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Angel Investor & Advisor Les Borsai at BlockCon 2017
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Les Borsai Interview Transcript


 

Amy Wan:

We continue today's Investor Spotlight with part two of our interview with angel investor and advisor Les [inaudible 00:49:15]

Les works in the music industry here in Los Angeles and has an interesting take on the crypto world from an investor point of view. Find out how he approaches investing in ICO and how ICOs could impact the music industry. Is there anything that when you see it yes it's got all the kind of marks that you might like but there is there anything that makes you run the other way? Maybe it looked good at first and at further sniff [inaudible 00:49:34].

Les Borsai:

You know the strange thing about it is there's been a lot of those situations and I don't know what it is that made me not pull the trigger on sending the [inaudible 00:49:44] invest in it. But that's happened a lot.

Amy Wan:

Oh interesting.

Les Borsai:

And it, you know, look I don't know if it's just a gut feeling but there have been certain things that I'm going to do it, I'm going to do it, I'm going to do it. But then at the last minute I don't do it and then you'd kind of take a look at the after results and they didn't quite raise as much money or something didn't happen just right. You know, and so...

Amy Wan:

You've just accumulated enough of the sense from you being in it four years which is an eternity you can if they're not... if it's not clicking on all of the boxes it's just....

Les Borsai:

If it's not click and it's not and, I think, too the other part is I've met a lot of these founders. So that's a rare position I get to be in. So if I get to meet the founders of these really exciting companies then, you know, we have conversations about other companies that might be exciting or what they're working on and, you know, that gives you a different sense about what you approach and how you approach it.

The thing that has gotten complicated for me is, you know, at one point it was an ICO but it's not an ICO. You know, there's all these pre-sell dynamics now. How much is it discounting? You know, and so this is another factor that you, kind of, look at. Is there venture involved? Is it going into a pre-sale? How is that connected? Those are different, you know, dynamics completely.

And you'll see companies doing, you know, $50 million in a presale and then do $180 million, you know, on a ICO. Well, those are all factors that lead to the big ICOs as well.

Amy Wan:

So what do you think about that in terms of this whole presale dynamic? When you're talking about the anarchist, the whole vision of the dis-inter-mediated world and then suddenly pre-sales only for the rich guys. Does that... is that okay?

Les Borsai:

I like the idea of doing them in a discount, but I've never done one. So, you know, and it's not because I haven't been invited to do them.

Amy Wan:

[inaudible 00:51:36]

Les Borsai:

I've just been, kind of, really careful about the presale hype. You know and, there are just these astronomical raises that are happening right now, and I just don't understand all of them why so much money is being raised for certain product offerings, you know, that...

Amy Wan:

What do you think?

Les Borsai:

What's that?

Amy Wan:

What do you think, I mean, why do we see...

Les Borsai:

I think it's because it's like ,you know, any good pump and dump, there's a lot of hype behind certain things, and because there is this bubble mentality you buy into something, you know, which is inexpensive you'll be able to get out when it's expensive, hopefully. Once you've received the token and there's a way to actually exit it. And, I mean, those are all, again, factors and I think, you know, money for me can't be the driving factor of the companies I select.

I think, when we take a look at the crypto hedge funds, I know there's 102, or something. You take a look at fund managers and what they're dumping money into it's a different set of rules. It's like how my going to make money off this? You know, what pieces I'm going to take? And there's a lot of people building exciting things right now. I mean, and if we go back to just the pure nature of this and how it's going to evolve this is a new Internet for me.

It's an Internet of money and what that mean, you know, we're at the ground floor. The application layer is actually going to be the more exciting layer because whoever builds the next, you know, search engine on top of the blockchain like those are going to be the exciting opportunities, and those are the companies I want to be involved in.

Amy Wan:

You know, they call the 'Netscape moment.' When somebody is going to figure that out. Yeah. It's exciting.

Les Borsai:

and that to be there at the right time and, I think, the way I approach it is what are those bets, you know, that possibly have the odds of becoming that and let me invest in those things because those are the right investments to make right now.

Amy Wan:

Immense. So speaking specifically about what you've built as a career knowing about, like it or not, you know, you you know your music and you know your entertainment. You've been around it you've been in it from like every different angle. You're still in it in all different things.

Les Borsai:

I'm still in it. Yeah.

Amy Wan:

Like it or not, where do you think the music and blockchain or music and crypto like where is that in [inaudible 00:53:49]?

Les Borsai:

You know, it's funny because in my whole career is about intersections and, you know, I work for Zynga, for instance, as a consultant and I do music licensing and that gave me the ability to do a IP deal with Wynonna Judd who's a country artist so now I manage her, and it was a strange intersection of technology and traditional music.

Along those lines I have worked with a lot of app companies and built a lot of, you know, music applications, kind of, built the first social karaoke...

Amy Wan:

Oh really.

Les Borsai:

Application when the App Store launched.

Amy Wan:

I don't if I should thank you for that. [inaudible 00:54:27]

Les Borsai:

I was Lady Gaga and their team at the time, and it was really interesting because licensing an IP was a big part of that and, you know, UGC and we did a bunch of those. We also you know built one of the early Voip apps which was a voice changer and it downloaded a significant amount of applications.

So it was this convergence again of music related ideas and technology, and I ended up working for a lot of great companies, you know, because of those ideas, but I was a builder. So I was building products then that had this kind of intersection. With crypto which came a little bit later for me, you know, I didn't think about the music intersection with crypto then. I just didn't think it was the right time. I didn't see the natural fit. Well, that's changing now.

There's companies emerging, you know, Ujo which is a consensus company that Jesse has that's really interesting. You'll hear more about it from him but there is there is interesting, kind of, music opportunities emerging right now. Vest is another one, you know, I don't know how well they did, but it's something that relates to music rights.

And, you know, you've got Music Coin and Opus, and so you're seeing the emergence of music-based block chain technologies. You know, Benji has had is thing forever. What's going to be interesting is the divide because now we're also hearing about security tokens connected to, you know, revenue streams, connected to music. So, you know, it's starting to happen now. I don't know if that makes me want to get into it or run away from it. I haven't really decided but I do like the idea of licensing an IP and data on the blockchain because what the music business doesn't have is a centralized database that allows you to look at things, kind of, in a public way, and understand where the ownership of those rights lie.

Amy Wan:

Yeah. It feels like there's a natural marriage there.

Les Borsai:

It feels like it except for the fact that the record companies you know for the longest time loved to slap down innovation and, you know, you can sit here and say, "I'm going to use the block chain to identify" but at the end of the day you can't use it to grant because you don't own those rights are in cumbered.

And if those rights are in cumbered by someone else that has to grant you consent, it makes it a complicated layer.