Interview with Les Borsai from Wave Financial

The following is an interview with Les Borsai, Co-Founder of Wave Financial.

This week, Horacio sat down with Les Borsai, Co-founder and Chief Strategy Officer at Wave Financial, an actively-managed liquid VC fund investing in crypto-assets since 2018.

Les is a former music executive who started the Wave Financial NFT Fund after noticing parallels between young musicians and NFT artists.

Discussion topics include:

  • His roots in the music industry as a rave and concert promoter
  • Common attributes between artists in the music industry and in the NFT space
  • The ability to be someone else in cyberspace while taking risks to make money
  • The advantages of being an outcast
  • Wave Financial’s global vision and the genesis of the NFT Fund
  • NFTs are art and collectibles, but ultimately about the creation of a gig economy in the metaverse
  • The strategy in buying certain NFTs as opposed to others, including infrastructure plays
  • The importance of building and supporting a community as an NFT artist
  • Veg Surfer, an NFT analyst hired by Wave Financial, who is immersed in NFTs and spotting trends
  • The importance of collaboration and learning to let go of ego
  • Investing in the Wave Financial NFT Fund
  • The NFT Fund adherence to regulations and potential tokenization
  • Following the DAO blueprint for creating a community through the NFT Fund
  • Thoughts on the adoption of NFTs by corporations including Nike’s acquisition of RTFKT Studios
  • The future of intellectual property rights for NFTs


[HORACIO RUIZ]

Hi, I’m Horacio Ruiz, host of the Alts podcast. You’re going to want to listen to today’s guest Les Borsai. If you’re in NFTs, even if you’re not, Les has a story for anyone interested in business, music, community, art, and just being in the moment. Les is the co-founder and chief strategist at Wave Financial. About a year ago he spearheaded the launch of an NFT fund for accredited investors as part of a series of wave venture funds. We talk about his early career in the music industry, the development of the WaveNFT fund and his thoughts on the NFT space. And there’s so much more. Les truly is one of the thought leaders in the space. Let’s go. We’re very lucky today to be joined by Les Borsai. He is the co-founder and chief strategy officer at Wave Financial. They are a digital assets management company. They currently have more than 600 million dollars worth of assets under management. And Les just recently started an NFT fund which is on the cutting edge of all these NFT funds that have come out recently. Les, thank you for joining us today. 

[LES BORSAI]

I appreciate it. It’s actually closer to a billion and a half AUM right now, but I think maybe with depreciation of the assets lately, it’s a little bit lower. But 600 million was a minute ago. 

[HORACIO RUIZ]

I got that from maybe a couple months ago, so that’s amazing. Les, we do some research here with NFTs and NFT funds and there’s been a bunch of them come out recently, but yours caught our attention early on. We just kind of wanted to know more about the fund, your background, kind of how you got into the NFT space. But I know that you started down in Southern California. You started as a music promoter in the rave scene. Is that correct? 

[LES BORSAI]

Yeah, It was right around 1988. I think I had just turned 20 years old and I’d left home pretty early. I left home when I was 16. Eventually wanted to figure out a way that I could make a living and somehow throwing parties kind of fit my DNA at the time. So we would find these warehouses and create these events. And what that kind of merged into was the first incarnation of the rave scene and kind of bringing over talent from the UK. Some of those first bands were like Massive Attack and the Stereo MCs and The Farm and Primal Scream and the first incarnation of all that kind of EDM music. And I guess where that went was just a deeper career in the music business, being an actual concert promoter and moving on into other aspects of music, 

[HORACIO RUIZ]

I can imagine as a 20 year old promoter in the music scene, that was a pretty exciting time to say the least. Maybe exciting kind of meeting a lot of other young people and the energy behind it? 

[LES BORSAI]

Yeah. I mean look, I think there’s a lot of comparables to what crypto is today with the Metaverse and NFTs and define. And back then it was just young people creating community through physical kind of activities I guess. Like to dancing and the music was kind of the underlying factor and the warehouse was the experience and that ultimately turned into kind of other jobs in the music business. And that was going from concert promoter or working at a record company. And I went to the Silicon Valley and ended up working in one of the first online entertainment destinations. And it was funded by SoftBank in Asia Pacific. And then I came back and I was just a manager for many years. But kind of the crossover between all of that was, community was important. And if you took a look at a lot of the artists you were working with, there were a lot of comparable artists and those experiences just led you to building your own communities. And it’s exactly the same as it is today, except our version is Telegram and discord and different social media that has adopted. 

[HORACIO RUIZ]

Quick aside. I mean, because you mentioned that, I mean, is there something – I didn’t mean to go here, but is there something that’s lost or do you think gained, because you talked about the dancing, right. And the music and you experienced that physically, right? That was a physical experience. And now it’s like, everything is kind of digital experienced. We’re moving away from that physical – that being in person kind of community. And in some instances what I think made NFT NYC, right. something like NFT NYC so amazing was these people that had communicated for over a year or for months, let’s say for months, digitally they met up for the first time and it was almost like – there was some sort of fascination with it. “Oh, we get to meet in person when I was, you know, 20, 30 years ago”. What else were you going to do? What do you think about that divide I guess?

