Stripe bought his startup for $1.1B—just 2.5 years after he quit his job. | Zach Abrams, Co-Founder of Bridge

Zach was burned out after a decade of working at top roles in Coinbase, Square and Brex. He quit with no startup idea-- and then, he went right back in. Given their background, Zach and his co-founder quickly raised an $8M seed round to build an NFT-related product in Web3.

One month later, they completely abandoned their idea. They realized it was never going to work. Then, the floor fell from underneath them. FTX went bankrupt. SVB fell apart. They took punches to the face for the first 6 months straight.

But, when everyone was paying attention to Gen AI in late 2022, Zach kept going deep in Web3. He noticed stablecoins were growing but there was no platform for developers to build with. So he built Bridge, a Stripe-like API for stablecoins.

The first months post-launch were underwhelming-- until they landed a fast-growing customer. From then on, the next year was exceptional 10x+ growth. Then Stripe noticed them.

In Oct 2024, they were acquired for $1.1B. Just 2.5 years after he started.

Here's the story of how it all happened.

Why you should listen:

• Why even $1B+ exits still feel like rollercoasters from the inside. 
• How to quickly abandon ideas and pivot to what truly matters.
• How they found a massive opportunity where no one else was looking.
• Why starting outside of the Bay Area was critical to their success.

Keywords
startup, billion-dollar exit, stablecoins, investor relations, crypto, fintech, market dynamics, entrepreneurship, pivot, challenges, stable coins, startup journey, acquisition, fintech, market resilience, product market fit, Pablo Srugo, Bridge, Stripe, entrepreneurship

Timestamps
(00:00:00) Intro
(00:2:46) Starting at the Worst Time
(00:8:56) The Emotions on Pivoting a Month After Raising
(00:11:44) Pivoting
(00:18:24) Leaving Brex
(00:20:36) Working on Something Out of Trend
(00:28:34) The Core Beliefs of Bridge
(00:32:56) Launching & First Customer
(00:38:57) Sometimes you Can't Think Too Much
(00:42:29) Series A
(00:44:24) The Acquisition
(00:49:05) The Feeling of Exiting for a Billion
(00:52:24) One Piece of Advice

Chapters

• 2:46 Starting at the Worst Time
• 8:56 The Emotions on Pivoting a Month After Raising
• 11:44 Pivoting
• 18:24 Leaving Brex
• 20:36 Working on Something Out of Trend
• 28:34 The Core Beliefs of Bridge
• 32:56 Launching & First Customer
• 38:57 Sometimes you Can't Think Too Much
• 42:29 Series A
• 44:24 The Acquisition
• 49:05 The Feeling of Exiting for a Billion
• 52:24 One Piece of Advice

Transcript

Pablo Srugo (00:00):

Zach went from nothing to a $1.1 billion exit in just two and a half years. But it's actually crazier than that because- if you look at it from the outside, you assume if somebody goes from nothing to 1.1 billion exit in two and a half years, they must have absolutely killed it. Like probably they launched and the product just took off right away. And it turns out that the first year was just straight punches to the face. Zach leaves a c-level CPO role at Brex in late 2021 when Brex is like one of the hottest startups in the world. He raises $8 million outta the gate because he is an exited founder. But literally one month later, this is early 2022, he gives up on the idea that he raised up <laugh> literally a month after he raises all this money he did. He realizes that the whole idea makes no sense and isn't gonna work.

Pablo Srugo (00:51):

And so he spends the next like four to six months. And by the way, during this time in 2022, just to give you a sense, not only was it a terrible macro in general, but for crypto Web3, it was the worst possible time. We're talking about FTX failing, SVB failing, all of this stuff is happening while he's running a Web3 startup. Everybody else is moving on to AI and Zach and his team are still in the Web3 space. They do this for months. And finally they end up landing on this idea of stable coins. They launch with a couple of design partners, and it falls flat, <laugh>, it falls completely flat for a few months until a different customer with a different use case that they hadn't considered at all comes along, they partner with them and then they start growing like a rocket ship. And a year after that, they get acquired for over a billion dollars by Stripe. Here's the story. 

