Unchained - How Lyn Alden Will Take on Bitcoin DATs and Private Equity With Orange Juice

Episode Date: July 21, 2026

Lyn Alden raised $40M to launch Orange Juice, a holding company that buys cash-flowing businesses and layers Bitcoin on top, not another pure-play treasury bet. ======================================================== Thank you to our sponsor! ⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠Cape⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠: Your biggest crypto vulnerability isn't your wallet, it's your phone number. Cape is America's privacy-first mobile carrier that rotates your SIM identity daily and blocks SIM swaps before they happen. Get 33% off your first six months at cape.co/unchained (use code: UNCHAINED). ======================================================== Lyn Alden just raised $40 million to launch a Bitcoin-backed holding company that skips the trade most of crypto is chasing. Rather than build another pure-play Bitcoin treasury stock, Orange Juice buys cash-flowing, unglamorous businesses and layers a Bitcoin treasury on top at the parent-company level. Lyn Alden, cofounder of Orange Juice and a partner at Ego Death Capital, frames it as a countercyclical alternative to procyclical treasury companies, and she does not spare Strategy from criticism. She compares Orange Juice's structure to Berkshire Hathaway and argues Strategy let its dollar reserve fall too far, weighing in as Laura invokes Michael Saylor's 'sell a kidney' line and STRC's slide to near $85 against its $100 target. She also addresses BIP-110's inscription debate and Bitcoin's quantum computing threat, questioning whether the community’s resistance to change is a strength or a liability. Host: ⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠Laura Shin⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠, Host / Unchained Guests: ⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠Lyn Alden - Cofounder of Orange Juice and Partner at Ego Death Capital Timestamps 🍊 00:56 Lyn Alden lays out the $40M raise behind Orange Juice's core thesis 💵 08:06 Why Lyn Alden targets cash-flowing firms over VC backed startups 📱 11:17 Cape: get 33% off your first six months with code unchained at https://cape.co/unchained 🏦 12:16 How keeping the Bitcoin treasury at the parent level avoids procyclical risk 🪖 25:37 How Orange Juice handles a bleeding company and Ruben Zweiban's Navy SEAL background 📈 32:15 Why Lyn says going public aids liquidity, retail access, and tax deferral ⚠️ 39:15 Why Lyn is critical of Strategy's capital structure and Saylor's kidney line 🗑️ 47:40 Why Lyn views Bitcoin inscriptions as spam despite BIP 110's technical limits ⚛️ 50:47 How Lyn assesses the quantum computing threat to Bitcoin's security Learn more about your ad choices. Visit megaphone.fm/adchoices

We think in our case, because the whole strategy is really about building this diversified set of uncorrelated AI-resistant cash flows and then attaching a Bitcoin strategy to it, accumulating those retained earnings into Bitcoin. We generally think that that sum of parts analysis makes sense. Hi, everyone. Welcome to Unchained, your no-hyped resource for all things crypto. I'm your host, Laura Shin. And now we'll take a quick word from the sponsors who make this show possible. This episode is brought to you by Cape, America's privacy, mobile carrier. Same premium service you'd expect from any other carrier, but designed so your number, your location, and your data actually stay yours. Get 33% off six months at cape.co slash unchained. Today's guest is Lynn Alden, co-founder of Orange Juice. Welcome, Lynn.

Happy to be here. Thanks for having me again. You announced last week that you had raised $40 million to launch Orange Juice, a permanent capital holding. company that will acquire, improve, and permanently hold cash flowing businesses backed by a Bitcoin Treasury. How did you come up with this idea for Orange Juice? And what problem were you trying to solve? Yeah, good questions. I mean, first of all, we have a very strong team. It's certainly not just me. Some of the headlines will put my name on it, but this has been a really big team effort. So it's the partners at EcoDeath Capital along with Rubin and Adrian from other, you know, from other ecosystems.

And, you know, the idea actually goes back to early 2025. We've been working in this for a while. This isn't something we put together here this year. It, you know, it's been a process to figure out the exact structure, how to bring it to market and all that. And the main kind of focus was that there are a lot of treasury companies out there, Bitcoin treasury companies. You know, one of the biggest criticisms against them is that they don't have cash flows.

You know, for those seeking kind of, pure play levered Bitcoin approaches, that, you know, that can be a plus in some context. For others, it's a minus. It certainly kind of adds volatility to the upside and downside. Whereas we view that if you have a stable cash flows, like operating cash flows, that provides a really good foundation that you can then use to build a Bitcoin treasury. If anything, I mean, ever since I saw kind of the first company come to market and had Bitcoin this balance sheet, I've been expecting to see, you know, a variety of other companies want to add some Bitcoin as well. But it's that they've actually been quite slow to do that. Most of the

ones that have done it are kind of more Bitcoin adjacent type of companies or they're springing up specifically to do the strategy, whereas I'd actually love to see just boring companies add Bitcoin to their balance sheet. And if anything, I think value stocks that are kind of underperforming in this kind of winner take-all market, they kind of slowly become a smaller. part of the economy over time. One of the ways they can protect themselves is by owning a truly scarce asset. And instead of, you know, sending all their cash flows out as dividends or as, you know, buying back through their own shares and stuff, they could be holding, you know, this asset.

And so kind of after years of waiting to see more companies bring this to market, you know, a couple of us, a bunch of us decided, let's go and make this happen. The other reason is that there is a really big, strong demographic force of American business owners in general are aging. Many of them are looking to pass on the wealth that they've built. And there's a variety of options to them. One of the hardest things you can sell is a business because of the size and uniqueness of each one. And the main option for companies in that kind of small to medium size is private equity. and private equity serves a very important spot in the market.