[LES BORSAI]

Well I mean, look, I don’t if it’s a divide or ultimately, as I got older, I was okay. Not leaving the house too much. So for me, I think it was a benefit for younger people. I think they enjoy leaving the house. But if you really take a look at the underlying philosophy, it wasn’t too long I did an interview, and I did it as an avatar in the metaverse. And I think as a guy that was a little bit of an outcast in high school, we always want to be things other than ourselves in some instances, or when we’re young, anyway, as we’re trying to fit in. And now having the ability to be a CyberKong VX, if I feel like it as a young kid with a bank account because I’m trading NFTs or doing DeFI, it it’s pretty remarkable. So is that other element missing? I don’t know. I mean, it was just a different experience. I threw those parties to make a living, and there was a lot of it that is the same energy when you’re risking something, when you’re risking throwing an event in a warehouse that may or may not be permitted appropriately or may or may not make money or lose money. I think what it’s really akin to is online poker better than going into a poker room? And to be honest with you, I’ve been in poker rooms, I think online poker’s probably better. 

[HORACIO RUIZ]

Okay. You talked about the earlier part to your career. What led you to co-found Wave Financial even before you started the NFT fund? And what was your background with that? 

[LES BORSAI]

Well, I mean, I think again, curiosity is the thing that really matters in 2013. Bitcoin was trading at about 200 bucks I think. And I wanted to find the next one. I thought it was expensive. I became an advisor for a company called Ripple in 2013. In 2014, I invested in Ethereum. I did the presale. So that was good. And then I really invested in a lot of the currencies coming because I think if you really kind of look at my history, I was always kind of fascinated with outcast. You know, I don’t know if you’re picking up on that. And these guys that came from the Cypherpunk movement, and they were always fascinating to me, that hacker culture was really interesting to me. You know, it’s something I could never be. I didn’t have enough of aptitude for coding or patience, but I genuinely liked the attitude in some ways. So when I came to cryptocurrency, I kind of immediately understood it. It just had a natural connection. So as I invested kind of through the ICO period, we started Wave Financial because we knew there would be an institutional capability, and I guess even Peter Pan needs to grow up. So all of those ideallic views I had to it, I knew there would be institutional use case. I knew that we had a good head start. And that’s how we co-founded it. And the company does a lot of things now. We have multiple venture funds, we do treasury management for high net worth’s and protocols. And we create a lot of financial products and really have a global vision of how we accomplish those things. And obviously NFTs were near and dear to my heart. And that’s something that’s been incredibly successful kind of out of the box. 

[HORACIO RUIZ]

Yeah. You started Wave Financial in 2018. Is that right? 2018. 

[LES BORSAI]

Yeah, just at the beginning. 

[HORACIO RUIZ]

Okay, and you dealt primarily with, deFI and cryptocurrencies. And then all of a sudden about, I would say a year, year and a half ago, right, NFTs pop up. Was it kind of difficult to start this NFT fund? Would that maybe that you just started, that it wouldn’t be taken seriously or obviously you started, so you had some conviction there. What was the thought process behind starting it? 

[LES BORSAI]

Well, we were a registered investment advisor with California out of the box. And then one with the SEC when we had enough AUM. And I had bought my first crypto punk, which I lost in 2017. Looking at the crypto prices today, I guess it’s not that big of a deal, but I’ve got crypto kitties back then. And I was always a collector. I understood sports cards and watches and all sorts of stuff. And my Dad was a collector, but he was more of a hoarder. So I always kind of liked flipping things. It was fun. So I really got curious again. And I became an advisor for Aavegotchi. And Aavegotchi really showed me what an NFT could be. Because I think people get confused that this is about art, and it’s not. Or this is about collectibles and it’s not. And let me just talk about how the funds started. I started collecting again and I was doing very well at it. My partners kept saying, “you got to launch a fund, you got to launch a fund”. And I kept saying, no, I don’t get it. Why would we as an asset manager do that. And they’re like, “Hey, dummy, it’s art, it’s an asset. Do it”. And I’m like, “all right, man”. So that’s how it kind of came about. And it wasn’t hard. It is the single most successful launch we’ve had in terms of what we’ve been able to raise and what we’ve been able to invest in. But if you look at the ethos of it, Aavegotchi really showed me that an NFT could be a financial instrument. It could be a wallet, it could be an avatar, it could be your identity. It could be a whole bunch of things in the metaverse. And I really look back to Wall Street bets, and the fact that they gamified going long on some hedge funds just to hurt them. And then I look at Satoshibets and then I look at the Dows, and it’s really easy to comprehend that we’ve created a gig economy in the metaverse. And all of this is about liquidity, and it’s not about collectibles necessarily. It’s about a convergence of ideas that ultimately end up becoming things like gamified banking wrapped into an NFT, that’s your profile. And that’s a crazy way to think. And I think really what it is, is we’ve heard so much about the boomers leaving the millennials the worst economy in history. And I really think it’s kind of like, this is the millennials and Gen Z saying fuck you and the economy you left us, we got this. And if you tie that back to my early history, which I remember. I didn’t really want to go to college. I was a guy that could actually do things. And I think that’s really what it comes down to, is you have an opportunity to do lots of interesting things. It’s why my 14 year old nephew understands this so well and has created a bank account for himself. 

