Relentless
00:45:41 · Brian Armstrong
[00:45:41] S0: Yeah. So for folks who don't know, we we have something internally called next bets. And twice a year, we have a panel where anybody in the company can come in and pitch and say, I think we should be building this, and I have one or two people that wanna work on it. And you don't have to get a yes from everyone on the panel. That would be a committee where they're... Like, one no means nobody does it. You don't have to go to your your boss, your boss' boss, your boss' boss, all way to the CEO. That's also a committee in another form where one person's no kills it. And my fear was from reading things about, like, you know, Wozniak, Steve Wozniak at HP. Like, he went... Famously went to HP and said, I think we should build a personal computer. They said, no. He left to found Apple. And so your best people, even junior people on the on the team can really be on the frontier, like, coming with great ideas. Not all of them are gonna be great, but some of them are really great things. And so what we've done is we've created this next bets program twice a year that can in and pitch, but they only need to get one yes. So of the panel, there's different product group leaders who each have their own budget. They can decide to fund it out of their own budget. There's folks like myself, some young engineers like our president, CFO, etcetera. And so if you get any one of them to decide they want to fund it, you're greenlit, and it's kind of like coming in and pitching an internal set of venture capitalists. So that's what we modeled it after is if you go pitch 10 VCs and you get one term sheet, you can go move forward. So it lowers the bar for these ideas to be tried. Now we also want to make sure we don't lose focus at Coinbase. We can't just, like, fund everything willy nilly. Right? We we use what's called, like, seventy twenty ten resource allocation, so 70% of the of the resources are on, like, our core business, which has a certain definition of a scale and profitability. Make sure you keep the main thing the main thing. You know?
00:47:24 · Brian Armstrong, Ty Morse
20% are on these adjacent or strategic bets that have reached a certain scale, but they're not profitable yet, and 10% are on these venture bets, the the next bets, which are typically very small teams, like two or three people, small amounts, but they're really kind of crazy high potential ideas where it's okay if they have... They don't work, but if the ones that do work could be really massive. And that's just been fun. I mean, it's just fun, like, both because I get to go work with a lot of these next bet teams, and they're, like, just these really brilliant, high potential young people, and I get to... They get to work directly with the CEO and other people in the company, and then we get to try, like, a lot of really innovative ideas. And, yeah, USDC came out of that. The base blockchain came out of that. There's a really cool one we'll probably announce in a couple weeks. So... [00:48:09] S1: Yeah. One of the founders that I interviewed recently, he basically is a pro drone racer. [00:48:12] S0: So he [00:48:13] S1: used to be, like, the world champion drone racer. He said, When I first started the company, it was because I love making drones and now I don't make any drones. I created this thing and now I have to live with it. Was there any moment where you were building the company and realized, Oh my God, I haven't been doing the thing that I actually love for a while, and reevaluated your entire life and how you're operating to make sure that you're having fun?
00:48:35 · Brian Armstrong
[00:48:35] S0: I really loved programming and coding. And in the early days of the company, I built the first version of the product and was coding a lot of it. So were parts where I felt a little regret about not getting enough time to do that. But I also felt like really the thing that motivated me about it was building things was that you could have an impact on the world. You could start to build cool stuff. And actually, I didn't have to be coding to do that. Organizing a team of people and coordinating fundraising and all these things are another form of building. Now recently, I have started to get a little bit back into coding just because of the AI tools getting so great, which is really fun. But yeah, I mean, there were certain points along the way where I would say I got burned out, right? For sure. I mean, starting company is a grind, right? And there's a lot of people I know who they do it at an unsustainable pace or something about it, like, really stresses them out, and they just... It's just unsustainable. Like, they they gain a bunch of weight. They lose a bunch of weight. They can't sleep at night. Like... And it's fine. Every... There's gonna be periods of stress, but you you also need periods of renewal to try. How do you get it to be, like, a marathon pace, not a sprint? So I'd say every couple years. I've been building Coinbase about thirteen years now. Every couple years, I'd say I hit a patch of burnout, or I was just like, oh, man. This sucks, and I... I'm exhausted or, like, whatever. Something wasn't working. And, usually, you what you have to do is change something about it. It's like delegate part of it. Stop doing something. Hire someone to do that who actually is better than you at it. Be okay with your ego saying, only I should be the one doing that, but oftentimes it's your ego talking. Right? And it's like, maybe you don't have to do that. Like, put someone... Have someone do it who's better than you at it and let go of that. Right? Or there's different variations of it. But I also... You know, you don't want it also... It's not supposed to be like, building a company is not supposed to be fun all the time. Like, it's kinda like, if you're playing a video game, right, and it's just like every level was easy, you're just, like, clicking buttons. Like, doesn't...