It obviously provides liquidity for these businesses that are otherwise quite illiquid. You know, it could be very hard to find a strategic buyer. But they, you know, many would say they have a negative reputation. And I think at least some of it's well deserved, which is, you know, PE funds generally have like a 10-year life. The typical life cycle, what they want to do as a business, is go in. And they within like a three to seven-year period,

they generally want to flip it, so they lever it up. They cut costs pretty aggressively. They try to find ways to boost the multiple, and then they want to either bring it to IPO or otherwise exit that position to kind of optimize for that more short-term gain, potentially at the expense of that long-term success of that business. Studies show that, you know, companies that emerge from PE have a higher-than-average bankruptcy or financial distress rate,

and it's because they're kind of in some ways hollowed out. They might otherwise have a good business operation, but they've been hollowed out for that kind of short-term flip, whereas it's rare, but there are other options, permanent capital vehicles that actually want to own that company roughly in the format that it's already in. You're happy to make modifications and help them where possible bring additional scale, but otherwise keep intact the legacy that they built

and not have that kind of four to seven year or three to seven year mandate to flip and get out of it, which just totally changes our incentive structure. So, yeah, I would love to ask you two follow-on questions, but we're going to start with one. So when you were describing the types of companies that you would be looking to buy, you describe them as boring. So do you have in mind what types of companies you're looking at? Yeah, good question. So basically, because a lot of us come from a venture capital background in the company. So we are. partners at Eagle Earth Capital. So we, for example,

invest in Bitcoin growth companies, tech companies, you know, fintech companies. But the types of companies we're looking to buy with orange juice are generally speaking companies that are outside of the space entirely. Things that often have a physical real world presence, you know, that are

kind of AI resistant. You know, kind of the classic PE examples, like HVAC businesses, for example. It's almost a meme at this point that, you know, you leave Wall Street and go and you roll up a bunch of HVACs. But that's not really far off. You know, when we start out, we are industry agnostic,

meaning we're not targeting any specific industry. Instead, kind of in the early stages, we're interested in founders that specifically fall under a certain size category and that have an interest in preserving the business that they built. They optionally can even continue working at it, even as they want some liquidity. You know, maybe they want to keep their employees together. They want to keep kind of the soul of the company alive.

They think it's better in those types of hands. And generally speaking, early founders are probably going to be interested in Bitcoin in some way. So they're going to be founders that just happen to also be Bitcoiners. Because, you know, early on in the strategy, you know, we intend to buy companies with a combination of cash and some equity in our own entity. And that, you know, that could be variable to the business seller. And so generally speaking, you know, we're looking for founders that kind of buy into the thesis as we see. see it, which is the cash flows and Bitcoin is a good combination. Generally speaking, as we get, as we, you know, hopefully make a series of successful acquisitions, we will then have,

you know, an industry set that we can maybe more lean into and find synergies between. And at that point, you know, at that point, we're probably less targeting business owners that necessarily care about Bitcoin. And, you know, we're more in that kind of traditional PE type of category because at that point we will hopefully have a track record of successful implementations. But early on, the profile is generally speaking small business owners that have a business that most likely has nothing to do with Bitcoin, but on the side, they're bullish on Bitcoin and they like the asset and they're looking for liquidity and they're looking to keep their company intact. And why is it that you've decided to not go with VC-backed type

startups, but instead the more boring ones? Specifically for cash flow. So VC-backed startups are rarely profitable. You know, in some rare circumstances, they can be. But generally speaking, they're more growth-oriented. You know, many businesses start without venture capital. They generally have, you know, somewhat of a slower growth profile, quicker time-to-profits. But venture-cap-backed companies are generally really going for something bigger. Whereas, and that's not really something you want to vote, a Bitcoin treasury kind of, you know, is a competing force with that. Instead, we're looking for companies that are generally on this, you know, they're the mature

phase of their life cycle, meaning that, you know, we see them as AI resistant, you know, they're not really going anywhere, but they're not in some massive growth area. And they can be bought at low multiples, meaning they with a fairly small amount of capital, you can get a substantial amount of cash flows that if selected well are very, are very adorable and long lasting. And then that can be a very strong foundation to accumulate Bitcoin because the company's not often the type that benefits from aggressive reinvestment of those cash flows. In some circumstances, it might.

But in generally speaking, these are companies that are already established. They're spitting off cash. And, you know, in a traditional value stock setting, you know, private company or even, you know, a public traded example, which we're not going after initially. But just as a value stock in general, there's only a handful of things they can do with that excess capital. they can give it back to the owners, either in terms of private distributions or for a public company dividends. They can buy back their own shares if they're public.

If their balance sheet has issues, they can put more money toward their balance sheet. If they already have a clean balance sheet, that's off the table. So a lot of it is just distributing capital outside of the company. And we view that accumulating Bitcoin is one of the valuable things that you can do with that. In addition, when you have solid operating cash flows, you can put moderate amounts of leverage on that. with the interest expense that's fully covered by the operational cash flow. For example, you can have interest expense equal to, say, one-third of operational cash flows so that, you know, it would take a two-thirds fall in operational cash flows to get to a point

where you're not really covering interest expense anymore. So you can conservatively lever these businesses. And then unlike a traditional kind of PE exit where these companies are highly leveraged, these companies would be attached to the parent company that has a lot of Bitcoin on the balance sheet. So it would be a company that has more assets than liabilities, while at the same time having operational cash flows that fully fulfill the interest expense multiple times over. And so that's a very different model than if we were to go out and buy venture-backed companies, which would be very high multiple and generally profit, you know, non-profitable

