This interview is a transcript from Inter:views, Cracking The Entrepreneurship Code, episode 109. It has been edited for length and clarity.
Gabriele Musella is the CEO and co-founder of Coinrule, a Y Combinator-backed startup (batch S21). Launched in December 2018, it is all about catching the next market opportunity on your behalf by automating your investments. With Coinrule, hobby investors can compete with professional traders and hedge funds by creating automated strategies for crypto and stocks.
Gabriele started in UX, working at different banks, and later developed into more entrepreneurial and management roles, working at companies like Nokia and Vodafone. He was able to raise 3.2 million dollars in investment for Coinrule. Gabriele has been a mentor at Google launchpad, Zilliqa, Tekneitalia, and Imperial and is also a guest lecturer at ESCP Izad and the University of Palermo.
Tell us a little bit about your journey toward becoming an entrepreneur.
Oh, gosh, that's like a long journey. Okay. Where to start? So I think the startup bug was always in my mind even when I was working for a few banks. Innovation labs in London, and before that, in Finland and the US. I always said this, the entrepreneurial approach that I could not work in corporations. So I was always basically during the day, nine to five, working in a kind of capacity of designer, UX designer. And then, in the evening, I always had my own team trying to build a product or find some exciting market. And so I had a couple of startups before this one.
And obviously, those two failed, but I've always been interested in the apprenticeship since I was, I think, a kid. I remember when I was like eight or nine, I was buying second-end motor boards. I was changing the battery and selling them for the next price. I have always had that type of entrepreneurial approach. It was always in me. It's always been part of my personality, probably because I come from a family of entrepreneurs or SME owners, so probably that's why I always had this idea that you can make your own job, your own work. You can create your own world around you and add value to society by having a small kind of shop instead of just being a small wheel in a big machine.
What brought you to create Coinrule?
That's a story that started in 2012. So I was at MIT. I was working in a research lab, and obviously, all my colleagues were like scientists, data scientists, brilliant people, and they were really talking about this cryptocurrency thing. And that's when I bought my first Bitcoin in 2012. And then, I sold two Bitcoins after a few months; I made a 6% return, and I was thrilled. We are talking about Bitcoin being at $400 each. And I remember with this money; I went to the Bahamas for a weekend. I didn't regret selling those coins. Anyway, so I remember I did Coinbase, and then I went back after a few years to check my account on Coinbase. I found Ethereum. I started buying a lot and found myself in this big pump in 2016.
So I've always been working in the FinTech space. So for me, it's pretty natural to build a product, a FinTech product for normal people. That's always been my focus, the retail FinTech side of technology. And so, for me, it was pretty straightforward to merge the new cryptocurrency space, all the DeFi, all the new things that were coming about with a more kind of classical FinTech product development. In the beginning, Coinrule was not supposed to be an automated trading platform, but it was supposed to be a portfolio management app with specific goals.
So a little bit like an improved block folio, but then I had another need: its automation. And then that project morphed into Coinrule. And I remember the first time the idea was literally at a Christmas party where I worked with a colleague. And his strategy was on stocks on IG Index to buy every day the best coin for 24 hours. And then the next day, you will sell it and buy again, sell it, and buy again. And I was really, really impressed by this thing. It was straightforward, but I was like, this is cool. And in a bull market, this strategy actually works very well.
So that night off drunk, I went on IG index myself trying to build that script, and I'm not a good coder. So it was almost impossible to build something meaningful. And that's when I started sketching my first interface for a product that would be called Coinrule.
Then you joined the Y Combinator, and the Y Combinator backed you. What is it like to join them? What did they bring to you?
Honestly, the experience was terrific, but we didn't want to join at the beginning. And that's because when they called us, we were already making like 160 k a month in monthly recurring revenues. So as a startup, we were already at stage two. And obviously, there was a pre-fixed amount of equity that they gave you. There's a specific deal that they offer you. So it was really, and also the program was supposed to be face to face, but because of the pandemic, it was actually hopefully remote. So actually, it was a really conflicting decision. Attend [06:36 inaudible] obviously to join. And I mean, the experience was terrific. It was like going back to UNI for three months. Every day we had three or four-hour workshops.
