[ad_1]
In his new book, Kings of Crypto: A Start-Up’s Quest to Bring Cryptocurrency Out of Silicon Valley and Wall Street, Fortune Senior writer Jeff John Roberts describes the rapid rise of Coinbase, the digital currency exchange office. Coinbase has emerged as one of the dominant platforms for trading Bitcoin and other cryptocurrencies, and the company has generated a lot of controversy along the way. In this scene, Roberts captures the wide cultural divide that separated upstart fintech and its established competitors on Wall Street in Coinbase’s early days.
For a story on one of Coinbase’s other fintech startups, broker Robinhood, click here.
Adam White had seen a lot of stuff in the air force and at Harvard Business School. And since joining Coinbase as employee number five, he had risen to head GDAX, the company’s exchange for professional cryptocurrency traders. Now, by fall 2017, GDAX had become a cash cow as Coinbase hit $ 1 billion in annual revenue and White was ready for a new challenge. He thought he could handle whatever the business world threw at him. Coinbase CEO Brian Armstrong threw Cantor Fitzgerald at him.
The famous firm embodied all the stereotypes of Wall Street clubby culture. Working at Cantor Fitzgerald meant wearing suspenders and three-piece suits. It meant spending hours on expensive steak dinners and good scotch, bawling about how much money you were making.
And as befits Cantor’s reputation as a premier banking and brokerage firm for many of the world’s richest and most sophisticated companies, working there also meant enjoying coveted status. Cantor is one of the few companies that the Federal Reserve Bank of New York appointed to act as Market Maker for Federal Securities, which means to act as Uncle Sam’s bond broker.
It was now White’s job to sell Cantor on the benefits of crypto and do business with Coinbase. The legendary firm, he hoped, might want Coinbase’s help in offering Bitcoin to its customers or perhaps hear White’s explanation of how blockchain – the technology behind cryptocurrency – might. one day transform the securities clearing process. Meanwhile, a tie-up with Cantor would be a feather in the startup’s hat and go a long way in legitimizing a crypto industry that many still consider unsavory.
White met with representatives of the company on 59th Street in a tower overlooking Central Park. Cantor Fitzgerald’s headquarters had long stood atop the north tower of the World Trade Center until a Boeing On September 11, 2001, 767 jet stranded the building five stories below. The company lost 658 employees – two-thirds of its New York workforce – including the brother of CEO Howard Lutnick. In defiance, Lutnick brought the company’s trading markets back online next week, saving the company and ultimately paying benefits to the parents of employees killed in the attack.
Now Lutnick stood at the head of a phalanx of Cantor’s staff who had come to meet White. White did not meet phalanx with phalanx. He brought the friendly, self-effacing, easy-going disposition of a native Californian and a little more. Lutnick quickly noticed that White was not wearing a tie and arrived unescorted. And then he saw the title on his business card: General Manager.
In Silicon Valley, titles, like clothing, are often informal, sometimes creative, like “Digital Prophet” or “Innovation Sherpa”. Many startups treat headlines like a rack of hoodies – take one off the rack, try it, try another. Find one that you are comfortable with. Old-school finance companies, on the other hand, where top performers have earned nicknames like “Human Piranha,” treat titles as critical badges of power and status. Ranks such as “executive general manager” and “senior general manager” count. They send important signals about who is worth the time to invest, who is serious, and can be ignored. Lutnick scoffed at the idea that Coinbase would send a “CEO” – anyway – to waste their time. Didn’t they know who he was?
“So I sat down with this big financial company with sharp elbows, trying to make a deal,” White recalls. “There must have been a dozen and it was just me. Then the CEO laughs at me and says, “ Hey, GMare you going to make my coffee? I went out to New York and got my ass handed over by old school shopkeepers.
Humiliated, White returned home without a new client for Coinbase. But he would have the last word. A year later, he would join a new cryptocurrency company launched by the Wall Street giant Intercontinental exchange, becoming its chairman soon after – a sign that even New York’s most traditional financial firms were turning to crypto.
Reproduced with permission from Harvard Business Review Press. Extract of Kings of Crypto: A Start-Up’s Quest to Bring Cryptocurrency Out of Silicon Valley and Wall Street, by Jeff John Roberts. © 2021 Jeff John Roberts. All rights reserved.
More stories from Fortuneof print edition:
- Years 2020 The most powerful women in the business
- How the secret CFIUS became a powerful weapon in trade wars
- De-United States electricity: Mapping of US energy supplies
- This engineer has propelled Amazon through the COVID crisis
- Telling stories of men through their cars
[ad_2]
