How I lost 1 year of life doing failed crypto startup
In April 2019 I decided to completely stop developing my cryptocurrency project ending entire year of full time work in failed tech startup which I wanted to create. During that time:
- I spent about 2200 hours hardcore coding, writing, meeting, pitching, calling and everything else related to building a startup — in that case a software product;
- implemented ~ 80 000 lines of code which never experienced production usage;
- registered company which did not gained any profit only expanses;
- spent about 10 000 USD on life living costs without any income;
I would like to share my story. I believe it may be an inspiration and bring some answers for anyone who dreams about running own startup. During that time I’ve done tons of mistakes but I’ve also achieved a lot of milestones. This was a very interesting adventure and I believe anyone can enjoy that chronicle.
I invite you for the story of a dream and the failure.
How it all started
At the beginning of 2016 I’ve joined Volvo Group as a regular Java developer. I just got my MCs degree in computer science. I was a fresh graduate but already with a few years experience on professional IT market. The project I joined was quite interesting. Old technologies however international environment and planned business trips (to France). As young ambitious developer I wanted to learn modern technologies however I decided that big project will allow me to get a valuable experience.
It was a time when my professional carrier widely started. The end of university duties. Well paid job. I loved to be software developer but sadly I already felt meaningless of work I do. It was not specifically about Volvo Group — it was my perception of overall IT market, especially here in Wrocław where I live. I always had rebel soul being a metal guy and always consider myself to be against the machine. Unfortunately I had very critical opinion about the IT market surrounding me. A lot of foreign corporations and a lot of companies making software for foreign corporations. Very income oriented industry. Of course it’s the main goal of every business — to generate profit. However I was in the moment of my life where I wanted to be part of something purposeful, at least in my eyes. Unfortunately there was lack of purpose in the work I could do. Also everyone around doing carrier was focused mainly on making money. Simply what I saw around didn’t satisfy my personal need of challenging growth in the name of something meaningful.
I’ve heard about Bitcoin for the first time in 2016. In Volvo I’ve met some Bitcoin geeks who introduced me to the world of blockchain and cryptocurrencies. The topic interested me extremely quickly. Since childhood my personal interests were focused on computers and this is why I’ve decided to study computer science. There was a time however when I really wanted to study economics what ended as a broken dream. Taking into consideration all of my interests and my internal conflicts — blockchain and cryptocurrencies got sucked me very quickly. Bitcoin represents for me a technological resistance movement. It is the tool against a broken economic system and it has a purpose. What’s the best — I could be part of it. I fell in love in this unique and extremely intriguing movement connecting computer science and economics at first place but also other spaces like social science or even politics.
I’ve met Bitcoin in quite interesting time. I could observe the great rise of blockchain. 2017 year ended with all-time high Bitcoin price which reached almost 20 000 USD. The Bitcoin hype was everywhere and everyone was talking about it. New cryptocurrencies were created every day, new different businesses and projects were emerging. Among many interesting projects for a software geek like me there was the “holy grail” of all crypto businesses. That business during the 2017 was focusing most crypto world attention and was earning extreme amounts of money: a cryptocurrency exchange.
I’ve always been passionate developer and I simply love to code. Learning software methodologies, mastering best coding practices, trying new libraries and tools, building own products. I believe the love to code drives people to work in open source projects, start freelancing, open software houses and finally try to create software startup. The work I was doing in Volvo was not enough to satisfy my needs of coding. I needed more autonomy, more challenges and I felt I could do more. Corporation couldn’t give me what I wanted in that time.
It took a whole year and I didn’t expect that the seed inside me will grow to something what will change my life inevitably. But it happened. The idea or even obsessive dream of having own cryptocurrency exchange born in my head at the end of 2017. I felt it is something what will allow me to feel fulfilled: the work in the blockchain space developing the technology of the new open financial system. None knew how Bitcoin future will look like but some were expecting it’s going to change the world. I believed in that too. 2018 however was not going to be that time yet.
Chapter 1: The beginnings of Cryptomeda.