companies that are just a completely different category, which, by the way, we're still focusing on an ego-death capital. It's just a very differentiated type of strategy. Super fascinating. All right. So in a moment, we're going to talk more about the Bitcoin Treasury, but first we'll take a quick word from the sponsors who make the show possible. If you hold crypto on your phone, your biggest vulnerability isn't your wallet. It's your carrier. AT&T, Verizon, and T-Mobile have been breached again and again. And SIM swaps are still one of the easiest ways for attackers to drain accounts. That's where Cape comes in, America's Privacy First Mobile Carrier. Same premium service, but CAPE rotates the identifier on your SIM every 24 hours,

deletes your call-and-text metadata after a day, and protects against SIM swaps with a 24-word recovery phrase that only you control. You also get two middle-to-end encrypted secondary numbers for banking and sign-ups, so you stop handing your real number to every app that asks. Go to cape.co slash unchained and use code unchained for 33-3.3.3. percent off your first six months. Back to my conversation with Lynn. So as you already started discussing, there will be this Bitcoin treasury. And that is seemingly in a way, like on the surface, part of a trend that we've seen this last few years, you know, this explosion in digital asset

companies. But, you know, most of them are vehicles specifically to acquire Bitcoin. And obviously Orange Juice is taking a different approach. So explain, you know, how, your Bitcoin debt will function. You said, I guess it stays with the parent company, but I'd love to hear more of the details about, you know, what the relationship is with the portfolio companies. Yeah, the main relationship is that, you know, although all the companies will be subsidiaries of the parent company, the treasury will itself be held at the parent company level. And what that does is it gives us optionality. So if you have a pure play debt, for example, the primary goal every every month or every quarter is to pretty much only accumulate more of that of that coin per share.

And the challenge with that is it can be quite a pro cyclical approach. You know, when Bitcoin's or other, you know, for some of the other types of data, whatever the coin is really high, generally speaking, the MNAV is going to be high. The market enthusiasm is going to be high. They're selling more shares or otherwise raising capital to buy more of that coin. And often when there's a bare market, it gets harder to buy that. whereas when you have kind of more than one direction that you can go in, it gives you some countercyclical optionality.

And what I mean by that is, you know, if you have a set of cash flowing businesses and you're, you know, you're accumulating that that cash flow, you're putting some of it into Bitcoin. At any given time, you have a handful of options for what you can do. If the inbound pipeline of businesses looking to sell that meet your target at the multiples you're looking for,

if that's a very strong pipeline at the moment, you can lean into buying more business. businesses, especially if Bitcoin, for example, or just went up 10x, maybe it's very enthusiastic at the moment. And that's a very pro-sical environment. Maybe it's better to lean into those businesses with a strong, with a strong inbound pipeline. On the other hand, you could, you know, a year or two later, you could find yourself with Bitcoin in a pretty deep bare market at the bottom, according to most valuation metrics or most sentiment metrics that are available, coins that have rotated away for fast money to our strongly held hands.

And that might be a time where you actually wanted to put more cash flows into accumulating a Bitcoin in that kind of when it's cheap, when it's kind of out of favor. And so there's a handful of options. And the companies, you know, as long, again, as long as the operational cash flows are managed well, it's not a company to have to perpetually issue new securities. You know, it has the option to raise capital. But the cash flows themselves provide a continuous sort of just a new capital that comes in. and it can be put toward either new businesses or Bitcoin.

You know, leverage can be used judiciously at times. Other times de-leveraging can be a tactic that makes sense in certain environments. And so it gives the company just a handful directions that they can go in that is very kind of execution dependent. So the better that the partners and management is at, you know, executing properly and doing it in that kind of countercyclical, cautious way, it's a differentiated strategy compared to what else. is out there. I've been on record. I've been a, you know, I've been a strategy shareholder since

August 2020 when they started strategy. But I'm on the record that the long tail of other pure play debts or treasury companies, you know, I think it's a very crowded space. There's only, you know, liquidity begets liquidity. So I think the large ones have a role to play. And there are different markets out there. There's Japan. There's Brazil. There's European markets. There's a number of kind of big liquid markets. But if you're not one of the top pure playdats in those markets, those treasury companies, those markets, you know, I think the much bigger opportunity is just that other companies, whether it's publicly traded companies now, or it's our strategy that's, you know, accumulating private companies and

intends to go public eventually to take these just totally non-Bitcoin businesses to have cash flows and just put it into a Bitcoin treasury, as this another thing you can do with your capital besides, you know, the other things you can do with retained earnings. And how many companies do you expect that you'll end up with in your portfolio? Well, we intend this to run for years and decades. You know, it's a permanent capital vehicle. And, you know, it's been compared to say Berkshire Hathaway, which of course is premature because, you know, we're talking about one of the biggest, most successful companies

the world. But in terms of just intention and structure, it's a comparable kind of data point. So it's like saying how many companies will Berkshire Hathaway acquire while we they want to keep acquiring companies indefinitely, right? So especially as we start from this small stage, we plan on... Yeah, with the $40 million. Yeah, so we plan on acquiring a few per year. We're looking eventually to likely raise additional capital in the future.