[HORACIO RUIZ]

I’m trying to digest what you just said, because it’s a new definition. It would be a new definition for a lot of people that are listening, right. That it’s not about being a collectable. It’s not about the art. You’re basically just talking about an entirely new way of making money. And that’s what it boils down to. 

[LES BORSAI]

Right. Dows are really interesting. They’re community driven. As everyone knows. It’s a way to do a launch out of a Dow, and have the Dow recoup from secondary sales, and people have those attributed royalties on secondary sales. And Dows launching tokens that represent value in the Dow and doing that over and over and over again. So yeah, it’s a new economy. 

[HORACIO RUIZ]

Well, let’s dive into the specifics of the fund. You’ve gone out and I’ve tracked some of the purchases you’ve made. And correct me if I’m wrong, I don’t see any like – I would imagine that when you’re starting off the fund, you would start off number one, a crypto punk, number two, a Board 8, right. And your fund has kind of taken a little bit of a different approach. As of right now, there’s no apes and there’s, there’s no punks. How are you going about curating your fund? 

[LES BORSAI]

Look, I bought kind of a grail board ape for an Ethe and a half personally. And I bought another eight for a half E the, under half Ethe. And if you take a look at the grail and you’ll take a look at the other one and the value after the mutineer drops, and after the Kennel dogs, it’s very hard to go buy one at market for me. Regardless of what they’re going be or what they’re going to become. And it’s the same with punk. Although now’s the time to buy a punk because of, kind of the way it’s backtracked here. And I bought my punk, my first one at 17. And the second one I bought for 16 ethe. So if I’m looking at it from an investment perspective, there’s no way I’m deploying money out of the fund to go buy a premium ape at this point. When I have enough sense to understand that a cryptoed bought at $300 better investment, or what I believe the cool cats are to be. The cool cats are beautiful artwork created by Clon, there’s milk tokens coming, and they’ve hung around. And I believe in that project, I believe in the gaming component they’re building out. Or I love the CyberKong VX’s because I think they represent identity of a lot of the youth that builds in the space. The other thing we’ve done that you don’t see is a lot of the illiquid investments that we have. So we’ve invested in a lot of metaverse stuff, a lot of gaming stuff as well. That’s going to act as a gateway. So Ethe’s is about 70% collectibles and 30% infrastructure plays. And I think there’s a lot of Dow stuff I’m really interested in. Really support Justin Aversano with his twin flames, we bought one of those. We also bought a blow. And you can read about this on his site, which I come from music and I don’t want to buy music in NFTs. I actually don’t even like it most of the time, but in this case I like the artist. And I wanted to do a Reg D offering with that and figure out different ways to license. Because the models of licensing in the music business when it comes to the publisher side and master side, and all of the writers, are just completely archaic. So I think there’s other ways to do that. And that’s why we bought it. But we ended up selling it an hour later and passing some of the upside to the artist. And that was important to me too, because I think when we talk about this economy that’s being built, the second part of that is the democratization and the ability to actually have a career in this world. And there’s too many barriers and roadblocks in IRL, right? And if you want to sell art through a prestigious gallery, you’ve got a lot of hoops to go through. If you want to sell art in this world, you have to build a community and they’ll support you. And I think that’s a fundamental kind of optimistic difference. And the barriers for trans, gay, people of color, It doesn’t exist here. It’s actually supported. And I think that’s another really kind of important factor. Because I don’t think anyone should be blocking anything. And that, when you book end it with how I started my career to where I’m at now, the middle was a cluster fuck for me. Somehow I believed being connected to artists and all of the ego connected to that and all the bullshit connected to that, that’s not how I wanted to live my life anymore. You know, somehow I forgot, you really got focused on money and with this, you can just look at the bigger picture. And it’s really cool. 

[HORACIO RUIZ]

Yeah. That’s pretty deep. And I kind of want to take it back. Like, I mean, yeah. You mentioned you’re fund, you’ve purchased some photography? 

[LES BORSAI]

Yeah. 

[HORACIO RUIZ]

You did the music and NFT’s that you referenced earlier. You flipped that like immediately you, you made like 60 Ethe on it. And I was going to say, I mean, you basically made yourself a crypto punk right there. 

[HORACIO RUIZ]

Well, we also float a lot back to the artist. Yeah. So Blow got a piece of that because I thought it was a good deal for him. And it was a rare situation. Someone really really wanted it. And I saw that the artist could benefit from it. And that was really the point of it. Because I can buy another one and do another collaboration if I want to. And I think with the stuff that we are getting involved in, there’s many sides to it. We all want to make money, but if you’re not really like authentically supportive of all of this, then when you think about the way I put the fund together, there’s a guy named Veg Surfer. Veg Surfer already had a pretty cool portfolio and came in to do this because he wanted the collaboration. And he makes a lot of the decisions on what we buy and has those relationships. And I really wanted to set it up like a record company on the creative side. I didn’t want someone who was a banker coming into the office. We have those, we have plenty of bankers. I wanted someone who would just be immersed the way I was. And it’s very hard to find those types of people that understand kind of so deeply what’s coming next. You know, why is [unintelligible 00:19:00], not having a native token using a magic token and launching from layer two is what I’m not native too. Or what’s going on with some of the other models that are happening right now. And I think staying ahead of it is a thing that keeps us really relevant. 

