Anthony Georgiades Transcript
Clint Betts
Today's guest is Anthony Georgiades. He is the general partner of Innovating Capital where he leads investments in disruptive technologies across cyber security, enterprise infrastructure, and Web3. He has a background in finance management and computer science from the University of Pennsylvania's Wharton and Engineering schools. Wharton is a very prominent school, man. Well done. And he also worked at First Round Capital and a number of other things, which we'll get into. But Anthony, thank you so much for joining the show.
Anthony Georgiades
Yeah, happy to be here.
Clint Betts
Hey, tell us how you became the general partner of Innovating Capital.
Anthony Georgiades
Do you want the short story or the full story?
Clint Betts
Let's do the full story, man.
Anthony Georgiades
So I was a freshman in college, and I thought I knew a lot, as we all do, studying finance, business, et cetera. I wanted to start a company and really build a tutoring application. And that application was meant to be like Uber for tutoring at the time. I didn't know a lick of code or anything on the technical side. Long story short, I got ripped off by my CTO. And basically, nine months into it, we're ready to release this application, and I realized there's no product. Nothing's there. He's been bringing us along for a great ride. I decided I'd never wanted to go down a path where I didn't really know what I didn't know.
I started to take some comp science courses and ended up pursuing a more technical path. I went, spent some time on the venture side, and really fell in love with the world of early-stage investing, just understanding the world from a much larger lens. What are things going to look like in the next 5, 10, 15, 20 years? What are the key areas that are poised for the most disruption? Then, I decided I wanted to spend some more time getting even more technical. I went back, did a master's in comp sci robotics, and spent some time working on the product management side, but then stumbled across the world of Web3 before it was called Web3.
There was an early Ethereum DApp called the Golem Network. And I started to contribute to some of the open source repos, deploying dApps, getting familiar with smart contracts, et cetera. And just fell in love with this tokenized future of the world. There weren't a lot of funds that were investing in crypto at the time. This is 2015, 2016. And decided that I wanted to focus on really the next stage of deep tech with a large focus on crypto and Web3.
So, we launched Innovative Capital with the mindset of being a first-defined fund that is extremely thesis-driven with regard to what we do. And we really take more of a technical point of view in each of these sectors that we focus on, as well as each of the investments that we partner with. And so we'll take a look at the world of cybersecurity, enterprise infrastructure, Web3 infrastructure, and we'll spend a tremendous amount of time really diving into those verticals, understanding where is their demand, what are things that are poised for, technical points of differentiation and disruption, and really who are the top managers and operators, that are really building upon that thesis itself.
We typically look to back partners at a very early stage, partner with these companies, provide a lot of hands-on support at the most what I would view as nascent and vulnerable points of these companies' life cycle, pre-product, market fit, pre-revenue, and really help provide as much operational know-how as we can take them to that next stage of market capitulation.
Clint Betts
Give us a sense of the state of Web3 right now because you've been through it from the beginning when no one was paying attention to it to the boom, which is probably early COVID days, right? And now, here we are in 2025. And I'm actually not entirely sure what the state of Web3 is right now. It'd be interesting to hear from you.
Anthony Georgiades
It is confusing. That is for sure. If you had asked me 5, 6, 10 years ago even what I thought the world of Web3 would look like when there is institutional adoption, when there are ETFs, when there's talks of a strategic reserve actually happening, I would've thought there'd be much more clarity in the market, and I thought that the market would've been much more well-defined across protocols, scaling solutions, whatever it might be.
We have a very clear-cut view of what we think the multichain future looks like. We're very far from that now. And where I see a lot of interest and activity today, it almost feels like we've taken a few steps back, whether that's meme coins, whether that's a lot of speculation on leveraged assets, derivatives, whatever it might be. And there's a bit of a disconnect from where the fundamental value lies.
And so the current state of the market is certainly confusing. There are obviously a lot of projects and protocols that are continuing to develop and make tremendous innovation, building both vertically and horizontally in terms of multichain interoperability, scaling, onboarding the next a hundred million users to the Web3 ecosystem, but the focus has largely been around liquidity and finding the next outsized market return.
And so I think there's a bit of disconnect with regards to where the focus should be and where it actually is. And I think that we've potentially gone a little too quick with regards to some of the legislative measures that have put the magnifying glass on the wrong side of the market, if that makes sense.
Clint Betts
Yeah, for sure. I mean, what the hell's going on with meme coins? I don't get it. And it seems like there's a new one every two to three weeks, and they're quite successful for a few people, but they're quite devastating for a lot of people. How is that even a thing?