So I have really bad news for you. The show actually now costs money, so I'm gonna need you to wire 10,000 dollars to my account if you wanna keep listening. I'm kidding. I just need a review now. You thought you had the pay doesn't look so bad, right? All you have to do is take your phone out, hit a couple buttons, hit five stars, and you're done. Thank you. Well, Zach, welcome to the show, man.

Zach Abrams (02:02):

Excited to be here!

Pablo Srugo (02:04):

Dude. So, I mean you're like the new Instagram <laugh> at this point, at least the new Instagram 2024, right? it's just crazy, right? Two and a half years from starting to a 1.1 billion acquisition by Stripe. So, let's jump into that. I'm just curious to see how you can build so much value in such a short amount of time. It's just crazy, at least from the outside looking in. And maybe I'll start with this question. Like, you know, startups are all about timing. You started a Web3 startup in April, 2022. Seems to me like the absolute worst timing ever. What happened? What was that like?

Zach Abrams (02:46):

I mean, I certainly thought it was the <laugh> worst timing ever for, for a long period of time. I mean, we started, Sean and I decided to start the company in March of 2022. And Terra Luna, you know, Terra Luna happened pretty shortly after that. Then FTX happened after that, and Silver Gate signature happened after that. SVP happened after that. I mean, the first year of the company was awful. And, the first the first bit of time we actually started, when we launched the company, we were building something different. You know, we were building a means of- not only was it bad because the market, but it was bad because the segment that we originally launched into, which was buying like NFTs and stuff like that, is what we kinda originally were, you take your bank account, you convert the funds in your bank account in stable coins, you then use those stable coins to buy NFTs, that sort of thing. That space also became hugely competitive. Like when we kind of had the idea, it was before CrossMint and a bunch of these other folks, you know, Moonpay now does- there's just a lot of folks that do.

Pablo Srugo (04:04):

The idea came when, by the way, did it come like right around that time early ‘22, or was that earlier that you had the idea?

Zach Abrams (04:08):

So I left Brexit at the end of 2021. I was like in like Q4 ish of 2021 is when I was leaving Brex. And then I officially left at the beginning of 2022. But I started thinking about what I wanted to do next. And probably around December is when we were, Sean and I were interested in this general space of like, you know, crypto payments and we thought the first use case was going to be NFTs. And then between then and when we actually raised money, we basically went from what we thought was like a totally greenfield opportunity and like NFTs were gonna be, you know, a trillion dollar asset class themselves and so on to like wildly competitive. And then the space fell apart. And so before we even, we raised money with this idea.

Pablo Srugo (05:03):

When did you raise and, and how much? 

Zach Abrams (05:05):

We raised in April, so we closed the route in April. Okay. And then we pivoted in May <laugh>. So that's how long idea 1 lasted <laugh>.

Pablo Srugo (05:13):

And how, how big was that? How big was that round? The inception round?

Zach Abrams (05:16):

We raised about 8 million. And so I felt like a complete moron. I had just like gone to all these folks and, you know, told them about this thing that we were gonna build-

Pablo Srugo (05:31):

Especially 'cause I assume, I mean 8 million obviously at inception, that's a big round. And like, I assume a lot of that was like you and the team and the fact that, you know, you're multi-time founders and you kind of see, you know, where things are going. See great story. And then a month later it's like, actually <laugh>.