[HORACIO RUIZ]

Could you talk a little bit about that with Veg Surfer? I mean, you have him immersed in there and he himself was a pretty, for lack of a better term, a successful collector, right? With deep knowledge of the space. That’s interesting to me, like you said, bringing him in and working alongside, say, financial analysts. There’s a synergy there, right, that you can’t get otherwise. 

[LES BORSAI]

Yeah. And I think it’s because I’ve seen it so many times. I love to tell this story in 1992-3, I worked at a company called MCA records. And there was a band called Sublime that was manager by Blaine Kaplan and Jon Phillips. And I remember Bradley coming into the building. I remember two things really back then, but Bradley coming into the building and MCA was as corporate as you got and Bradley wasn’t – Bradley was as soulful as you got. And this relationship was either going to work or just implode. But I remember at the time I was pretty young. I think I was like 22. My boss saying, you know what were we going do with this? And I go, what? He goes, leave it the fuck alone. I’m like, okay. And the point was, it was something already. And if you could let it just be organic and develop, then they could do the stuff like distribution or positioning at retail because we still had retail not streaming back then. And it really worked because everyone understood their lane. And I think when it comes to understanding the marketplace, why would a guy like Veg want to do this? Well, that’s pretty simple to understand. He’s collaborative. There’s other things that he’ll learn that are not necessarily part of his existing tool box or skillset. And that was a hard lesson for me. I did a lot of things alone for a long time. I just didn’t realise that authentic collaboration can take you places that doing things on your own can’t. And that’s really pretty remarkable when you can do that. 

[HORACIO RUIZ]

Wow. Yeah. And that something I think that we gain with experience, right. Totally can relate to that. You think you can do everything by yourself. You have this youth about you, this energy, and then you realise there’s a lot that I don’t know. 

[LES BORSAI]

Well, and what you don’t know when you collaborate, you can just build something that’s greater than yourself. And I think when you’re young, you don’t really give a fuck about that because you got money. But in a certain place, the money is just the money. And you can do things that are much greater. I never dreamt that I’d have a company that has as much AUM as it has, or as the staff that it has. And I couldn’t do it alone. There’s no way without David and Ben, my partners, there’s just no way. It’s like, they just know too much that I don’t. I’m not a finance guy, they’re finance guys. And it, it’s really hard to build a finance company if you don’t know about finance, when you start. And that was me at the beginning. Now I know a lot now, but that was the fun part is learning. 

[HORACIO RUIZ]

You know, learning and all that. And a lot of people are learning this space. And from my experience, just engaging a little bit on Twitter, we talked about money, right? And it seems like that’s a huge driving force, right. For the space right now, kind of like the quick buck. You jump on a project, it rockets, and then you sell it at whatever, whenever you’ve made your 10 X or 15 X, 20 X, whatever, you sell now. There’ve been people also that have been buying at the peak of the mania. Only to be holding it when it drops down by, I don’t know, a thousand percent. What do you see about that in this space? That’s something that I find kind of alarming. I don’t know how involved you are or how much you see that in the space where people are so fixated with the money that it’s a lot of people are put off by it.

[LES BORSAI]

Well look, I mean, I don’t know if you’ve ever been to [unintelligible 00:23:13], I’m not really a burner. I’ve been a couple of times.

[HORACIO RUIZ]

It’s on my bucket list. 

[LES BORSAI]

It’s kind of choose your adventure, right? I mean, you can have a completely sober experience or you can have a completely intoxicated experience. Well I kind of look at this world in the same way. If you want to be authentic collector, buy low and hold, one, you have the ability to do that. If you want to be someone that stakes your NFTs and gaming create returns, you can do that. If you want to be someone that does high frequency trading of these things or arbitrage, you can do that. But I think there are people that may just want to play the games for instance. Or just get the NFTs as identity. And I just think the general kind of underlying rule with this or anything else is, don’t risk what you don’t have. Don’t leverage if you can’t afford to lose it. And I mean, those are just basic ideas. And I think that’s where we see people get in trouble. But that’s no different than kind of in real life when people gamble. So, I mean, there’s lots of opportunities in this world and you get to select which path you go down. I mean, you can be conservative as well. There’s a lot of stuff that has very conservative returns. 

[HORACIO RUIZ]

A hundred percent agree with what you’re saying. I mean, I think that you just have to be authentic with what it is that you’re collecting, right? It’s like, if you really enjoy something and you have the means to buy it, I mean, that should be the first and foremost kind of decision that you’re making. Like, hey, I love this…

[LES BORSAI]

Right. 

