Tai Zen: When I had originally got like Factom, but then after that discussion, I had with you last time, I actually doubled my position size and it actually came out well, it made more than 100%. David and I were looking at today during the pullback, and we just made a decision that I needed to take some off the table.
So I actually took half a position off. It’s all the rest that’s in the market all profits, so you added more to your position?
Leon Fu: Most of that money came from Litecoin, and I basically dumped all my Litecoin in, I don’t have any Litecoin now, it’s all in Factom. I think the last one I got was at 28, 29, 30, right before the really big jump.
I thought I was overpaying, but it actually went up even more. This thing is worth at least 50 million dollars.
Tai Zen: Did you add some profits to cover your initial?
Leon Fu: No, I didn’t. Because even after doubling, it’s still only at a 15 million market cap. So it was ridiculously undervalued that 10 cents, so I kept 10 cents, it was like 800.000.
If I had gone to those meetups, I would have known about this earlier because it was at 10 cents all summer. I would have gotten to know those guys and I wouldn’t have 10,000 or 20,000 Factom, I would have 100.000 or 200.000 Factom, because they were at 10 cents. You had all summer to buy that, it’s not like we’re in any hurry.
And here’s one thing I noticed, Tai. It’s a lot easier to buy the low than it is to sell the high. Look at the chart, you had 6, 7, 8 months to buy Factom, it just sat there for 8 months.
We’re talking about 10 times over 100 times. What difference if you pay 20% more or less. It’s not going to make a big difference in a big scheme of things, because the moves are so huge. I didn’t take any profits off, because the fundamentals are just so much higher than what is trading for right now.
Tai Zen: How are you figuring out that the market cap should be bigger? What are you basing that on?
Leon Fu: I’m basing it on what other investors are willing to pay. When a VC goes in, and says I’m going to give you a 50 million valuation, do you think he’s looking at the chart? He’s looking at the fundamentals. If you were investor, and you say I want to fund this startup, you got to figure out what valuation I’m going to give out.
If I give them ten million dollars for 20% of the company, that’s like 50 million valuations. You’re going to look at the chart and say I’m going to give you a 5 million valuation because you are at 1, that doesn’t make any sense. There’re two things I’m basing it on.
Number one is based on going to the meet-up and on the valuation that they’re trying to get on the private markets from venture capitalists. And the second thing I’m basing it on is what the valuation is compared to other Cryptocurrencies. I’ll give you a really stupid example, why is Dogecoin worth 23 million?
Tai Zen: They supposed to come out with a billion Dogecoin, and the value of it right now is at 7 cents.
Leon Fu: That’s not what I’m asking. Mathematically, that’s not hard to do. What I’m asking is what is supporting that valuation? What is the difference between the utility Dogecoin has versus any other copycat coin?
There’s a picture of a dog on it, a copy of Litecoin. Litecoin is already a copy of Bitcoin, and Dogecoin is a copy of Litecoin. What does it have? It has nothing.
But it’s still at a 23 million dollar valuation. So you have the other some things on the top-ten list like Peercoin. It’s got proof of stake but Peercoin is one guy, Peercoin is just 1 dude.
This is actually an entire company, Factom has an entire company. I spoke to 5 engineers, I know they have a sales team, they have a marketing team, they actually did something, they actually have an entire business here. They have customers too, they have people that are paying them.
So, they have a product and they have customers and have a sales team, they have engineers, and they have 3 million in funding so they can fund all their operations. They’re going to close to probably 10 million dollars round by the end of the month.
Now, what is that worth? I don’t exactly know what it’s worth, but I know it’s worth a lot more than 9 million when I was telling you to go buy it.
Tai Zen: At the time you told me to buy, it was also technically at a good buy point too.
Leon Fu: So anyway that one worked out very well.