Zach Abrams (05:43):

Yeah, I mean, I felt, I literally thought I was gonna burn my career to the ground. Like, I had, like worked for all this time, like Sean and I had started another company, and then over the last eight years I had worked at like Coinbase and Brex and kind of trying to build my career. Yeah. Then we started this company, we raised this money, and then it was immediately not a good idea. We, we, like, I lost confidence in it. And this was probably the hardest time of all the times this started a company, this moment was the hardest because I lost confidence in the idea before Sean did. And Sean really wanted to launch, you know, and just be like, Hey, let's just get a product out there and iterate because that's what you do. And I just felt like it wasn't even a good enough starting point. Like it wasn't worth launching and iterating from that point. And so it took us a little bit of time to agree on what to do and, and especially because we didn't know what exactly we wanted to do next. So I was like, Hey Sean, I've lost confidence in this idea, and I also don't know what we wanna do. 

Pablo Srugo (06:50):

That's the worst, right? When you have a- I know the problem, I just don't have a solution for you. You're just the negative person in the room. you're adding no value at this point.

Zach Abrams (06:57):

Totally. Totally. So finally, he got on the same page, we kind of agreed, we agreed that we'd take a step back and explore, 

Pablo Srugo (07:08):

this is over what by the way, like timeframes here. This is like days or weeks that you're in this kind of tension. This back and forth,

Zach Abrams (07:13):

This was probably weeks. It was like I had lost confidence and it probably took two, three weeks for Sean to be like, okay, I'm fine giving up on this thing and let's move on to the next thing.

Pablo Srugo (07:23):

And how were the investors, were they on you guys, like, what's going on? Or they just like, whatever, you'll figure it out, hands off, giving you the space.

Zach Abrams (07:33):

So it was more pressure that I was putting on myself honestly. I felt like I had gone out to them and told them this story and, you know, they had invested, you know, all this money in us and I was disappointing them by not delivering upon that. And I actually reached out maybe in late May to one of our investors and I was like, Hey, this idea that we raised money on. And I was so stressed, I was not sleeping because, you know, it was like, these people invest all this money in us. And I reached out to, I reached out to him and I was like, Hey, you know, our idea, we lost confidence. We're pivoting. We don't know what we're gonna do. I know this is bad. I'm sorry. You know, da da. 

Pablo Srugo (08:27):

And what can I ask? I'll interrupt with one question 'cause I'm just trying to get in your mind frame. Like, what do you think really was giving you such a hard time emotionally? And I asked this because the flip side of looking at it is you're a month in, you've probably barely burned any of that money. Like whatever, you know, worst case, you don't figure anything out. You give them 90 cents on the dollar, 80 cents on the dollar, everybody calls it a day. And, you know, it doesn't seem that bad. Like, how are you, what, what about, what about it was kind of pulling you so far down? 

Zach Abrams (08:56):

I just thought that people- that these investors had- either they really like the idea and I felt like they had just put a ton of confidence in me to deliver a thing. And then everything that I told them, I was wrong, you know, within three, four weeks and <laugh> and, and I felt like for that to happen so quickly would be bad. So anyway, so then I called Mark and I was like, Hey, this is what's happened, and Mark, - he took a beat. And he was like, I didn't think that idea was gonna work anyway, <laugh> <laugh>,

Pablo Srugo (09:49):

Oh man, only in startup land. 

Zach Abrams (09:51):

Yeah. And I was like, what do you mean? I was like, what was that NFTs or something? He was like, mm-hmm. He was like, we figured you'd figure it out at some point in time, I figured you'd go through a couple things, maybe you'd take you a year, you know, and then you'd land on the right thing. And that blew my mind. You know, because my perception of what people were thinking was so wildly dislocated from what they were actually thinking. And that was quite liberating. I wouldn't say it was a turnaround moment for us, but it just, it alleviated a huge amount of stress because then I realized, oh, like these folks are kind of, you know, they just believe we will find our way through the maze at some point in time. I don't wanna spend a year in the maze, like Mark mentioned, that would be terrible. But <laugh> we have plenty of time to figure it out.

Pablo Srugo (10:52):

But, you know, it is crazy, man. Like you say that, and on the one hand, I think we're all taught in this world, like, hey, you wanna bet in teams, like you wanna back teams, but it's actually so hard to back a team, especially with 8 million, not like half a million bucks, right? Like an 8 million round on a team where you don't even really buy into what they're telling you they're gonna do. It takes some serious gut. So I, you know, <laugh> props to Mark, you know what I mean? Obviously he called it Right?