[HORACIO RUIZ]

…It speaks to me. And if it drops to zero, I don’t care because I still love the heck out of this right. You know, I want to talk a little bit more about the fund, kind of some specifics about it. I kind of want to then pick your brain a little bit about the future of the NFT space. You have the NFT fund. Who can invest in it? Is it somebody that has to be an accredited investor or, let’s say somebody’s listening and they want to get in on it.

[LES BORSAI]

We do KYC, AML, we’re regulated. So we’re require to do that. Obviously you can invest globally. So different restrictions for different geographies. But yeah, we’re very serious about the KYCMA and AML, and you have to be accredited. There’s a minimum. But the minimum has been met pretty easily. 

[HORACIO RUIZ]

Could you say what it is or?

[LES BORSAI]

Well, you know, that’s a funny thing is I’m not sure if we’re going to raise it or not. But I can tell you that in the first month we raised about 13 million bucks for the fund. And it’s not really slowing down. So one of the things that we did is that we just kind of  – now are going to probably engage more people around it to talk about it and bring some more funds in, I think the unique perspective on it and the fact that we have everyone from high networths to protocols, to the guys who work at private equity firms investing in this thing, really says a lot. And I think what it says is they don’t understand the space. They know it’s an asset that you can create a good return on. But if you’re not deep enough in it to understand that small brains increase IQ and your hope is to get to coconuts that have magic tokens in them. They literally will listen to you and say “what the fuck did you just say?” And I think that’s the point. Because we know what’s coming next. We know what whitelist we’re on, when we see how the market’s changing. And it requires that kind of dedication. So going back to Veg and some of the other people that we have as advisors, it’s constant dedication to be in the space all day long. Because that’s what it takes. I mean, look my nephew again, who was 14, wanted to get on a whitelist. They made him wait seven hours and draw pictures of penises. And it’s just like what? It’s just like – but he did it. And he got on this whitelist. And I mean, it’s just ridiculous. And look, that’s not an NFT. The fund would never buyer collect. But I guess the kind of really ridiculous point I’m trying to illustrate is you have to have a lot of dedication to know what’s coming next and how to connect to it.

[HORACIO RUIZ]

Absolutely. And I, and most people, I would say, don’t have that, right? But if somebody has $10,000, right. That they want to put their money into, and they understand that the NFTs are an asset class. Right. But they’re not in the space. And some of it is just – there’s so many things, right. I mean, you could literally spend a whole week and not go to sleep, and you’re still not caught up with what’s going on in the space.

[LES BORSAI]

Yeah. 

[HORACIO RUIZ]

I guess I wondering like with NFT funds, should it be something that, that there’s a barrier to enter? Or what, what would you recommend, I guess like, if someone really wanted to put in a good size amount of money, a regular person has an investment? 

[LES BORSAI]

Yeah. I mean, if they have enough money to come and enter and they do KYCML. I mean, they’re going to qualify as accredited. And we have had kind of large amounts come in. I mean, that’s how we got to what we got to kind of so fast. But there’s always something happening and it happens per chain. I was amazed to find out how robust the Cardano ecosystem is, something I hadn’t looked at. Solana, Michael George just launched the Catalina whale mixer on Solana. And those were really interesting. And yeah, you do get busy. I had the opportunity to do the whitelist and buy those for one Sol. And I think they’re 14 Sol, like two days later. And it’s because they’re interesting. And he’s a good person that knows how to engage a community from the background that he came from. And he as good group of people around him and a nice development plan. And I missed it. I personally missed it and I couldn’t have done it anyway if the fund was going to do it. Because everything goes to the fund first now. But the fund bought some and we bought them and did well with those and believe in those at least for the minute. But at think we’re pretty careful about what we deploy into. So if it’s going to be significant, we kind of really understand what the long term plan is because we have kind of access to do so. 

[HORACIO RUIZ]

Yeah. With some of the assets. And I kind of want to get your strategy on the fund. Are you looking, some assets you’re looking to just buy and hold long term? 

[LES BORSAI]

Mostly, I mean, look, a collectible by definition is a collectable to collect. So we very rarely will do trading other than to maybe cover the cost basis. And if I’m buying it, that means I’m buying it because I believe in it and I’m not getting out of that position. 

[HORACIO RUIZ]

So if you get into the fund, you’ll be holding their capital for, I don’t know… 

[LES BORSAI]

Five years. 

[HORACIO RUIZ]

…Five years, Okay. 

[LES BORSAI]

But we’re also probably going tokenise it to create some liquidity for them, which we can do after a year, but the hold is five years and then they can redeem. 

[HORACIO RUIZ]

So the tokenisation would make it available to others investors? 

[LES BORSAI]

Well, what would happen is because again, we’re regulated, the tokens would end up on security exchanges and it would tokenise the fund. So, I mean we haven’t done it, but we’re able to do it. So I’m still kind of digesting whether we want to do that or not.

[HORACIO RUIZ]

Wow. That’s big news. 

