Sam Parr interviews Jason Yanowitz, co-founder of Blockworks, the largest crypto media and research company in the space. They cover how Blockworks was bootstrapped from a small events business to $20M+ in annual revenue, Jason’s wild origin story running an MLM in college, the economics of conference businesses, and why Jason keeps nearly all his personal wealth in crypto.
Speakers: Sam Parr (host), Jason Yanowitz (guest, co-founder of Blockworks)
Welcome and Introducing Blockworks [00:00:00]
Sam: Where are you calling from? Your place looks nice. Is this your apartment?
Jason: Yeah, this is the Blockworks office. We got a new office about a year ago in Manhattan.
Sam: How many people do you have?
Jason: About 60. I think we’re up to 65 — we had six people start this week, so that might put us at 65.
Sam: What’s the pitch for what you are?
Jason: At the high level, a crypto media company. But what did you tell me the other day? You go, “You do everything right. You do things the right way.”
Sam: Wait, let me just get this straight. Is Shaan not joining us? You know what — Shaan DM’d me one day. He gave me his cell phone number. He said, “Dude, hit me up, would love to meet and chat.” I’ve never met the guy. He gives me his cell phone, I text him, “Yo, it’s Jason, what’s up man” — said something, friend tech guy just ghosted me. Left me on read.
Jason: Really? This was gonna be my time on air to call out Shaan, but alas.
Sam: Well, you called him out. Shaan’s out — he’s getting a nose job, out with surgery this week.
Jason: Really?
Sam: Yeah. But he’ll hear this.
Jason: Shaan’s a ghoster, man. He’s a ghoster. I give him a hard time for that, but he brings the heat, so he gets a pass.
Sam: So what are we talking today? I don’t know, man — tell people. You’re under the radar, but your business is shockingly big and I think it’s going to be incredibly successful. What’s the pitch for what Blockworks is?
Blockworks Origin Story [00:01:30]
Jason: Blockworks started six years ago. My co-founder Mike and I started it in December of 2017. The thesis back then — which remains the same — is that crypto as an asset class and as an industry is going to grow exponentially over the coming years. This was back in 2017 when most of the information about the asset class was basically siloed on Reddit and Twitter.
Our thesis was that as the industry grew exponentially, the investors and professionals who came into it weren’t going to listen to Crypto Panda or Crypto Whale about this new asset class. They wanted a professional source of information, kind of like a Bloomberg or Wall Street Journal for crypto. So we said, let’s go build it. That was six years ago.
What we’ve built — for the first five years — is basically a media company. We own the largest podcast network in the industry, we have a couple of big newsletters, I think the best team of reporters and journalists in the industry, and we own a couple of the large conferences in the industry. Then about a year ago we thought the industry was ready for deeper, what I call bottom-of-the-funnel information — crypto data, analytics, research, protocol governance. That’s our subscription platform called Blockworks Research.
So we’re a media and information platform, just about crypto. A crypto-native media and information company.
Sam: Did you share how big you are? My researcher Eugenio had your revenue and EBITDA numbers. He said 2023 you’re going to do $25 million in revenue with $8 million in EBITDA, and 2022 you did $25 million and $7 million EBITDA. Is that right?
Jason: I’m not going to say specific numbers, but what I will say is yeah — last year we had a goal of $20 million in revenue and we pretty decently exceeded that. We’ve been profitable since day one. We bootstrapped for the first five and a half years, and then back in April or May we raised our first outside round — $12 million out of a $135 million valuation, from 10T and Framework and an angel, Santiago.
We’ve been profitable since then. Those numbers are a little off because this year — just to share some insight into the crypto market — the market’s gotten crushed. What’s actually done really well for us this year is the subscription revenue on the research platform. But the ad market across the board, both in crypto and digital media — if you’ve talked to the Morning Brew guys or seen the BuzzFeed numbers since they’re public — it’s been a tougher year on the ad market.
Sam: Is it coming back now?
Jason: The ad market is just starting to come back.
The Conference Business Model [00:05:00]
Sam: You guys crush it on conferences. I went to your conference — what did you have, 5,000 people there?
Jason: The final number was a little above 4,000 this year.
Sam: I mean, that was amazing. It seems like you filled it.
Jason: Yeah. I’m a media nerd. I think that everyone who has a media business or works in the media business — they hate it and they love it. I hate it, but it’s like an art I’m addicted to. I hate selling ads but I love creating media.
