After reading “Ugly Americans” (a personal top 50 book), and “Rigged” many years ago, I became a fan of author Ben Mezrich. He has a penchant for writing fascinating entrepreneurial stories, typically based on real-life events. So when Bitcoin Billionaires was released over the summer, I put it on my to-do list; and, like every Mezrich book I’ve read, it did not disappoint.
Bitcoin Billionaires is an entertaining read, specifically for entrepreneurs, speculative investors, and those in the crypto space. Every one of you who have taken a significant risk in business, or made a bet on a new industry or previously unknown opportunity, will have a hard time putting this book down. As an entrepreneur, the book provided many inspiring moments, and also several cringe-worthy ones where I was left asking myself how someone could be so foolish…
There are three main characters in Bitcoin Billionaires: The Winklevoss Twins as they are known (Cameron and Tyler) and Charlie Shrem. Although the three started out as partners of sorts in the crypto space, their business ethics took them in very different directions by the end of the story – highlighting a precious lesson for entrepreneurs looking to capitalize on new and emerging industries.
For some background in case you’ve been living under a rock for the past several years, Cameron and Tyler Winklevoss are the same Harvard rowing champs and Olympians who went toe to toe with Mark Zuckerberg over the rights for Facebook. I won’t get into it here, but they were made famous from the movie you’ve probably seen called “The Social Network.” Inevitably settling out of court with Zuckerberg, they walked away with tens of millions of dollars, and what they ended up doing with that capital is where Mezrich’s book picks up…
You can probably surmise from the title of the book that the Winklevoss twins parlayed their new-found wealth into the crypto space at a very opportune time. However, it wasn’t easy, nor did it come without a tremendous amount of drama – keys to any great entrepreneurial story.
Drama aside, there is a very, very valuable lesson in Bitcoin Billionaires for entrepreneurs and investors involved in new and emerging industries.
We always hear about the first-mover advantage. Reality is, there are typically two types of first-movers in any nascent industry. The first are the trailblazers – the adventurers… the entrepreneurs and investors who jump into the new opportunity head first because being first is everything to them. They know the space will be transformative and are willing to figure it out as they go. So long as their rod is in the water before the masses, they’re content. This group of people typically will include a lot of cowboys and idealists. By that, I mean the type of individuals who will overlook important details to get a piece of the action. Often, they’ll run afoul on protocols, and sometimes even legalities. The crypto space was no exception…
Then there are the second type of first-movers who try to bring structure to a nascent industry – those who attempt to professionalize the sector. They’re the ones who introduce checks and balances, streamline commerce in the industry, and make it more convenient for the masses to partake. It may not sound sexy, but these are often the entrepreneurs who take a new enterprise or industry from the fringes to the mainstream. And, as we all know, taking a business mainstream is the ultimate goal (or at least it should be). That’s what the Winklevoss Twins did for the crypto space. And Charlie Shrem was the former – the cowboy. Take a guess who ended up in jail and who ended up on Wall Street as Bitcoin Billionaires…
The Winklevoss Twins knew that for Bitcoin, and therefor their millions invested in the space, to be a winner, they’d have to work tirelessly with regulators and financial institutions on education and building proper financial market infrastructure. Cameron and Tyler believed, being visionaries and first-movers in their own right, that this was required heavy-lifting if Bitcoin would ever be recognized by the powers that be as a legitimate financial instrument, enabling mass-adoption potential.
Even though they didn’t get involved in the crypto space until several years after Bitcoin was created, the Winklevoss Twins were capitalizing on their own first-mover advantage – the legitimization of cryptos. The cowboy-types, Shrem and several others, overlooked (or couldn’t care less) about this process as their focus was on how disruptive crypto was – almost anarchist-like. While they indeed weren’t wrong, crypto was/is disruptive to the legacy monetary system, an idea/concept/MVP without a way of bringing it to the mainstream will always remain just that.
You don’t have to be an industry’s first-mover to garner the first-mover advantage… and Ben Mezrich’s Bitcoin Billionaires details precisely that. I highly recommend this entertaining and educational read.
PS – I have my own unique stories as an entrepreneur and early-stage investor, which you may find entertaining (and educational). Subscribe to my newsletter below. Only my best content will land in your inbox.