The early capital is to kind of prove the model, to prove that the pipeline exists, to prove that there is demand from business owners to sell to this type of. of entity compared to digital private equity. And I will say we've already gotten a ton of inbound ever since the announcement. So that's, you know, we're kind of at the early stages of proving that demand. But we have to actually go out and execute and acquire some of these businesses and kind of

find the percentage of whatever that funnel is that meets our criteria and ends up being a good fit. But the initial capital is meant to buy a handful of companies, prove the concept so that we can go out and, you know, potentially, hopefully continue the process for the longer term. And like I said before, you know, at a certain point, you can get to a phase where, you know, additional capital is optional because the cash flows themselves are additional capital that can come in and eventually require, you know, result in another acquisition or can result in more Bitcoin stack, which occasionally could be levered to go out and buy a business and then pay off the small amount of leverage you took out to acquire it. Okay. Yeah. I mean, like it's funny that you mentioned strategy. because obviously there's they've been in the news a lot recently. But I do feel like there is something about, you know, you want to have sort of like a diversified

group because there's going to be like a number of different levers. And, you know, when things swing a certain way with Bitcoin or something else, like you would want to have something that, you know, is, yeah, maybe not swinging or swings the other way or, you know, whatever it is. But I was curious to just think about, do you think that the volatility of the Bitcoin price could ever hurt these companies or in any way, like, cause some stress?

So we intend to structure it so that the answer is no. Obviously, any sort of strategy has risk associated with it. Because this is a permanent capital vehicle that it tends to buy business long term, financial stability is one of the key metrics that we would try to optimize. So we would keep leverage conservative, you know, backed by operating.

operational cash flows. If you design it properly, so the interest expense is only a, you know, relatively small fraction of operational cash flows, in theory, even if the Bitcoin treasury were to go away, the company itself still functions. It's still solvent. You know, at that point, you would have lost your buffer. And obviously, it's not something we intend for, you know, for Bitcoin to go away. But the way we intend to do it is that the Bitcoin strategy is only upside for the cash flow companies. That, you know, if these, if these companies, were spun out of private equity, often on their own. They would be very levered. They wouldn't have a bunch of liquid financial assets to offset that leverage. They would have just had pretty big cost

reductions, maybe kind of the employee morale is often not the highest. And they're kind of set up for a difficult road ahead. Whereas our companies, you know, they, at the pair of company, you know, we probably would have, it depends on market conditions. We would anticipate having some degree of, you know, leverage, but as a small percentage of operational cash flows. But then importantly, all those companies are part of a structure that is backed up by a company that has more assets than it has liabilities. It substantially so.

So that even as that asset pile swings, sometimes it could be really, really overcapitalized. You know, in a bare market, it obviously could be somewhat less overcapitalized. But that's all still strictly better than if that company was just, just on its own with very little financial assets, with leverage purely against its operational cash flow backed up by no treasury at all. So we intend to structure it so that it's only upside,

even though obviously the volatility is still a factor to consider. And kind of one of my views, you know, as I continue to be active in this company with my co-founders, is I tend to be very cautious. I'm a cautious investor in it, the other aspects that I work on, I expect to bring it to this company as well. Okay.

And the way that the companies would benefit from the Bitcoin would be that it could be used as like collateral for loans or like how does it become monetized? Well, primarily it's it's a way to retain value. So a lot of that is attractive to the investors. It's also attractive to the business owners that sell to us because again, if we buy those businesses partially in cash and partially in equity in orange juice, those business owners have a long-term, you know, incentive for the company to continue growing. And if those founders, those business owners, if they are Bitcoiners, if they like Bitcoin, they expect it to appreciate long-term. And, you know, a lot of them, you know, they might have millions of dollars locked into a business

that they've, you know, to some extent, they'd rather have in Bitcoin. They think maybe Bitcoin has higher upside than their business. This allows them to unlock some of that liquidity and either grow up and buy Bitcoin if they want or, or, you know, as they take equity in our company, they would have that combination of cash flows and Bitcoin. So, you know, we think it's an attractive proposition for business sellers, as well as those that want to invest in this combined strategy. Because we generally think that the sum of the parts is better than the whole.

When you have Bitcoin, when you have operational cash flows, when you have operational to take on leverage in conservative ways, either collateralized by the Bitcoin or, you know, backed up by the cash flows, these different strategies are available. you know, it kind of gives you just different options through different market conditions. And another kind of aspect that one of the challenging things, you kind of back up and say, why aren't there just more permanent capital vehicles out there? There are a handful, but why aren't there a ton?

And the general answer is because you need some sort of edge. So if you're buying small businesses, small cash flow businesses at low multiples, you generally need an edge that would push your returns higher. And for PE, for private equity, their answer is, is flip it. Their answer is, we don't want to hold these longer term. We're not interested in that kind of slow and steady approach. We want to buy a company, gut it, lever it, find ways to juice up the multiple and get out. And that if you do that over and over again, that's their kind of, that's their juice. If your Berkshire Hathaway that is buying companies and holding them long

term, their main juice is that they have the best source of like leverage in the world, which is their insurance float. So Berkshire Hathaway is, you know, it's one of the biggest insurance companies in the world. And insurance flow is an incredibly low cost of leverage. It's an incredibly stable source of leverage. And then they also, of course, have other types of corporate leverage. I mean, one of the lowest borrowing rates in the world. So they're able to go out by these businesses and they're doing it on insurance float. They're doing it on some of the lowest bond yields in the world. And that's their juice. And for orange juice, you know, name implied, our general view is that our kind of X factor, our juice, is that we think Bitcoin is kind of a little bit of a rocket fuel to kind of push you over that edge to make that work really well.