Zach Abrams (11:17):

Totally. and I mean, I'm glad it's like having that license to not feel wedded to the original idea because we did, like, we felt like we had raised money based on that idea, and we needed to deliver something. And so being able to untether ourselves from that idea is what then enabled us to look around a little bit and find what ultimately became Bridge.

Pablo Srugo (11:44):

How do you go through that process? Because it's dangerous, right? It becomes a little bit inorganic when you have funding, you have a team, maybe you have a space, but you actually don't know what problem you're gonna solve. You don't really know what you're gonna do, and you kind of have to come up with something, right. At some point. How do you structure that process? Like what do you go through?

Zach Abrams (12:05):

So I don't know if what we did is repeatable, but I can tell you, I can tell you what, what we went through. My sort of zone of expertise is in FinTech, and Sean and I were particularly interested in crypto. So while we were pivoting away from this thing, we never sort of lost that scope.

Pablo Srugo (12:22):

And even in the macro, like even with FTX falling, all these things falling, you're like, “the crypto's gonna be fine”.  That was a conviction.

Zach Abrams (12:28):

Yeah, and we were also really interested in stable coins, although we didn't- we were using stable coins as this intermediary, you know, to facilitate these NFT purchases and so on. But when we first started our exploration, we started super wide. So we just reached out to a ton of different teams and we just talked to them about what they were using, what they were building, what problems they have, and all these teams were in the crypto space and, you know, there were a bunch of problems that arose and this sort of thing. But, but really after a week of doing that, one of our realizations was that any crypto product that is like sold to crypto companies is unlikely to be successful. That was like my biggest takeaway. Like they definitely have problems and there are things that you could build to solve problems for, but the market is tiny.

Zach Abrams (13:18):

And none of these folks, even the folks who like on the outside, you feel like they have product market fit, had really scaled product market fit. And at least the folks that we talked to. So our realization from doing that was that anything we did needed to- if we wanted to stay in the crypto space- it needed to use this technology, but to serve a much bigger audience. Like our core market cannot just be crypto developers. We couldn't build indexers or whatever, which is something we thought about for like a second.

Pablo Srugo (13:54):

Was it a TAM you would say? it was a market size problem?

Zach Abrams (13:57):

Yeah, and like the teams, you know, the teams were just- like the TAM is tiny, tiny, tiny, tiny. And anything that you're building, let’s say you're building a SaaS tool for crypto teams. Well, your market is, not just the number of teams, but how big those teams ultimately become. And, and along both dimensions, it was not working <laugh>, that was our first thing is like, okay, it has to serve this bigger audience. And we were continuing this whole time to come back to stable coins. And basically what happened is I ended up connecting to some folks on the Paxos team and talking to them about what they were planning on doing with launching, with launching a bunch of stable cords. And this was sort of when the USD, the Binance stablecoin, had recently launched and became super successful.

Zach Abrams (14:55):

And, you know, there was, it was well before PYUSD, but it was kind of clear that others were gonna come behind. And the combination of spending time, you know, early on working with stable coins, then like doing this discovery around, you know, realizing that we needed to serve a broader audience and then kind of chatting with people in the space and beginning to form opinions around where the stable coin space would go. Those things just at some point in time just clicked for me. And it was like, oh, there's a world where there's many stable coins, many blockchains, and even just using USDC is extremely hard and there's no quality APIs to be able to use it, but there is gonna be an immense amount of value in providing tooling that enables folks to use this emergent stable point layer.

Zach Abrams (15:51):

As soon as those pieces kind of clicked together in our head, it was one of those where it was like, once it's seen, it can't be unseen. And, our team, like, there were a lot of ideas that we had come up with before where we were like, here are the pros and cons list. Here's this list, you know, all this stuff that we're trying to convince ourselves to do it. And once we kind of, these pieces clicked, it was immediate, like we were like, this is it. This makes sense. This is a hundred percent what we need to do. Like, let's go. And that was in September.