We met some of the founders from Airbnb, Stripe, and Coinbase; we got mentored by all these fantastic founders and entrepreneurs. So it was really worth it.
What it really teaches you is the art of frugality.
It's funny because obviously, when we read Tech Ranch, when we read like the magazines, the tech magazine, we hear about these huge fundraisers. Actually, from a seed stage startup, from the seed stage to series A, you really need to be careful and check your budget and finances. Don't spend all the money basically once, and also have many small experiments. And there are many things to take care of on a small scale.
And that's basically what I see; first of all, gave us a lot of confidence in some of the processes and decisions we took, but also opened our eyes to how Silicon Valley is and how these people are really hard-working founders. I mean, the guys from Stripe, they're super modern, super humble, they're amazing. From Brian Chesky from Airbnb, how the story was told during the company when they were to fire 70% of their employees was heartbreaking. Especially him, he's one of my role models because he was a designer and turned into an entrepreneur.
So it was a fantastic experience overall. And also, Y Combinator does the ultimate fundraising hack. That's because on demo day, you present for 60 seconds, one minute, but then you get bombarded by an email from some investor that throws money at you. Actually, I had to reject a lot of tickets. We got contacted by more than 120 investors. We didn't want to accept any more money and delay more, so we had to accept some strategic investments.
But like some of the YC companies, when they start another company, some of our YC founders return to the same accelerator because it's just so easy to fundraise that. It's really a significant validation for your company.
So, go back to the basics. I like what you said about the art of frugality. I would say don't worship the money because this is something that I see a lot among startup funders. They go to this accelerator, and they only think about money. And I like to hear you saying the opposite.
Totally. I mean, some people think that we are conservative, that we are European. But actually, a startup works if it's sustainable if you think about the long term, and some startups are successful because they crunch through better markets and periods that are not so bright. And that's where we are at now at the moment in Coinrule. Thanks to our kind of European approach, we have enough funding and revenues to go through the bear market for the next two or three years. And then maybe come out on the other side where we are still alive, and we'll do series A.
And our approach is really like, I think, like me, my co-founders, we are really complementary. My co-founder is about crunching and pushing and kind of really being a constant machine, creating value. On the creative side, more like thinking about new ideas and new channels to open, and more straightforward in terms of communication and team management.
And then we have Xanax. That's kind of the strong foundation is the tech co-founder that is there. If the server is down, is the one that wakes up at 2 o'clock at night and actually fixes everything. Even now, we have an excellent team of 11 engineers, very senior people that we manage to steal from the big corporations. But yeah, I mean, the complement title, the co-founders, is critical. And it's the most challenging thing to find. I know it's kind of underrated, but finding a co-founder is like finding a wife, basically. It's the same type.
How did you find your co-founder?
It's funny; we actually participated in an accelerator called Mass Challenge in London. And all three of us had three different companies. So it's kind of teammates, kind of colleagues at university. We were, like, the three of us working on combines that were going nowhere. So at some point, I think Olick has wanted to talk with me for like few months, but I was always super stressed and busy. But eventually, we ended up having coffee, and I showed him the sketches. He was also a lot into crypto. And then we started, and then we changed a couple of CTOs, but then eventually Xanax actually joined.
I'm interested in your experience with accelerators because I think, if I'm not mistaken, you went through five of them.
Probably. Yes. Fast Forward, Mass Challenge, Y Combinator, Why not Berkeley, and something else, probably as well. It was also a little tricky for us because when you don't have much funding and need offices and support, some of those accelerators won't ask for equities. So that was very good. Also, I mean to learn because, obviously, at the first shot, very few people succeed with their first company. So you need to learn techniques and methodology, basically the job, like any other job.
So, how to make the best out of those different accelerators and programs they offer and the mentors?
My approach is I don't have any embarrassment in asking for help. So in the accelerator, I was really taking advantage of all the mentors. But being also very strict in asking direct questions because sometimes you got people like the director of sales from Deloitte, who have been making sales for all their lives and want to consult you or advise you on product management. So you need to be very careful where you take advice from. But I've never been ashamed of actually going and asking for help. Even now, we reach out on LinkedIn to senior professionals and ask them to give us one hour of their time. Obviously, now we pay.
