Welcome to our comprehensive interview series – Humans of Blockchain™ where we get the best and brightest to answer a diverse set of questions.
This series will attempt to clear the air of doubt in the Blockchain space today by focusing on bringing more transparency to the readers.
Our guest today is Jay Coshan, Founder/ CEO at Unique Block Group.
Jay is a Blockchain Angel Investor, Crypto Strategist and a Future Thinker.
Now lets hear it out from Jay himself.
1.We would love to know about Jay Coshan. (Your background, education, interests etc. anything you are comfortable sharing with.)
I guess I should begin with where I feel I first started to learn about myself, that was on the golf course. I started playing at a very young age, which led to me playing competitively in my early teens; it was my main passion and purpose. I was the youngest person in the UK to hold a course record at that age of 14 years old. Sport is an amazingly honest teacher, it’s very clear that there are no short cuts other than working on your craft.
I was privileged enough to be given lots of support and guidance, which included sports psychology and training on a national level; this was the beginning of a fascinating journey for me to start too access myself and what makes us tick.
Here also begins the most unexpected life turn for me, I was introduced to online poker by my uncle who simply played recreationally, I must have been about 15 at the time. I instantly fell in love. This was the perfect strategy game combined with deep human emotions (money). I was in awe of the complexity and variations of the game and structure, I couldn’t focus on anything else, it completely consumed me. It was extremely difficult at the start to tell my family that I wanted to pursue this as a professional given all time and effort we had all put into my golf career. I am just thankful my parents allowed me to continue to explore where this could go.
Poker was pretty new to the internet at this point, a game that had deep roots in America, played in some of the riskier parts of sociality as well as the elite. Now accessible to anyone with an internet connection, to play against anyone else in the world.
Over the next 10 years or so I treated the game with the same mindset that I had on the golf course, it was a sport in which I would persistently search for ways in which to create a bigger edge. I made some incredible friends, in which we would study the game for months at a time trying to find new formulas. I saw the game evolve over time to a point where math and game theory were essential in staying ahead. Like many new wonderful markets that come to the internet, the window of opportunity gets smaller and smaller as awareness grows in the form of competition. Global regulation played the biggest roll in slowly causing a decrease in profitability.
It’s hard to quantify how much I learnt from this intricate game, as well as the overall ecosystem. It felt like a microcosm of real-world economics. I left with an ingrained understanding of evaluating risk, EV (expected value) and human psychology.
For those that know a little about poker, I specialized in cash games and later 1 -1 (heads up) which was where I found the psychology aspects was amplified the most. The main reason I stepped away from poker was due to decline in long term opportunity, I was losing my enthusiasm as I continued to see my future value decline in the industry.
During my poker days, to diversify and expand my investment portfolio, I started to invest in property development as well as buying properties to renovate and rent out; something I still maintain today. I exited poker and managed to gravitate to the riskiest part of property development, which is land acquisition and planning permission. To this day I still work closely with property projects.
My old poker friends started to come knocking and tell me about this technology called cryptocurrency and just like previously when my life took an unexpected turn, it happened again!
Not only did I fall in love again, it combined all the things I had learnt from my poker days.
2.Can you tell our audience about Unique Block Group in a layman’s language?( The vision behind it, the mission, scope etc.)
UBG is an investment group which invest in emerging blockchain projects as well as investing in the secondary market, both require an in-depth analysis on a project for us to invest.
It feels a little too early and restrictive to narrow down on only one aspect in which we want to be a part of in the future. Our mandate is to enjoy the journey and embrace what is ahead. Short term is extremely difficult to predict in this wild market, long term is boundless and why we’re here. At the risk of sounding generic, although we’re here to optimize and seek opportunity, there is something about investing and being part of the “decentralized future, web 3.0” that is pretty damn cool.
3.How many startups has Unique Block Group invested in so far? What qualifies a startup to get investment from Unique Block Group?
We’re just over the 30 mark now. This question has evolved overtime and with the market to some degree. There have been certain challenges over the last 2 years that require attention (scalability, interoperability, payments) and therefore projects have come forward.
If the elevator pitch is plausible, whether that is communicated in person or online, we then always look at the team first. Most of the pitch events that we attend is simply to meet the founders. In some instances, we have operated by looking at other aspects of a project first and it has often resulted in time inefficiency.
Then we dive into the tech, development stage, economic standpoint, competition.
We really enjoy this process and it can often take a long time to evaluate, so patience is needed.
4.What kind of investments do you prefer? Token purchase or equity?
Hmmm, good question! They’re two different products that each have positive and negative attributes that need to be examined. Tokenomics, engineering, modelling, whatever is the fashionable word right now; is in its infancy. This I find intriguing on multiple levels due to the economic game theory behind the token, the smallest differentiator can have a profound impact on the health of the token ecosystem.