Pablo Srugo (16:21):

 So, there's kind of three- from May, right? So from May to September, three or four months of just talking to customers, thinking about exploring different kinds of places you could go.

Zach Abrams (16:32):

 Yeah. and it took us a decent amount of time to get there.

Pablo Srugo (16:36):

And how many people were on the team at this point?

Zach Abrams (16:37):

We had four people on the team. 

Pablo Srugo (16:40):

Okay. so you kept it really- I mean, you had a million, but you kept it obviously really small. And for this, and I always say, man, for pre-product market fit, and certainly when you're trying to figure out the thing to do, you move so much faster with four or five people than with even like 15, let alone 30, right? But like even 15, so much more alignment, so much more communicating overhead, like all that stuff just slows you down. 

Zach Abrams (17:02):

Totally. Like I mean, another part of the sort of investor story is, when we were pivoting, another thing we were worried about is like, we had just hired Dan, Dan was our first engineer. So Dan decided to join, and we pitched him on this idea. And then by the time he joined, we had pivoted away from this idea. And like, I remember we talked to Dan, we were like, Hey Dan, like, you know, sorry, this is crazy and we don't know what we're doing and whatever. And I was worried. We were both worried that Dan was gonna be like, okay, this is crazy. Goodbye. I'm outta here. Dan was like, this is amazing. This is what I signed up for. Let's go! let's just start talking to people and going off the rails and seeing what's possible. And so it was like consistently we were like, it was like being reinforced that like my internal expectation of how other people were- the riskiness or their concerns or their lack of confidence or whatever was wildly different versus my perception.

Pablo Srugo (17:57):

By the way, I gotta go back for a second just to get your mindset on one thing. Like you're like the CPO of Brex, Brex in late ‘21, as far as I remember, it was pretty hot. Like those were good times, right? why do you leave? Like was it the pull of this particular idea or was there some other reason that you're like, I don't wanna- because at that stage I assume people internally were  thinking IPO they're thinking these sort of things and then near future,

Zach Abrams (18:24):

Ultimately I think there's a lot of reasons, a lot of micro reasons why I left. But now as I reflect on it, I just burnt out. We had basically started this comp- Sean and I started the company in like 2011. We sold that company to Square, and then I ran a bunch of product teams at Square, then ran the consumer business at Coinbase, then did this at Brex. It was just like a very, very intense long run. 

Pablo Srugo (19:00):

And so you wanted to do The easy thing and just start a startup? <Laugh>?

Zach Abrams (19:07):

Oh man. Yeah. If only I had known, but yeah, I had just burnt out. I had just lost steam, and I was no longer as effective at the job. I didn't have it in me to push the same way I did early on. Then I took a break then, then I left, I actually left and right after I left, Sean reached out and was like, Hey, I wanna start a company again. And I was like, no, I can't. I'm like, I need to take time. And 

Pablo Srugo (19:36):

Oh, so you actually, you didn't leave for this idea. You left to take time. Okay.

Zach Abrams (19:40):

Yeah, I left and I was just taking time and I went away and I skied for a while and I took time off and then it wasn't until probably like December, January that I was like,, oh, I like this idea. Like, okay Sean, let's spend some time on it. And then from there we would, we would talk two times a week and then three times a week. And then by March we were like, okay, I was like, I'm ready. I'd taken a bunch of months off like, I'm ready to, to do this.

Pablo Srugo (20:09):

Got it. Okay. So now we fast forward back to, to real time September of 22. And my question is, what are some of the main problems you're seeing? you're kind of like, okay, stable coins are gonna be a thing, they're gonna be adopted outside of just crypto, but what are some of the big problems you're seeing that you think you can solve? Like you talk about USDC, what was so hard about it? what was so hard to do? Yeah. Where, where did the problems kind of come up related to it? 