00:50:30 · Brian Armstrong, Ty Morse
It has to be, like, hard and difficult enough to be fulfilling, right? So I think sometimes people start to be like, well, man, I made... I have a little bit of success, and I started to make some money, and, man, why am I dealing with all these problems, right? But it can also just be very unfulfilling to, like, sit on the beach literally or metaphorically. And so I think it's important to still be in the arena and playing the game and, like, trying hard stuff, and some days you're going to be like, That was exhausting and sucked. And other days you're going to get some wins on the board, and you're going to look back on it over a period of a decade and you say, like, that was fulfilling, hopefully, right? Like, I tried to do something big and important in the world. It didn't go exactly how I thought. Some of the stuff was harder, but we actually ended up having a pretty big impact. So that's fun, and I hope I get to... In the broader sense, right? And I hope I get to do that for a long time. [00:51:20] S1: Crypto companies have one very unique trait that almost no other company has, which is they're effectively public from day one. And what I mean by that is as soon as you founded Coinbase, you have this real time ticker that is Bitcoin that is kind of saying, here's how hot the industry is at any given point. And because of that, you see these violent cycles up and down from the beginning. What makes you uniquely suited to absorbing and experiencing pain and just staying at it? Well, you're you're totally correct. Like, we did have a lot
00:51:51 · Brian Armstrong
[00:51:51] S0: of that volatility before even being a public company. And, I mean, there was periods of, like, three years of crypto winter where I remember, like, 30... 25, 30% of the company quit, and it was just like, they think it's over. And I'd go I'd go to interviews with, like, journalists, and they'd be like, so now that crypto's over, what are you gonna do next? So, yeah, what is it about my personality? I mean, well, first of all, I think it's like anything. You know, if you get more reps on it, you start to... It doesn't affect you as much. Right? So it's it's kinda... Actually kinda funny. Like, the Bitcoin price just recently came down from about, like, 125 to, like, 60 or something. Now it started to go back up again. And part of me was like, man, that was like a pretty mild winter. Know, like, I think everybody kind of lost their mind for a bit, and we saw all the same tropes come out. But part of me was like three months. That that was it. Like, we get... You know, I've been through, like, three year crypto winters, like... And so... Anyway, I think that the winters are getting a lot more mild now, which is good. I... I'm a pretty... Like, emotionally, I'm a pretty steady person. Like, I don't think I feel high highs the way that some people do, but I also don't feel the depths of the lows. It's a more moderated sine wave or something. And, you know, I can kind of, like, develop a routine where every morning, it's like I just try to get after it, you know? And usually when I wake up in the morning, was like, I'm kind of tired and like, this thing sucks. And and, you know, I kind of have to, like, get my mind right in the beginning of the day. And I have, like, a routine for that where I'd, like, do some exercise and, like, you know, write down what I want to get done and sort of dust myself off and be like, alright. Let's get ready for
00:53:26 · Ty Morse, Brian Armstrong
[00:53:26] S1: Do you actively just say no phone for the first, like, thirty minutes or, like, after a workout or something like this? [00:53:32] S0: Well, I think it's better to... Like, what I try to do... I'll tell you what I try to do and then what actually happens in practice. What I try to do and happens probably 50% of the time is that I'm just listening to, I would call it like positive learning development stuff in the morning. So it's like podcasts, audiobooks, which I can usually ingest those like on a, you know, some multiplier, faster than reading, actually. Most people are better at reading than listening. I'm better at listening than reading. But I... So I start off the day trying to ingest something inspiring, like educational, and then, yeah, like, at a certain point, usually the day gets started, and you kind of jump into the flow of things. I also try to start the day really with the things that are the most important for me to get done and then dip into, like, the flow of whatever it is, like x or Slack or or something like that. That doesn't happen every day. Some days, it's like you wake up, and there's someone you have... The only time you can call them is, like, in the morning while you're working out, and I do, like, calls in the gym sometimes too. So [00:54:32] S1: That's interesting. I don't know if you used to hike a lot or still hike a lot, but what has been the role of hiking and, like, getting your mind right and thinking longer term and and these sorts of things?