Because you buy a collection of cash flowing businesses and you're able to kind of put that into a Bitcoin treasury. And then you're able to have conservative leverage that has no end date to it. So there's no like, you know, if you look at say a pure treasury company, you say, well, where is the cash flow going to? to pay off, you know, the existing leverage. And the answer is that they, they expect that the underlying asset is going to keep appreciating. And of course, you know, it's a very cyclical asset. There's times where it goes up. There's times where it goes down. Whereas an orange juice case, the interest is fully covered with operational cash flows. Again, assuming, you know, there's always risk with business, but assuming that they're well selected and well managed, you have interest

fully covered by operational cash flows. And then you have this growing collection of Bitcoin on the side. And that combination is your long Bitcoin, your long, you know, kind of durable AI resistant businesses, and then your short Fiat. And your short Fiat in a way that's not tied just purely to one asset, but is tied to a strong foundation as well as, you know, a scarce asset that can't be printed. Okay. This is so interesting and it totally makes sense. And it also feels like it answers some of the criticisms that we've seen with some of the dots. However, I do have a question. Let's say that you have a portfolio company that ends up for whatever reason, bleeding money. How do you handle that and how does that affect the structure? Because like everything

that you said makes a lot of sense to me if everything's working and going up as planned. But if something goes wrong, then how do you handle that? Yeah, good question. I mean, so when we kind of model this out, we have to anticipate that if you acquire 10 companies, some percentage, the more you require, some percentage of them might not work out the way expected. You could have some companies that exceed expectations, and you can have other companies that don't. When companies are spun out of private equity, if they run into frictions, it's pretty much game over

because they're levered, they're already gutted, they've already done cost cutting. If they still run into frictions, that's, I mean, that's why they have a higher than average bankruptcy rate or a financial distress rate. Whereas in our case, if they're part of a collection of companies, you know, you can have a week, area that is, you know, it could be temporarily weak. Maybe they run into a cyclical issue or an

operational issue that would otherwise kill like a levered company on its own. It can be temporarily carried by the operational cash flows of the other businesses by the strength of the parent company. You know, we, you know, we can bring in resources to help them solve the issue if possible. You know, I'm very bullish on our managing partner, Rubin. He has a Navy SEAL officer background, then he went into finance, kind of a very kind of an interesting combination, very kind of focused on execution. We would send resources to try to help that, you know, those running that business solve the problem. It obviously in very adverse circumstances, you know, there's there could be situations where a business has to be wound down or

otherwise, you know, transition to some other owner. It's not impossible. We do, we don't rule out the possibility that some businesses might one day down the line have to be sold or might otherwise just, you know, the world can change and those are not functional. And the main difference compared to private equity is that we're not intending to sell. So we don't have this kind of three to seven year, you know, surety that we're going to do everything we can to flip a company. Instead, when we buy, we intend to hold indefinitely. But the world does change.

It's always possible we'd have to take actions. And, you know, the general rule is that, you know, we're not going to just put unlimited resources into one bleeding company. If there's a wound, sometimes you do have to mitigate harm. And the other side of the token is if we have a business that we initially bought thinking it's slow growth and it's low multiple. But if we find investment opportunities, we can direct more resources to help that company grow faster than it was prior to acquisition. And so there's both upside and downside associated with some of the businesses that we anticipate acquiring. Okay, super interesting.

So one other thing that, of course, is like yet another piece to this is you're planning to go public. And, you know, obviously there are some similarities that you have to Bitcoin treasury companies. Even strategy itself also has its own operating business. Obviously, it's a very small part of the business. But, you know, there is that component. But I was curious, like, should or not should, but like, would an investor kind of look at this and be, looking more at kind of the, you know, Bitcoin per share metric or the MNAV metric that people have been looking at? Or since this is a different kind of animal, like what types of metrics would people assess the performance by? Good question. I mean, if I saw a structure like this on the market, even if I wasn't involved at all, I would use a sum of parts analysis for it, which is actually initially how I analyzed micro strategy when they just started the strategy. Because back then, the operational company was a bigger percentage. You know, when they go out buy their first or second tranche of Bitcoin.

You had this Bitcoin tranche and then you had this software company. And that was, you know, that was before they added billions and billions and billions of Bitcoin. So I would say, okay, well, here's what the software company was worth pre-Bitcoin. Here's how much cash flow they're earning. Here's what's on their balance sheet. You know, here's a reasonable industry multiple that is associated with that business. And then here on the side is this Bitcoin and then any leverage that, you know,

that company might have attached to, you know, as well. And you generally do a sum of parts analysis. So in terms of MNAM, you know, or Bitcoin per share, those are probably not the go-to metrics I would use for a more hybrid company like this. I think that they make sense for something as closer to a pure play treasury company. But when you have this kind of hybrid approach of operational cash flows, as well as that Bitcoin treasury, you have to kind of break those up to some extent and do the analysis. And then there's a degree that's where investors might differ. Some might view it as a

greater than some of its parts, because when you have to... have that engine combined together that gives you that countercyclical strategy that I talked about before that you can link you have a couple different levers that you can lean into you know they they can compound on each other and just be better you know it could be one plus one equals three because you have this kind of synergy there whereas sometimes conglomerates get like a conglomerate discount meaning that you know you have a bunch of companies together the market you might find it kind of opaque or challenging and some some conglomerates find that spitting off certain entities ends up helping their valuation in some way, that those things get valued better

separately. We think in our case, because the whole strategy is really about building this diversified set of uncorrelated AI-resistant cash flows and then attaching a Bitcoin tragedy to it, accumulating those retained earnings into Bitcoin. We generally think that that sum of parts analysis makes sense. Yeah, there's something about the picture making that reminds me of how People have long been saying that, for instance, renewable energy producers could use Bitcoin mining as a way to, you know, kind of even out their cash list. So I do see like there is, you know, something to the strategy that is very interesting and appealing. But I do also have to wonder, like, why it is that you're pursuing a public listing because, you know, maybe it's just