At the end of 2017 more precisely in August I initialized my new cryptocurrency exchange project — without the name yet. Decided to use Java for backend and Vue.js for frontend. I love the story of Moby Dick, the great white sperm whale which couldn’t be hunted by humans. A whale has rather negative meaning in crypto world — this is how are described rich traders who often manipulate the market. I didn’t care. I liked to think about the platform that deals with crypto that it will be against the system. My platform was going to become the great whale of the crypto ocean.
I was spending time on my side project mainly after regular job and at weekends. After some time it was noticed by close friends and family members. I was slowly introducing myself to the startup world by reading and learning what should I do and how should I behave. One of the things which I read I should do was telling everybody that I build a startup. The positive effect of that suppose to motivate me more to work and focus on the project since everyone expected me to succeed.
Everyone I knew thought that my idea is crazy. At the beginning of 2018 I decided to go for the Startup Weekend in Łódź and try to search potential co-founders. It’s the event where during a weekend people simply try to build a startup idea. It was good experience however all I heard was how low chances I have with such serious business idea.
There was one of my relatives however who liked the idea of the cryptocurrency exchange and gave me the serious business proposal to make it together. I liked it since he had business experience (however not in IT field). The deal was simple: I put 10 000 USD and focus on product development, he gives 40 000 USD and focuses on the business. I accepted it. That proposal gave me a kick. I started to code more and more and plan how the platform can start to really work for customers.
We showed names proposals of our new common project to relatives and close friends. MobyCrypt lost the voting. Our new project name was Cryptomeda.
Chapter 2: I quit my job.
It didn’t take so much time to start having problems with my regular job. My thoughts were all around Cryptomeda and there was still my regular job where I was working on the different project. The regular job was taking me about 10 hours every day. When I was coming back home at 6 p.m. I had not much time to work until I was really tired and had to go sleep. I was living with my current wife at that time, so I was not independent only.
In January 2018 after negotiations with my boss I reduced the time working in Volvo to 20 hours per week. I worked 2 days at Volvo and then had full 5 days at home (including weekend). The salary was enough to cover life expanses: mostly flat rent and food. The project was accelerated, and I was really motivated to work.
3 months passed by quite quickly and Cryptomeda started to have very easy UI. Coding was all I was focused on every day, and I was putting great attention to the details especially on the backend side. I knew that cryptocurrency exchange platform requires very good and flawless performance. My main goal was to handle 5000 tx/s. Coding backend features, frontend UI and unit tests — this is how my every day looked like.
It was good for me to work 2 days and be paid in a regular job. Rest of the week I could spend on Cryptomeda. However, I felt that I need to focus full time on the project. My partner was more and more willing to start doing something more about the potential Cryptomeda company. I decided — in March 2019 I was ready to quit my job. This was very irrational in that time. I remember when I shared my decision with my current wife parents. They told me I need to have at least 50 000 USD of free cash. I had a bit more than 20% of that. However, things went quickly. I described everything to my team members and manager. March was going to be my last month in Volvo Group.
At the middle of March my partner called me to meet in the coffee house and talk about the project. I was quite happy that things are moving forward. I remember that day very clearly because I was first in the place and my partner was late. Some negative thoughts came to my mind. I felt something bad in the air. When he came I knew bad news are coming. Few minutes later he told me that he will not be my partner in that business. Basically he just resigned. I was left alone with huge mess in my head and without any realistic future plan.
From big perspective everything changed and I should give up. But I was already too much involved with the vision of creating the startup. I wanted to fulfill my plans and March 2018 after 2 years in Volvo was the last month of my regular job.
After I left that coffee house the project wasn’t Cryptomeda anymore. The MobyCrypt has reborn.
Chapter 3: Startup life.
With the beginning of April 2018 I’ve started to work from home. My day was usually starting around 8 a.m. and I was coding until my (current) wife came back from work. She was very supportive for me. Telling true I had not too much home duties, I was not even cooking — so basically I was coding until evening or even further. And this is how days were passing. Even weeks. There was not too much to talk about MobyCrypt with family or friends because there was nothing really interesting to show. I also didn’t want to argue about the irrational decision of leaving my job. In fact I was more and more separated from everybody. I didn’t go out too much, didn’t enjoy meetings. I was focused only on the work.
