On The Brink with Castle Island - Tony Scuderi (Imperii) on Crypto Banking and Advisory (EP.388)

Episode Date: January 18, 2023

Tony Scuderi, the founder of Imperii Partners joins the show. In this episode we discuss: The investment banking landscape for crypto/blockchain companies. How the fundraising environment is evolving in 2023. The impact of FTX on the broader market. How companies backed by FTX are taking action. The M&A landscape. Common pitfalls that founders make when selling their business. To learn more about Imperii Partners visit imperiipartners.com  

On today's show, I sat down with Tony Skidari, the founder of Emperry Partners. Imperi is a global crypto-native investment bank and advisory firm. In this episode, we talked about the landscape for capital raising and M&A, as well as some of the implications for the FtX fraud. I enjoyed this episode, and I think you will too. So without further ado, here's my conversation with Tony Skidari. Matt Walsh and Nick Carter are partners at Castle Island Ventures. All of these expressed by them or the guests on this podcast are solely their opinions

and do not reflect the opinions of Castle Island Ventures. Guests and host may maintain positions in the assets discussed in this podcast. You should not treat any opinion expressed by anyone on this podcast as a specific inducement to make a particular investment or follow a particular strategy, but only as an expression of their personal opinion. This podcast is for informational purposes only. Brought down by bad mortgage investments, Lehman, which has 25,000 employees, will be liquidated. The federal government loans American International Group, AIG, $85 billion. This is a different kind of market, and the Fed is asleep. The federal government is stepping it to stabilize Fannie Mae and Freddie Mac, the two mortgage giants that have been threatened by the house.

housing crisis. The bank of England has pumped 75 billion pounds more into Britain's ailing economy with a new round of quantitative easing. You print a couple trillion dollars and all of a sudden people start to worry. So out of this worry, we have something called the Bitcoin. Tony, well, thanks so much for joining us today on the podcast, Under the Weather as you are. No, it's my pleasure. Thank you. Well, I want to talk a lot about just what the landscape looks like for M&A and for just general advisory businesses in the space. But before we do, why don't we just hop into how you got into the space. Tell us a little bit about your company. Yeah. So I guess if you want to go

the quick Genesis story, I was a 14-year Wall Street guy, worked for a financial sector specialist investment bank back in 2013 and 2014. I was doing a lot of work on payments and we thought this Bitcoin thing might be something, this crypto thing might turn into like payments rails. You know, could that be something that competed with MasterCard and Visa or things like that? And I just thought Bitcoin was super interesting, given what we'd gone through in the financial crisis and what central banks around the world have been doing for 45 years or so, I thought this is really interesting. I became kind of the crypto guy at my old firm. And, you know, very little that you can do with that on Wall Street. So ultimately, in 2018, I decided to even pursue crypto full time.

And ultimately, we were able to form Empry in 2019. I think we're one of the few, if not the only, crypto-native investment bank and advisory firms, and certainly the only one who's got the now distinction of having a registered broker dealer in house as well. So we're proud of some of those accomplishments, but most proud of, I guess, at this point about a dozen deals that we've completed on behalf of our clients to help them grow

and drive our industry forward. So a lot of people have heard of investment bankers, but maybe have not had firsthand experience working with them. So maybe just as a little bit of background, what are the products and services that an investment bank does? And within crypto, what does that mean? Yeah, so it's a really simple business. The core of why we set this up was M&A right there.

In every other industry, there are dedicated advisory firms for that industry that really understand the businesses and have relationships with really everyone in the industry from investors to potential strategic partners. And so to be able to connect those dots and understand what are the major financial and strategic initiatives that could affect your firm, what should you be thinking about on the lookout for and how should you execute on those. And so like from a broad perspective, you know, that's what we do. On the M&A side, it's that, you know, when is the right time to sell? You know, we're typically a sell side advisor. So it's that founder who's never been through something like this before or maybe has. But if they have and they're smart, they hired an advisor. to really understand, you know, what are my options? And if this is the best partner, even if I'm, you know, really in love with this company that just dropped a term sheet on my desk that's going to make me wealthy and they're making me feel really good here, do I just take that deal or do I really seek to understand and then get into the terms and then drive that to completion? Because I think what so many people probably don't understand are maybe the biggest blind spot for founders is how few of these deals actually happen from the point where, you know, you