a way to raise money, but it also feels like then, you know, it just gets complicated with having to answer public shareholders and all those kinds of things. So yeah, why, why? A couple of reasons. One of the main reasons, like I said, when we look to buy businesses, you know, we're partially looking to buy in cash, but we're also interested in, you know, using the equity of the company to purchase some of those businesses. Some of the owners we expect will want, you know, ownership in orange juice in a similar way that investors have. It actually also, in certain circumstances, it could come with tax deferral advantages when you, you know, you sell a business for equity rather than for cash. So there are a variety of reasons why business owners might want that equity,

but that equity is more valuable to them, generally speaking, if it's a publicly traded company or has a vision toward going public in a, you know, kind of a reasonable number of years. because often if you're a business seller, one of the key things you're looking for is liquidity. If you have a functioning business, it's very successful, you enjoy what you do, you might even want to continue working there, but for one reason or another,

whether it's because you're looking to eventually retire, you're looking to pass on what you build or you just want to diversify, you're generally looking for some form of liquidity, and a publicly, you know, a company with publicly traded shares can offer that a lot better than a private company can. And so that's kind of the key motivation

to eventually go public. In addition, we've already gotten questions. Obviously, as a private company, you know, when you're raising capital, it's from accredited investors. But of course, people reach out and say, you know, obviously I can't invest that, but, you know, I'd like to invest a smaller amount. And, you know, having a public listing lets investors

of a variety of sizes participate. And because, you know, this is a Bitcoin company. Obviously, Bitcoin has a lot of enthusiasts. You know, we think that having a retail stock you know, can be interesting to a lot of people. So we think that there are additional kind of capital market access opportunities. If you get large enough for the, obviously there's an additional cost of being publicly. You said you have to answer to public shareholders.

There's a lot more auditing burden. There's obviously a lot more frictions and expenses. But if you reach a scale, well, that makes sense, it does unlock additional opportunities. And I would say the main thing is you want to make sure that we have, you know, kind of liquid offerings for business sales. that might not want the entire value of their business in cash and might actually want to continue to participate in the upside of both their businesses and other businesses in the Orange Use umbrella.

And this might be early, but do you have any thoughts on how you'll go public? That's still early at this point. You know, we intend in a number of years to go public. Obviously, it's very market condition dependent. You know, the lawyers obviously want us to be very cautious with how we phrase things as well. We want to make sure that we're doing things properly and conservatively.

But when it comes time, if the business makes sense to be public, you know, we'll explore a variety of things to kind of make sure that that's done in an optimal way. Okay. So now let's talk about the AI portion. One part of your press release mentioned that you will be, quote, assembling an in-house operating team to support companies with operational improvements and successfully navigate the AI transition. So how do you see Orange Juice helping your portfolio companies with AI?

Yeah, so a lot of business owners, especially ones that are looking to sell, are, you know, older in years. They might not, you know, they have a lot there, they're handsful running a business. You know, they might have just been overwhelmed figuring, you know, how can I get AI to make my business a little bit more efficient. And if you have a team that is prepared to go in there and help them with that very, question, you know, it's a way to kind of ease them of that burden. You know, it's not one of those like hack and slash type of AI approaches. We just say, hey, humans are irrelevant. We can do everything with AI. We can degrade customer experience to, you know, save a, you know, a couple pennies here and there. Instead is basically saying, okay, are there redundant back-end tasks that can be, you know, just way

smoother with AI? You know, can we use AI and just, you know, obviously the various kind of pattern, recognition, optimization to figure out where revenue growth might be able to come from. You know, can we do revenue optimization with AI with that analysis? And even just like value stocks in general, like, you know, I pay attention a lot to the banking space, which is something, obviously, it's a separate conversation than Orange Shoes. But when you look at like community bank CEOs or very small regional bank CEOs, it's often not the most tech forward group out there. you know, the average CEO in that category is like 60 years old.

And, you know, they're experts in finance and banking and all this. They're not necessarily tech experts. And so when they look around and they're saying, how can we keep up with the really big banks that can go hire all these, you know, AI experts and tech experts and all that and digitize their platforms, how can we keep up with that? And I think that basically the same type of questions being asked by a ton of small business, small and medium business owners around the country and around the world, which is, you know, the owners, the owners, you know, like up in years,

even if they are tech savvy, they might just have their hands full, right? They're just, they're running a business. They're not, you know, they're not, they don't want to reinvent the wheel with this whole thing and just kind of custom apply it. They could bring in consultants, which is hard if you're at that smaller scale. And so we think that having a small but, but very kind of, you know, kind of updated, in-house team to go in and just work with that owner and say, we want to preserve the business that you build.

We don't want to interfere with customer relationships and just disrupt your team, but we do want to find ways to, you know, to stay competitive in this modern world, how can we, how can we streamline your backend? How can we make it so that you maybe don't have to hide, you know, maybe you're not letting people go, but you're not hiring as much because you're doing more with employees you have because you can empower those employees to do more with AI. you know, how can you use AI to seek out new revenue opportunities that, yeah, that might have been invisible to you before.

So we generally think there's an arbitrage there of these kind of just smaller, you know, cash flow in businesses that just probably aren't the earliest AI adopters and that can be accelerated in a responsible way. Yeah, I mean, even if I think about my company, just in the last few months, so many of these back-end operations have been completely transformed. So I agree that that could probably happen at pretty much every single company on the planet. Yeah. All right. Let's talk about strategy now.

