Neil Bergquist, Co-Founder and CEO of Coinme

Coinme® is a leading U.S.-regulated cryptocurrency exchange founded in 2014. Its mission is to be the world’s trusted gateway to digital currencies and a better financial future. 

Coinme’s crypto infrastructure platform, which includes its Crypto-as-a-Service (CaaS) offering, provides enterprise-grade APIs that “crypto-enable” its partners’ digital and physical financial infrastructure. Through its CaaS partners, Coinme provides the largest cash onramp and offramp network for crypto, with 40,000 retail locations. 

f1. Tell us a little bit about your background and how you started your company?

I was the managing director at SURF Incubator, a community-supported space for digital entrepreneurs. In this role, I was one of two executives responsible for managing the organization. Day-to-day operations included supporting hundreds of startups, managing our staff, securing corporate partners, overseeing the 15,000 sq. ft. downtown office space, coordinating events and doing everything possible to help our entrepreneurs succeed. 

I was inspired to launch bitcoin ATMs when I was at SURF Incubator. I knew the technology, specifically bitcoin and the concept of decentralized money, had great possibilities for the future. My co-founder, Michael Smyers, and I believed we could place bitcoin ATMs around town, including at the incubator, and foolishly thought they would nearly run themselves. 

Our inspiration accelerated after the world’s first bitcoin ATM launched in Vancouver, BC, Canada. It processed over a million dollars in transactions in its first few weeks of operation. This success validated the customer demand for bitcoin and bitcoin ATMs as an essential channel for this new “magic internet money.” This early validation and my long-term belief in the promise of bitcoin led my co-founder Michael and I to establish Coinme in early 2014 and launch the first licensed bitcoin ATM in the United States, one of the first ten deployed worldwide.

2. What would you say are the top 3 skills needed to be a successful entrepreneur, and why?

The first trait instrumental to an entrepreneur’s success is having enough conviction in an idea that your passion will drive you always to find a way forward. It’s essential to remember that starting a business is very challenging. Profits may not come for a while, and your company may accrue debt in the interim. However, with persistence and a belief in yourself and the business, you will find a way to be successful. 

Another trait of a successful entrepreneur is solving problems at the right time and in the right way. Some days, it might be a staffing issue, others a product, the list is endless. You can’t possibly solve them all at once, but knowing which problems really matter and need solving is essential. This rapid, sometimes ruthless, prioritization is necessary. Entrepreneurs need to have a breadth of expertise, which, more often than not, will need to be learned along the way. The key is to continuously learn and educate yourself to gain the knowledge you need to solve whatever problem is currently being prioritized. An entrepreneur’s ability to learn and move fast is all that matters at the end of the day. 

Lastly, a successful entrepreneur believes that anything is possible. You can’t be complacent about the current reality and should always believe that you or others can change current circumstances. When you think anything is possible, you have the faith, belief and confidence to do something about it and make things better.

3. What are your plans for the future, how do you plan to grow this company?

We plan to expand our consumer cash network while scaling our B2B crypto solution as a service product. Coinme has solved the access problem – nearly 90% of the American population is within five miles of a Coinme-enabled location. We want to bring this number to encompass 100% of the population, giving them simple, trusted, affordable and instant access to digital assets and better financial opportunities. Since the access problem is solved, we will now focus on creating user experiences that enable people to use crypto to improve their everyday financial lives regarding payments, remittances, and investing.

4. How have the pandemic and Lockdown affected you or your new business? 

Within the first few weeks of the pandemic, Coinme transitioned to a fully remote workforce. We learned that we didn’t need a physical office space to work efficiently and productively. This also gave us access to a global workforce, greatly enhancing our team’s collective capability and allowing us to be agile and innovate quickly. This is key to remaining competitive in a fast-paced industry like crypto. 

5. How do you separate yourself from your competitors?

Coinme has four customer pillars on which we continuously innovate: trusted, affordable, simple, and instant. We work with name-brand partners, crypto-enabling the financial services people already know and trust. Additionally, Coinme has always prioritized regulatory compliance – we’ve never believed in the ethos of tech companies like Facebook and Uber, which is to break things and fix them later. From day one, we’ve worked with regulators to ensure that our business complies with state and federal regulations. Our regulatory diligence allows us to provide a secure and trusted service that our customers can count on and feel safe utilizing. 

Our locations to buy or sell crypto with cash have the most competitive fees on the market. Bitcoin ATMs sometimes charge a fee of up to 20% of the transaction, which can be restrictive and a non-starter for some people. Coinme charges cash exchange fees that can be as low as about 2%, with a transaction fee as low as $2.50, depending on the location. The lower fees and cost advantages of our model make our service affordable. 

We also provide a simple user experience so people who are not tech-savvy can utilize our services and easily exchange cash for crypto. Coinme delivers a delightful experience that will make people want to use our service. Crypto is also instantly available upon purchase, which surprisingly isn’t the case with others in this space. With some of our competitors, you must wait hours or sometimes days to access your funds. Crypto is automatically seamlessly loaded to your Coinme wallet, making funds available when needed.  