Media is an interesting business because the barrier to entry is really low, particularly for the written word. Everyone can write. Therefore the pool of people who think they’re good writers is significantly higher than in building some other type of business. Most people do it really poorly — myself included. I’ve made a lot of mistakes.
But whenever you’re telling me about your guys’ business, I’m like, from the outside I see a crystal-clear path to $100 million in sales. You just do the same stuff but more and more, and you’re just thoughtful. You do things right. I think you’re one of the more under-the-radar operators in the space.
Sam: Thanks, man. That’s why I think a digital media business is actually one of the best businesses to start. It’s not going to make you a billionaire — there’s no path to that. But a digital media brand is the best venture into entrepreneurship for first-time founders.
Mike and I were just roommates. We were 23 when we launched. We just worked. We’d wake up at like 4 a.m., jump on LinkedIn. We had no media business, we didn’t even know what media was. We just wanted to host an event because we went to an event and realized they made like $5,000 — that was big money to us. So we’d jump on LinkedIn every morning and send like 300 messages. Ten of those people reply, that’s 30. You get like three out of the 30 to actually buy a ticket. Our first event, February 2018, we had 220 people and made $12,000 top line.
That’s off to the races. Then we ended up building the media company basically ass-backwards. How you probably started with The Hustle was with content.
Sam: Yeah, I did it horribly.
Jason: I would argue the problem with most media companies and why they don’t work is because they’re started by folks who can’t monetize. They’re usually started by a podcast host or newsletter writer who’s brilliant at content but doesn’t understand how to sell. So they’re a year and a half in and they’re like, “Oh, I need to monetize” — and they don’t know how to build a business.
For us, we did events, then we linked up with Pomp. Our first podcast was his — it used to be called “Off the Chain,” now it’s “The Pomp Podcast.” We were doing everything. I’d go into Pomp’s office seven days a week, Saturdays and Sundays. I’d put the mic in front of his face, I learned GarageBand, I was editing and producing the podcast, designing things on 99designs, selling the sponsorships — all of it. We built that out, hosted shows for other people, realized that was great for revenue but sucked for IP because we don’t actually own the content.
Sam: You’re just an agency.
Jason: Yeah. Then COVID hit and 80% of our revenue got wiped out overnight because 80% came from events. That’s when we pivoted into media proper.
Sam: How much could one event do in sales?
Jason: Our biggest one — last year we did well over $10 million from Permissionless.
Sam: Dude, that’s insane. My whole thing with events was I did the same thing with HustleCon — I threw it together in six weeks. I think the first time I did it I made $50,000 in revenue and $20,000 in profit. The second time, $160,000 in revenue and $50,000 in profit. The third and fourth time it varied between $500,000 and a million in sales. But the margins got smaller, events were hard, and I screwed it up. I made the event about speakers on a stage with people sitting in the audience — basically a TED Talk format. That was really dumb from a money-making point of view.
I knew some of these events were doing tens of millions in sales and I totally screwed it up. The way you really make revenue is the speakers are simply a way to get like-minded people in the audience. You make money through more expensive ticket prices because you’re selling networking. You make money through what people call sponsorships but are really booths — it’s basically a marketplace. A conference is a three-day marketplace where you build it and shut it down three days later.
Jason: Sheldon Adelson. There’s this guy, Sheldon Adelson — I think he just died — he started this thing called Comdex, which eventually became CES. He built it up and actually sold it for a billion dollars. He’s also the guy who made the Vegas Strip happen, because what he noticed was: I’m basically just creating real estate. I’m selling corner space because that’s the best space. It’s a marketplace. And then he said, well, I’m just going to get into real estate — he saw all the parallels.
When I read that I was already pretty deep into my one big event and I thought, I did this all wrong.
Sam: You know what, I don’t even think you did it wrong. You just needed to go bigger.
Jason: So the secret with events — the business model of small events is a great experience for attendees, really fun, good community building. It’s a terrible business model. The secret is you need to figure out how to go really big.
One early insight: let’s say you have a company like Coinbase. Coinbase might pay a million dollars to sponsor our conference. If we launched another conference, they’re not going to go to $2 million — they’re going to cut that million in half, so it’s $500K here and $500K over there, but we’re doing twice the work. So we basically consolidated. We now just have two conferences: Digital Asset Summit and Permissionless. Bigger is better.
What’s really tough is big conferences require booking venues years in advance. Our events team wants us to book four or five years out. We can’t do that because crypto is too cyclical. And if you’re planning a big event but you end up not being able to host it at scale, it can crush your business. CoinDesk almost died in 2019 because of that. They had 10,000-plus people in 2018, fell to like 2,000 people in 2019 — down 80%, almost wiped out the whole business. Their takeaway was that big events aren’t going to be big again, and so they de-invested from it. You lose money on the upside when the market comes back.