You know, we alluded to this earlier. They've definitely come under fire recently for complicating their capital structure. You know, there are some people who are saying that what they've done is created a structure where any move they make will hurt at least one part of the capital structure. And obviously, we've seen that they're selling Bitcoin. after Michael Saylor famously said, you should sell a kidney before you sell Bitcoin. So what do you say to those critics?

Like, do you agree with them? Do you disagree? What's your take on what's been happening with strategy recently? So I think there's some valid criticism. I think my view kind of, it shifted over time based on when you asked me this question.

Because I've been an analyst and shareholder of microch strategy, so I, you know, analyze them. When I went on there February, earnings call. So I've been on two of their earnings call as an analyst. One of the things I focused on, the two main questions I asked were, you know, are they going to maintain that existing USD reserve policy? So that two to three year worth of preferred dividends, are they going to maintain that policy? And two, we had seen actually at the ego death side in our venture capital arm,

we had seen a number of companies looking to build products on top of STRC. some of which could be levered. And so we, you know, that, you know, certainly gave me some red flags, combined with just Tradify leverage. If you have one thing, you know, pretty low volatility with a high yield, and you can borrow at a lower yield than that, there's a lot of investors out there, either retail or institutional, that might want to try to lever that trade, and it comes with certain risks.

So my second question was, you know, are you monitoring leverage built on top of SCRC? How would you kind of encourage or discourage? or discouraged, that type of thing. In the months that followed, generally speaking, their USD reserve dip below their two to three year guidance that they had given. And, you know, when they were gathering questions for their next earners call, which I wasn't on, but I did on social media provide that question, which was I pointed out that the dollar reserve fell to 18 months outside of their

two to three year range. And if they have updated guidance. And then in the month or so that followed after that, at one point dipped all the way to down to six months of dividends of, of reserves. And to their, to their credit, it wasn't because they, you know, they, they just aped into Bitcoin. They actually paid off one of their convertibles. So they, I would assume that they actually somewhat view that as a conservative decision. But I think kind of a chief, you know, if I were to be critical to the company, is that they generally

speak when a company sets guidance, especially things that is in their power to do, the market generally expects them to follow that guidance. And so if there's kind of surprises to that, you know, to their operations, you know, it can spook investors. So that combination of having, I think, a lower dollar reserve and then, you know, leverage built on top of STRC, obviously that combination can create a very powerful volatility event. And then when that volatility event happens, investors can get spooked about the ability for the company to kind of continue supporting, you know, the dividends there. So I think that there are things you can be critical of of kind of the steps leading up to that. Where I do like the announcement that they did where they came out with that kind of

updated plan where now they have a board level kind of line in the sand that the reserve has to stay above 12 months unless the board authorizes otherwise. They also kind of authorized pools of like buyback capital, you know, for some of their preferred with an emphasis on STRC as well as potentially their own common stock. They've always been trying to make their my read of their kind of selling of Bitcoin is partially that they want to show that they, you know, that reserve can be tapped

to pay for dividends and things, which unlocks, obviously, years of reserves assuming that Bitcoin doesn't just totally collapse from value or something. And, you know, obviously, in a perfect world, they didn't really want to sell their Bitcoin. They want Bitcoin to keep appreciating. They want to build an issue new capital

with positive MNAVs. But they do have that opposite. to fall back to. And so I think that there is been some criticisms around, say, the path that depends to get here. It would have been, I think, better just not to let the dollar reserve fall as low as it did. But I do think that the steps that they've done since then have been, you know, about as ideal as I could consider. Like, if I just found, if I just found myself in that situation with, you have six months of reserves, STRC just had a really big volatility event and it's still nowhere near to the target, what steps you do now, X, Y, and Z?

I can't imagine what steps I would have taken differently than they would have since them, even if I might have advised different steps in the months leading up to that point. Yeah, I said this on some other shows, but it sort of felt like what happened was that it was more about the psychology of just whether or not you trusted their judgment anymore. It was like they said one thing, they did another thing, you know, not clear communication. like they were just a bunch of missteps that I think caused investors to lose confidence in the decisions they were making. And it's not about like, you know, whether they have enough Bitcoin to fund all the dividends or anything like that.

But, you know, ever since they announced their new plan and, you know, all these kind of rules about how they'll operate, we've seen that. So first of all, the MSTR MNV is still at about one. And STRC is, well, actually, last night when I checked this, it was at 85. I don't know what it's right now at this moment. So it's not at the $100 it's supposed to be at. So, you know, given this state of affairs, if you were strategy, what would you do? Good set of questions. I mean, their latest actions have been to be building their dollar reserve.

They actually, I think announced one in the past 24 hours or they got it up something like 22 months. So I think that's a reasonable kind of initial step is just have this USD reserve. And some people are critical of it while it's building because it is generally speaking dilutive in terms of Bitcoin per share to be building that reserve. Obviously, an ideal path is that you never dip the reserve

in the first place so that you might not have boosted Bitcoin per share as much, but then you're not also pulling it back. But again, you can't really go back and change the past. So you are rebuilding their reserve. I think there's a reasonable first step. Two, if STRC stays in the 80s, they do have this authorization to buy it back. So that's an option that they can turn to, which I think can make sense. I also think a very reasonable approach at this current time is just a wait and see approach.

It's still early. It generally takes a while to repair. you brought up investor psychology around management. If they deviated from guidance, they have this new guidance. I think the market wants to see how credible that new guidance is.