So it's good. So accelerator for me was the same. First of all, you don't feel alone because you see other people in your situation. Because going from zero to one, as all of it tells us, it's actually the most challenging part. So once you reach something that resembles profitability, then the game changes. Totally changed. So, first of all, everyone around you thinks you're no longer a fool. You actually have a job. You're actually doing something. And secondly, you have funds to sustain yourself. And also, you can actually grow the company. So now we are, for example, 22. And that's the perfect size because in terms of management, in terms of creating the culture with the right amount of people.
But when you are from zero to five people is the most challenging part. And it's tough. So at that stage, having like peers in an accelerator, having people that understand that pain. The pain that literally you have in the stomach because you cannot go for lunch because you're busy in 20 meetings in a day. You need to be a founder to understand those situations, those worries, and anxiety. So usually what I've seen in the founders, when they start, or the first startup, the first one year, they're like a lot of anxiety. They can't sleep at night. They think like, oh, why did I leave my job? My parents think I'm like stupid. My friends don't talk to me anymore because I don't have that full job at Google or Facebook anymore.
Then after one year, you start kind of balancing yourself and understand how to manage your anxiety, but still, you have a lot of problems, you start to worry about the finances, and then the third year is when you actually start feeling more comfortable, and you embrace your status of entrepreneurs. Okay, I'm an entrepreneur, I'm going to do this for at least several years or for life, but this is who I am. I think that comes after the third year of getting entrepreneurship status. I believe that when I was in the US in 2012, MIT worked in a research lab. I was visiting scholar and research specialist. That's when I understood that I wanted to be an entrepreneur forever. So it's not for me; it's not just like a matter of being a company, doing a good exit, and then kind of sustaining myself for life just with these funds.
I would always be creating probably companies or funds or ways to create a good startup ecosystem worldwide. So I think that's what I embraced. I was there when that opportunity of being an entrepreneur was taken off from me. Because in the US, obviously, I was on a research visa, which is why I came back to Europe because I could not build companies there. I think that was the realization; it took at least one or two years to understand.
Has the anxiety disappeared?
I mean, for myself, it's a bit different. I'm an anxious type. That's probably because I grew up in Italy, so I'm like really relaxed about everything. So I have two goals in life, not to die and not to go to jail. These are the two goals. The rest, I expect anything to happen.
As you said, entrepreneurship is a journey. You also said entrepreneurship is a calling. What does it mean for you to be an entrepreneur today?
Suppose you think about a tribe, a community, or a network of people in a specific place. You can call it a city, region, country, continent, or political party. I think it's like elevated the welfare of that tribe. And it's a thought that came to me when I was at the Schindler factory in Poland. It was Schindler that saved tons of Jewish people during the World War. And that's what he was doing. Basically, at some point, he was not doing anymore for profit. It was a social mission. And that small part of the social mission to be always at the core of your business. Because at the end of the day, we are mortal, and you will have a legacy when you die.
You want to leave something for future generations. And that could not just be a kind of financial value. It has to be also some more value in society as a different meaning and actually elevate ourselves.
So for me, solving a relevant current social problem for a specific tribe that's what the apprenticeship means. And then connected to that is other than practicalities. It also means learning a lot about making quick decisions without much data. Being comfortable with that. So, continuously doing a risk assessment, basically. Okay, what is riskier, this or that? And be comfortable with risk. And then kind of to the extreme that you can say, okay, if I do this, the company can blow up, and I go to work at McDonald's.
But you need to constantly assess where the risk is and be okay with the outcome, with any outcome. And also, what I learned is that connected to these, if you don't manage, for example, manage your problem solving, your decision making, and to improve your risk assessment skills, then you end up having some weaknesses in your management. And those weaknesses that are connected to your personality. They really reflect in your company. Being a CEO or a company founder is kind of always with a microphone next to you; whatever you say, even if it's minimal, it gets amplified. And other people in the company kind of tend to replicate that behavior.