Sam: But you’re big enough now that cities are courting you.
Jason: Yeah. The bigger your conference gets, the more GDP you bring into a city. For Palm Beach last year, I think we brought in like $3-6 million of GDP in those three days. The mayor came to our conference, he really wanted us to come back.
The bigger your conference gets, the more countries will court you. They’ll give big upfronts. How much do you think Web Summit got?
Sam: Web Summit has what, 50,000 people? A couple million probably? Maybe $5-10 million plus tax credits?
Jason: That’s insane. I haven’t cracked the code on events. But you have — that’s why I like hanging out with you. Though it is stressful.
Sam: It is stressful.
Jason: Fifty percent of tickets get sold in the four weeks leading up to a conference. Imagine, five weeks out, thinking 50% of your attendees aren’t coming — even though you have six years of data saying they will. But it’s stressful.
Ultimately the conference serves as the cash flow engine for the podcasts and the research business and the newsletters and all that stuff.
Jason as a Storyteller — The MLM Story [00:13:00]
Sam: One interesting thing about you is you’re one of the better storytellers I’ve ever hung out with. I spent a summer living three floors below you in Brooklyn, and you’ve told some of the craziest stories. Particularly one about when you won a — did you win a Corvette?
Jason: Oh man. I was nervous for this podcast — not because I’m nervous to go on podcasts — but I was telling Dana last night, I’m actually pretty nervous. Sam knows too much about me.
Sam: I’ll give you a pass on anything you don’t want to talk about. I think Shaan and I joke that if you were really good at gaming, good at poker, were a hacker — a lot of people who end up with huge amounts of financial success were doing something gray early in their career before they realized that following the book is way better for long-term success. But they had that gene in them.
Jason: A hundred percent. I’ll tell an abbreviated version—
Sam: No, don’t give me the abbreviated version.
Jason: I’ve always had this entrepreneurial tick. My parents told me that when I was in like fourth or fifth grade I would buy MLB Showdown cards on eBay. I thought they were marketing them poorly — bad picture, bad description. I’d buy the card, take a nicer picture, re-upload the same card to eBay with better marketing copy, and sell it for 2x what I bought it for. I’ve always had that kind of bent.
This particular story — summer after senior year of high school. I wanted some summer money. I went to my parents: “Can I get some money? I’m in high school, I don’t have a job.” They said, “You’re not getting money. Go, my friend Jake is getting a job at Taco Bell — go work with Jake.” I said, “I’m not going to Taco Bell.”
My buddy was a year above me and had just come back from his freshman year at the University of Hawaii. He said, “Hey, I heard about this thing — most companies spend like 40% of their budget on marketing, but there’s another type of company that spends zero on marketing and 40% on affiliates who market their products for them.” Basically the pitch was: if you sell this energy drink to other people, you get a percentage. I’m 18, I didn’t know anything, I just wanted money and didn’t want to work at Taco Bell. So I signed up. I bought like 30 energy drinks and started telling people, “Hey, you drink Red Bull and Monster, you shouldn’t do that — buy these healthy energy drinks from me.”
I did it for a couple months, didn’t make any money. Got to college at Emory in Atlanta. I didn’t want to be the energy drink guy on campus. But then I discovered digital marketing — Noah Kagan, that whole crowd, and Russell Brunson. Figured out how to create landing pages, went super deep down that rabbit hole, and the business got crazy.
Sam: So you got paid a percentage—
Jason: This is where, looking back, I didn’t realize what I was doing. I ended up having 4,600 people in my downline. A thousand in France, actually. It wasn’t just that you were making money selling the drink — you were making money from enlisting people to sell it for you. So basically it was a pyramid scheme.
Sam: Multi-level marketing. Yeah. You told the story — your parents said, “Jason, this is an MLM,” and you’re like, “What do you mean? I’m just selling a drink.”
Jason: The company was the official sponsor of the Phoenix Suns. Dr. Oz was on my materials. If any of my friends from college are listening, they’re going to laugh — they’ve heard this pitch probably a thousand times. I used to get on Skype, not Zoom, and give this pitch to a room of 500 people. “Dr. Oz says a can of this and a handful of almonds is the healthiest thing you can put in your body…” They had all these big names. I had no idea. I really fell for it.