even a term sheet, even sometimes much later stage definitive documents happen that we actually progress to a close. And so a lot of pitfalls along the way there. And our job is just to make sure that, number one, the founders have visibility and they understand, you know, what really are my options, both with this potential buyer and or with others. And what's the market look like? What does this look like if I pivot and just raise strategic growth capital and wait it out another couple of years? What's happening with other industries who want to get into crypto? will they be acquiring for companies like mine anytime soon and should I hold out for a better deal? It's providing some context and visibility to all those things.

And then once we've decided, hey, we really want to go forward with this partner, there's a long process of going through terms in great detail to get the right deal for our clients. That's a great explanation. So we're recording this in early 2023. 2022 was probably the most catastrophic year for the crypto industry. if you look at just the number of bankruptcies, the number of fraudulent actors that were revealed, and just generally the sentiment of the market. How does that impact what we're going to see here in 2003 from an M&A and a capital raising perspective? Yeah, well, it's obviously going to have a tremendous impact.

And I guess just a comment on that is the way we set ourselves up is for, you know, long term to be aligned and tied with the success of this industry. And if we execute well for our clients and this industry turns into even half of what we imagine it can be, we're going to do extremely well. So we're set up to survive, you know, no matter what happens and to be able to help our clients, whether this winter lasts another five years or longer, we'll still be here. So, and we expect it to take a long time. And some of the things that happened in early, you know, in late 21, early 22 in terms of the evaluations exploding, all kinds of traditional players come to the market, that's not

necessarily healthy all the time either. And it creates challenges for investors. it creates challenges for us, and it creates a lot of very short-term focus rather than kind of long-term. So this is a great time for, I think, all the companies in our industry to think about what their long-term goals really are and how they're going to execute on those. And, you know, we're helping clients do that today. And so, yeah, that's what you can do. You can control what you can control. You survive. You protect the core of your business. And you think about what are the strategic milestones you want to accomplish over time and go to work and execute on those. So,

So that's what we're doing, doing on behalf of clients. There's going to be some opportunistic things along the way for sure. And there's a few of them that we're working on today. But generally, I mean, you know this. The VCs are going to look at their books and try to protect a couple of the companies they think are winners if those companies come back to the market and be in a position to do that. So, you know, new capital, new investors are going to be harder to come by for at least a couple of quarters here.

And then we'll see. So FTCS is just the big story of 2022, unfortunately, from the perspective of having raised so much money from reputable firms, having done a lot of public partnerships. How do you see that specifically being digested by the market? It's just the fallout of FTCS and the impact that that will have? Well, there's going to be a lot. I mean, it touches so many things, touches regulation, it touches politics. it certainly touches capital markets trust centralization versus our decentralized protocols, portion of the industry. So, I mean, I think initially, like what you've already seen,

I haven't actually looked at this part, but I bet you, you know, ledger sales are up quite a bit. And so you're going to have that sort of distrust of things that are centralized. And I think sometimes coming from where I came from, the traditional financial services industry, everything is centralized and also heavily regulated. And yet we had Lehman Brothers. And so it's it's not like regulation is a panacea or a solution to everything. It can help. You know, there are things that happen outside of regulation that can be avoided.

And we do want to create hopefully a thoughtful framework around that. But there's a lot here. The main thing is one, there's fraud. Fraud can happen anywhere. We haven't seen anything like this since Madoff. Madoff is very highly regulated company. And so I hope we don't lose sight of those things. But yeah, I'd say it touches on virtually kind of every part of certainly our business.

It affects virtually every company in our industry. It creates this really, I'd say an additional layer of distrust, not only in centralized organizations, which we need, by the way, to create these bridges for adoption in our industry generally. And we'll probably persist no matter how promising the decentralized world is that we all believe it is. But we need those bridges, and now the outside world kind of looks at crypto, I think, with even more distrust and will for some time. And it's pretty unfortunate because it really boils down to a couple of bad actors. But look, we're all going to bear this burden and everybody who's dedicated to this industry, like it or not.