[LES BORSAI]

That’s also just another variation. And I think one of the things about when we’ve done tokenisation, although I don’t think we’ve tokened it yet. We’re just in the middle of it. We did a whiskey barrel fund where the return profiles pretty incredible. And we’re about to tokenise that. But again, all through kind of regulated means. So we have a lot of firsts. This is a regulated NFT fund. Like there’s other NFT ones out there. I’m sure there’s other ones that came before us. What I’m not so sure about is if there’s other ones that really kind of adhered to the regulatory process the way we did. And that’s another big differentiator that gives people and kind of crypto corporates ability to invest in it because of that protection. So yeah. 

[HORACIO RUIZ]

A lot of views, a lot of that tokenization would be a big deal. I don’t even know if there’s – what that reminds me of is tokenising is kind of like having a Dow, right? And the Dow having its own token. 

[LES BORSAI]

Yeah. 

[HORACIO RUIZ]

And then almost kind of representing a piece of whatever the Dow has except a Dow structure differently obviously.

[LES BORSAI]

Well, it’s funny you should say that because a Dow’s governed by the community, and this is governed by me and partners. And the interesting thing is that I really love the Dows. I love something that’s governed by community. I love tokens representing a voice. I love that they took it from a beneficial corporation model. And I think I’ve adopted the ethos of that into what we do. If you take a look at the way we do things. But I guess if you really take a look at my history, when I did the rave things in those warehouses, a concert promoter snapped me up because I was doing things differently and it was a different thing emerging. And we figured out how to blend those two cultures. Same thing with record companies would blend the culture. Same thing with a lot of the things I’ve done technology and music in my history. I always love the science experiment of if we put these people together, what’s going to happen? Is it going to create an interesting result? Not unlike Moneyball, except I’m not nearly as smart as that guy was. But that’s really the way we do things. And I like how the Dows operate. And I thought if I could do some of that in a regulated fashion, that’d be really interesting. 

[HORACIO RUIZ]

Yeah. Dows are definitely shaping the way things are done right now. You reference again, you know, your time in the music industry. And I guess I’ll preface this question with this is, it doesn’t matter if you are a raver or a crypto punk, a cyberpunk, everybody wants to have some money, right. Everybody wants to make money. How do you consolidate though, like that spirit, that energy of, I’m not going to go my parents way or my grandfather’s way of making a living. How do you consolidate that with kind of what’s happening where you have these corporate behemoths, right? These multinational corporations beginning to – “Hey, there’s a lot of money to be made here”. And is there the chance that that energy gets destroyed or polluted a little bit by that?

[LES BORSAI]

No, I think it’s funny. This is the first time I’ve ever seen Corporated options so fast. And we have to remember what’s actually happening here. Everyone always asks, is it a bubble? Is it not a bubble? And it’s like, well, not really because the more money that goes into the Dows, the more innovation that happens, and you’re creating underlying technologies. And that’s the funny part for me, because at the end of the day, the corporate guys, and it’s so ridiculous, I saw something the other day where Pepsi was talking about their mic drop, to meta talking to some beer.com thing. And they’re doing it in all the acronyms that are so popular with NFTs right now. And I just thought, what a load of shit. I mean, I know those are younger people who are working at those companies, but it’s just, it doesn’t matter. Because the people that are authentic are going to have their authentic successes. There is that divide right now. And the corporates are – there’s room for them. And in some instances they’re going to have their successes. And I think the best version I’ve seen with that is artifacts being acquired by Nike. And having an artifacts, crypto punk and virtual punk NFT early on, didn’t understand why I was being offered so much money for those. Well, turns out because I had those, I got six CloneXs, and I thought the thing with Meracome being kind of a special bonus, if you could get, was really brilliant. And then Nike coming in to do that, or G-money doing an indeedist deal, I think those are the best versions of corporates getting involved in the space because they’re doing it in a way that’s authentic. Now, some of the other stuff that you see that’s a pure corporate, that’s not that interesting. But I think a lot of the sports stuff that’s going to be more centralised is just going be better technology for trading sports cards. So, I mean, look, different strokes. Every one of those opportunities and launch is going to be different. 

[HORACIO RUIZ]

The sports card, you’re saying that that’s going to be… 

[LES BORSAI]

I think that’s just going to be a centralised version but with better technology. Let me tell you what I mean. So when I used to collect crappy hockey cards, which were probably the worst card to collect, I’d have to go through those booklets and just look for hours at pricing. Now we have everything that’s digital, the way we display it, the way we can find the information on it, the providence, the value. And again, when we go back to liquidity in the marketplace, having decks in that we can trade those cards in immediately or open C offers. You can trade immediately. That’s a big difference. That’s the thing that powers all of this. So I think some corporates are try to tap into that. But they won’t be successful. You know, again, if I put it akin to the music business, authentic alternative music at the time really created traction and people loved it. It’s the reason bands like Radiohead, or I don’t know, Sonic Youth or the Flaming Lips at the time were these bands that just gained such traction. And you got to hear coin terms like corporate rock sucks. And I just look at it the same way. I mean, there’s going to be corporates that try to do it and replicate it and it’s going to suck. And then there’s going be the authentic ones that emerge. And look, I mean, it kind of hurts my heart in a way with the board apes, to see some of the stuff they’re doing, because it immediately made me want to just get rid of them. 