It wasn’t a Corvette — it was a BMW. I got so high up in this company that they gave me a BMW my sophomore year. I tried dropping out of college my sophomore year, got like a 2.2 GPA. My parents wouldn’t let me. I later learned it was a big debate — my mom wanted to shut it down from day one and my dad was like, “It’ll teach him a good lesson.”
It wasn’t until Bill Ackman and Carl Icahn got into that crazy battle over Herbalife that I watched the full presentation and realized: oh my God, he is explaining the company I’m working with. And then my roommate junior year basically slapped me in the face: “All right man, we’re gonna get internships — stop doing this thing.” And then the company shut down.
Sam: How much money were you making with 4,000 people in your downline?
Jason: Probably $1,000–$1,500 a week as a sophomore.
Sam: That’s four thousand people and you’re only making $1,500? I would have thought you’d make way more.
Jason: There were people making millions a year. The balance of my downline wasn’t even — if my two sides were balanced it probably would have been much better. But yeah, for a 19-year-old, that was crazy money. A year and a half after not wanting to work at Taco Bell.
Sam: And you were just giving speeches in front of hundreds of people on Skype about why this drink is awesome?
Jason: Kind of both — the drink and the business. The technical difference between an MLM, which I’d call shady but technically legal, versus an illegal pyramid scheme is the percentage of people who buy the product because they like it versus the percentage who buy it just to access the selling opportunity. The reason Amway and Herbalife can still exist is because there’s a pretty high percentage of people who just buy the products because they like them.
Sam: I’ve got tons of friends who sold Cutco knives and they all say awesome stuff about the product.
Jason: Exactly. This company had been around for 10 or 12 years. They sold mostly to 50 and 60-year-olds who wanted protein shakes and the product was actually good. Most people used it and maybe told a few friends, but they didn’t do the money side. Then they realized, “Who wants money more than anyone? 19-year-olds.” So they launched the energy drink, did flashy marketing, sponsored the Suns, got Dr. Oz as a spokesperson, and that’s when the percentage of people buying the product to make money started to outweigh people buying it for the drink.
Sam: How big was that company?
Jason: I don’t know. The CEO went to jail for a year or two though.
Sam: Oh my God.
Jason: I wasn’t even sure I wanted to talk about this on the podcast today. Multi-level marketing is a shady thing and I didn’t realize it at the time. I’d drunk the Kool-Aid so hard.
The debate I have now — I don’t have any kids, but would I let my kid do this? The immediate answer is no. But it did teach me something. I know for a fact I would not be here today if I hadn’t done that.
Sam: Why is that?
Jason: Blockworks started by just me posting a lot on LinkedIn about crypto. Nobody was posting on social back then, nobody was posting on LinkedIn. The MLM gave me the confidence to post on social a lot. It gave me the understanding that growing a business at the beginning is just grit and hustle and marketing and sales. It’s less about the product — eventually that changes as you find product-market fit, but at the start it’s that.
And it just made me realize there was nothing in the world I wanted to do outside of build a company. I didn’t know how to build a software company — I wasn’t a coder. It just gave me the confidence to go do it.
How Blockworks Actually Started [00:24:30]
Sam: Were you thinking about any other ideas before you started Blockworks?
Jason: Yeah, I was desperate. I had a bunch of bad ideas. The way Blockworks originally started — you had Sam Evans on the show, right? Consulting.com.
Sam: Oh, Sam Evans, yeah.
Jason: I wanted to start a consulting practice because I’d seen Sam Evans’s stuff. I didn’t buy his course but I saw all his ads — this slicked-back hair, bright blue blazer, slick apartment. I later realized he was selling a dream, kind of playing a part. He came on your pod and he’s like, “I helped a lot of people, but I was playing a character that wasn’t authentic to me.” I don’t think he did anything wrong, but he pushed it to the limit.
So I saw those ads and I wanted to do that. I was sick of my job. I went to this thing called Brunchwork in New York — they had an event about how to build a consulting firm at 2 p.m. on a Sunday. I got there an hour early because I thought it was at 1 p.m., and they were doing a talk on Ethereum.
I already knew about Bitcoin since 2015 — I was living in Budapest when I heard about it. But Ethereum I didn’t fully get until this talk in 2017. I came home that afternoon and — this is the real story of how Blockworks started — I went home and said, “I’m launching a consulting firm to help companies figure out Ethereum.” Hours after learning about Ethereum.
Sam: You were like, “This is what I’ve been looking for.”
