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Startup Step-By-Step: No Cryptocountry For Old Men

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“Let’s make a country,” my friend Rich said. He was serious.

He and I were talking outside of a bitcoin conference in New York. It was April, 2014 and we were inside the Javits Center, the glass abomination on the Hudson that event goers hated. It was raining wildly and the crypto-folks were bumping into each other as they milled about talking about the future of money. I was thinking about the future of getting out of the Javits Center.

“What does it take to make a country? Why can’t we create a digital country?” he asked again.

He wrote down a few ideas. He was always writing things down. I never did.

“We need a passport,” I said. “A cryptographic ID. That’s the start.”

Rich is tall and imposing. He’s got black hair and a voice like gravel. He talks a lot and when he talked I liked to listen. He had a lot of great ideas and he was tired of working as a consultant for big pharma. He always had a philosophical bent, hence the question about a cryptocountry. We’re both about 40. This is important information because neither of us had any business thinking about cryptocountries and startups but here we were.

I’d known Rich since college. We both went to Carnegie Mellon. I studied Information Systems and he studied History & Policy. We both double-majored in Creative Writing. We ran mostly in the same circles – the arty writer crowd – but he was always hanging with the cool kids while I was futzing around with the school paper. We talked quite a bit during school but didn’t talk much after graduation. He spent a week at my apartment in Fairfax, VA after I graduated writing a history paper but that was the extent of our interaction for about 18 years. He worked at a famous digital agency before the dot-com boom and I wrote COBOL code for telecomm billing systems just before Y2K. We’d chat, off and on, but now he was back in New York for a while and wanted to talk about building a digital country mostly because we were in the middle of a bitcoin conference. I had been thinking about crypto as well and was even writing about the idea. It made some kind of sense.

“So let’s do it,” he said.

I was game. But we’d have to talk more.

We left the conference and walked up the street to a Mexican restaurant. It was still raining and neither of us had an umbrella so we skirted the downpour under scaffolding and awnings. It was one of those afternoons in New York that encouraged either yelling or drinking. We decided to take the latter route.

We talked more. What was the digital passport? The cellphone. How could we identify citizens? With heavy cryptography. We could raise taxes via lottery. We could offer banking services offshore – we considered setting up in Sealandia or one of those weird places – and we talked about what rights you had as a digital citizen. We talked for a good hour before Rich left.

As a hardware guy I was fascinated by the phone. What would happen if you owned a phone that could identify you specifically? Perhaps it had some biometric systems on board, perhaps it held a digital wallet. But it would be a tool that could identify you as part of a very special thing and it could give you rights that you didn’t have before. It was a very esoteric idea, to be sure, and I was a pragmatist. Rich was the thinker. I thought he and I could get together and figure something out.

We talked off and on over the next month and I was scheduled to speak at Startup Iceland that June. Rich wanted to come and I offered to let him stay in my hotel room. The primary problem, however, is that Rich is a light sleeper and I am a snorer. He didn’t seem deterred.

Iceland is famous for its scenery, its food, its music, and its people. It’s also famous for its Pirate Party, its crypto-anarchist tendencies, and the fact that it is a great place to hide bitcoin mining servers. All of that was swirling in our jet lagged heads as we got off the plane outside of Reykjavik and headed to the city. Rich, before the flight, had run around the airport trying to find a way to change his dollars into krona. He liked to be prepared as much as I liked to not be prepared. I assumed I’d be able to swipe my credit card anywhere on the island and the vagaries of money transfer were unimportant to me. Who cared? You’re going to get screwed no matter what so why try to fight it? Rich was of a completely different school. He was from Brooklyn. He didn’t like getting screwed. He wanted to be ready to pay for dinners and drinks and touristy stuff with the currency of the country he was visiting. More important, he didn’t want to lose money doing it. In the end, we both lost money because exchange rates are, at best, opaque and at worst rapacious. But more about that later.

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We spent a few days in Iceland talking to crypto ninjas and entrepreneurs. We ate lamb. We drank through a single day that never ended and Rich went to bed with eyeshades and earplugs while I sawed away in the next bed. That he didn’t strangle me was a miracle. We decided we weren’t going to build a country – one smart guy I knew told me that when he looked into the idea all he found were a bunch of weirdos and bad people – so we decided to build a phone. At this point the company had nothing to do with bitcoin. Instead, we wanted to build something like a cheaper Blackphone It would be a secure phone with dedicated security apps and a secure portion of memory that would store your ID. Only you could use it and you could make secure calls and send secure texts. We wanted to make it really cheap – we were eyeing the devices that would eventually become the Firefox phone and I knew how to source them. We made a deck.

