Raoul Pal: The Journey Man
00:02:35 · Raoul Pal, Micky Malka
The Journey Man, as you well know, is my journey to that nexus of understanding between macro, crypto, and the exponential age of technology. Today, I've got a special treat. I can't think of anybody better in the world to speak to on this whole nexus than a good friend of mine, Mickey Malka. Mickey is well known for being probably the greatest fintech investor of all time. You know, he was early, very early stage investors in Coinbase, Robinhood, Revolut, you name it. He was Bitcoin 2010. All of the things. Mickey has been at the forefront of everything that's been happening. He's also thinking deeply about where AI is going and how it all fits together. The brilliant Ribbit Capital essay about the tokenization of everything and what tokenization means, not just in the crypto sense, but the broader packets of information that render all of this information for the new digital age is powerful. And Mickey also is a great collector of digital art. So I've got an incredible amount to talk to him about. And I think you're gonna be... You'll really enjoy this because there'll be lots of new perspectives from you from somebody who really is at the nexus of the exponential age. Enjoy. Join me, Raoul Pal, as I go on a journey of discovery through the macro, crypto, and exponential age landscapes. In The Journey Man, I talk to the smartest people in the world so we can all become smarter together. Mickey Malka, welcome to Real Vision finally. [00:04:15] S1: Oh, it's good to be here with you.
00:04:15 · Micky Malka, Raoul Pal
[00:04:15] S1: Oh, it's good to be here with you. [00:04:17] S0: Yeah. Look. I'm really looking forward to this because, a, you've got an amazing story, and, b, you're doing amazing things. And our paths intersects with all of this stuff, so we have a lot of common interest in this stuff. But I'd love to start by telling your story because you've got one of the great stories of finance, and I think it's a nice story how the boy from Venezuela ended up doing what you're doing. I mean, it's just a great story. So if you can take us back in time a bit and tell us about how you got here. [00:04:47] S1: Sure. It's a long story. I'm gonna make it short. But I was... I grew up in Venezuela. And in the nineteen eighties and nineties, it was an amazing place. The beautiful thing about it was that I was exposed to every single macro event that you can imagine before the time I was 15. If you ask me about hyperinflation, devaluation, capital controls, banking system collapsing, I had checked the box in so many of them since I was very young. And I got to learn. That was my master's in life was exactly that. So I did go to college there because my parents were expecting a degree in economics, but I started my first company when I was 17. [00:05:30] S0: Wow. [00:05:30] S1: And I started a broker dealer. [00:05:35] S0: Why? How?
00:05:35 · Raoul Pal, Micky Malka
[00:05:35] S0: Why? How? [00:05:36] S1: I I understood flow of funds. I understood that, my dad had a private medical practice. And when oil was up, patients came in and spent money in their in their exams. When they didn't, they didn't. So I don't know. You just grew up seeing all of these things. So to me, understanding markets was very natural, very simple. And when I was 17, it was a couple of years after the Brady bonds were all restructured and Venezuela had restructured. There was a whole fixed income world out there that I started to learn about. So I grew up in the environment of bonds and issuing and and privatization of companies in Venezuela in the nineties. So The Broca Dealer was a great place to be. [00:06:17] S0: Amazing at 17. And then what prompted you to leave Venezuela? What was that story?
00:06:17 · Raoul Pal, Micky Malka
[00:06:17] S0: Amazing at 17. And then what prompted you to leave Venezuela? What was that story? [00:06:23] S1: So I started to grow that business in the in the mid nineties, and I started to do more with New York and bringing Americans to do business in Venezuela and all of that. And in one of my trips, I saw an ad for a billboard in New York for E*TRADE where you can trade online for $29.99 or $19.99. And I'm like, what is this? So I got on a plane. I went to the E*TRADE office, pretended I was looking for a job, got interviewed, and learned as much as I could of what they were doing with online trading on the Internet. And came back and decided to completely, at 23, shift everything I was doing to the Internet, shut down the offline part, and start building the online broker dealer for what was then the second largest market in South America. The biggest one was Argentina. Second one was Venezuela. Everything else was nothing. And in that journey, I met a dear friend who... Well, I mean, I met an entrepreneur who's become one of my closest friends, who you've you've know. And we started... We merged because he was doing the same thing out of Argentina, and we started this company called Patagon in '98... '97, '98. [00:07:35] S0: And then so you you then became... You and Wences did a few businesses together. Is that right?
00:07:41 · Micky Malka
[00:07:41] S1: We did. We we... This first company, this first broker dealer, we we... There was no VC money in Latin America. There was no venture. We were not the kids of anybody famous or we were middle class kids. So we had to raise money in The US. And we convinced a bunch of investors in The US to give us money to allow us to grow this. We grew it into Brazil, Mexico, Chile, all over the region. And in 2000, Santander bought the company from us in in the peak of Nasdaq. And once they bought it, they took it over. They merged it into their operations in every country. And when the Internet blew, they had zero conviction on the Internet after the dot com crash. So... Yeah. So we convinced them to to allow us to build an online bank in Spain called Open Bank, which still exists. We started... Lived in Spain, was behind that for a long time. We then left Santander after our contract was due and moved to Brazil. When Lula won, we had met Lula. Lula won. The new Lula is very different than the first Lula. And the first Lula was very much into trying to bank the unbanked, give them access to financial services, trying to get them into the ecosystem. Back then, Brazil had 40,000,000 bank people out of 160 back then. And we started our company. We started our technology company to serve the unbanked with financial products. So I lived in Sao Paulo for three years, did that, sold it to the largest bank in Brazil alongside with Wences. And then we moved together to Silicon Valley eighteen years ago. And that's been the whole different journey of our lives, our our fourth chapter... Third and fourth chapter.
00:09:22 · Raoul Pal
[00:09:22] S0: So talk talk me through that chapter. So then you... Did you go straight to start a venture capital business? Or