Jason: I’d known about Bitcoin for two years, had been listening to Bitcoin podcasts, kind of heard about Ethereum but it hadn’t clicked. After that talk it clicked.
I came home to the apartment I shared with four guys, including Mike who became my co-founder. We remember it slightly differently. What I remember is him saying “Let’s do it,” and then waking up the next morning saying, “Wait, this is a horrible idea. I work in consulting. Nobody’s going to buy consulting from us — we’re 23 years old. We need to build trust with the community first.” He said, “What if we hosted events? We went to that event last month and they made some money.” So we started hosting events to try to sell consulting, and six years later we have no consulting — but we have Blockworks.
Revisionist Founder History [00:28:00]
Sam: So blackworks is going to be a huge success. I don’t know exactly how big, but I believe you’re going to have a multi-hundred-million-dollar exit before the age of 33. Very likely. You’re 29?
Jason: 29.
Sam: You’re going to be worth at least $100 million liquid in the next five years. That’s my prediction.
But in order to get there — I think what people always miss is there’s this revisionist history where founders say “I had this great idea,” when in reality you just do a bunch of Meathead stuff, iterate your way through it, and after you hit some type of sustainability and mastery you look back and say “I had this revelation.” You told your story earlier like, “I thought crypto was going to be a big thing and no one was covering it.” But in reality it was, “Ethereum sounds sick. I need a job. I’m just gonna host this event and see what happens.” You know what I mean?
Jason: A hundred percent. And that is true, what I said — we did have this vision that crypto would become this institutional asset class. But yeah, I think you’re dead right. And I think that’s actually a problem that gets pushed — everybody thinks founders had this vision from day one. If you talk to founders who’ve built big companies, 99% of them did not. Not at the beginning.
Second-time founders do. I’ve noticed that. Second-time founders will have a Grand Vision. But honestly — first-time founders, there’s never a Grand Vision. It’s just one foot in front of the other, day after day, and that’s how you build your first company.
Sam: I remember when I started my first thing. I was like, “I want to start a newsletter.” Then I read the biography of Ted Turner and he employed all these people and I thought, “That sounds amazing, I want to employ 10,000 people.” Then I had a team of 10 and I was like, “No. I definitely do not want 10,000 of these people hanging around. This is too hard.”
The second or third time around you have a clearer vision. You also have more wisdom. After doing something for two or three years I feel like I can see five years out. But you also have more patience and trust in the evolution — things take time. When you’re first starting, you’re like, “This isn’t even going to work to get to point B, let alone C and D.”
Jason: A hundred percent. And the other fallacy is this idea that it gets easier as you grow. I think founders keep constant the rate at which they can tolerate problems, and everything else becomes a variable. You’re always in the zone of max pain. Whenever you’re below that threshold of max pain you take on more stuff. I thought when Blockworks hits 10 people it’ll be a lot easier. Then 30. Nope. I was listening to Patrick Collison on a podcast — the founder of Stripe — and he is in max pain right now. It doesn’t get any easier.
Sam: Have you read the Elon Musk biography?
Jason: I’m reading it right now, about 200 pages in.
Sam: All my friends keep talking about it and his life sounds miserable. He does not sound enjoyable in the slightest — his personal life, his professional life, all of it sounds bad. I would not trade what he has for anything.
What Founders Are Optimizing For [00:34:00]
Jason: Can I flip the script and ask you something? You were talking with the Soylent guy about what you’re optimizing for. Some people optimize for money, some for happiness. He said something like everyone has a duty to make a big impact on the world.
Sam: I did not agree with him on that.
Jason: I know you called him out. But you’re doing Hampton again, you probably have enough money to sit on it and put it in treasuries for the rest of your life. What are you optimizing for?
Sam: I’m optimizing for fulfillment. When I took time off after selling my first company, I was incredibly lonely. Scott Galloway talks about the loneliness epidemic particularly among young men, and I experienced that. I felt proud of my previous experience but I felt lonely. So I started the business because I wanted a new challenge where I could achieve something, succeed at something, but more than that, I wanted to be less lonely. I wanted to be in the trenches with the troops, creating something together.
I think young men especially need something to chase with a team of people they enjoy being near. That’s really what I was optimizing for. I’m also optimizing for living life on my own terms.
That’s why I’m not willing to do what someone like John said — “You’ve got to build something big.” Because if you have a huge company with 10,000 employees, you have to do lots of meetings, you should be talking to your investors constantly. I don’t want to do any of that. There’s stuff in my life I have to do no matter what — I’m okay with some of that. But I want to maximize my time for things I want to do, not things I should be doing.
