators · Regan Bozman – Defensible Moats in Crypto at Lattice Capital (Manager Meetings, 34) · IDENTIFIED FROM THE TRANSCRIPT · source

  20. “Lot of DeFi has historically been in this kind of degen narrative. A lot of the people early on in these DeFi products would chase really high yields. There were a lot of hacks. It was just kind of like almost like taking this Robin Hood mainstream market mania and just pushing it to an extreme. And a lot of people made a lot of bets there. A lot of them didn't work. A lot of these protocols lost money in hacks. But I think long term, just like the market for DG Gens is not very big. There's not that many DGNs on earth. Robinhood is like sexy in the mainstream media writes about it. The people holding boring ETFs has gone up way more in the last three years than Robinhood users. So I think for us something like maple is actually a good example. It's like not that sexy. It's, hey, you can earn 15 to 20% yield on your dollar-denominated stablecoins. That's not going to get retail crypto traders jumping out of bed, but like long term, I think that market is.”

    2022-07-07 · Capital Allocators · Regan Bozman – Defensible Moats in Crypto at Lattice Capital (Manager Meetings, 34) · IDENTIFIED FROM THE TRANSCRIPT · source

  21. “We can talk about OpenSea, which is an investment I made personally before Lattice, but it's sort of broken out as the largest NFT marketplace. It's more or less like eBay for NFTs. But what's obviously different about it is all of their smart contracts are open source and anyone can see them. And I think really where what they've done well and have executed is just really building a brand as kind of this trusted place to go to. And you also kind of see these marketplace effects that have existed in Web2, right? With things like eBay or something like Uber, liquidity begets liquidity. And like they were just marketplace before NFTs blew up. And then as they started to blow up towards the beginning of last year, more and more liquidity flowed into there. And I think now they have something like 80% market share.”

    2022-07-07 · Capital Allocators · Regan Bozman – Defensible Moats in Crypto at Lattice Capital (Manager Meetings, 34) · IDENTIFIED FROM THE TRANSCRIPT · source

  22. “Are judged on is people call it TVL total value locked in smart contracts, which is more or less analogous to AUM for a fintech. And then on-chain cash flows. So for example, in Maple, a certain percent of every interest payment is more or less directed back to the Treasury, which token holders control. Again, one of the really cool things about DeFi and crypto in general is anyone in the world can go on chain and look at these metrics and make decisions based on them.”

    2022-07-07 · Capital Allocators · Regan Bozman – Defensible Moats in Crypto at Lattice Capital (Manager Meetings, 34) · IDENTIFIED FROM THE TRANSCRIPT · source

  23. “Meeple's interesting case study in that most of what we do out of our fund is private deals. We invest in companies before there's a token, we sign a contract with them, and at some point down the line they launch a token and we get it. But it's not like anyone can just do this. Meeple is different in that they'd already launched the token by the time we raised the fund. And so Maple was never a counterparty to our investment. We just looked at on-chain metrics using something like dune analytics and you could see AUM is slowly creeping up. You could see them kind of onboarding more of these pool managers. And so kind of the same way like a stock analyst would just like quarterly reports on Ethereum. You could look at this in real time and just see that all of this was going up into the right. And so we started buying NKL on the open market and we continued to do that until it was the largest position in our fund. But I think generally the core metrics that a lot of these DeFi protocols”

    2022-07-07 · Capital Allocators · Regan Bozman – Defensible Moats in Crypto at Lattice Capital (Manager Meetings, 34) · IDENTIFIED FROM THE TRANSCRIPT · source

  24. “Are going to be meaningful over the long run, and they've done really well. It's been a slog. There's been a lot of hard things to execute on, but they've done all of them.”