From the development perspective I was working on matching engine implementation and exchange UI — but still it was nothing extraordinary. It wasn’t the simple application to develop how I thought before it will be. Everything I was coding — all the complex features were basically required components of any cryptocurrency exchange. The amount of work was overwhelming but I could handle this. The lack of extraordinary was something what in the beginning of holiday period started to worry me much more.
End of 2017 was all-time high for cryptocurrencies and 2018 was the beginning of the price downfall. Bitcoin was losing the value very drastically and to be honest you could hear about it less and less often. Cryptocurrency exchanges were fighting to get users attention. It was not a bad year but was not the year of hype, and we were just about in the middle of that year. I started to worry if my product has any sense in that time.
There were of course much more things which worried me. First I was all alone. Just after my potential partner told me it’s over — I decided to try search partners on few Facebook groups. There was not much attention since I was very critical to the people I was searching. I expected full engagement — I was involved full time in the project and was expecting at least 20 hours a week in the project from anyone who would like to join me. Secondly — I was searching for developers because this is what I thought is the most important at that moment. Doing startup is of course not so simple but it wasn’t yet the time for me to find it out. I didn’t find any partner.
In May 2018 I went to Amsterdam for a blockchain conference organized by some Polish guys. One of them wrote a post on Facebook offering free ticket. Not thinking too much I took it. It was a nice trip for me. I met some projects from blockchain space, for example Aeternity team. Unfortunately I couldn’t find anyone interested with MobyCrypt. Every project there was focused on searching attention exactly the same as me.
I started to believe that being traditional cryptocurrency exchange was not enough to build successful business. This thought was growing in my head and started to have more and more impact on my motivation to work. I knew I want to build cryptocurrency exchange but I felt I must be different from others. Not only better exchange but to bring something fresh to the market.
Chapter 4: Exchange prototype ready.
At the end of May 2018 so 2 months after I left Volvo I had the cryptocurrency exchange prototype finished. I was ready to show it to some bigger audience (with focus on crypto geeks which would be eager to test it). Also, I wanted to try again searching potential co-founders. This time I had not only the idea but also the working prototype. On 31 May I posted in the Bitcoin Polska Facebook group:
The interest was not spectacular however I got some attention and questions. Unfortunately most questions were about the technologies used in the project. Now I am not surprised with this lack of attention but at that time I expected that something will change. Few hours passed, few days passed and nothing happened. Google Analytics showed some traffic but very little. There were few registrations.
Among all the feedback and contact requests I received unique one. This lead to another chapter of MobyCrypt story where I had the chance for the first real and valuable partnership. In order to meet with my potential co-founder I needed to visit Poznań.
Chapter 5: I have the co-founder.
In Poznan I’ve met a lawyer. He owned a law firm. We spend about half day together, and we found the synergy of working together on MobyCrypt. I had the prototype of a cryptocurrency exchange. Even better — I had new interesting idea of unique services MobyCrypt could offer. My potential co-founder had appropriate resources, experience and knowledge — he could provide legal and formal help in running MobyCrypt as a company. We agreed to start working together.
The day I was coming back to home from Poznań was also the day which gave me another power kick. There was someone who could help me with a project and saw a real business potential in it. Such stories, such deals usually don’t have happy ending and it was also going to be my case too, but I was not aware it yet. I was thrilled and motivated.
Chapter 6: Tokenize your brand.
Second half of 2018. It was a time that the concept of tokenization was becoming more popular. The success of cryptocurrencies going mainstream was mostly the Ethereum platform and all the ICOs made on it. There were hundreds of tokens which were used to raise capital for many cryptocurrencies projects born in 2017 bubble. MobyCrypt was going to allow trading these tokens however I started to think different. What if MobyCrypt would offer easy token creation and going further: to become the tokenization business, deliver everything required for anyone to issue and use a token? Companies would use such token as a marketing tool or even for rising the capital. That thought was big and it started to be pretty interesting pivot in MobyCrypt story.