Jason: Yeah it makes sense. Brett Adcock was on your pod recently — the guy who goes big. What I believe about him is he’s actually happy. He’s doing what he wants to be doing. I’m happy that freaks like him exist. But I am not that person. I don’t want to go into his factory on a Sunday and mess with robots. I’d rather read a book by myself. I just don’t want to sign up for big world-changing ideas because I feel like you’re obligating yourself to live a life for other people.
Sam: Kind of. I think fulfillment is a good way to put it, but let me break it down into a few things.
First, there’s Safety and Security. There’s this idea in people’s heads in the U.S., especially people who graduate from good schools and go into the workforce, that working at a big tech company is a safe thing to do. That idea has been shattered in the last year. The number of people laid off from big tech and banks is incredibly high. You can be the best employee somewhere and if the business model doesn’t hold, you get let go. So I think there’s actually more safety and security in owning something where you manage 100% of the risk.
Second, there’s Autonomy. My personality — I’ve never done Myers-Briggs, but I’m sure it would say I need autonomy. I would not work well inside other companies.
And third, building a company is like a personal growth forcing function. There’s no way Blockworks can grow if Mike and I don’t become better as humans. I like that.
In some weird sense, and I don’t want to make this sound bigger than it is — it’s almost like being an artist. I joke about it. Give Pablo Picasso a tuba and he’ll make art out of it. That’s sometimes how I feel about playing on the internet.
Sam: We were talking about different opportunities you’re spotting. What interests you at the moment — even though you have a full-time gig?
Business Ideas: Ticketing and Hair Transplants [00:41:00]
Jason: Just crypto right now. But if someone waved a wand and said I couldn’t work in crypto, there are maybe two or three things I’d look at.
First: you remember when everyone started creating “the Uber for X”? I think we’re about to see that with Beehiiv. What that means is — there’s a newsletter platform that’s just 10 times better than anything on the market. They had deep domain expertise, Tyler was I think CTO of Morning Brew before this, built a slick UI/UX and a more technologically powerful platform. All these other platforms exist — Campaign Monitor, SendGrid, Klaviyo, ConvertKit, Substack — and Beehiiv just built a 10x better product.
I think you’re going to see people try to do this for other industries. If I were doing it, I would do it for conferences. We’ve used six different ticketing platforms in six years and it’s always been a nightmare. There’s a company called Hopin that was one of the hottest startups of the year during COVID, raised at a $7 billion valuation—
Sam: I heard the founder took $100 million in secondary.
Jason: Yeah. And they just sold for $15 million.
Sam: No way.
Jason: Ring Central acquired Hopin Events and Sessions products for $15 million.
Sam: Holy — and the founder took over $100 million in secondary. He won that one.
Jason: He absolutely won. Hopin could have dominated this market but they had this stupid thesis that virtual events were going to take over physical events — the dumbest thing I’ve ever heard. So they failed. But if they’d just built a better product for event hosts and conferences — that’s a real business.
Sam: I actually think a better Eventbrite is not a great business. Eventbrite’s market cap has been slow growth.
Jason: You’re right. The problem is you’d need to go Enterprise. A better comparison is Bizzabo — it’s an Enterprise events platform, like $20K-$30K a year subscription, you host all your events on them, they don’t take a ticket cut. But the platform sucks. They dominate the Enterprise event space and the product is still terrible. That’s the opportunity.
Sam: Why are you interested in hair transplants?
Jason: The hair transplant space is one of the fastest growing markets in all of medicine right now. Lasik 20-25 years ago was sketchy and expensive. Now the success rate is 99.9%, costs have come down 95%, and everybody gets Lasik. I think you’re about to see the same thing happen with hair transplants.
Market size: $5 billion last year, projected to reach $30 billion by 2031 — a 20% compound annual growth rate. The people you’re selling to are the most desperate cohort of individuals. You see this already with Hims — they’re selling fear of balding and they’ve built a huge business. And if you look at the hair transplant market today, it’s a bunch of semi-shady plastic surgeons with billboard ads and 50-page liability waivers. There’s a real opportunity to build something better in that space.
Blockworks Research — The Subscription Business [00:47:00]
Sam: Tell me more about the research business. I screwed this up with Trends at The Hustle — I charged $300 a year and went too broad. We should have gone much narrower. You’re one of the few media companies I think that’s going to pull off having a totally non-ad income stream. How does your research business work?
