Eric Demuth wanted to become a ship’s captain before changing course to set up the Bitpanda cryptocurrency trading platform.
He worked as a mechanic on various container ships for two and a half years, anchoring at ports in China, Japan and Southeast Asia. But the nomadic life left Demuth “a little bored” and he eventually returned to Vienna to study finance.
Back on dry land, he met Bitpanda co-founder Paul Klanschek, a meeting that turned out to be spectacularly profitable.
The duo and co-founder Christian Trummer still own around half of the company – even after closing a $ 263 million funding round this week led by Peter Thiel’s Valar Ventures which valued the startup at $ 4.1 billion. . Demuth and Klanschek each own about a fifth of the company, a stake worth around $ 820 million on paper, according to Bloomberg calculations.
Their outsized holdings demonstrate the benefits of seed money and years of profitability, co-CEO Demuth said, noting he was in no rush to go public despite an increase in public offerings. initials of fintech.
âUsually fintechs make a lot of money, money, money, try to minimize the burn rate, and then go IPO, especially when they aren’t profitable,â says Demuth, 34 years. âFor us, it’s different. We don’t want to do it, we are taking a different path.
The company, which began offering crypto retailing, is growing as digital assets become mainstream. Without being put off by the pandemic or the fluctuations in crypto prices this year, Bitpanda offers stock trading, a payment card that allows you to pay for your coffee with Bitcoin or even Tesla Inc. stocks and builds a new one. head office in Vienna.
Demuth discussed fundraising, the world of fintech, and his ambition to diversify Bitpanda users. His comments have been edited and condensed.
What did you learn during this fundraiser?
Having someone who really supports you and still has deep pockets for the next few rounds is so effective. Of course we could have gone out and maybe even gotten a higher rating, but Paul and I saved a lot of time by not having to do the whole roadshow after deciding to do another lap with Valar.
I would advise anyone considering a Series A to pick the right investors who can do the exact same thing in the next few rounds.
How did you get started with Bitpanda?
We put all our savings into it and tried to get the business going. We wanted to be profitable very early on before we had the first investors on board.
How do you see the competition?
I don’t consider Revolut to be a crypto site, although they also offer crypto like many others. Coinbase does a great job, but the focus is still on the US side.
The crypto side will always be one of our main activities and there will be more products coming for this space. But on the other hand, we now want to make investment accessible to everyone in Europe.
Revolut builds a superapplication that does a bit of everything. We only focus on investing and trading.
Why did you become an entrepreneur?
It all started when I understood how banks work. I come from a family that is, I would say, the normal middle class. I remember when I was in school and started to be interested in financial stuff and a bank advisor advised my parents to buy stuff and I looked and they didn’t no money wasted on it but it was too expensive.
I got so pissed off I said it was a scam they say they are your advisor but in reality he is a salesperson. So I always wanted to do something to fix the system.
We are trying to build Bitpanda so that people don’t need all these middlemen. People can just do things on their own.
How is the world of cryptography evolving?
The demographics when we started the business were clones of me, Paul and Christian. Now he has completely changed. It’s 18 to any age – as long as you’re comfortable doing things online with money. It doesn’t matter if you are a student and just have a little to invest, or if you are a richer 60-year-old judge.
The only thing we want to change is that most of our users are by far male, so there is huge potential for female involvement.
What are you doing to relax?
I am a gamer. There’s a meme where you sit in front of a computer all day so you can sit in front of the computer all night. So when I have free time I play on the computer.