During whole 2018 cryptocurrencies prices were falling. It was the end of the bubble. If I would even think about doing crypto exchange at that time then I would probably not even start. But I was already on my way. The new concept of MobyCrypt platform was to be the tokenization center. This concept of tokens was very interesting for me. I was sure I have the new undiscovered idea, not present on the market yet. As I mentioned before — I shared that ideas with my co-founder and he really liked it.
My idea for business was to enable companies, influencers, generally everyone to issue their own personal/loyalty token. That should be kind of digital currency, digital ownership existing on the blockchain. MobyCrypt would allow to create tokens and exchange markets for trading these tokens and even more — possibilities to utilize them. How?
People having token could exchange them on services/products of the token owner. Thinking about using it for a business: imagine a company issuing loyalty token which simply represents discount for their services. Let’s say 5000 tokens represents a 5% discount. You buy the necklace in the jewelry store and get 5000 tokens for a next purchase discount. Now having that tokens you can use them but you can also sell them on the MobyCrypt exchange. Someone who needs to buy jewelry can buy your tokens in order to have a discount. In that scenario you gain (because you sold the discount you could probably never use anymore). Buyer gains because probably he bought 5% discount and it was probably good deal. After all also jewelry store gains because they have a new customer to come (with 5% discount but still it’s customer). Sounds interesting? I was excited.
I accelerated MobyCrypt development because very quickly I wanted to have the platform with features I’ve described. There were quite a lot of technical challenges especially about automatization of token issuing process. I wanted to issue ERC-20 token on the blockchain with the single button click. Also, I had to focus on other aspects of customer ready features like KYC process which was required by regulatory.
Chapter 7: The ending and the beginning.
The 2018 holidays passed fast but all I wanted to be ready before the end of summer. My co-founder organized the company registration and the MobyCrypt officially started to be a legal business entity. It didn’t take long however when my relations with co-founder have broken.
I was very afraid of all the legal aspects of our cooperation with my co-founder. What will be our responsibilities? What will we bring to the company? Finally, what will be the “stocks” share in the business we create? I spent many evenings preparing the founders agreement. I knew that it will be side project for my co-founder and he doesn’t want to involve 100%. He had resources and wanted rather to utilize MobyCrypt in order to strengthen his already crypto related business. I proposed him 35% company share and he agreed. He had also exclusive rights for providing accounting/law services for all MobyCrypt customers. I believe it was too good deal for him without significant risk yet. It didn’t take much time however when I started to feel he is more focused on his businesses rather than on MobyCrypt. We didn’t find any customer yet for MobyCrypt but there was already a proposal for me to do some kind of software development work. I would work already for our new company however I didn’t like it. I wanted to develop MobyCrypt, not to code for anyone.
Even after some time has passed already — I can’t find out whether I made some serious mistakes in that relation. However, it took us 1 evening to decide that we completely stop working together. Few days later I was left alone. I had to pay for all the services my co-founder already made for MobyCrypt (e.g. terms and conditions page). I’ve also bought all the MobyCrypt company shares from him. I was alone. Again.
Having the new vision of MobyCrypt I didn’t break up anyway. At the end of October 2018 I was ready with the beta release of the new MobyCrypt. Again I posted on Facebook groups.
My marketing didn’t make a lot of sense. I was showing my product to people who were not going to be my real customers. I had something experimental to offer for users however it was not clear enough what is it. In fact, it didn’t bring any real value for anyone in that time (running on testnet). I found some attention but it was mostly from the people who just wanted to play with it for fun. In fact I even knew how pointless my actions were. But in the same time I was at a standstill because I knew that I cannot yet offer serious service to any company. But I was trying hard.
During that time I’ve also tried to speak with real businesses about the services MobyCrypt can offer to them. I send e-mails to few polish companies with the proposal of meeting. I’ve received successful response from one of the largest polish coffee house chains. I’ve met with the CEO and talked about some ideas. Unfortunately it was the stage where I was desperately looking someone to help me run MobyCrypt as a business. Sadly I was not yet ready to offer any services independently. We didn’t make any deal, but I was satisfied with the opportunity to meet.