Anthony Georgiades
[inaudible 00:06:30] pre-mined really, right? So, with meme coins, there's the good and the bad with them. And there are the crypto advocates that view meme coins as obviously the scum of the market, basically nothing, no fundamentals, no value. They're catastrophic because users that enter the market to acquire a meme coin are either going to lose all their money and never come back to the market again, or they're going to make a quick 10x or whatever it might be, and then they're going to spend the rest of their career or lifetime in crypto searching for that next outsized performance, which is just not realistic. They say that obviously the most patient investors... Or the best investors are the most patient investors, the ones that can sit 5, 6, 7 years and wait for things to happen, which is somewhat of a dichotomy if you look at meme coin investors overall.
On the flip side of that, there is the side of the crypto camp that views meme coins as being fundamental to the longevity of crypto, not necessarily with regards to rational exuberance or speculation, but the fact that it's a very easy and tangible way to onboard users to an asset class or a market that is otherwise extremely challenging and complicated. And irrespective of whether they enter the market getting rugged or finding the next gem, it doesn't matter because we've captured that customer, and they may or may not go down the rabbit hole, and there's a greater than zero probability that they will become a lifetime user of crypto.
Where I stand, I'd say I'm probably a little bit more in the latter camp with regard to meme coins. Personally, I don't speculate or trade on meme coins, nor does the firm, but I don't necessarily have an issue with them. And they're no worse than ICOs were, right? At least with meme coins, you know what you get. And they're marketing and advertising that. And it's a buyer-beware symbol.
The one thing that obviously gets me a little nervous has been some of the predominant players that have come out recently, whether that's POTUS or whoever it might be pushing out their own meme coins and leveraging their really existing credibility to potentially entice certain users into the market. And I think that could potentially be detrimental, especially if it lends credibility to the next wave of celebrities or entertainers doing it as well. Users need to understand that this is an asset class. That is, meme coins, particularly, are likely zero-sum or potentially negative sum if you consider fees and the opportunity cost of fundamental assets. And it's entirely speculative.
Clint Betts
Yeah. Yeah, the Trump coin was wild. It's wild he did it the day before he went into office too. That whole thing was wild.
Tell us about some of your big wins at Innovating Capital. I mean, you were doing this, as you mentioned before, when not a lot of VC funds were doing this, so you must have had a couple of good swings there.
Anthony Georgiades
Yeah, we definitely did. Solana was definitely one of our earliest plays. I reached out to those guys. We ended up basically taking the majority of our position via secondary sales years and years ago. And this is when that goes back to the technical thesis that we employ. We were spending a lot of time looking at VDFs know verifiable delay functions as a new type of cryptographic scheme that could really, in the world of Web3, cybersecurity, or traditional Web two infrastructure, solve a lot of problems, namely with regards to crypto in the context of DEXs limiting or eliminating a lot of the issues with front running, spam risks, execution risks, etc. And then, in the world of generalized L1s, solving a lot of these scalability challenges, particularly for financial applications, is a huge crux in terms of the underlying primitive of Solana where it stands today.
So we came across that team just with regards to the technical approach that we're taking, made an early investment in them, and that's obviously proven to be [inaudible 00:11:05] investment-
Clint Betts
Yeah, that's a good win. Well done.
Anthony Georgiades
The injective protocol is another one; I love those guys, but there are still large holders there. Eric Chen actually spent some time working at Innovating Capital before he spun out and started that. Love what they've been doing. That really ties into our thesis of the multichain world, but really having application-specific L1s. There are not going to necessarily be hundreds of general-purpose L1s that each have their own use cases per se. There's probably going to be a handful that have their different functions and use cases, whether that's Ethereum and figuring out vertical scalability via a variety of L2s and L3s, whether that's Solana who has effectively solved that it doesn't necessarily have those vertical scaling needs, but interchain solutions are definitely practical.
In any event, these L1s are going to require application specific networks that provide particularly provisioned resources, whether that's compute, storage, data aggregation, whatever it might be. In the case of Injective, very well-defined L1 focused on financial primitives, and so love what that team has done and what they're continuing to doing today.
Clint Betts
What do you think of XRP just out of curiosity? I'm not sure if you invested in them or not, but that's an interesting one that has obviously seen a lot of momentum over the past couple months.
Anthony Georgiades
Yeah, so it's funny; I was on a, I think, Yahoo News or something like that a few weeks ago and was talking through XRP. And I think it got reposted as me predicting it's going to zero, which by no means did I say that that would be the case, but definitely got a little bit more publicity with regards to the XRP army with regards to what I was saying that I think was taken out of context. So, I definitely would love to use this time to share my thoughts on XRP with you.