[HORACIO RUIZ]

What are you referencing there? 

[LES BORSAI]

Well, you know, look, the universal band thing. It’s funny because I recoiled a lot of the music stuff. and I didn’t want to see the apes do a band with universal. There was just a bunch of shit like that in a weird way. And I think G-money has his finger on the pulse. And I think looking at where the Deedus thing landed with the Apes actually worked. So that’s interesting. But you know, I’m just that kind of music snob. It’s like when you discover this great band and you’re part of that club, you don’t want it to really like too fast too far, and dilute what it actually is. 

[HORACIO RUIZ]

I hear it’s like when you discover a band and not too many people know about them. And then they get discovered and it’s just like, ah, I got to find another band. 

[LES BORSAI]

Well, exactly. And I think with the apes, it’s easy to do that. Now, the part that’s really cool about apes or anything else is the way the IP transfers and what you can do with it. And the fact that it’s an individual thing. And look Guy Osiri I’ve known a long time. I like Guy, it’s going to be interesting to see what he does with it because he comes with a different hat. He comes with that deep music background, working with these large artist, brands and entities. And he’s been successful at that. And, and it’s going to be really interesting to see how he adopts that. Look, his partner in some of the ventures, Ashton Kutcher, they did the Stoner Cats at had cool ad with Vitalic and I mean, Stoner Cats haven’t done much, but my guess is if I had to bet on them, well the only reason I haven’t sold them, and I got some good ones, when that happened is – you just don’t count those guys out. It’s like all of a sudden there’s going be some fucking television show that blows the Stoner Cats up and you didn’t see it coming, you know? And it’s just like right now, they’re shit, you know in terms of an investment, but you just can’t count them out, ever. 

[HORACIO RUIZ]

I know right now what’s kind of because of Nike’s acquisition of auto fact and Adidas with the board apes, it seems like fashion right now is having its moment. And there’s speculation that there might be some other fashion brands looking to acquire other collections. 

[LES BORSAI]

Yeah. 

[HORACIO RUIZ]

You talked about the board apes and I – this is what I want get your kind of big picture of you here. Intellectual property rights. Right. So with the board apes, in my opinion, right, they’re probably a little bit better set up because when you buy that ape, it’s really yours, right? You can brand it. You can make a company out of it. You could use it to market other brands. You can’t do that, or at least as far as we know, right, you can’t do that with crypto punks. Larva Labs has not been very clear. 

[LES BORSAI]

But you know, what’s really fascinating about that. Look, if you think about that story, Larva Labs launches the crypto punks, and Artifacts does a crypto punk shoe. I have no idea what kind of rights I got to do that or if they just fucking did it. Because the punk bodies came out. And the only people that Larva went after were the funks, that were exactly comparable, right. Which the funks actually cooler in some ways. But the funny kind of thing about the rights part and you know, it just hit me as I was sitting here, I have a lot of these things and it would be really fun to take my ape that I have the rights to and do something completely different in terms of licensing, that is more traditional. Whether it’s licensing it for a product offering whatever that is and seeing how I can earn money from this investment that I have. Because that’s really a new model in a funny way. And that’s what they’re going to do. If you look at the thing Two Chains did, he did this ape thing and it had a lot of different kind of NFTs connected to it. And he’s launching these episodes that are like mini Netflix shows, but not on Netflix. But they’re really good. And I think that’s what you’re talking about. How’s all this going to change. How are rights going change? Rights are complicated now. This makes it a lot easier. 

[HORACIO RUIZ]

Definitely. And correct me if I’m wrong, though, it seems like certain projects give their owners way more latitude, right? Way more freedom to use their products as they see fit, whether to market stuff or to profit from it. But I know you mentioned how artifact came out with the punk bodies. 

[LES BORSAI]

No they didn’t come out with the punk bodies they came out with the punk shoes. Which was a physical shoe. The punk bodies was something else that came out right around that time, which was really this kind of pure, beautiful use case. Someone comes out with a crypto punk and then another company, unrelated, launches bodies that match your punk. That’s pretty cool. 

[HORACIO RUIZ]

But as far as I know, right, Like the crypto punks, they haven’t come out and been given that green light that say the board apes have, right. They’ve been unclear with what intellectual property rights… 

[LES BORSAI]

…Yeah, I think they they’ve blurred some lines. I mean, I think they’ve been very clear that they own their IP from what I understand. Which is different. Look, I mean, the thing that’s significant about the punks is the fact that it’s generative art that hit the Ethereum blockchain first. 

[HORACIO RUIZ]

Right. 

[LES BORSAI]

And it’s not the first piece of generative art and it’s definitely not the first NFT. But it is the first one on the Ethereum blockchain. And I think that’s what their significance will always be. So in terms of the IP, whether they own it, whether they don’t own it, it was early days. And I think those guys think a lot more like a company. If you look at what they’ve launched. So we’ll see. With the apes, they were the first one to really have this really kind of intricate roadmap into the metaverse, and adhering to a lot of the principles that the community is connected to. And it’s such a good community. They’re always inspiring the community to do things. And I think that’s where the crypto punks really fall, because they do things like launch me bits. And then you kind of don’t hear from them again for a minute. Or [unintelligible 00:42:49], he’s a 53 year old guy that knows all of this crap. This is just really frightening.