We have to deal with it. So we're less focused on what happened at this point, then how do we push the industry forward? How do we create more trust in our centralized organizations? and how do we highlight the promise of decentralization and the things that we can accomplish there? So that's what we're doing. That makes a lot of sense. One of the things that's interesting if you really start to dig into some of these FTX shenanigans and just outright crimes that were happening is some of the manipulation around the tokens.

So token deals that they were invested in that said that they had certain investing schedules and now we can see on Chan that FTX or Alamedo was getting the tokens earlier. There's also the FTT token, which it looks like in Q2, they just printed a bunch out of thin air and started to use that. What do you think this looks like going forward for companies that have done a token or closely affiliated with a token? Does that complicate the eventual M&A or public offering of a company like that if they have this token on the balance sheet that is kind of hard to wrestle with, hard to contemplate how it fits into a preference stack? The answer is it shouldn't because to us it's relatively simple. It comes down to governance and accounting and things like that, right? There's no reason that this cannot be executed in a really compliant and transparent manner. Fraud is fraud. They were doing things that they didn't tell

anybody they were doing, right? And we didn't have a way to audit that. And so we didn't have the transparency there and they obviously didn't have any reasonable government. It's not to say can't happen. We've seen it happen many times on Wall Street, Main Street, and beyond. And anytime you have human beings, you have this opportunity for malfeasance. But there's no reason why we can't create the right framework and governance and transparency in these things. And so I'm glad you mentioned that because one of the things that we're certainly working on, probably more on the, you know, in the tokenized space and, you know, especially around deeper tech earlier stage protocols where they're, they're not yet liquid.

They've not made it to a retail distribution yet. They probably have some really high quality investors, but now there's this dark cloud over our entire industry, right? And they've got to somehow navigate this last mile, if you will, until, you know, that retail distribution and regain credibility somehow. And so we have a plan in place to help those projects do that, regain that credibility and get, you know, and achieve that kind of retail distribution and meet their goals at that distribution that they're looking for. You know, and part of that, though, is to create and

recreate that trust and governance and transparency to make sure that the market can have confidence going forward. You know, we need these things and it's, you know, there are plenty of parallels to Main Street and financials and Wall Street and how we do things there and how we instill confidence in markets or re-instill it when it's disrupted. So it's relatively simple stuff, but yeah, it comes back to, you know, governance, compliance, transparency, these sort of things that will give investors trust and confidence back again. One of the reasons this has been so difficult for companies and projects that have a token is just the lack of regulatory clarity in the United States over things like who oversees the spot market. Are these things securities

or are they commodities? How do you actually comply with certain frameworks? here. And as a result, you just haven't seen as many, I would say, traditional companies enter, traditional financial services firms that operate maybe broker dealers or operate as banks and might want to do certain things in the crypto space, whether that be run a custodian, whether that be run an exchange, but just don't feel like they have the clarity. Do you see any rosy scenario here where we start to get that clarity? And I know you've been thinking about regulation for a long time and have built your business in a way that will benefit from some of that regulation. So just curious how you think about the regulatory landscape. Sure. That can be a long and

winding road. We can do an entire podcast on regulation for sure. But I think the high level point that I'd like anyone listening to this, anyone thinking about how regulation pertains to them and their business within crypto is that you need to know. You know, you can't risk your business with something like this because it's solvable. And then we've solved it. You know, we, We absolutely don't want to give up opportunities that we might have to execute on deals in our industry by being overly compliant or being, you know, just making some of the mistakes we saw maybe some other businesses make where it's, you know, we didn't just put a stake in the ground and say, hey, we're compliant. We have a broker dealer, like, come do business, even though we have no business. We have a business. We have this business that we set up to add value in our industry.

