Cryptopocalypse, justified?

Welcome to a CMO Wisdom podcast. This is Charles Cormier with John Balcombe today with us. John is a CMO at a company that I like a lot. It's called Sovereign, sovereign.io. You can check them out. It's Bitcoin education in two words. John has also been a founder at like other companies before and an author. Tree Wind Sponsorship was the book you started in 2019. It's been a while ago, but Welcome to the pod, John. Tell us a bit more about what you do nowadays.

Yeah, thanks, Charles. Appreciate it, man. And, uh, yeah, Sovryn, we're an early-stage company in the Bitcoin space. The way I describe it is we're essentially building the Geek Squad for Bitcoin. So if you all remember the late '90s, early 2000s, Geek Squad emerged as kind of the go-to support team for the personal computer, which was advanced technology back then. And of course, that, uh, that was 20, 25 years ago. These days, Bitcoin is advanced technology. And what you find is that to drive adoption, people who are not very technical but want to use the technology, they want a trusted support team to be able to benefit from this technology without having to go in depth, right? Think about it like, you know, you drive a car, but you don't— you're not a mechanic. Right? You want a technician to be able to handle and, and rely on when you're using the technology. So we're building it, we're building it up. I'll be happy to talk more about it. But yeah, I've been an entrepreneur for about 10 years and, uh, it's been an amazing journey so far.

Let's talk about the crypto apocalypse. Like, that was pretty striking yesterday. I listened to it on a podcast. Not the first time I hear about it. And I'm bullish on crypto, right? As an individual, not necessarily the fundamental technology of it because I think that's crackable. But yeah, more on that later. I want to hear your opinion on it. But just because banks have too much of a monopoly on people and I feel there's— and I'm not a conspiracy theory guy, but definitely there's unholy stuff going at the bank level and they have too much power. I believe in decentralization as well. Like, people should have like their own wallet, right? And have full autonomy over it. I believe in economic empowerment. That's like probably my number one charitable social pursuit, right? Like, especially creating more founders, but founders need a bank account and they need to have sovereignty on their own money, right? So that's why I love crypto. Now I'm more of an AI guy. Right? Like, I think AI is changing everything. It's the most important shift, hands down, of all times. So far, it's the most important technology of our times. And I think it'll change all technology, including blockchain. And right now, models are cracking math, right? Like mathematical formulas and the very mathematical formulas that have been underlying Bitcoin and Ethereum, right? And crypto as a whole, generally speaking. I'm not saying that, yeah, overnight they'll be cracking the system open. I think it'll take a while. I think the community will adapt and will fork as well, right? And will, I don't know, like biometrics or something like much more secure. But I do think that the current state of technology, there's a lot of actors that are incentivized right now to crack it, right? Once they crack it, they technically can steal like billions, right? And yeah, what do you think about all of this? Do you think the headlines are justifying the crypto apocalypse, or is it just like PR?

Personally, I don't think so. And let me preface my response by saying that I'm a sales and marketing guy working in Bitcoin. I'm not a technical founder, right? Same here, by the way. We have technical people on the team. So when people listen to this and they say you're completely wrong, You know, I, I gave the caveat up front, but let me put it to you this way. I'm focused on Bitcoin. Bitcoin and crypto, I think, are 2 separate things. What, what is at the core of Bitcoin, right? At the core of Bitcoin is cryptography, right? And the purpose of cryptography is to use mathematics to essentially make it extremely difficult for people to crack the code. Right? At the core of Bitcoin is the public-private key cryptography, right? The SHA-256 algorithm. These are designed to be pretty much impossible to crack unless you have just kind of the most powerful computer that has ever known to exist, right? Like, I'm not concerned. And some of the things that we've seen with AI hacking this year, Particularly within Bitcoin, there was an incident that had to do with a hardware wallet created by CoinKite. It's called the ColdCard. If you've been following Bitcoin, you saw this story, which— where indeed, uh, there was an attacker that used AI to exploit a— not a fault in the Bitcoin code or the Bitcoin network, but a fault in the hardware of the ColdCard. Right, and there were people who lost funds because of this flaw in the cold card. But it's important to note that this has been 17 years now. Excuse me. It's been 17 years now that Bitcoin has been up and running, and it has never been hacked. Right? The network itself has never been hacked. The cryptography is strong. Where we're seeing issues is with the players kind of on the different layers above the, the base layer of Bitcoin. And so I read this post. The developer who put it out, he works for the Ethereum Foundation. He's concerned about these advanced superintelligence models being able to crack the cryptography on certain different crypto networks. Um, I would say, look, maybe he's concerned about Ethereum, maybe he's concerned about other alternative crypto assets. But no one in the Bitcoin community has seen evidence yet that this, this is like an existential risk to Bitcoin. If there— if it were the case, we would see some of the most prominent voices in Bitcoin chiming in. But everything I've heard from some of the leading technologists and technicians in Bitcoin has said this is not an issue if you don't reuse your, your public key. Your public key addresses, you're going to be totally fine. This is not an issue. So I'm not concerned. I have not sold all my Bitcoin. I'm not encouraging other people to panic, right? I don't think there's any reason to panic on the Bitcoin side.