[HORACIO RUIZ]

No, and I think what you just said is kind of what I’m thinking, I just wanted to get your opinion on it. like where it seems like, yeah. Like you’re right. I mean, there’s no doubt about the significance of crypto punks. Right. But then yeah, you can’t just be a crypto punk. What are the owners going get out of it? You know.

[LES BORSAI]

You can just be Andy Warhol limited edition lithograph or painting. You can be that. Sure. But is it going continue to evolve and grow. Might hold value and it’s okay. That’s what it is. So there’s other things that are interesting, like Sherbets, that if you hold a Sherbert, which sold out quickly, you need it to go play poker, which is launching in January. I thought that was pretty interesting. I saw this thing called floaties that no one seems to love. And I thought the artwork was really cool. And it was again, about IP rights and old studio rights that are public domain. And I really liked them, but I mean, I don’t think anyone knows about them. So there is stuff out there that I definitely like, that I would never buy for the fund, but personally, just because I like what it is, I would buy it. You look at a personal NFT collection, it’s vastly different than what the fund is. And the fund just launched. 

[HORACIO RUIZ]

So with that being said, right, how do you separate the two? Right 

[LES BORSAI]

If it’s a drop, the fund goes first, if it’s a secondary, it doesn’t matter. 

[HORACIO RUIZ]

Okay. Just last thing. I mean, I saw it’s really cool. You have a space where you have all your artwork that the fund owns. It’s on Cyber?

[LES BORSAI]

Yeah. The on Cyber Gallery is cool. 

[HORACIO RUIZ]

Yeah, and it’s real cool. And I love how you have the CyberKongs almost like stacked in a corner there. And it’s just like a little army of CyberKongs, you know.

[LES BORSAI]

I love the CyberKong VX’s, I don’t care what anyone says those things are awesome. 

[HORACIO RUIZ]

Yeah. They’re real cool. 

[LES BORSAI]

And you can see what they’re going do with them. And they’re to me, CloneX before CloneX. 

[HORACIO RUIZ]

So, thank you so much. I mean, as I’m listening to you, you’re basically ticking off all the things I was going ask you about, about the fund and about your thoughts on the space. If people want to just follow you or learn more about the fund, what can they do? 

[LES BORSAI]

Like, I swear to God, I should have started Twitter 20 years ago. It just never occurred to me that I should. But definitely, that’s probably a good place. 

[HORACIO RUIZ]

Twitter?

[LES BORSAI]

Yeah. Because I mean, I kind of just talk to anyone. Yeah. And I want to get more into like supporting, I haven’t had a lot of time lately, but I want to get more into supporting local art and local artists, and just start supporting them. It’s super important. And I’ve done some of it, not enough. So, 

Yeah. 

[HORACIO RUIZ]

And I want to say to what you just said about talking, I mean, 90% time I send out a message, even if it’s like, you know, sorry can’t, don’t have time, or maybe can we reconnect in a month? You responded and you were so open to share your story and to just come on the podcast. And, I can’t tell you enough how I appreciate that. and my company appreciates that. To have someone like your voice out, and we can kind of have that on our podcast episodes. 

[LES BORSAI]

No, I appreciate you. I mean, the thing about it is, is I think you’re either going be part of this community or not. And I don’t think selection fits. It’s like, if someone’s in the community doing something, you should talk to them and you should be supportive of it. That’s the whole deal to this. And I think people who value their time in such a way to say, look, I was a young guy and I’ll close on this, that wanted to get into the music business bad. And all I did was make phone calls. And most people didn’t take the call. And the ones that did I remembered, because that’s what the whole thing was. If someone was ahead of me, they could help support me as a young guy and get me to a place where I wanted to do kind of what I was doing. And I’m not suggesting you’re that person. I’m just suggesting that being open to talk to people who have good intentions is not a bad thing. So I don’t mind doing it. I want to do it. 

[HORACIO RUIZ]

I think the biggest takeaway I got from Les was about the importance of community and supporting each other. I hope you really felt his on honesty and the way he managed to be so introspective at a point in time when he’s having so much success. I don’t know about you, but the conversation really inspired me to continue building. If you enjoyed the podcast or other episodes, tell your friends, tell your neighbors. But you can really help us by following or subscribing. That’s all for now until next time on the Alts podcast. 

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Author

Horacio Ruiz

Horacio Ruiz

Horacio is a veteran math teacher of the New York City public school system. Prior to teaching, he lived in New Orleans where he worked in sales for the New Orleans Hornets before joining The Institute for Sport and Social Justice to rebuild homes in the Lower Ninth Ward and neighboring St. Bernard Parish. He currently lives in Staten Island with his wife, Alicia, his three sons; Oliver, Henry, and Jacob, and their pitt-mi,x Tipitina. In 2019, Horacio published a biography, The White Knight: Calvin Patterson and the Integration of Florida State University Football.

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