So be very careful, especially when management comes in, as well as what to say and your decision. And also, how do you communicate and explain the decision? I'm also the product manager of the company. So sometimes, when I have explained why we have to do specific features of the others, I have to spend half an hour talking about business and giving the developers all the background. Otherwise, they don't just buy in; they ask a question. They drive me nuts. So I think there's like these practicalities. These are like the foundation of what that interpretation means to you.
You were talking about purpose at the beginning of the conversation of that discussion. You talked about legacy, and now you're talking about the fact that being an entrepreneur, there's no difference between you and your company. When you thrive, your company thrives when you are the bottleneck. And this is an excellent transition to my next question because I help entrepreneurs not be the bottleneck in their businesses. When you're the bottleneck, the company is stuck. Do you remember a time when you were the bottleneck, a significant bottleneck?
I think every day, I'm the bottleneck. That's my feeling. I mean, we practice radical transparency in the company and always ask for feedback with consent. So I always ask for feedback. I sometimes ask to give feedback to people, and you ask because then you have to be right mood to receive feedback. So because I always worried about being the obstacle, the bottleneck. And actually, I took three days off last week. When I returned to the team, the completeness of the sprint was 82%. The sprint was great. It was actually very productive because I went away. So sometimes I think that having a more autonomous independent structure in the team is very good.
And that comes with kind of centralizing the decisions. Sometimes they wait for me for some front-end questions; other times, some people think that the specific business logic they're implementing some functionality needs to be validated. But I try actually always to delegate as much as possible, and I'm okay with that. And that also comes with the fact that I said I'm very kind of a very relaxed leader in some aspects. And I think I've been the bottleneck probably at the beginning of the venture because I wanted to have a proper agile process with GitLab, sprints, all the agile ceremonies, and retrospective setups. And it was almost scientifically proven that agile doesn't work in small teams.
So I think that case, me pushing for processes, what I saw in innovation labs of a few banks. That moment I think I was like basically blind, and then I kind of realigned myself to other management techniques. But then, now that we are 20, for example, now it works very well, and we are flying. Last six months, we got a new CTO. We got a few tech leads, and we are flying because they're also used to working jobs. I think the bottleneck sometimes comes because we don't understand which process or step we are in, in terms of startups. Being in a six-stage startup is something; being a Series A startup is something else. It's a different job. It's not even like an evolution.
So being a CEO of a five people company, it's one job. Being the CEO of 20 people company is another job. Being a CEO of 500 people is another job. Probably I will not be the right one when you have 500. So I need to acknowledge that. And also, recognize when you're at the bottleneck, you can take another position in the company. And that, for example, that's what our tech cofounder did in a brilliant way. And acknowledge we need a CTO that's more on the management side. I don't like to do it. I like to do more engineering. And so it became CIO. So it takes all the internal infrastructure where the new CTO has a lot of experience. He comes from eBay; he was working in another big company. So he has managed people all his life, like teams of under 20 people.
So he came on board and brought new management methodologies that we wouldn't have otherwise. I think it's tough to acknowledge that you're at the bottleneck and have to find a solution. It's very, very difficult. I don't think I would be able to do it.
I want to talk about your experience as a mentor because, as I mentioned, you're a mentor in several organizations and a guest lecturer in different organizations. Why are you a mentor?
I mentor because I've been on the other side of the table, so often receiving advice and feedback, and I love that feedback loop to create that one for myself. I always ask for feedback from everyone: my friends, partner, family, and coworkers. And then understand the value of that, kind of everything. Someone that tells you what's available or asks you the right questions to make you think. And so my way to kind of give back, also, it's my way to network. Sometimes I invest in a startup that I mentor, or it's a way to get to know people. Actually, my previous co-founder is in another startup. I met her at the Google Accelerator I was a mentor, and then she joined me.
So I think it's a way to give back, but it's also a way to network. I like sharing; when I find something interesting, like a new methodology or something, I like to share it. So I think it, for me, it's fun. I do it because it's part of the network. And then it's also about karma. I think just sharing, at some point when you share stuff, they come back at some point in life. So it's just like, in the Internet era, I think sharing is the best way to receive.
What's the big dream for your business?