Vitaly yesterday—I mean, this is like breaking news, sort of, right? But Vitaly was yeah on the record yesterday saying that AI will. Break crypto as a whole in less than two years. That's so prominent voice, right? Vitaly is probably like the de facto voice in crypto. But yeah, I'm I think the community will adapt. You know, if you ask me, so I'm not like an alarmist and like oh shit crypto apocalypse. The community is strong. People want economic sovereignty, right? And people will adapt. As simple as that. And there's very smart people in crypto, right? So including Vitaly. So It's just like, and it's not just in crypto, it's like pretty much in everything, dude. Like, it's so alarming. AI is like replacing all jobs, literally. I mean, I've been running various agencies. I'm curious to learn about your background, by the way, but I've hired like thousands of humans and pretty much all the roles I hired for nowadays, an AI do it, right? Like copywriter, image editor, video editor, strategist. Even CS, dude. Like, I have agents replying to clients nowadays. What's your background? How did you land it at Sovryn? And since when have you been in crypto?

Sure. So my background was actually in marketing and specifically sports and entertainment marketing. I had around 2019, you mentioned that book I put out. I decided to kind of go out on my own and use this book as kind of my calling card. Because I was young, I was about 26, 27 when I started my agency in sports entertainment. But I put out this book to kind of give my perspective and point of view on where I think sports marketing was going. And so that book was called 3-Win Sponsorship. The idea behind it was to create win-win-win partnerships and opportunities and embed that into your sports entertainment marketing, right? So embed some type of cause or impact to go just above and beyond what marketing and sports marketing had done up to that point. And then the agency that came out of that was Third Wind Group, right? So to kind of take the thesis of the book and look to apply that into working with athletes, working with brands, working with teams, working with really any kind of entity or asset in the sports entertainment world and apply this perspective of this lens of this thesis into that world. So frankly, it was terrible timing because I started it in the middle of 2019 and COVID hit in 2020, right? So think, I'm like bootstrapping, I'm young, I've got a book, but then, you know, you can't travel, you can't move, right? So I had to adjust on the fly. And so what I immediately did was I started to do a bunch of podcasts to promote my book, to promote myself. I got my company up and running. Like, literally, I had one athlete who found me through my podcast and my book. That was the catalyst to be able to grow because I thought I was going to have to shut the business down during COVID because, like, how are you going to go and meet clients? It's a very relationships-based business to be in sports marketing. How am I going to get out there and meet clients if I can't travel around? I can't meet face to face. Anyway, I was able to survive. I landed one client that led to 3 clients. You know, to make a long story short, I was able to build like a pretty decent company there. But in the course of COVID and 2021, 2022, I had heard about Bitcoin, but I really like dove deep into learning about it, and it kind of changed my perspective. on things. Um, and I, as I built up Third Wind Group, what I realized is that I could work my ass off as an entrepreneur, but if I'm using the dollar only as my medium of exchange and my store of value, I'm going to lose to inflation, right? I, I— it really doesn't matter how hard I work if I'm not saving in a harder money than the dollar. It's not going to be worth— my company is going to fail. So it was almost a survival mechanism for me and my company to adopt Bitcoin. So we adopted Bitcoin on our balance sheet as a store of value for Third Wind Group 2022, 2023. We kind of started accumulating around like $16K in 2022, and we accumulated for the next 3 years from $16K to $125K. And I think it saved our business, to be frank. Right? Um, so that— seeing that and, you know, making that decision, then experiencing that, I kind of realized like every single entrepreneur and every single small business owner had the same issue that I had. They maybe just hadn't realized it yet. So when I transitioned over to Sovereign, I met those guys online, honestly, through a Bitcoin Jobs newsletter. I realized like I could actually have a huge impact on lots of entrepreneurs like me lots of small business owners like me by helping them grasp this concept that I grasped, which is like inflation is probably the number one problem you have as an entrepreneur that you don't realize that you have. And Bitcoin is a potential solution to that problem where you can, you can earn and then maintain the purchasing power of your earnings, right? That's the really powerful thing, um, that led me to believe like I need to, you know, put aside my agency and move into Sovereign and making this my full-time gig. Now that agency is still operating, my business partner's still operating it, uh, doing a great job. But this felt like the right— the next journey that I needed to go on because of the amount of impact I felt like I could have.