There’s very little Innovation — sorry, wrong word — there are very few younger people talking about this. But if you look at really large companies, a lot of them are research businesses in England, making hundreds of millions of dollars a year for 50 years. The founders are dead and it’s lost in history. How does your research business actually work?
Jason: In crypto there are these things called protocols — Uniswap, Aave, Compound — and then layer ones like Ethereum and Solana. The industry is moving from treating these protocols like weird esoteric things to treating them for what they actually are: businesses. Maker DAO will do $100 million in revenue this year. That is a business. They have employees, contractors, profits, costs. Nobody talks about them that way.
What Blockworks Research does is it’s a platform for investors who allocate to crypto assets to look at these protocols — their user metrics, financials, research. We’re early to trends in what’s happening with protocols. You can look at governance, voting on proposals, who the big stakeholders are inside the protocol.
Sam: How did you build V1? Did you just find public and private databases, aggregate them, and then write articles on your findings?
Jason: We started with research — we just hired analysts and had them write what feels like sell-side research on these protocols and put it behind a paywall. We started at $25 a month.
Sam: I don’t know what sell-side research means. I’m going to interpret that as disrespect.
Jason: It’s a 10-page research report on how something is doing — here’s how we think the asset will perform, here’s how the protocol did last quarter in user metrics compared to this quarter. All of that behind a paywall, that’s how we launched.
Then we started aggregating what you’re talking about — all these protocols vote publicly on what to do, on forums and proposals, and it’s a total pain in the ass to track. It all happens in Discord and disparate sites. We manually scraped all that information, put it into a database, built a front end, put it behind the paywall. Now we’ve automated most of these processes.
Two weeks ago we launched our analytics product — the data product where you can see user metrics and financials for any protocol. What was Ethereum’s revenue yesterday? What was Ethereum’s revenue compared to Solana’s? User metrics of this exchange versus that exchange? I can tell you all that.
Sam: How much did the first product cost to build?
Jason: About a million dollars. We have a team of eight analysts and a couple of engineers.
Sam: How big do you think this business could get, just the research side?
Jason: Politico Pro — what were they doing, like $100 million in revenue? Politico sold for a billion. The reason their business was great was they had a huge media business and about 0.01% of their audience converted into the research platform. So we think it can get much bigger than that. We think there’s a lot more ad dollars and a lot more research subscription money in finance than in politics.
Low end of the spectrum: Politico, sold for a billion. High end: Bloomberg Terminal — they’ll do like $9 billion in subscription revenue. That’s like saying you want to build Google. But somewhere in between there’s Refinitiv — nobody knows Refinitiv, but they’re a capital markets information platform that sold for I think $27 billion. CapIQ. FactSet. A lot of multi-billion-dollar companies built on the back of basically one asset class. Bloomberg started with just bonds and then expanded from there.
Personal Finance and Crypto Conviction [00:55:00]
Sam: Are you putting all your personal money into crypto right now?
Jason: Mike and I don’t pay ourselves that much. Most of my money is just in Blockworks — like my net worth is the company. Of my liquid portfolio, until very recently I was 100% in crypto.
Sam: That is insane. You and my wife agree with me on this one.
Jason: That’s not the case anymore, but if it were up to me I’d still be 100% in crypto.
Sam: That’s crazy. Why?
Jason: Deep, deep, deep conviction on this industry. From a risk/reward perspective, there’s no better industry in the world to work in than crypto right now.
Sam: I was talking to Shaan the other day. His argument is that the trailing 100 years of the S&P will just repeat. I think if you have a private company, it’s reasonable to keep most of your liquid money in almost all bonds or T-bills — safe, liquid, low return — and then have the rest in a high-risk bet, like your private company. That’s a barbell strategy.
But my criticism of your portfolio is: you have your liquid money in a high-risk bet — crypto — and you also have the majority of your net worth in a somewhat high-risk thing, your private company. Doesn’t that freak you out?
Jason: It doesn’t freak me out at all. Here’s one thing: nobody ever got wealthy through diversification. No single person ever got wealthy that way. You are wealthy — it’s just not in cash. Blockworks is wealth.
Sam: I get that. And you could argue that if crypto works, Blockworks is worth multi-hundreds of millions, so you’re already betting big on crypto. So put the liquid money in equities — that’s the reasonable thing to do.
Jason: I’m probably not right. But it’s this Jeff Bezos regret minimization thing: what would kill me is if I didn’t have any of my personal money in crypto and crypto went the way I think it’s going to go. That would kill me to my bones. What wouldn’t really bother me? If crypto went down another 90%. I’d be like, “I took a bet.”