    2022-07-07 · Capital Allocators · Regan Bozman – Defensible Moats in Crypto at Lattice Capital (Manager Meetings, 34) · IDENTIFIED FROM THE TRANSCRIPT · source

  25. “I think their Joe and Sitter are kind of exactly the founders we like to back. I'd actually done some consulting work for them after I left CoinLesson before we started the fund. And so I knew them well. But I think good examples of DeFi got really hot at some point in 2020. But they've been working on it for a long time before that. And it really wasn't cool. It came from fixed income backgrounds. They experienced these challenges firsthand. And so it wasn't, hey, this DeFi thing seems cool. It's like see what we can build. It was really, you know, we have this relevant professional experience and we can build something better here. And then I'd say they also, I think, a lot of DeFi is kind of been these Ponzi games where you have these really high yields and this tends to be kind of what gets press attention. This wasn't that at all, right? Like they had hired institutional salespeople to bring large capital into the space. They'd kind of invested in doing the hard things that”

    2022-07-07 · Capital Allocators · Regan Bozman – Defensible Moats in Crypto at Lattice Capital (Manager Meetings, 34) · IDENTIFIED FROM THE TRANSCRIPT · source

  26. “Historically been challenging to access. Anyone can deposit money into these pools. I think the second really interesting thing is Maple uses their native token MPL to kind of align all of the incentives in this ecosystem. So for example, these money managers who manage each pool, they actually have to buy MPL tokens and basically stake them as a default insurance in each pool, right? So they were kind of incentivized to take on the same risk that anyone in their pool is taking on. And then still a relatively nascent part of Naples business, but I think an area”

    2022-07-07 · Capital Allocators · Regan Bozman – Defensible Moats in Crypto at Lattice Capital (Manager Meetings, 34) · IDENTIFIED FROM THE TRANSCRIPT · source

  27. “So that was kind of one of the first wow moments of these globally accessible permissionless money markets. It's not just an academic thing. This actually is pretty real. A portfolio company we have that's been doing really well is called Maple. And so Maple is basically an on-chain credit marketplace. They function on top of Ethereum. People can go in. They can deposit money into lending pools. Each pool is managed by a professional money manager. So right now most of those are quant crypto funds. Block tower is a prominent crypto fund that has their own pool. And then those money managers lend money out to institutional clients. So large crypto exchanges and trading firms like Alameda Research all borrow there. What's interesting is one anyone can kind of become a liquidity provider, lend money out on these platforms, right? So this sort of like fixed income asset class.”

    2022-07-07 · Capital Allocators · Regan Bozman – Defensible Moats in Crypto at Lattice Capital (Manager Meetings, 34) · IDENTIFIED FROM THE TRANSCRIPT · source

  28. “Absolutely. So DeFi is actually kind of one of the first things that got me really excited about crypto. I was pretty cynical about crypto for the first year or year and a half. I worked in it. And definitely a cynicism that in retrospect cost me a lot of money. But I met two founders of this thing called InstadApp. I want to say this was like early 2019, two young guys in India. They were probably 19 or 20 at the time. And they basically just built a smart contract to kind of help people optimize their earnings in DeFi. But they shipped this in a few months and there were like 20 or 30 million dollars flowing through these smart contracts. And I think to me that was kind of one of the first illustrations of like, wow, these kids who have raised zero dollars have been able to ship a financial application in three months. And there's 20 to 30 million dollars that's flowing through.”

    2022-07-07 · Capital Allocators · Regan Bozman – Defensible Moats in Crypto at Lattice Capital (Manager Meetings, 34) · IDENTIFIED FROM THE TRANSCRIPT · source

  29. “This. So, that could be something like a company bringing real world identity on chain. It could be people making it easier to stake assets, things like that.”

    2022-07-07 · Capital Allocators · Regan Bozman – Defensible Moats in Crypto at Lattice Capital (Manager Meetings, 34) · IDENTIFIED FROM THE TRANSCRIPT · source

  30. “Kind of look at the market in four categories there's DeFi, select blockchain based financial products, a good example of that is a decentralized money market like Compound, which probably let's say has a few billion dollars of Ethereum-based assets in it on a given day There's NFTs in gaming so that could include something like digital art being traded in a marketplace like OpenSea that could include kind of a blockchain based game like Axi Infinity The third is like Web3 more broadly and crypto has kind of become renamed as Web3 so this is like maybe a bit confusing But I think just historically decentralized software So DAOs these like internet native organizations and companies would fit into that token powered marketplaces or something like Helium which has kind of used token incentives to bootstrap this 5G network I would include in that and then the fourth is just infrastructure that powers all”