  1. Slide01

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  5. Slide05

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  10. Slide11

  11. Slide12

  12. Slide13

You should note a few things about this deck. First, it is awful. It’s full of words that do not help the cause and it was based on a deck we found searching for “best deck for pitching.” I had seen hundreds of decks but I had no idea where to start. It was the most frustrating thing in the world: I could judge others all day long but when it came to helping myself I found myself lacking. I would sit listening to pitch after pitch and, quite smugly, make comments. Now I was producing my own deck and I had no idea that it was horrible.

My first bit of advice: find a friendly entrepreneur who has raised money and ask for their deck. You will notice a few things. First, there aren’t very many slides. Second, it’s very clear how they will make money. Third, it is well-designed. This deck featured none of those things.

But we had an idea! And I knew people in the industry! We’d send the deck around and get some interest and we’d win. Easy, right?

Nope. But this was a start. That first deck began the next deck… and the next deck… and the next deck. I didn’t follow the advice above so we waddled our way from deck to deck. A startup is a hypothesis testing machine. It is a broken box full of moving parts, clashing personalities, and market vagaries. It’s a damn mess. I made it a bigger mess by not following my own rules.

But it was also fun. That’s one of the beguiling things about all this. No matter how silly you feel, no matter how down you get, it’s still a lot of fun. You want to know the reason entrepreneurs like all those goofy maxims and pictures of sunsets they post to Facebook? Because those things – “Skate towards where the puck will be” and “Be your best self” and “I hate Mondays” – best describe how they are feeling. They feel like they’re pulling one over on the rest of the world. I get to work with my friends and build something amazing and maybe change the world? Wow! And there are a bunch of people who did it before me and they can distill my feelings into a pithy quote? Why not share that on social media!

Entrepreneurs have always existed. TechCrunch and a few other sites made them the “rock stars” they are today. There’s an entire industry catering to them now, an entire school of thought, an entire university. And they’ve always told themselves that they were the luckiest people in the world. And, in a way, they are. They are given the opportunity few others have and, if they have it, fewer still take.

As the sun never set over the cold water of the North Atlantic and the warmth rose in our bones as we hopped from bar to bar, I suddenly felt very excited. We could do this.

I thought, just for a moment, that this idea was great. I thought that we’d build a phone, sell it on Kickstarter, and have some fun. I thought we’d eschew VC and instead bootstrap while still working our jobs. And I thought this was just another side project for us to mess around with. Heck, we were old and we didn’t need to completely disrupt our lives to do this. We’d play it safe. And I thought we were onto something really cool.

Only one of those things ended up being true. The last one. And that’s what I want to tell you about.


I love the people who make startups, the entrepreneurs. The vast majority, except for a few notable exceptions, are driven, humble, and kind people. They have taken on a heavy burden and they always try to give back when asked. As a writer it was always my mission help them whether it was by writing about them or bringing them to Disrupt or listening to their pitches in the countless meetups I’ve held with Jordan Crook and the events team. I love seeing startups outside of the main startup cities and I love seeing a small ecosystem blossom in places like St. Louis, Norfolk, or Belgrade. When I started traveling the world talking to startups – way back in 2009 – the idea of a small company entering the global stage was laughable. Now it is commonplace.

Fast forward to 2016. I have been writing about startups for nine years and I want to build something so we started building what I’m writing about right now. It’s a bold move for an older dude like me but I suspect it’s been done before and will be done again. Writing for TechCrunch is a dream job and I’m pretty dumb to quit it but, as they say, John Biggs is not a smart man. Thankfully I have two great partners who are helping me and I think we’re going to be OK. Our goal, ultimately, is to change the way the world thinks about bitcoin and the blockchain so I think anything we do on that front is worth doing. The rest is gravy.

So now it’s my turn. I’m starting this thing with two friends and I’ve been given permission to tell you about it. I know this is an unfair advantage but I also feel that it’s a great way to talk about a startup from beginning to, well, end. I’ll talk about the troubles we’ve had, the joys, the pitches, the mistakes. So this is the first in a series of columns about starting my startup, Freemit. I am transitioning to a columnist soon and my goal is to offer one or two of these a month. I think they will be an important record of all the awful stuff I did and, as such, allow you to avoid the same mistakes.

These stories will not be in chronological and I’ll leave people out to protect the innocent. However, I will tell the unvarnished truth about this whole thing and I will try to have some fun. I hope the information will be helpful to folks who are stuck in a cubicle somewhere hoping to get out and I hope I can learn something from the folks who have been there before. Until then, enjoy Startup Step-By-Step and see you next time.