6. What were the top three mistakes you made starting your business, and what did you learn from them?

The number one mistake I made was not prioritizing enough. You need to do several things, but you need to do only a few things well right now. So, spend the time necessary to figure out what really needs to happen right now and put the rest aside. If you can’t put it aside, learn to compartmentalize. Priority-wise, generally speaking, entrepreneurs need to work as quickly as possible to get to their first dollar. The product or service doesn’t have to be perfect. You just need to get to that first dollar and use the customer feedback to improve and iterate.  

The other mistake I made was trying to attain absolute perfection. Again, getting to that first dollar is imperative. The product or service can be imperfect. Start delivering a minimum viable product or service and let customers help guide the roadmap and priorities.  

The third mistake I made was not thinking big enough. I’m a relatively practical and pragmatic person, but when raising venture capital, you need to think big and present a viable path to disrupt an industry. This doesn’t always apply if you’re building a small business or a lifestyle business, but if you seek to raise outside capital, think big.

7. Tell us a little bit about your marketing process, what has been the most successful form of marketing for you? 

Capturing people’s attention in this increasingly digital world is incredibly competitive. We experimented with everything under the sun, such as Google ads, SEO, retailer signage, email, influencers, social media, sweepstakes, you name it. We measured the results and doubled down on what worked. Now, we only focus on a few valuable trade-secret strategies because we know they work. What works largely depends on your product and industry. There isn’t a ‘one solution fits all’ approach to marketing. Once you run several experiments to get a signal on what works, hire the best in the world at that channel and seek to be number one. 

Listen: Bitcoin Kiosks With Neil Bergquist Of Coinme: Ep 184 >>

8. What have been your biggest challenges, and how did you overcome them?

There were plenty of challenges when Coinme was first established. All we did was put out fires on a day-to-day basis. The ATMs would malfunction, which seemed to happen every few days. A customer’s ID would get stuck in the ID reader and, reasonably so, they needed it back as soon as possible. It didn’t matter how far away you were; you needed to visit that ATM immediately. The customer support cell phone was passed around between us as we took calls at all hours of the day before hiring someone years later. 

Overall, our biggest challenge was figuring out how to manage cash logistics. Our customers would insert physical bills into the ATM, and bitcoin would be transferred to their bitcoin wallet. This meant we had thousands, sometimes hundreds of thousands, of physical dollars in the ATM that needed to reach our bank account and eventually to our bitcoin liquidity provider. 

Established companies work with Brinks, Garda and Loomis, but we needed to be a larger company before they would work with us. So, we had to do it ourselves. After much discussion, we decided the best approach was to put on street clothes, visit the ATM late at night with a JanSport-type backpack and stuff it full with cash from the cash acceptor. Then we’d wait anxiously for the bank to open, wait in line, and then, when it was our turn, we’d empty six figures of cash onto the counter. The bank teller’s expressions were priceless. 

We did it this way for over three years before we could afford (and convince) an ex-military individual with a concealed weapon permit to take on the role. Eventually, we became big enough to contract directly with Garda. As the team grew in the early days, doing at least one cash run became almost a right of passage. At one point, when we had locations across the U.S., some people had to fly to an ATM to pick up the cash because our bank was too small and they didn’t have any locations in that state. That was a bag you definitely carried with you on the plane. Dealing with TSA and explaining the cash brought about its own challenges, but that is a story for another day. 

9. What was your first business idea and what did you do with it?

It’s hard to say which idea was the first. Entrepreneurs generally have no shortage of ideas. The first one I actually wrote a business plan for was a vacation property management company when I was in high school. I eventually incorporated and provided property management services for my first client, my mom. It went about as well as you’d expect. It was a lot of home repair with barely any income. I quickly learned I wasn’t as passionate about the work as I thought. I failed to sign up more clients and eventually moved on to something else.

10. What are you learning now? Why is that important?

At this moment, I’m spending a lot of time on organization design. Like in math, there is no absolute correct answer. There are many ways to design an organization with various hierarchies and roles/responsibilities. It’s an important endeavor because we need to operate as a high-performing team before a company can claim to be a great business. Great teams build great businesses. I can’t say we’ve perfected it yet, but we’re getting closer.

11. If you started your business again, what things would you do differently? 

This is a long list. It’s always easier to look backward and criticize yourself, as looking forward is often murky and confusing, which is a big reason why making perfect decisions is hard. The biggest thing I would have done differently is try harder to raise venture capital. In 2014 and 2015, people didn’t take bitcoin seriously, and I was discouraged by what conversations I did have. If I had been more persistent, I might have been able to find someone who ‘gets it,’ which would have accelerated the business before 95% of the companies that exist today.

12. What are the top 3 online tools and resources you’re currently using to grow your company? 

• Jira – Essential for tickets, prioritization and managing development efforts
• Intercom—After using other support tools, we landed on Intercom. Its chat and chat-AI functionality is easy to build upon and helps us provide a delightful support experience.
• Google Drive – We use Google Sheets, Docs, Gmail, and all things Google. It just works. 

13. What’s a productivity tip you swear by?

I take advantage of the time between meetings to catch up on emails, slacks and calls.  There is always more to do than the day allows, so I continuously prioritize to ensure I’m focused on the right things and the team is accomplishing them correctly. 