After all I was disappointed and lost. I started to understand how crazy is my idea in front of the real world. I needed money for better development, marketing, legal and regulation stuff. I knew there are no chances to run it without investment. And I didn’t have the money. All I had was a website and application prototype. In that hard time being alone again someone contacted with me with the interesting proposal. This time the proposal for a deal with the company from the capital — from Warsaw.
Chapter 8: The huge vision and the plan.
I’ve met a guy who was closely cooperating with some tech company from Warsaw. They were doing IT related businesses and they were very interested with this catchy cryptocurrency tokens topic. They could provide resources for MobyCrypt and what even more important: very attractive customers.
My experiences with previous co-funder learned me to be cautious. I wasn’t searching for a fair deal but I didn’t want to be abused. I had the product and I was searching for someone who can offer also something valuable. The concept of fair deal in business is hard to describe. Being the single guy like I was with nothing more than a piece of software running on VPS hosting — I knew I must search for any opportunity.
The guy who contacted me was quite young but ambitious and startup oriented. I noticed quite fast that he can build relations better than me. After few weeks of online/phone talks he succeeded to organize a meeting with one of the company founders which was interested to run MobyCrypt with me.
We met in Poznań — exactly the same city where I traveled to meet my previous co-founder. This time I was invited to a classy restaurant. During the 2 hours meeting we ate a dinner and talked about the idea of tokenizing people. The idea where MobyCrypt could become a first company in Poland (or even at the world) which would start to tokenize people — more specifically celebrities, opening them another field to gain profit.
Few weeks later I was in Warsaw where I’ve met all of my new co-founders. They liked what I did so far and the most especially my vision of MobyCrypt brand. We talked about the future and the details of our cooperation. They had a plan how to monetize MobyCrypt and this plan was aligned with my goals. Additionally, they could provide all necessary development support for running MobyCrypt on production. And what most important: they could reach top celebrities in Poland. I agreed on 20% share of the new business we were going to start.
The plan was simple. I had to focus on preparing business model and estimate everything what is needed in order to start MobyCrypt not only as a platform but also as a business. Also, I had to prepare for meeting with our first customers. My co-founders job was to organize that first meeting.
The day I was coming back from Warsaw to home was another day I felt that I achieved some important step. New motivated co-founders with valuable resources and with exciting plan.
Chapter 9: Hustle, Turkey and the great meeting.
The 2018 was going to end. I was focused on developing MobyCrypt to work faultless and to have all of the professional platform features. It was a lot of detailed work: backend with its own performance challenges. Frontend needed nice looking main page, password recovery, 2-fa, administrator site.
At the same time there was only one among my 3 new co-founders who was really involved in the project. We were working on the business plan and were preparing commercial materials. I was few more times in Warsaw where we were working on site. I felt like it was serious involvement from all of us. However, except own time they didn’t spend any money yet.
Our business model was to enable celebrities to issue their own crypto token. Fans could buy these tokens exchanging them on the celebrity services/products. Think about popular musician and exclusive concert or meeting which could be possible only for tokens owner. People would sell, buy and use these tokens. Everything using the MobyCrypt platform.
Very important in that case to make sure that everything will be done in accordance to law. We knew that none will make a deal with us if we will not have legal and formal work done. Still, none here was ready spend any money for lawyers if we didn’t have any celebrity ready to issue the token.
2018 ended and 2019 started. In January, I decided that it’s time to stop development. The platform was ready even if I knew that it required professional testing and security penetration tests.
From a technical point of view I developed everything I planned since the very beginning. MobyCrypt enabled everyone to issue a token and provide trading markets for that token (dynamically created trading markets in MobyCrypt exchange e.g. Token/BTC). The trading performance could reach about 5000 tx/s per single trading market. It also gave users possibility to send tokens, even utilize them — exchange on the services offered by token creator. There was also tokens catalog page where everyone could promote their tokens. Read more about the features here.
I wasn’t doing any marketing when I’ve finished. All I was waiting was the expected meeting with one of the most popular TV celebrity in Poland.