Sam: Even though I make fun of you, I respect it. You’re not different from Brett Adcock — you have an idea, a vision, you think the world is going one way, and you’re walking the walk. I deeply respect that. The good news is you’re a wonderful enough entrepreneur that everything is going to be fine.
Jason: But also — the way the world is going — do you think the trailing 100 years will repeat themselves? Do you know Peter Turchin?
Sam: Does he spell his name funny? Does it start with a T?
Jason: It does. Peter Turchin is a historian and mathematician who developed this field called Cliodynamics. He studies the cycles of cooperation and conflict among elites throughout history. His argument is that periods of internal peace are disrupted when the population of elites grows too large, competition emerges for limited elite positions, and that leads to infighting as elites try to maintain their wealth and status. That breakdown in cooperation doesn’t stop historically until there’s a crisis — state collapse, revolution, whatever — and then a new cycle of cooperation resumes.
Sam: I read a lot of history for fun, and what I’ve noticed is that when empires cease to be number one they don’t go to not existing — they go to being like number five or number seven. England is the example. And if you look at the iShares Emerging Markets ETF for the trailing 30 years, it’s something like 5-6% compounded annually. If the trailing 100 years doesn’t fully repeat, it might still be 5-6% instead of 8%. It won’t go away.
Jason: I agree with that. I agree.
Sam: My point is it’s just far more exciting to read about America ending than about the same stuff happening over and over again. I don’t think America is going to end.
Jason: I don’t think America is going to end either. This is actually my problem with a lot of the Bitcoiners — the best way for Bitcoin to really work is for the U.S. to collapse, and that is a really shitty vision for the future. I don’t align with that. Bitcoin’s a good hedge, but I don’t want Bitcoin to go to a million — because the world in which Bitcoin goes to a million is one in which civil war is back in the U.S.
What is happening in Ethereum and DeFi is a very different vision. That vision says: Amazon, Facebook, Google, and Apple have become far too powerful. The traditional way to decrease their power is through regulation — I personally don’t believe that will work. I think the best way to build a better future is through crypto.
Sam’s Take on Crypto [01:04:00]
Sam: Tell me the books and articles you’d recommend on this. Peter Turchin — what else?
Jason: The Fourth Turning. Though it’s long.
Sam: What is your current thought on crypto, Sam? You’ve seen something like Permissionless with thousands of people walking around. Do you think it’s a scam? Do you think it’s just not going to work? Are you excited about it but don’t understand it?
Sam: I’m not incredibly well-versed, so I’ll preface anything with that. I would say the major things — Bitcoin and Ethereum — I enjoy the ideology of it. I respect it and I support it.
I think 90% of the rest of the stuff is a complete scam. I think NFTs are for the most part total garbage. I think Web3 for the most part is total garbage. And I think the people who entered into that space were often horrible entrepreneurs looking for get-rich-quick schemes — slapping “Web3” or “NFT” onto something rather than building a widget that truly solves a problem.
So I own Ethereum and Bitcoin and I sit on it. I enjoy the idea that it could exist. I’m in favor of the government not controlling certain things. I think it will exist for a very long time and will potentially become more useful. But most everything else in the space I think is nonsense.
Jason: I think you’re generally right that there are a lot of hucksters who come into crypto. That was probably true two years ago. Anyone who’s still in crypto today is not a scam artist — nobody is operating in a market that’s 90% down trying to scam people.
But there are a lot of parallels to new industries. All the scammers coming into the oil industry in the 1870s, into the railroad industry, into electricity, into the car industry — basically 90% of the people who came into those industries were scammers. America is probably the most optimistic country in the world, and that leads to frauds. You can’t have one without the other. The best part of someone is also the worst part — same coin.
Sam: I think the worst part about crypto is that the people who were selling garbage social media consultancies moved into crypto. And now they’re in AI.
Jason: Now they’re in AI. And that’s bad for the industry — like a presidential candidate having the KKK say “We love you.” You’d be like, “No, get the hell out of here.” Get out. It’s been quite bad for the crypto industry. But that’s my opinion.
Sam: I agree.
Wrap-Up [01:07:00]
Sam: What’s your plug?
Jason: Blockworks Research — blockworksresearch.com. Yano on Twitter. We’ve got eight crypto podcasts at Blockworks, so if you like crypto podcasts, we’ve got a bunch. I host one called Empire. And come to our conferences — Digital Asset Summit London coming up March 2024, going across the pond.
Sam: Well, I appreciate you coming on. That’s the pod.