the founders who took their raise in bitcoin and sold it on the way down

yesterday on the show i sat across from a man who was writing bitcoin term sheets before most people had heard the word. he ran one of the first bitcoin startup incubators, back in 2013.

so the next time a founder asks me whether a startup should hold bitcoin on its balance sheet... i'm telling them his story first.

late 2013, early 2014. he was signing deals where the investment itself was denominated in bitcoin. founders raised fifty to a hundred thousand dollars worth.

then mt. gox collapsed. by his account bitcoin went from about a thousand dollars in december to about two fifty by that summer.

and he said it plain... "most of them sold it on the way down."

not because they lost faith. because the landlord wanted rent. payroll wanted dollars. the lawyer's invoice didn't take bitcoin. back then you couldn't pay for much with it, so every month the founder sold a little more to keep the lights on, at the worst prices of the cycle.

he told me he wouldn't structure deals that way today.

sit with that for a second. the asset wasn't the problem. the business underneath it was. a company that has to sell its savings to make payroll doesn't have a treasury. it has a countdown.

everyone talks about bitcoin on the balance sheet like it's a decision about bitcoin. it's a decision about your operating business.

his own company is the other side of the coin. they listed in london in 2015, billed as the first blockchain focused ipo. last year they raised about twenty million dollars between may and august to buy bitcoin, and they hold roughly 180 of them now.

and he was clear about it... they are not trying to be a pure play treasury company. bitcoin is the foundation, not the end goal. the business still has to stand on its own two feet.

that's the order that works. business first, and the stack sits underneath it like bedrock. flip the order and you're building a house on the one thing you'll be forced to sell.

think of a farmer and his seed corn. in a bad winter he can eat it and make it to spring. but then there's nothing to plant. the farmer who builds wealth over generations is the one whose harvest feeds the house, so the seed never gets touched.

he said one more thing i keep coming back to. "every crypto winter we have companies that go down, that close... and i think actually that kind of cleansing process has actually been very useful for the industry."

winters don't kill bitcoin. they kill the companies that needed bitcoin to pay the rent.

so if you're thinking about putting part of your raise or your profits into bitcoin, ask yourself one question before anything else. if the price got cut in half tomorrow and stayed there for a year, would you have to sell a single sat to make payroll?

if the answer is yes, you're not ready. fix the business. get to the point where revenue covers the bills.

if the answer is no... you have a treasury. and you have the one thing those 2013 founders never had. time on your side.

low time preference only works when nobody can force your hand. a ten year hold starts with a company that pays its own bills.

i wrote down how i think about all of this, from self custody to how a company should hold it, in the bitcoin field manual.

so look at your runway honestly... is bitcoin going to be your foundation, or your emergency fund?