And, you know, and clients are coming and they're benefiting from that. and we can do it in a compliant way. So where you can find that marriage, where you can navigate, rather, those issues on a global scale, there are some things that fall outside of the purview of the SEC and securities laws. And, you know, and that can be fine. There are some things that are definitely securities. And so that should be pretty straightforward, you know, in our domain. But I think the general thing, again, the takeaway is hire an advisor, hire a compliance officer,

what, depending on your business, you know, you make sure. that you're executing a compliant way that you're not running a file of regulatory bodies and in the jurisdictions that you're operating in because the stakes are high. If you've got a real business, you've got to protect it and you've got to think about what those issues are and then navigate them. And if you do that, I think that that creates an interesting moat in some ways. I think it certainly does for us. But having a registered broker dealer where others don't or cannot operate in the way that we can,

yes, there's a burden of compliance there. and it's a process and in many ways it's worth it. In any way, it's required for doing a lot of the things that we're doing. So, you know, I would just encourage every executive in the space to think about how their business touches regulation around the world and make sure that you're compliant and you're thinking about those things and navigating them in the right way. If you just think about how large these markets could be if the spot market clarity question is answered and if you actually have the ability to get some of these things under

like an SEC framework for being securities. I mean, a lot of what entrepreneurs want to do here is to represent fractional ownership in some asset on a blockchain. They want to represent a revenue share on a blockchain represented via a token that you can trade on a public ledger. And so these things should be securities. But unfortunately, there's no path to trade these things on a secondary market. It's been really difficult to get ATS venues approved in the U.S. And so as a result, do you see a bunch of these entrepreneurs either go to different jurisdictions or they launch these governance tokens that claim to not have rights over cash flows? And it's just super janky. I mean, I would argue that this market would be 10x larger if we just had, you know, a clear path forward

for things that want to be securities. Absolutely. We don't do any trading ourselves. We're not in those markets necessarily, but we certainly work with companies who do, you know, markets are a big part of our industry. And yeah, I mean, we'd like to see more clear communication, especially where we feel it's straightforward. So that's a great example. I think ETFs are another great example. It's a double-edged short. I'm glad that our entrepreneurs in the spot market space for crypto generally were able to build exchanges and now can build wealth management platforms. And there are not a lot of options for a retail investor to acquire and custody crypto. But, had there been an ETF, I mean, that probably would have kept a lot of people off of FTCs.

And there's no reason why there shouldn't be. We have their answers. And they're wholly unsatisfying and disingenuous. And so I don't think I'm saying anything controversial when I'm saying that. I mean, it's disingenuous. There's absolutely no reason why we shouldn't have at least Bitcoin and ETFs at this point. And it would create, you know, kind of access, liquidity, transparency, and more regulatory oversight that we need in some of these cases for these types of securities in that realm. So yeah, high-level comment. I would love to see straightforward regulation applied where things are really straightforward. Yeah, I totally agree. So talk about just what the capital-raising landscape looks like. How have you seen this evolve in terms of just

the types of firms that are present at that downstream capital growth round, pre-IPO round? and will that shift meaningfully since a number of those firms got burned on FTX? How do you see that evolving? So, you know, if you go back three, six months, you're going to have a lot of investors who are coming into crypto, who are not crypto-native, but are breaking in in some way, you know, either creating separate sleeve for this or sort of expanding their mandate, you know, they want to be invested here. I feel like trains leaving the station, very much not the case now.

I think on the positive side, we have most relatively high quality BCs in our space, raised capital probably sometime last year. And it was probably their biggest fund. So most of that is still dry powder. But it sounds like investors are really taking their time right now. And, you know, and rightfully so. It's still that shell shock, I think, period of time where do I look at distrust things? Am I opportunistic? Am I just looking at my own portfolio? I'm going to start to look outside. What are the themes that are going to emerge here? And how do I want to, you know, sort of reset and move forward now. And I think we're just starting to get into that, hopefully as everybody gets back to work. But what that means for companies is that new investors and growth capital are just not going to be as readily available. Valuations will be compressed somewhat from, you know, from what we saw last year. I think availability of funding for strong companies with thoughtful business plans and good quality founders and executives are still going to be there, especially as we move into the middle part of this year. I think there are no crypto-native people that look at the events of the last three or six months and say, I'm folding