XRP itself, I view it as no different than a variety of L1s out there that have come to market, many of which we've invested in directly, that have potentially had a disequilibrium with regards to token supply and tokenomics, a certain level of pre mines, et cetera. But I do view XRP as having a particular number of inherent flaws that I don't think people have fully rationalized, whether that's token supply concentration, chain sovereignty, et cetera.
The biggest issue I see with XRP, and it's really important, especially with where it's moving into the market, I actually view this potential weakness as XRP as honestly one of the potential downfalls of the cryptocurrency over time that I think that users should be mindful of, is really the ledger's current node governance mechanics, which allow for it to be really captured overnight. And they talk about it being a strategic reserve. And I honestly think that, from POTUS's perspective, it's likely a requisite for them to use it as a strategic reserve.
I'm really happy to talk through what I mean there. But XRP operates on a decentralized ledger, XRPL, but it's far from it. It uses a unique consensus RPCA, which relies on a pre-approved list of validators, the unique node list. These validators, very similar to well-established POS or DPOS networks, validate transactions, ensure network integrity, et cetera. So what's really the problem here? That organization, Ripple Labs, and more recently, the foundation itself curates and recommends that default unique node list to participants. So, in theory, any node operator can choose their own unique node list, but the majority of operators are going to use the default UNL, which is just Ripple's recommended list. This really creates a defect of reliance on a third-party centralized organization's discretion over validator selection.
So, more critically, you don't really have any sort of on-chain governance mechanism to update this list. And so you have a third-party organization that really acts as a quasi-gatekeeper overall. So if the government decided to come in and accumulate a significant reserve and nominate an XRP, it's most likely going to say that we need to assert some sort of control over validator operations. We need to comply with FinCEN, censor certain requests, and deny certain transactions. We need to ensure that activity happening on the ledger is fully compliant with national laws. It's much easier to do based on the reasons I mentioned: curated UNL, 90% of participants use the de facto UNL, third-party organization selects that, et cetera.
So, you basically have a scenario where you might have a fully captured network overnight. You might have the inclusion of government control nodes as well to survey, censor, influence transactions, whatever it might be, and force the removal of others. And so the problem is, if this happens, the Ripple advocates and XRP advocates say that there could be some sort of fork or the other participants in the network don't have to use UNL anymore. Well then all of a sudden you have this fragmentation of trust that's going to drive a lot of the active participants to effectively fork the network, use all the UNLs, you're going to have latency issues, you have network instability, and really degraded performance, which would likely all result in a loss of network value overall.
And so I see some challenges with how the current architecture is set up in terms of longevity, particularly being used as a strategic reserve, which has been the talking point in most of the media's attention over the last couple of weeks.
Clint Betts
What does a typical day look like for you I wonder? Because, I mean, to have that extensive of knowledge, you must be reading constantly on these things and kind of really going deep on them.
Anthony Georgiades
Well, frankly speaking, the crux of what we do really does come down to being technically active with these projects, running validators for obvious networks that we're stewards of, joining active sets, being early champions of governance, and on-chain mechanics and whatnot. And so you learn about obviously these different consensus mechanisms, the various intricacies that one protocol might have over the other, and try to understand and discern what's defensible, what's differentiated, and what's going to have staying power over time.
And a lot of that we look at from more of a technical point of view than really just a pure market adoption point of view. And so I think a lot of the knowledge comes from both our active participation in these networks and mostly the fact that this is the stuff I'm interested in. We don't invest in DAPs, we don't invest in L3s. We're really focused on the protocol level and infrastructure level of Web3.
Clint Betts
What do you think of AI, and how is it disrupting Web3? And obviously nobody else knows the answer to that question, but of this question in particular, which is what does our future look like given this technology that's taking over the world?
Anthony Georgiades
How does Web3's future look like, or how does AI-
Clint Betts
Web3 particularly, and then probably just generally as well, I'd love. But yeah, I mean, obviously, as you know, there was a period where every startup was a Web3 startup, and then almost immediately, every startup was an AI startup. And so there's some overlap in these two things. And I just wonder what you think about AI affecting the Web3 industry and then just your general thoughts on AI overall.
Anthony Georgiades
Yeah, AI has obviously opportunity to disrupt every industry, and it's doing that. And it's funny the way you phrase it, where you see basically this sort of follow the herd hype mentality, NFTs, Web3, AI, whatever it might be. But the technological transformations of AI in terms of where a lot of the disruption's been going on has been happening for years and years and years.
