Navigating Volatile Cryptocurrency with Warren Lorenz

Warren Lorenz is the Managing Principal at TechMeetsTrader, a firm that consults, invests, and venture-builds top-tier startups. Warren and his firm have invested in over 20 blockchain startups and operate a hedge fund focusing on arbitrage trading strategies. He is a Venture Partner at Blockchain Founders Fund, an early-stage venture capital fund, and sits on the Board of Directors at CryptoStar (TSX.CSTR), a data center and cryptocurrency mining.

Operator. Warren is an entrepreneur with multiple products built, licensed, and sold to Hedge Funds, Proprietary Trading Offices, and Family Offices. Before that, he had exited an EdTech company that he helped scale from 7 Universities to 130 within 12 months. Warren was part of Batch 13 at 500 Startups VC out of Mountain View, California, where Warren and 32 other companies developed their businesses. He was a licensed Investment Advisor at Northwestern Mutual and bought his first Bitcoin in 2011. Currently, he serves as an advisor for multiple companies across the blockchain ecosystem ranging from financial products to NFT games and decentralized autonomous organizations (“DAO”).

Episode Highlights Here:

Warren:

In managing risk, extracting opportunity would be like what we’re doing with our hedge funds.

Brett:

What’s the number one secret to trying to build wealth during changing times?

Warren:

You know, it’s interesting it is about building an edge and managing your risk. And ultimately, you can have to compartmentalize both opportunities. You know, the managing risk component, as you’re seeing right now, with markets drawing back, is at this point. If you weren’t managing your risks, that’s kind of you see the byproducts of that. Whereas then the opportunity aspect in the lead into your edges, you know, for us, our edges include, you know, venture capital agreements with early-stage startups. So we’re supporting entrepreneurs from their seats, you know, to family and friends rounds, even pre-series A typically. And you know, you get an edge because you have an asymmetric risk-reward profile right? Of course, you know that every company you’re involved with is not going to be it is not going to become the next Facebook.

Nonetheless, you know. It’s an asymmetric return profile that works well, you know another one is in terms of managing risk, but also extracting opportunity would be like what we’re doing with our hedge funds. We have arbitrage and lending fundamentals, which means we do not take a directional risk. And that sounds interesting for most listeners, I’m sure, you know, if you could essentially buy any asset in this instance. Let’s call it Bitcoin for $100, and then sell it for, let’s call it $101, simultaneously via computer algorithm You don’t want to do that right, frequently. And so we have computer systems that do that all day across the markets, that’s built us an edge. So ultimately, I would say it’s risk management and, establishing your edge which is the most paramount key to success in any investment market, regardless of sector. Okay?

Brett:

I got that as I was there a lot. And it was really good. So building an edge in managing your risk and edges could be something like, you know, venture capital into some startups with an asymmetrical opportunity to grow your wealth, right? I think I heard that. And then the other thing could be the technology behind automating computer tech robots that are trading Bitcoin higher and lower automatically. Is that a fair summary so far?

Warren:

I mean, it doesn’t have to be computers. I think theoretically, it’s finding something that fits your personality, right? For me, I didn’t want to play cowboy, if that is. If you are more of a risk individual, you can gain an edge being a risk-on as well. But it’s just you need to know that about yourself and your Own profile to figure out what strategy might work best for you and what you’re trying to like you’re trying to achieve, you know if you’re trying to achieve a 15 to 20% Return that’s a lot different of a risk profile than if you’re trying to get 10x Multiple.

Brett:

Excellent very well said.