Yeah, I love that. And do you do sports yourself? Like, why did you get into sports, uh, as a first time? And how do you Yeah, like, why? Start with that.

Oh yeah, yeah. I mean, I've been a very— I mean, I've loved sports since I was a kid. I was a baseball player, that was my first love. I was a pitcher, I pitched through high school, but I've also been playing golf my whole life from a young age. Um, I'm not— I know you're a prolific runner and marathoner and ultra marathoner. I've done 3 marathons, you know. It's— I've— I hung it up after 3 because I was like, I think I prefer golf and volleyball and stuff like that. Um, but yeah, like, athletics has been a core part of my life and built up that competitive nature and spirit that I've now translated over to, um, you know, my professional career as an entrepreneur. Um, I just love, you know, the— that competitive spirit, that competitive energy. That you get when you're, you know, moving your body and, and being on a team. It's just that dynamic that you get from being an athlete. I love it. And I, to this day, you know, right before we got on, I was, I was doing a workout, and I just love being able to feel that power in my body and, and just move around. And it's, it's awesome. And I think that a lot of Entrepreneurs, you know, were athletes or are still athletes. I think that it's just like once you get that itch to be a competitor, you have to find ways to apply that. You can't just sit, rest on your laurels. You're always trying to improve and challenge yourself and compete and win. So yeah, athletics has been huge for me for a long time.

And how do you bring like that athlete mentality to business, right? And specifically in Sovryn, As a, as a teammate, like, what is it to, to work around you? Are you competitive? Do you bring the team up? Um, yeah, how does that dynamic foster the, the building?

Yeah, so since I'm on the leadership team, uh, but it's early stage, I try and play both roles as like both player and coach in a sense. We have a small team, but so everyone needs to be a player and contribute and bring in leads, opportunities, you know, create the product, deliver the product or service, right? Everyone needs to do that. But on top of that, what I try and do is help people to see the long-term vision, right? And how they play a part in the long-term vision and help people to get in the right position to contribute to us achieving the vision, right? So I've learned a lot over the years. Honestly, it seems like, you know, sometimes it may seem like a waste of time to follow professional sports, but you can learn a lot from the, the coaches, the players, and kind of like get inside of their head into how they think about what it takes to win. Um, so I've, I've taken a lot from studying the great coaches, the great players, listening to them speak, listen to them about what it takes to win. And I then, I try and apply in certain situations with my team the mindset that I think it's gonna take us to be able to achieve our goals, achieve our vision and mission. The thing I like about the athlete's mindset and the competitor's mindset is that you can get through any obstacle. You know what I mean? That's what you, as an entrepreneur, you're gonna have countless obstacles, but frankly, you need to just realize that like you're extremely capable of overcoming them. And that if you stay disciplined, right? If you stay focused, disciplined, work your ass up, you're gonna get through the obstacle, and the end goal is is is right there, right? It's it's if you push through, it's it's right there. You can achieve it. So that's what I try to apply, and I'm I'm very much like a positive guy. I don't try and dwell too much. Sure, if there's things go wrong, I don't try and dwell too much, but I'm trying to stay positive and focused on. our vision and mission and how can we get there.

Right. And yeah, I believe the company has been— you guys have sort of repivoted the leadership not so long ago. Like, how's been like the, the new direction to the company, right? Like, you're seeing great things for Sovryn. I'm seeing great things for you guys. How's been this new wind of change?

