July 7, 2022
Conduit CEO Talks DeFi Startup Origin Story at Stanford GSB
Conduit CEO Kirill Gertman was recently welcomed as a guest speaker for an MBA class at the Stanford Graduate School of Business.
His talk covered an interesting range of topics, including his own early life and roles before he entered the crypto industry, the origins of Conduit and the thought process behind some of the early decisions made by the Co-Founders, and the future of DeFi as he sees it.
As CEO of a fast growing company in a booming space, Kirill’s insight into the DeFi landscape and his recent experience leading a tech startup are invaluable for MBA students eager to enter the industry.
Kirill’s Journey Into Crypto
In his talk, Kirill shared how his past roles prepped him for eventually founding and running a startup. His origins – which began with pirated modeling software – detailed an interesting but natural path from web designer to founder. First designing websites, then designing products, and finally designing companies.
After roles in fintech and banking, Kirill became interested in the blank slate that the crypto industry represented.
“Crypto created an opportunity to build completely new products that worked in new ways,” he said. “That was extremely exciting for me and the reason I left fintech and banking for crypto.”
Describing his early days in the industry as limited by focus on speculation by its players, Kirill explained that in recent years, with the advent of DeFi, “we’re finally able to really build practical, useful products for people.”
The Promise of DeFi
Before explaining what those products are, Kirill gave a deeper dive into the foundation that makes them possible – DeFi. Kirill explained to the class that decentralized finance promised new possibilities in financial inclusion, “made possible by removing costly intermediaries from financial transactions [so that it] is no longer cost-prohibitive to service lower-income individuals”
Additionally, DeFi has ushered in the possibility of changes to the ways in which consumers interact with financial opportunities. “Before DeFi, the retail segment needed to interact with banks to access credit, which proved to be a time-consuming and frustrating process,” Kirill said. “[With DeFi] this market is accessible from anywhere and at any time so long as users are connected to the internet.”
Kirill also noted that the additional transparency, elimination of human errors and innovation speed contribute to the promise of DeFi – an exciting opportunity for anyone eager to make something special.
How Conduit Financial Got Started
To put that promise of DeFi into action, Kirill co-founded Conduit Financial with Michael Gregson, who he met while Head of Product at Eco.
Kirill outlined the bets he and Mike made in the first days of the company – including a big seed round, described as “the most expensive money we’ll ever raise.”
Raising a large upfront was a gamble based on the duo’s confidence that they’d “be able to achieve product market fit quickly, [which] isn’t always the case and in fact usually isn’t the case.”
The early target market was another big bet made by Kirill. Specifically, the choice to focus internationally and avoid launching in the US, “despite having very strong demand [there].”
This choice was made “because we believed that the regulatory landscape would be changing,” Kirill explained. It is a gamble that paid off, as Conduit has now launched in the US, confident in their compliance with recent regulatory changes.
Risks To Look Out For
Kirill explained to the Stanford class the risks that Conduit is facing – and how his team is working to manage them.
Chief among those risks is the industry’s volatility. Conduit generates yield through crypto-lending – where much of the borrowing from crypto protocols is driven by crypto trading. “Which is volatile of course, and creates spikes and valleys in the rates.”
The rise of permissioned DeFi is a solution to this, Kirill believes, “because they enable access beyond traders, to real world businesses.” He continued, “I believe that working with partners like that we can get to more stable rates.”
But the biggest risk, Kirill told the MBAs, is execution. “The opportunity is clear, but can we deliver? This goes back to people at the end of the day - in other words, hiring”. No doubt these are words that a grad class is excited to hear. The industry is hot, and eager for talent.
With the right people, working together to build a platform on top of a new decentralized and global infrastructure, it is Kirill’s opinion that “they will enable DeFi to actually fulfill its promise of better financial access for millions of people around the world.”
You can be part of that team! Conduit is hiring.
Get The Full Speech
Want to read the transcript of Kirill’s Stanford lecture?