    2022-07-07 · Capital Allocators · Regan Bozman – Defensible Moats in Crypto at Lattice Capital (Manager Meetings, 34) · IDENTIFIED FROM THE TRANSCRIPT · source

  31. “Look at this market, what's worked, what hasn't, do we think these founders are exceptional? Let's backchannel some of their early customers. Let's talk to teams building this ecosystem who knows them. I think that really looks like traditional venture. On the other hand, if we're looking on something on the open market, then it's much more analytical and data-driven, looking at what retention has been where our earnings and like TVL going, what do comparable things trade at on the open markets, what are those multiples, and so for the 10 to 20 percent of investments we make where we're buying liquid assets, that looks a lot more analytical and research driven.”

    2022-07-07 · Capital Allocators · Regan Bozman – Defensible Moats in Crypto at Lattice Capital (Manager Meetings, 34) · IDENTIFIED FROM THE TRANSCRIPT · source

  32. “Think it depends whether or not it's live or not. At the earliest stages, most of these things are not deployed on mainnet. There's not really any analytics. And so I think that really looks kind of like traditional venture.”

    2022-07-07 · Capital Allocators · Regan Bozman – Defensible Moats in Crypto at Lattice Capital (Manager Meetings, 34) · IDENTIFIED FROM THE TRANSCRIPT · source

  33. “What's really foundational about that is this is kind of the first timing marketplace it's been able to use equity, in this case it's programmable equity, it's a token to incentivize supply-side growth. And so I think there's a lot of marketplaces that haven't worked in a traditional paradigm that will here. And so we spend a lot of time digging into this, and that got us really excited about it. And then we invest in a company called Demo that's doing this for automotive data, where they basically make this little dongle that you can plug into your car. It streams a lot of data out of that. And again, there's no demand for data for the 10 priuses on day one. They have to subsidize that supply-side growth, but they've been executing really well and we think can be a big market. And we've started to look at more and more companies with this model.”

    2022-07-07 · Capital Allocators · Regan Bozman – Defensible Moats in Crypto at Lattice Capital (Manager Meetings, 34) · IDENTIFIED FROM THE TRANSCRIPT · source

  34. “In people's homes and IoT devices could kind of leverage that data. But that, like every marketplace, had this cold start problem. You're not going to have any demand at the start because there's no supply, there is no network. So how do you get people to actually install these things before there is latent demand? And they kind of pioneered this model where basically they have this native token called HNT and they kind of subsidized growth of initial hotspot deployment with it. So if you bought a helium hotspot in, I think 2019, they started rolling them out. Probably not many people were actually using that data, but you were running HMT just rewards from having it. And as the network grew, the price of H&T went up. And I think more or less people who kind of had those early hot spots are sitting on 50,000 to $100,000 in HMT. And so you kind of really aligned the release supply side users with the overall marketplace growth.”

    2022-07-07 · Capital Allocators · Regan Bozman – Defensible Moats in Crypto at Lattice Capital (Manager Meetings, 34) · IDENTIFIED FROM THE TRANSCRIPT · source

  35. “So, for example, neither Mike nor I are traders very deep trading infrastructure for institutional clients. It's just a little bit outside of what gets us excited. I think in terms of idea generation, a lot of it has just been looking at what's worked in crypto and trying to just mentally expand that out to what else could work. So I think a good example is Helium, which I mentioned earlier. It's more or less a decentralized mesh network, a 5G network where they basically manufacture these hotspots. Anyone can install it in their house. And it's very like low bandwidth data. And so it's generally like IoT devices that are consuming this. At a high level, essentially what they did, I think these guys started working on this in 2013 or 2014. They wanted to build this just like distributed network where rather than installing these very expensive cellular towers, you could just have hotspots.”

