Ari Paul: Betting on Crypto

Sep 28, 2017

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Ari Paul is the co-founder and Chief Investment Officer of BlockTower Capital. He was previously a portfolio manager for the University of Chicago's $8 billion endowment. Ari earned a BA in political science from the University of Pennsylvania, and an MBA from the University of Chicago with concentrations in economics, entrepreneurship, strategic management, and econometrics & statistics.

In this episode, we talk about Ari’s passion for poker, and what the game taught him about investing, risk, and table selection, a powerful concept that applies to just about every field. Ari recently identified what he calls “the opportunity of a lifetime” — cryptocurrency. It led him to start investing in cryptocurrencies, a decision that was guided by Ari’s commitment to stretching boundaries. Finally, Ari discusses his passions for backpacking and travel, and like so many guests, Japan was one of Ari’s favorites.

Time Codes:

2:30 - 6:20: Background and departure from science.

6:20 - 9:35: Playing poker and complete information. Tilt.

9:35 - 14:25: Table selection. Phil Ivey. Sharp Ratio.

14:25 - 17:40: Childhood/youth. Building skills and transferring them to trading.

17:40 - 20:30: Value investing vs. momentum investing. Path dependency for crypto.

20:30 - 24:00: All heuristics are regime dependent.

24:00 - 28:25: Shorter attention spans. Analogies. Changing minds.

28:25 - 32:30: Backpacking. Consuming information vs. going off the grid. Stoicism.

32:30 - 35:40: Japan/Osaka/Kyoto. Accelerated living.

35:40 - 40:00: Consciously stretching boundaries ("Life is lived at the margins"). Behavioral economics. Internalizing stereotypes.

40:00 - 43:20: Stretching boundaries applied to cryptocurrencies. Principal component analysis.

43:20 - 44:00: Specializing vs. building bridges in your career.

44:00 - 45:30: Moving away from hard skills

45:30 - 49:20: Perspectives and trust building pre and post internet. Signaling. Psychological bias. Overconfidence vs. familiarity.

49:20.- 50:10: We don't know people like we think we do.

50:10 - 53:35: Blogging and personal brand. Blogging as a way to falsify ideas. Cunningham's law.

53:35 - 57:45: Learning > Ego. Power laws. Combined talents out of necessity can create a combinatorial edge.

57:45 - 59:50: The experience of starting a crypto fund.

59:50 - 1:03:50: Agency when there's no roadmap. MBA students.

1:03:50 - 1:08:45: Breaking through natural momentum. Anchoring. Status quo bias. Fat pitch. Crypto as the opportunity of a lifetime. Hard work, burnout, and compounding.

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