When I was at First Round, one of the first things we looked at was AI-driven chatbots, and this was honestly almost a decade ago, but it was too early. There were a lot of issues with hosting, supervising, et cetera, and it just wasn't investible or feasible at the time. So it was really funny to see what happened in such a short timeframe. Obviously, there's been a disruption in a lot of different laws out there as well, which enables this to really take place.
But to kind of go back to your question, AI is definitely disrupting Web3. And it's enhancing it more than anything, whether that's efficiency, whether that's security, whether that's usability, whether that's AI to deploy a trillion different meme smart contracts every day and making it much easier to launch your own token, whether that's being used to optimize smart contract sequencing, making them faster, detecting vulnerabilities, optimizing code execution, whether that's for AI-driven audits, real-time monitoring, reducing the risk of exploits or hacks and DeFi, preventing obviously certain points of liquidation. And then you obviously have certain agentic type networks overall, one of which we're very active with, which really uses an agentic network for autonomous modules. And so whether that's effectively having kind of LLM hosting that occurs on a chain or whatever it might be.
So all these things are super exciting, and there's no doubt that AI is fundamentally reshaping Web3 overall by making it more scalable, by making it more secure, and by making it more user-friendly. And it's accelerating the trajectory of adoption more than anything. And that is the biggest takeaway to me, that AI is an enabler, and it's not something that's a massive disruptor per se that's going to eliminate a ton of jobs. And granted, it can do that, and it has done that, and will continue to do that, but in doing so, it's making things more efficient, and it's opening the doors of new possibilities overall and setting the stage for really what we view as a more autonomous and efficient digital economy.
Clint Betts
Yeah. What do you look for in a founder, a leader, an entrepreneur? What are some leadership traits that you've noticed over the years that are really valuable for those who are starting these types of companies?
Anthony Georgiades
Every founder has different styles, traits, qualities, and different things that make them successful and work. But I'd say that the recurring pattern in terms of repeatability, if I look at successful founders that have done it time and time again, it's the founders who know what they don't know and are not necessarily stubborn or naive enough to ask the right questions and put themselves in a point of vulnerability where they admit that they don't know the answers to certain things, and they seek out that advice.
Simultaneously, it's those who know exactly how and when to delegate and put full trust into who they delegate those tasks to. Because, again, the ones who have failed a lot of times are the ones who think that they can do it all themselves and that they're smarter than everyone else in the room. And that's extremely dangerous. And so it's interesting to see those traits and the symbiotic relationship with them, particularly when you have repeat highly successful founders that have taken a much more humbled approach to their next startup, and it's been the most successful.
I think the media draws a lot of adverse attention to people like Elon Musk, for example. And granted, some of the stuff he's been doing has been quasi-questionable of late from a government perspective. But if you look at him as a founder and a leader at these organizations, I know people who've worked for SpaceX, Tesla, whatever it might be, and he was never quick or never too slow to make sure that he delegated tasks to the next person in the room and relinquished certain responsibilities and traits to them, contrary to what it looks like from the media's perspective. At the same time, he was always willing to be kind of like a servant leader of sorts, spending hours and hours and hours on end, and nothing was beneath him. It was that kind of humbled nature that drove him to the next level. And I see it time and time again from our best founders and our most successful portfolio companies.
Clint Betts
Finally, we end every interview with the same question, and that is at CEO.com, we believe the chances one gives is just as important as the chances one takes. When you hear that, who gave you a chance to get you to where you are today?
Anthony Georgiades
Who gave me a chance to get to where I am today? I'd go back to my mother. Absolutely. I was in high school, or not even high school, middle school, and I was reading about Warren Buffett. And I wanted to, super successful, donate to all these charities, and my mom made a comment, "If you wanted to be like him, you got to go to an Ivy League school and do this and that."
And irrespective of whether or not that was true, I told her that's what I wanted to do. And for the next four or five years, she basically helped manage and organize my life. We had this massive binder or book, whether that was academics, or extracurriculars, or charity, or whatever it might be, but basically ensuring that everything I did was setting me up for success and leading me to really the next goal that I dedicated to doing, and very much time-intensive. She was a single mother as well at the time, and her parents were divorced, so it was a lot of time and effort that she put into investing in me. And I definitely look back and think of that as being a pinnacle point of turning my current career or trajectory into what it is today.
Clint Betts
That's incredible. That's a fantastic answer. I can't think of a better answer.
Thank you, Anthony, so much for coming on the show. It means a lot to have you. Let's have you back on again as things progress here, particularly in this interesting market. But what an honor to have you. Thanks for stopping by.
Anthony Georgiades
Awesome.
Clint Betts
Thanks, man.
Edited for readability.