up my tent and doing something else. We understand what happened. Obviously, it's terrible. It's very damaging in the short and medium term to our industry, as we've highlighted earlier in this podcast, but overall, we're here to build and we knew there be ups and downs. You know, we never, imagine they could be created by something like this and it's terrible. But what we're doing now is moving forward. How do we grow this industry? What do we want to invest in? What do we think is most promising for the future? And there's a ton and there's still great founders building. And so our small role is to work with those folks. And we've got a program now that we've partnered with Allen and Overie and we're working with some companies who basically trying to extricate themselves

from an FTCS investment. So a really good company that just happens to have, FTX sucking up part of their cap table that it wants to move on from that or, you know, maybe has some other entanglements there. So we create a framework to do that and basically do it in a really client-friendly way to get them past it, get the legal and banking expenses waived for this project to just to get them back on solid footing and on their way. And then we touched on the token side. So those pre, you know, retail distribution projects that, you know, we think are really promising

that yet need to reestablish that confidence in the marketplace and maybe a couple of other tweets if necessary. You know, same thing, like helping them get from where they are today to that goal so they can continue to build these extremely exciting and promising protocols that we think are going to drive the future of the industry. That's really interesting. So you touched on something that I've been really curious about is if you're an entrepreneur and you have like a three arrows and FTX and Alameda, you know, one of these organized

crime families on your cap table, what advice are you giving to those entrepreneurs? I mean, is there a way to speed up the process of getting some of these bad actors off the cap tables? Absolutely. Yeah. And that's what we're here for, you know, without sort of going into the gritty details, every founder and every company is in a little bit different situation. But generally, all those companies are dead weight now on your cap table. Some companies are perfectly healthy and they took 10 million bucks from FDX. sometime last year and haven't heard much from since and didn't really have other business entanglements, don't really care. And maybe they won't really do anything. It is an opportunity,

though, to be in the market. You know, if you want to get ahead of your next growth financing and just say like, look, why not cram them down and sort of get past this, especially if they were a lead investor or a larger part of the cap table. So yeah, it depends on how your docs are written, what exactly we can do. But that's why we set up this program. and, you know, with one of the top global law firms in the world. And that's what we're trying to do for those, some portion of those 300-so companies that, you know, that have this issue. Yeah. It's an incredible amount of companies when you look at it.

And just, I'm sure the docs are in all sorts of shapes and sizes. But, yeah, you could imagine interesting pay-to-play provisions. If they were the lead, you could imagine, you know, doing secondary transactions. I bet the menu is pretty large in terms of what you could do. For sure. But I would say by and large, the sort of extrication is very doable. And so there's some standardization there and it's not like, and also like to sort of wait for bankruptcy to play out is not really a viable option for really anyone.

You know, we all have to get back to work and build our businesses. And so I would, you know, definitely, we sort of did some outreach and let some folks know we're doing this. But yeah, to the extent that it can be helpful, founders and executives should know that these options are available and you can give us a call and we'll talk you through them. One of the things I've been thinking a lot about is just that from the perspective of being a strategic acquirer of businesses, this would actually be a really interesting time. I mean, you have the venture market has slowed down at the later stages.

I think valuations are very investor friendly at this point. And if you were a financial services business or software business in the traditional space outside of crypto, but you wanted to be in crypto, I think it would have been really difficult to buy something at this time last year, for instance. You would have been paying up pretty significantly. But right now might be a great time to be an acquire. How are some of the best in class purchasers thinking about this market right now? Well, there's significant bifurcation when you think about potential acquires in our industry outside of crypto and inside of crypto, it's like being on the island or being in the sea. And so we still, you know,

when we go through these bull markets is when, you know, those outside of crypto become most interested. And even though, you know, sort of the worst time from evaluation standpoint, that's when they're feeling that pressure from, you know, public markets and others. And to think about the future and how to execute in this space. I think what our industry has going forward in terms of that happening eventually and certainly will. I mean, we see that as being, you know, really a tidal way. at the moment where your competitors, your S&P 500 company, and at the moment your competitors dive in and you realize that you've hired, you know, maybe you've hired a bunch of blockchain-type