I think the fact that it's backed by the board further boosts the credibility, but the market, you know, it takes time for information to go to the market. I think they want to see months and quarters of execution. And so I think that sometimes the best option is to not

really change things and just keep doing what you said you would do and give the market time to adjust. It can also be the case that the market just currently waits STRC at a higher risk and it wants a higher yield. And so it's pricing it down so that it has that yield, you know, at least for investors that buy in. And so they have a couple of levels that they can pull, But I wouldn't say that they have to overdo anything. I mean, I think we're still in a Bitcoin bare market. So it's natural that MNAVs are compressed and just overall demand for their products is relatively compressed, especially after they had that, you know, that market scare, that volatility event. So I think, you know, just going for now and just continue to operate the way that they said they would is probably the key first step.

Okay. And I would love to ask two quick questions on that. Bitcoin. One is about BIP 110, which proposes a temporary soft fork in which nodes would for a year reject transactions that hold arbitrary data such as for inscriptions. Do you agree with BIP 110 supporters that inscriptions and similar data on the Bitcoin blockchain are quote-unquote spam? I'd say for the most part, I do view that as spam. A lot of is just speculation. You know, I think that the amount of utility that has been used for Bitcoin's non-monetary space has been low. So, you know, that gets a specific question.

It's like if you pay for it, is it spam? Generally speaking, for a network that is designed primarily to be a money, I would consider that spam. One thing you mentioned is that it keeps arbitrary data out of Bitcoin. The challenging part of Bit10 is it's not even fully the case. It limits op return. There's still ways to put a lot of money. non-monetary data into the blockchain, especially through the more inscription route, so into that kind of witness of the blockchain.

And that's actually one of the biggest criticisms that opponents of it have, or those that, you know, might even be sympathetic to the cause of, you know, adding costs to non-monetary data in the blockchain. They might say that, you know, this doesn't necessarily solve the problem, but just kind of moves the problem around. And then, of course, there's different debates within the Bitcoin space. are certain types of how that non-monetary data is organized better or worse than others. Like if you break it in chunks, does that fix it?

Or is it still a problem? That's kind of the ongoing debates. In general, I think it's one of those things where there are reasonable concerns that the proponents of that BIP have, you know, about either illicit material winding up in Bitcoin or just the overall kind of bloat that can happen. but I think that any time you try to rush a soft fork in Bitcoin, you know, I think one of the, probably the, probably the biggest single, you know, attribute of Bitcoin that brings a lot of us to it is it is very, very hard to change.

If Bitcoin was easy to change, you know, that kind of makes it sound money aspect reduced. So I think the fact that Bitcoin is very resistant to changes. There were those just a couple years ago that really tried aggressively to make Bitcoin more expressive, you know, to take on just more kind of script expressivity in Bitcoin. And that kind of ran into the wall of not going to happen, at least not in that time frame. And now it's kind of interesting that we're seeing kind of at the other angle, which is how to make Bitcoin even more conservative in some sense. And so I think there's a long-term discussion to be had around non-monetary data in Bitcoin. But in general, I've used some of the marketing around the BIP to be

somewhat disconnected from what is the actual the BIP is kind of able to do on a technical level as it relates to non-monetary data. Okay. And of course, I have to ask about the quantum threat to Bitcoin. I'm sure you know that this is something that a lot of people have their eyes on in terms of what is potentially a long-term threat that obviously would hit most of crypto and, you know, a lot of other things in the world. But the threat is almost existential for Bitcoin just because of certain things around, you know,

Satoshi's coins and the different key signature, some of which are quite vulnerable. There's just, you know, a whole set of things around also the culture of Bitcoin that, you know, are causing people to have concern about whether or not the community will be ready to face that threat once it comes. How do you think about that? Good question. I would separate the different concerns. So I view Satoshi's coins is less of a concern than most because we're talking about 5% of coins, roughly speaking. And then there's a number of lost coins as well. I view that as a volatility event more so than existential.

I think the bigger topic is the other one you brought up, which is that I mentioned the prior question, which is that Bitcoin is very resistant to change. So there's a lot of systems that are quantum vulnerable should a high-powered quantum computer emerge. but some of those can be changed faster than a system that is inherently decentralized and inherently resistant to rapid change. And then even when you do the change, for example, if you introduce a new address type, it takes time for existing coins to migrate over to that. There's only so much throughput that Bitcoin can do. And so you generally speaking want to get that change earlier than later. I do think it's a good thing that there are researchers working on this problem.

one of the worst things you can do is overestimate the threat and then rush a solution because quantum resilient signatures are still evolving. It's still not clear what the best one's going to be years down the line in terms of what is most data efficient, what is most resilient to the attacks,

what has been kind of fully vetted. And so putting in one that is maybe not up to par in a number of years just to get one in there could be worse than doing nothing at all. So I am glad that people are working on it. I don't, you know, I don't view it as a near-term risk in, say, five or ten years, like some of the really big quantum bowls do. I do think that there's a much bigger difference between kind of theoretical growth in this field

and actually bringing a cost-effective quantum computer to market at this scale. Generally speaking, the hardware takes longer than, you know, kind of many people think where they're just kind of theory crafting it. But I do think it's something that can't be fully dismissed. And I've talked to some of the people that have, you know, they're the ones working on the BIPs to eventually add quantum resilient signatures to Bitcoin or other solutions to make it more resilient. And I, for one, I'm just glad that there are people looking into that

to hopefully have solutions in place well before we need them and that we've vetted kind of all the possible things that we could do to find whatever signature types are the best for it, rather than just kind of the first one that we rushed. All right, Lynn, well, as usual, it's been such a pleasure having you on Unchained. Thanks for coming on. Thanks for having me. Nothing you hear on Unchained is investment advice.

This show is for informational and entertainment purposes only, and my guest and I may hold assets discussed on the show. For more disclosures, visit Unchained Crypto.com.