The dream for the business is to help people manage their funds, help people to actually have a game, a little bit of game in this crazy financial world. And cryptocurrency already helps significantly because you can bank the unbanked. So people that cannot have a bank account, people that cannot transact, or people that cannot spend huge fees on payments can actually use crypto. But then our game here is to allow normal people to create automated trading strategies the same way big banks and big institutions do now. So for me, it's like helping more and more and more people to actually have a consciousness of their money, understand what it means, create value for themself for their families, and also manage those funding in the long term so they can actually bring more good energy and good value for their own community.
I mean, the point is that there are all microeconomics mechanisms, from inflation to the fed printing money. There is, like, big banks trading all sort of products. So basically, it's like a lot of stuff is going on. And in the retail market, 90% of ordinary people don't have access to those. So I think creating tools for them to join this game is. Actually, it's very, very important. And that's why we want to take the company. I mean, we have a roadmap, like tons of products and different features. We are going to expand not just in automation but also in stocks as well. We are going to grow on stocks on effects. So that's where I want to bring it. And obviously, to do that, we need to increase our revenues, and we need to obviously also grow ourselves financially.
Take all the experience you have acquired as an entrepreneur and white collar before that; what is the one practical recommendation you will give to other entrepreneurs?
I think the first one is what I just said: build a sustainable business while doing good for society. That's the first. And really, the idea of sustainable business is like, don't burn your money immediately after investment. Be very, very careful. Then a company means a group of people together. So the first step is actually to create what everyone calls culture. So culture is like an abstract word, but it's basically having a good time and building a company. No, laugh, smile. No, create. There's a difference between creating a company and creating a community. And the answer is in between those two.
So a company is super performative, everyone is a robot, and everyone kind of works 20 hours a day, like crashes all the goals. But then, on the other side, you have the community and one that wants to be together. Everyone wants to have fun together, respects each other and shares the same value. Now, if you have to match your community, you end up not doing any job, any work. You hang out on the beach and go surfing, as we do during our retreats, like when the retreat is every four months. And then, on the other side, you have a combination that if you do that too much, then you end up being depressed and motivated. So I think the correct answer is in between. And understanding how to add value to those two powers kind of is very important. So, for example, in our case, we are a fully remote company. Even before Covid, we were like that.
And we meet every four months, somewhere in Europe altogether for a week. So every four months, we know that we will spend quality time with each other. And during this week, probably half the time we speak, we go surfing and do activities. And half the time, we actually work together. And then we end up working for like 20 hours a day because we're so excited about all the ideas that come up. And in this retreat, we also ask the people to bring their significant other so they can be with the family and with kids. And it's incredible because you create that sense of togetherness and belonging. And you can totally see after this community moment how the team really works, whether together or actually performing in a way that you wouldn't expect.
So that's why we have this current of retreats. And also we do another exercise that's called the tribe. So basically, we divide the company into a group of three people. And we have one hour we go to separate places. Like we go on a mountain. When we go to the retreat, we go to different spots and open up our hearts. So basically, everything you say in the tribe is confidential. And it says with these four people, you can share whatever worries you personally, professionally, anything. And that knowledge stays in the tribe. And then you meet again after four months. So you meet this tribe that also helps you on a personal level. I think those types of ceremonies, of rituals in a community, really help create what can become a company.
That's what I recommend entrepreneurs do. First of all, start with a problem you see in society. Don't start with just an idea. If it's an idea, try to validate it as soon as possible with different techniques, but then start even with one to create that sense of community or culture. But that will drive. Because if you think about the beginning of startups, it's like a shitty life. You need to ask people to work for you for free. As I told you, some people cannot do that. So when I see that, I tell people not to do it and find a proper job elsewhere.
Because if you're not able to really ask people to work for free for you from day one and sell division, I'm not sure you will be able to push through all the fundraisers and all the difficulties on startup. So that's an excellent signal to understand whether someone can be an entrepreneur or not. Can you make other people passionate about a project, work a little bit for free, and join your company in exchange for equities instead of cash because everyone wants cash? So that's a significant signal. And so I will say that's something that you should do at the beginning. So to recap this one: build a tribe and culture and also do good for society. I think those are the three elements that are really, really important at the beginning.
Contact Gabriele: Gab@cangue.com