The other aspect, which is very much being established right now, is the emergence of the traditional venture world in this new world of tokens. Everyone is a student in this area and for this reason I believe there is vast opportunity.
I believe we will see a new type of strategy start to form with professional token investors. One of the biggest value propositions is the early access to liquidity, even whilst the project is in its early stages of development. This presents its challenges as well, both for the investor and the project.
I foresee that as early liquidity continues to become the norm, investors will begin tailoring their strategies to be more dynamic and take advantage.
The best metaphor for this would be a hybrid of venture and trader mentality merging together. This strategy won’t be for everyone, but neither is investing in tokens.
5.Has any of your investments turned out to be ‘not so good’?
Yes, where do I start! 2018 has been a gruelling year for our bottom line. It’s been one hell of a training ground and made us analyse every little detail about our investment choices and strategy. Poker has allowed me to be extremely analytical and hold no negative connotations to losses, other than to learn and to optimise.
To be better investors we need to experience losses. One of the detriments to only “winning” or “running“over your expected value is you can experience grandeur and lose sight of continuing to form a better strategy.
To give you a specific, we invested in seed round in a project of which we were pleased with its development and progression throughout the funding rounds, just prior to crowdsale we decided to take a much larger position with the view of liquidating a portion to limit our exposure once launched. Long story short, post crowdsale was a real disaster with exchange delays and poor communication as well as the market getting more slowly more bearish.
6.What are the future plans for Unique Block Group?
We want to continue to establish our presence in this exciting space and continue are ability to learn from the technology and market. We’re always looking to expand our team, network and resources. Working alongside founders and projects is always something that we enjoy and are humbled to be apart of.
The more I think about this question though the more I realise I don’t know the answer; this space continues to surprise and operators at a such a fast pace.
The one thing I know, is we will keep our eyes open.
7.What are your views about the ICO market in terms of scope, transparency and growth potential?
I was blown away with the ICO model, it’s truly genius, I do urge people to leave their judgement at the door and look at the mechanism. It is a giant leap for fundraising, it outperforms many traditional systems in multiple ways. That said, the current model has many flaws which has and will continue to show cracks as time goes on. Sadly, the closer you are to ICOs the more you realise how survive the situation is, it’s quite shocking. It grew into a bubble that started to defy logic, movies will be made about them.
The level of transparency in some areas is non-existent to the point it is clear deception. ICOs have attracted opportunists in the forms of pure scammers to actors that have low morals. This is not restrictive to crypto, I was a poker player remember, you will always experience this when money is involved.
The reality is, this is all part of the process, it’s very rare that the first attempt is perfect, we can now build and learn from the past.
8.There’s a new trend of Security Tokens. What are your views about STOs? Has Unique Block Group invested in any so far?
It is a natural progression in the evolution of tokenisation. Security tokens can enable a symbiotic decoupling between speculation and utility. It allows a project to mint a utility token that is truly grounded in the product economy and not to be interfered upon by speculators. This in turn allows for greater flexibility of token utility policy, without the risk of compromising the positions of thousands of speculators.
The security token can also more directly align to the valuation of the company whom is operating the platform upon which the utility token is redeemed. Your utility token may remain forever accessible in price to users of the product, but that does not mean that the entity receiving such revenue is worth the same as its utility tokenbase.
The trade-off to this approach is that the security token must comply to international securities laws and this once again raises the barrier to entry for would-be investors from domiciles who cannot qualify.
There is a lot going on behind the scenes right now to enable STOs to flourish, we have projects like Polymath which is trying to be the Ethereum for STOs. tZero, Open finance network which are looking to provide the exchange trading functionality.
Yes, in fact one of our best performing projects this year is a security, Nexo. A great team and project which are providing crypto backed loans, I believe this project will go from strength to strength.
It is going to be refreshing to see more transparency in this market, it will be the pioneer for the next bull run and provide more needed liquidity. I think the short-term impact though is being over hyped currently and there is a much longer road ahead than people realise.
9.There is an ongoing debate about the sustainability of many blockchain startups and many startups are failing to deliver on promise. How do you filter out such startups?
I don’t think it’s much of a debate unfortunately, its probability combined with subpar teams, tokenomics, game theory, education and understanding. There will be a lot of projects that don’t get of the ground at all.
There is one element that you need to consider here that is different to “traditional” investments in start-ups, I alluded to this in question 4. Due to the extreme liquidity investors experience, you don’t have to watch your investment evaporate into dust, you often have the ability to sell, as long as you see the warning signs early enough. This is where the hybrid venture capitalist will emerge and where we spent most of our time trying to refine.