    2022-07-07 · Capital Allocators · Regan Bozman – Defensible Moats in Crypto at Lattice Capital (Manager Meetings, 34) · IDENTIFIED FROM THE TRANSCRIPT · source

  36. “It's definitely not rocket science. I think it's really just like pattern formation examples of things that immediately disqualify something for us. One really short lockup period or something where the team is going to have tokens liquid in three or six months. We are not traders. We want to underwrite these investments for a multi-year period. And so it's just not something we do. Teams without strong technical backgrounds. I think teams kind of building an incremental improvement. So maybe, okay, like we're building this lending platform that's like compound, but we do X and Y, and so it's like 20% more efficient. All of the software is open source. And so generally our view is kind of okay. Well, like if this actually is an improvement, Compound could just do this. And then I think there are some categories that either we dislike because we think they're bad markets or just given our backgrounds, like they're probably not the most interesting to us.”

    2022-07-07 · Capital Allocators · Regan Bozman – Defensible Moats in Crypto at Lattice Capital (Manager Meetings, 34) · IDENTIFIED FROM THE TRANSCRIPT · source

  37. “I'd love to go through a little bit of your investment process and maybe start with idea generation. I can only imagine that every message you get is some new project on wherever it's coming from, your email, LinkedIn, Twitter, and how do you start thinking about filtering through to where you want to focus?”

    2022-07-07 · Capital Allocators · Regan Bozman – Defensible Moats in Crypto at Lattice Capital (Manager Meetings, 34) · IDENTIFIED FROM THE TRANSCRIPT · source

  38. “I think we look at things through a pretty classic venture lens, which is really that it's about people and tenacity more than anything else. That's not to say the token design, the market, what blockchain I'm building on, all of these things matter. But I think for us, a lot of the successes I'd had personally, like I mentioned, OpenSea and Doon Analytics, where on paper, these are really good investments. No one cared about those companies for a long time. OpenSea was like not a breakout hit for at least two years after they raised a seed round. And my perspective is crypto has been really hot since we started the fund. I don't think that's going to last forever. These markets have historically looked like bubbles, and I think they'll continue to be, although long term, I think the trajectory is going in the right direction. And so it's really founders who have the tenacity and grit to kind of build through multiple cycles. They're going to be the ones who build meaningful businesses. And so that sort of been.”

    2022-07-07 · Capital Allocators · Regan Bozman – Defensible Moats in Crypto at Lattice Capital (Manager Meetings, 34) · IDENTIFIED FROM THE TRANSCRIPT · source

  39. “But I worked on 30 token launches, and my co founder, Mike, who I worked with at CoinList, had a similar experience. That's really relevant to companies. And there just weren't many investors with that background. And I think that third thing is it hadn't really been obvious whether or not we were good investors. And I think the juries actually still out on that, given how early the fund is. But some of the personal investments I've made and Mike had made sorted to do well. And that kind of gave us the confidence to go out and raise the fund. And that includes early bets on things like OpenSea, doe analytics, where big venture funds came in and marked these up pretty meaningfully. And that kind of gave us the confidence to go out and try to institutionalize what we were doing.”

    2022-07-07 · Capital Allocators · Regan Bozman – Defensible Moats in Crypto at Lattice Capital (Manager Meetings, 34) · IDENTIFIED FROM THE TRANSCRIPT · source

  40. “Are more and more important as a lot of these kind of hard technical scalability problems got solved and very few investors really seem to have this capacity to help teams with it. I think the second impetus was I'd seen a lot of colleagues from Angelists leave to start venture funds based on their specific experience. So Rihanna Hoover, for example, who is the founder of Product Hunt is a good example, he'd spend a lot of time at the forefront of like consumer tech just running Product Hunt. And he ended up raising this fund called Weekend Fund, largely based on that experience. And it made sense, right? Like there's a lot of reasons why he should be a good consumer investor. But you haven't really seen that in crypto yet. Generally, investors fell into three camps. They came from venture. They came from finance, or they just gotten rich in crypto and were institutionalizing what they were doing. And there's good investors in all of those categories.”