I also limit cognitive distractions as much as possible while working. It’s a simple habit, but it’s easy to pretend we can take on more than we can. I do this by ensuring I have a dedicated private workspace free from distractions. Additionally, I only work on one priority at a time and silence as many notification systems as possible. It takes time to get into deep thinking and concentration, which can easily be interrupted by a ping or beep. I will schedule time with myself, which blocks out my calendar to get critical time-sensitive work done.

14. Can you recommend one book, one podcast, and one online course for entrepreneurs?

“Emotional Intelligence 2.0” is an excellent book. It focuses on four critical components of emotional intelligence: self-awareness, self-management, social awareness, and relationship management. Organizations are a web of humans, and understanding how humans work and operate helps everyone within that organization intelligently navigate their own emotions and those of their partners. It’s an overlooked skill that has an enormous impact. 

Y Combinator has created a series of YouTube videos called Startup School. Most of the videos are must-watches for entrepreneurs.

I don’t listen to many podcasts. 

15. If you only had $1000 dollars to start a new business, knowing everything you know now, how would you spend it? 

It largely depends on the business. But if the entrepreneurs can build the product themselves, I’d probably use the $1k on measurable customer acquisition activities. That way, the spending will generate revenue to replenish the coffers and support future spending.

15. What helps you stay driven and motivated to keep going in your business?

I enjoy building something new that helps people and wouldn’t exist unless you did it. 

Coinme helps people by giving them access to what we believe is the future of money. The bitcoin a Coinme customer purchased in 2014 with $20 would be worth over $2k today if they haven’t sold it. Because Coinme existed, thousands of people could buy bitcoin at a time when there were few to zero other providers. 

Bitcoin gains aside, we believe in a digitally native form of money. That could be USDC (a U.S. dollar-pegged stablecoin we support on our platform) that can be sent or received anywhere in the world nearly instantly and for free. It’s like sending an email, but it’s money. The ability to send borderless and permissionless funds also gives people in developing countries access to the U.S. dollar, bitcoin and other blockchain-based stores of value that have been proven to preserve their hard-earned wealth better than their hyperinflationary local fiat currency. Financial services are having a once-in-a-generation evolutionary moment, and it’s been exciting to learn about the challenges that will enable that vision to become a reality. 

If you get dragged down by the work, try to remove yourself and talk to customers who love what you’re building. Hearing first-hand feedback and appreciation for your hard work is an easy way to reconnect with your mission and remind yourself why you do what you do.

16. What is your favorite quote?

“When you pray, move your feet.” 

It’s an African proverb that has been quoted many times. To me, it means having faith and taking the steps necessary to make it happen. 

17. What valuable advice would you give new entrepreneurs starting out? 

Starting a business or side hustle can be scary, exhausting, risky, and it will consume whatever you can provide and more. You have to love it. If you don’t love it, you’ll hate it. If you’re doing something you’ll love, you’ll have the energy, resilience, faith and confidence to convince or at least try to convince everyone you know or don’t know to help in some way, shape or form. 

Before diving in head first, start small and validate your key assumptions. Who is my customer? What are they willing to pay for this service? How much does it cost me to provide this service? Is it scalable? Defensible? What are the risks I need to take to test this idea? If I fail, what is my affordable loss? 

There are a lot of books out there, but for the ABCs that even the most intelligent people overlook, I recommend looking at the “Business Model Canvas” and the “Value Prop Canvas.” A good business idea has many components. Make sure you have assumptions for the critical aspects of your concept and plot them onto a business model canvas and value proposition canvas. Think of this canvas exercise as a simple blueprint for your idea. This approach will help you flush out your concept and help you identify what assumptions you need to test and what assumptions need to be true for your business to take off.  

At the end of the day, there will always be a lot of reasons why you shouldn’t do it. You eventually just need to do it and trust you’ll figure it out as you go. It’s normal (and healthy) to have fear. But proceeding anyway is the type of courage you’ll need to have if you want to be a successful entrepreneur.

Keep Reading: Coinme CEO Neil Bergquist Compares Paying With Crypto to Mobile Payment Apps >>

18. Who should we interview next and why?

Entrepreneurs who have failed miserably. It’s a fine line between success and failure. Similar to the fine line between a genius and a madman. Successful entrepreneurs often get the attention, but entrepreneurs who have failed have just as much, if not more, insight to share with aspiring entrepreneurs. 

19. What is your definition of success?

I have definitions of success for various stages of the business. If I had to pick one, I’d say the most significant milestone thus far was building a company that could pay me a market-rate salary with competitive benefits. It took over five years to get there, but it was a milestone. Building a business that could support me and my family was essential to keeping me focused on continuing to build it. The next milestone was profitability; fortunately, we achieved that after ten years.

20. How do you personally overcome fear?

Faith. Having faith and trust in something bigger than yourself is the antidote to fear. The fear doesn’t go away, but your faith empowers you to manage it and not run from whatever is causing the anxiety.

21. How can readers get in touch with you? 

Readers can find me on LinkedIn under @NeilBergquist.