titled people to try to do stuff and you go and open the door of that dark room and realize that nothing's been built, nothing works, and you're not sure how it should all go together. And you can't attract the talent. You need to do that. You've got to acquire. And so, you know, we really see that happening probably somewhere in the next. next two to three years at this point is what it feels like to me. And that's because of a couple of things. We're probably possibly in a recession right now or going to be in one. There's

certainly a lot more caution being exercised when you look at, you know, sort of the macro environment we're in. So yes, even though it's a great time for valuations, companies outside of crypto are acting more conservatively, I think, in some ways in terms of what they want to execute on. Within crypto, if you're balancing strong, if you've got a good business, you obviously believe in this industry, you should be acquiring the things that are going to deepen your remote before those competitors come from outside of our industry because those probably represent your biggest threat at the time that happened. So yeah, we're seeing some of that, but I think everyone is sort of taking that step back to is my core business working the way

I thought it did? What are my cash flows? What are my needs? They're going forward. The main goal is survive. You survive these types of periods in crypto. You're probably going to do pretty well on the other side. Yeah, I totally agree with that. So flipping the question a little bit, if you're in the position, if you're an entrepreneur in the space and you get a preemptive offer, how should entrepreneurs be thinking about that? What are some of the common mistakes that you see people making? The main mistake is just not getting, I mean, I'm a baker selling you bread right now, but not hiring an advisor. I mean, this is the most important financial decision and it's a fiduciary decision. So you're the founder. It's your company. Somebody just offered you money that's going to

change, you know, your life. And it sounds like a lot of money. And by the way, they're saying all sorts of nice things about you and your company. And it feels like it's like a first date that's going extremely well. But if you sort of fall in love on that first date, you can make a lot of mistakes, I guess, is the analogy that I would use. So yeah, I think the biggest thing is understanding that this person and this company that's approaching you and saying all these nice things and offering you this life-changing amount of money is going to be sitting on. the other side of the table from you in this negotiation. So yes, it's this love affair, but it's also this adversarial relationship that you're going to have to navigate once you've

decided, hey, I want to do this. And so, you know, I think there's just a blind spot there in terms of who else might be interested. If these folks are so interested in my company, if I'm this great, shouldn't I be great to maybe some others and we can create some competition there and really get, you know, you've got one chance to exit your business to sell your company. So my strong recommendation would be to optimize that. It's not always the highest price, but it's probability to close. It's the consideration. It's the terms. It's all these details that go into, you know, that final outcome that is really, really key to optimize because you only, you only get one shot at it. You know, that's it. Once you're done, you're done. So that's

the main thing. And in our industry, obviously, things are so insular that, you know, like folks that, you know, are in the same circles, there's this level of trust. And, you know, that might be the right acquire for you, but there's no reason not to make sure you've explored that from a fiduciary standpoint and make sure you get the optimal outcome for yourself and your other stakeholders, your employees and shareholders alike. Yeah, and at least, you know, recognize that this is maybe the first time you're going through this and maybe put some people that have been through the process many times around the table because there are hardball tactics on the acquirer side where they might be trying to put pressure on you not to tell certain investors that you've gotten the term sheet.

and really just things that are borderline, not ethical, that you want to just be careful that you don't step into those pitfalls. It's crypto after all. There's some folks with a lot of cash who feel they're in the driver's seat, and if you put yourself at a major disadvantage, if you lack the information that you could have, and if you don't negotiate terms in the right way,

and negotiate the process in the right way to really keep those options open, to make them accountable, to help avoid retrade. We see retrades all the time, even when we're involved, We see attempts at retrading. And so if you don't have somebody on your side, looking around the corner for these issues,

chances are you're going to run into some. How do you generally think about equity versus cash transactions and how should entrepreneurs be thinking about how to value the acquirer in these types of transactions? Really key because we've yet to see an all-cash deal that we've been either involved in or even on the periphery of, as you would expect, right? if you're buying a crypto company today, you want them to continue to build, you want them to be a part of your company, and you want them tied to the success of your organization. So that said, this is an event where our expectation is there should be some cash because,

you know, there should be some consideration and where you really do get liquidity as founders, investors, stakeholders, you know, and then you're tied to the future success with probably some earnouts and other opportunities to create wealth with the combined company and beyond, right? But certainly with some of their stock as well. And especially when you get into some larger acquirers, there may be some parts of that business you're not going to like. And now you're only this, you may just be a cog in that wheel, right?