It was a time I was also involved as the Aeternity ambassador. I’ve made a tool which was awarded by Aeternity team in Dashboard bounty. At the beginning of 2019 I was invited to take part in Aeternity Aepps Summit in Turkey. The event was focused on Aeternity blockchain main-net launch. I’ve spent few days with Aeternity team members and it was really great time. The time with a focus on open source community oriented blockchain project also showed me what does meaningful work mean for me. I also understood how far am I from these ideals with the MobyCrypt.
It was February when I received the message that the meeting with the celebrity is finally scheduled, of course in Warsaw. I was going to present MobyCrypt to the celebrity who probably earns hundreds of thousands USD yearly income and who has own TV show in public television since years.
My train was at 4 a.m. morning and at about 8 a.m. I was in Warsaw. Few hours later we were in the celebrity office. The atmosphere was very nice, and I was excited however positively scarred of what will happen next. I presented MobyCrypt in the cluttered office simply talking about our idea and showing slides of presentation directly from my laptop screen. It took about 2 hours and the result was great. Thinking that our potential celebrity customer has about 80% recognition in Poland I was corrected that it’s almost 100%. It showed me how big chance we have. He wanted to make a deal with us. However, it was clear that it’s not a one way ticket for him in the same way as it was for me. This could be just another business for him — another potential source of revenue.
Taking into consideration my whole adventure so far — this was the most successful and amazing day in my startup story. This meeting was probably my biggest achievement and showed me that everything is possible.
Chapter 10: The phone call and the end.
I didn’t mention before how among the months I’ve changed inside. There were a lot of stressful nights where I couldn’t sleep thinking about the business I’m going to start. I felt overwhelmed with the feeling that I’ve done a software which will have to work flawless. I had a lot of visions how it doesn’t work properly and is causing serious problems. My fears were focused mostly on the software I’ve created because that piece of software was actually all I have done.
I was also stressed with lack of cash. MobyCrypt was company and it required monthly payments for accounting and flat renting. My savings for living were going to finish very, very soon.
Finally there was something else. After the year passed I already knew that my vision of MobyCrypt — the platform which represents the rebel and freedom is a total bullshit. It was everything but no rebel and no freedom. I already knew that we will need tons of regulations and will have millions of formal responsibilities. We were going to closely cooperate with government agencies. Also, the service we were going to offer was mainly going to give profit to rich celebrities and us. I didn’t like it. I hated what I’ve created.
I also felt that everything is too beautiful to be true. From a simple project completely written by a single guy to top celebrities in the country. Days passed and I started to understand that nothing suppose to happen after our meeting with the celebrity. 3 weeks later I called to my Warsaw co-founders. They told me unfortunately there will be no deal because simply there are completely no law regulations for the service we want to offer. No celebrity will risk doing anything in that scenario. Simply: the whole MobyCrypt vision disappeared during single phone call.
It was over and I knew it even before the phone call. And I agreed with that. In March 2019 I’ve stopped working on MobyCrypt.
Summary
In March 2019 I went for a life trip to Thailand. I rested. I experienced something new. I cleared my mind.
In April 2019 I started new work in the innovative blockchain project concept. Exactly 1 year passed since I quit Volvo Group.
In June 2020 I’ve married and organized really beautiful wedding.
It’s truth probably that my aspirations were very naive. No real business plan, no team, no users, no money, no marketing — generally no chance to succeed. However, I don’t consider my story as a failure story. This was a beautiful adventure. I’ve developed the greatest portfolio project so far. My technical skills extremely increased. If I regret it? Maybe a bit. But who can know what tomorrow brings?
My story is not about a failed project. It’s the story of me. Now I understand that for the whole time I was the MobyCrypt. I was the whale who took adventure through the ocean of unknown. That adventure gave me lot of new experiences. Allowed me to learn a lot. I had a chance to know myself better. I could taste things which I probably never would without starting my journey. Who knows — maybe without MobyCrypt I could be now still silent developer in Volvo Group?
I am now technical team leader working in innovative blockchain project. I’m still in the blockchain space exactly how I wanted at the beginning. Since few months I try to work on my new startup idea: bittery.io — better Bitcoin payments.
Have any questions? Feel free to ask in the comments.
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Originally published at mobycrypt.com — blockchain engineering