    2022-07-07 · Capital Allocators · Regan Bozman – Defensible Moats in Crypto at Lattice Capital (Manager Meetings, 34) · IDENTIFIED FROM THE TRANSCRIPT · source

  41. “Left QueenList in basically the beginning of 2021. I had been there for a long time. I'd learned a ton, but I think as Quinless business continued to scale, a lot of the problems we had, especially on the business side, were scaling problems rather than crypto native problems. So for example, we're going from, let's say, 5,000 people participating in any token offering to 100,000. How do we get our compliance process a lot more efficient to get them through that? And I really wanted to go work on more crypto native problems. So I left. I wasn't sure what I was going to do. I started consulting with a few projects on kind of growth and go-to-market strategy. Some of that was kind of token launch, like similar to what I've been doing. Some of it was more just broader business strategy. But what I saw was a lot of the introductions I got to companies I was working with came from their investors. And so it became more and more clear to me that all of the growth problems of Web3”

    2022-07-07 · Capital Allocators · Regan Bozman – Defensible Moats in Crypto at Lattice Capital (Manager Meetings, 34) · IDENTIFIED FROM THE TRANSCRIPT · source

  42. “Coin list had their exchange of common route would be you would invest, you would get your tokens in a third party wallet, and then you would like to take them to another menu like Coinbase to trade. But today, Coin must actually has a pretty large exchange, and you can do all of these assets natively within it. So they've kind of built a pretty meaningful business around just financial services around crypto, but really starting with this primary offering of tokens.”

    2022-07-07 · Capital Allocators · Regan Bozman – Defensible Moats in Crypto at Lattice Capital (Manager Meetings, 34) · IDENTIFIED FROM THE TRANSCRIPT · source

  43. “Yeah, so when Quinla started, it really was kind of like Angelist for crypto. It was like, we're going to help you with your initial fundraising. And then that's kind of it. And so it looked very different from Angelist in that we did many fewer deals where they tended to be much larger ones. Filecoin, for example, raised $250 million, where let's say the average rounder angelist was like a $500,000 seed round. But it really was a similar business. But since then, Quinlist has evolved a lot and the vision always was if you start with like the primary offering, you're kind of like upstream from everyone else. So for example, once you do the token sale, where are those tokens going to go? You're actually ahead of any other wallet. It's much easier for people to just receive tokens within CoinList. And then, well, what can you do with them? You can actually build a lot of financial services on top of that. You can provide native staking. You can allow people to lend their assets from a trading perspective.”

    2022-07-07 · Capital Allocators · Regan Bozman – Defensible Moats in Crypto at Lattice Capital (Manager Meetings, 34) · IDENTIFIED FROM THE TRANSCRIPT · source

  44. “Things they did was look through the sales funnel we had. We had this pretty bad type form on the website and it was just like, hey, if you're interested in working with us on a token sale, give us some information. And I think when I started, like literally no one had ever opened this. And when I opened it, there were about 2,000 inbound needs. And there were everything from like, we want to raise half a billion dollars to fund a hotel space to actually some kind of like Web 2 companies that hadn't.”

    2022-07-07 · Capital Allocators · Regan Bozman – Defensible Moats in Crypto at Lattice Capital (Manager Meetings, 34) · IDENTIFIED FROM THE TRANSCRIPT · source

  45. “I would say it was maybe out of every 100 teams, two were pretty incredible. Filecoin protocol labs, which is like the parent company behind it, they'd already shipped it IPFS, which was like this pretty impressive decentralized storage platform, really impressive team of technologists. And the vision for Filecoin was really quite meaningful. Then maybe there'd be another team like that. And then there'd probably be another 98 teams that saw like the local Fox News story about the kid they went to high school with who raised $10 million in an ICO for a hotel chain or some crazy token rewards platform for dentists and kind of like everything in crypto. It's a little bit of the Wild West. And so there were just a lot of people trying to make a quick buck. I was the first employee to jump over from Angelist to CoinList. And when I started one of the”

    2022-07-07 · Capital Allocators · Regan Bozman – Defensible Moats in Crypto at Lattice Capital (Manager Meetings, 34) · IDENTIFIED FROM THE TRANSCRIPT · source

  46. “And so it was just almost kind of flipping all of the fundraising assumptions that had existed in Venture on its head. And so CoinList really started as this angelist-like business, basically building this platform around primary offerings of tokens where compliance funding, all of this stuff was just kind of abstracted away so that teams could do it pretty quickly and then get back to work.”