And so how much can you really affect? And I think that a lot of that goes into this sort of negotiation where is this a huge company that's buying my little company and now you want to give me, you know, mostly stock, but we're really only this one piece of it. Why should we be tied so much to your fortunes when you're really doing, you know, 90% of what you're doing is this other stuff? So it's that kind of sort of logical give and take that we're trying to achieve in the best interests of our clients. And sometimes we're in love with the equity of the acquiring company. And we think it's really opportunistic. And founders want to be a part of that. And so we're just kind of balancing that with

what kind of cash should we take off the table. But all really good and important things to do, reverse diligence is probably something that you wouldn't really do if you just enter into a transaction without an advisor. Yeah, absolutely. Now, how do you think about it in terms of building your business? I guess if I had asked you this question a year ago around when will you see bald bracket entrance come in, it would have been maybe sooner. And maybe some of those firms are less likely to hop in and start to compete with you

in this type of a market. But how do you think about your own competitive landscape here? It's really interesting. You know, there's basically nobody else that sits where we do in terms of having a register broker dealer, being able to do deals that are compliant globally, having a global firm, but also having a U.S. presence. And so we compete with, of course, on one end of the spectrum, the completely illegal. And so it's probably things we wouldn't do, but there's money being generated for things

It's like in a completely illegal way around the world. And so I guess if that were rooted out, those things would have to find their way into the compliant and legal world and maybe find their way to us. So we compete with that in some ways. You know, on the other end of the spectrum, sort of the traditional investment bank, you know, Wall Street firms, they were coming. I mean, there tends to be a couple of guys who, you know, who got interested and, you know, probably were like I was five years ago, six years ago or so. Uh-oh. That was eight years ago. Time flies.

Maybe nine years. Yeah, okay, so it's been a while. But a lot of firms have that some people look at this and said, well, this is really interesting and it can change my career and I can be the crypto guy at my Wall Street firm. But they don't get a lot of attention from the top because it's still a very small industry relative to other industries. So we've yet to go head to head and lose with a Wall Street firm because you either want somebody who understands your business and can help you execute within crypto or not.

If you think you're a fintech company, then you may engage Goldman Sachs. If you're a crypto company, you should probably engage somebody who really understands your business and understands the entire ecosystem of potential buyers and other strategic partners within our space who are really likely to get motivated by what you've accomplished. So that's where we said in terms of what the outlook is. Anytime we have a downturn, like our industry just got smaller. And as I mentioned, it was already small in Wall Street terms. So those hundred people or so that like a city group announced they were going to hire at one point, that's not happening.

That'll be quite a bit slower for sure. Yeah. Well, Tony, this has been a fun conversation. Obviously, you're super busy over at Empry. Where can we send people to learn more, get in touch if they want to chat? Yeah, we do have a website. We spent a few bucks to putting that together. So occasionally we even updated.

But that's probably the best place to start. And there's an info, email address on there. We don't do much in terms of media, social media, other stuff like that. Most of our business is highly confidential anyway. And as you know, like almost, not almost actually 100% of all the business we've done and really endeavor to do is come through word of mouth, you know, our trusted friends and partners in the space. So I'd just say jump on our website and shoot us a note. We do check our email. And so if we can be helpful, we're we're certainly happy to try or at the very

least point you in the right direction, you know, and so encourage you to reach out. Awesome. Well, thanks so much for joining us to the podcast. Looking forward to having you on again sometime soon. Yeah, sounds great. Appreciate you, Matt. Thanks for listening to another episode of On the Brink with Castle Island. To find out more about Castle Island, visit castle island.V.C. To listen to all of our podcast episodes, please go to On the Brink-Podcast.com or just click on the tab in our website. Thanks for listening.