Well, look, every early-stage company, I think, has a bumpy road, a winding road, and that's been the case for us as well. Our original founding team actually left, and the current CEO, Brandon Karpelis, took over, I wanna say, May of last year. And around the same time, I went from being a part-time consultant on the team to joining the leadership team and becoming the Chief Marketing Officer. So we kind of inherited the seed of a company that we really loved. We really loved the vision of being a Bitcoin professional services company. The original vision was to deliver services to the business community. We thought that, you know, at least the founding team, the vision was like the business community is going to need to adopt Bitcoin and want to adopt Bitcoin, but they're going to want people who can educate, who can provide technical support, who can provide strategy. That was the original mission and vision of Sovryn. As we operated the company for the first year, it changed, right? Your plans run into reality and run into the marketplace, and some of your theses, you know, they get disproved. There isn't enough demand, right? And that's what we found. Honestly, we found that there wasn't enough demand in the business side, or at least small to medium-sized businesses. And we also found like the largest corporations, right, they were matching up for Bitcoin services and offerings with the largest financial institutions like BlackRock and Fidelity who were offering ETF products and things of that nature. So we need to recalibrate and rethink about, okay, like how do we deliver a valuable service in this space. What ended up happening is we found that individuals were the right target market, right? We were getting referrals from some of our partners across the space. We partner with the Bitcoin Well, we partner with a few other exchanges and like industry companies, and the demand that we were getting was from individuals who wanted support, who wanted that, hey, walk me through this step by step and hold my hand as I set up my Bitcoin wallet, my Bitcoin multi-signature. I want someone there. I don't just want to watch a YouTube video. I just don't want to Google it. I want a human being helping me out. So with all of that said, like, I found that you can have your great plan and your great vision as an entrepreneur, but until you run into reality, you know, until you make contact with reality and actually get feedback from the marketplace and see who's willing to pay you for your services, you know, your vision doesn't really mean much, right? And it's going to— sometimes your company is going to get pulled out of you by the marketplace than rather than you pushing your vision onto the marketplace, if that makes sense. So that's been great over the last year. We kind of pivoted away from business, focused more on high net worth individuals and family offices and even certain traditional, you know, finance companies as our target market. And the traction has picked up a lot. So that's been awesome. And I feel like this, the rest of this year and into next year, with the market picking back up, us avoiding crypto Armageddon, which I'm not worried about, I think next year is going to be a huge year of growth for us.

Right. What's been the main marketing initiatives you've been successfully deploying as the CMO of Sovryn?

Right. So we've realized that partnerships would be a great channel for us. By that I mean, where are the people who would want Bitcoin professional services? Well, they are on the crypto, you know, Bitcoin exchanges, the crypto exchanges. They're on certain products that people use to interact with Bitcoin today. That's where the people that use Bitcoin are. We originally thought that it was going to be like, oh, let's bring new people in who aren't using Bitcoin. Actually, we realized, you know, it's a niche market right now, and there are maybe a couple dozen big players where all the Bitcoin users, at least here in the US, are operating. So setting up these partnerships where we have mutual referral agreements with different exchanges— I mentioned the Bitcoin Well. Companies like River, companies like Fold. That's been a great piece to where, all right, these people don't need to be sold on Bitcoin, but what they do want is technical support. So setting up those relationships has been huge to say, okay, this company is already trusted. So how are we going to acquire a customer? Well, if we're the trusted partner of that company. If we're the trusted partner of the Bitcoin Well, right, their clients are going to be much more likely to work with us because there's a good reputation to be shared there. So that's one thing. And then the new thing that we've discovered is cold email, right? Like, and, you know, full disclosure, working with you and Sonny, it's like cold email just gives you the volume that you're missing. Right? So if partnerships is low volume but high quality leads and opportunities, cold email is the inverse. It's, it's, you know, maybe a little bit lower quality but definitely higher volume to where you're just getting more and more people and you get in front of more and more people. You get to hone your pitch, you get to hone your offering. Um, that's been huge. I think the last one is events, getting in front of folks Face-to-face, even setting like a basic booth up at an event, having conversations with folks. Again, that's harder to scale, but super important to build relationships for us.

Right. What do you— what are your main goals for the next year with Sovryn? Where do you want to take the company?

I want to start to establish our brand as the trusted professional services company in the Bitcoin industry, right? Because we are a— we kind of have a relationship-based approach, and it kind of— it's a trust sale, right? Not necessarily like, uh, oh, you know, you know, this is the best product, so this is the best service, right? A lot of what we do is coming down to relationships and building that great reputation. So I want to focus on us building up within the industry that reputation as like the premium professional services and technical support company in the industry. And we're going to do that through some of these partnerships. So we're going to start to market a little bit more about our relationship with Bitcoin Well. We have other partnerships that are coming to the fore, and to me, brand is going to be a huge lever for us. And it's going to take some time, but I believe that we can pull that off to where we're going to be attracting more and more great clients. The longer that we can stay in business and build up that brand and reputation, the more that Bitcoin can develop, the more the opportunities are going to flow to us. So to me, that's the big thing. Obviously, there's things like growing number of opportunities and growing revenue and things like that, but I, I like to think Long-term, what we need is to build one of the strongest and most trusted brands in the space, and that's how we're going to win. There's very little competition in our space. There's probably three or four at max other companies doing what we're doing, and so to me, that's a great opportunity to just own the category, be one of the best brands, the premium brand in the space, and. We'll see where we go from there.

There you go. Where can people find out more about you, John?

Yeah, I've been doing a little bit less personal social media, but you can find me on LinkedIn, uh, John Balkcom. If you type me in, you'll see me, uh, and Sovryn. Also, just go check out our website at Sovryn, sovryn.io, uh, S-O-V-R-E-I-G-N dot I-O. And, um, yeah, I really appreciate you having me on, Charles.