    2022-07-07 · Capital Allocators · Regan Bozman – Defensible Moats in Crypto at Lattice Capital (Manager Meetings, 34) · IDENTIFIED FROM THE TRANSCRIPT · source

  47. “Lot of venture capitalists do, which basically says your core business needs to be equity in private companies. And so it kind of had to be done. The crypto stuff had to be done through a different entity. There were also pretty different business dynamics in primary offerings of tokens versus seed, series A startups raising money, right? Generally, when I saw those financings done at Angelist, for example, people wanted to be done very quietly. No one is like out there publicly raising a seed round. There's like private metrics. They don't want their competitors to know what valuation they raised at. And maybe a seed round has 10 to 20 investors. Crypto almost flipped this on its head where Filecoin, which was the biggest token sale of that era and was like the first one CoinList did had, I want to say $2,000 to $3,000 investors and everything was public, right? From like the technology to the token economics to like the valuation.”

    2022-07-07 · Capital Allocators · Regan Bozman – Defensible Moats in Crypto at Lattice Capital (Manager Meetings, 34) · IDENTIFIED FROM THE TRANSCRIPT · source

  48. “So, this is like summer 2017. Angelist core business is around capital formation, right? They've kind of built this marketplace where capital going into early stage startups. They've built some pretty cool network effects where there's a lot of LPs on the platform. There's a lot of founders. And then just a lot of things, whether it's like moving money around, signing documents forming companies, cap tables, they've kind of productized a lot of this. CoinList, the idea was really driven by Evol Ravicon, the founder of Angelist, who's been into crypto, I want to say, since 2012 or 2013 for a long time. And 2017, the market was starting to heat up. There were some of these ICOs, this idea that you could bootstrap capital for a new business through the sale of tokens was becoming a bigger and bigger thing. And I think there were actually pretty legitimate regulatory reasons as to why it did not make sense to do this in HList. The details are not very interesting, but essentially Angelist uses an exemption that”

    2022-07-07 · Capital Allocators · Regan Bozman – Defensible Moats in Crypto at Lattice Capital (Manager Meetings, 34) · IDENTIFIED FROM THE TRANSCRIPT · source

  49. “I would say, why did you pass on this and why are you sending it to me if you did? But if there is a book I hadn't read it, and so I didn't know that at the time. But I do think it was a valuable experience. I mean, I think it gives me a lot of empathy now where I get to sit in an office all day and talk to people. And it's not my livelihood on the line if I say no. And so certainly I think having a huge amount of respect for founders time and recognizing their job is a lot harder than mine was definitely a valuable learning experience.”

    2022-07-07 · Capital Allocators · Regan Bozman – Defensible Moats in Crypto at Lattice Capital (Manager Meetings, 34) · IDENTIFIED FROM THE TRANSCRIPT · source

  50. “To be honest, like it was really just hard, I think. I've only been on the other side of the table in a post-COVID world, so I don't know what it was like then. But, you know, it was, hey, yeah, why don't you come out to San Francisco and meet us, right? And I had like very little cash at the time. And so it's kind of like, all right, I'm just going to buy a plane ticket and crash on a friend's couch. And hopefully this like 30 minute coffee chat is worth me flying $2,500. It was hard. I get why they said no, right? I was like a solo founder. I wasn't technical. I think the sentiment around this general market of on-demand services was also kind of declining. I also made a lot of tactical mistakes now. For example, that I know now. Like a lot of investors would say no and then like, oh, well, but you should talk to this person, right? And I think now I see it on the other side of the table. If someone passed on an investment and it sent it to me.”

    2022-07-07 · Capital Allocators · Regan Bozman – Defensible Moats in Crypto at Lattice Capital (Manager Meetings, 34) · IDENTIFIED FROM THE TRANSCRIPT · source