Zach Abrams (20:36):

So we were, when we had first started building the first version of the product, we were taking dollars, converting 'em into stable coins, seeing those stable coins, doing things with them. And we basically realized that there was no, there was like Circle at the time, kind of had some APIs, but they were really bad. And we realized there was no clean way for a developer like a Stripe, effectively a Stripe-style API -for a developer to come in and take a dollar and convert it into a stable coin, just that basic action, it required you to spin up wallets to deal with this mint burn infrastructure to - it required a ton of- you have to build up your own gas management.

Pablo Srugo (21:18):

If you're a developer and you wanna build an app that's gonna rely on stable coins, you had to also build a bunch of infrastructure that wasn't really the thing you wanted to do.

Zach Abrams (21:25):

Yeah. You had to build a lot, like a lot of crypto stuff in order to make it work. So we basically, and then we realized like, oh, Circle kind of has this for USDC, but it's bad. And you know, Paxos has really nothing,  for their stablecoin. And if there are many, there's gonna be a need for someone to just abstract away all of this complexity.

Pablo Srugo (21:52):

You know, lemme ask this. We had the CEO of Wyre, Yanni on, actually the episode launched earlier this week. They were building -, they had the bolt acquisition that almost happened right around- it was announced right around this time it was announced June ‘22. Were they in a similar space? Like they were kind of a wallet or whatever for - kind of this API, but for, I don't know what they were doing with stable coins, but certainly with Web3 in general.

Zach Abrams (22:20):

Yeah, I mean I think it's possible that they could have moved in our direction. They were really focused on card and card processing because at the time that's where all the money was. That's like Moon Pay was making all the money. I think Moon Pay had raised around, around their moon pay was making money from this. There were a bunch of competitors popping up and they had some of these APIs and they certainly could have moved in this direction, but a large portion of their business was card and card processing for crypto acceptance. And so we didn't really compete with them in the market. That being said, what happened was that over the course of a year there were a whole bunch of failures in the space and their company was impacted by it indirectly impacted by FTX and so on.

Zach Abrams (23:15):

And that essentially just nuked the competitive landscape for us for like a year. And so you know, starting when we did focused on stable coins and going through the hell that we went through ended up being hugely beneficial because we had a bunch of infrastructure and APIs, but none of the baggage from 2021 or 2020 as like the market started running and chasing what was super interesting then we built from-, you know, we focused on stable coins from the beginning and then anybody who could theoretically compete with us as we started getting traction was gone. And

Pablo Srugo (23:56):

And did you get influxes of users, like people who use those apps kind of saw, okay, this doesn't work anymore, and they found you?

Zach Abrams (24:04):

I wouldn't say it was step function changes, but I would say that there would be a handful of customers that would come when each one of those folks would have issues. Yeah,

Pablo Srugo (24:15):

It's like another tailwind kind of thing. 

Zach Abrams (24:17):

Yeah, yeah, yeah, yeah, yeah, exactly. There was some point in time where our success, it became clear that it was working in the market and like we weren't doing a lot of advertising or whatever, but you could still tell, but there's really not many companies who had the infrastructure to be able to, in any quick way, compete with us. And that's still true today. We have very few real competitors, which is nice.

Pablo Srugo (24:41):

Why is that by the way? Is what you've built just so hard to build? Or is there some sort of reason why when you build it first it becomes really hard to compete with?

Zach Abrams (24:48):

I think that there's probably a couple reasons for it. One, is that we were super quiet about what we were doing for a long time, and so folks just didn't know. I think the other thing is that crypto and stable coins have not been an interesting space that VCs in the world have wanted to fund until now. And so it was very hard to raise money and do this and it wasn't like you know, in the startup capital of the world in San Francisco, people, there's a real status games to the things that you start, and right now you achieve high status by starting something in ai and stable coins are- now they're kind of interesting. But six months ago it was super low status to “Pablo: That's true”. Do something in crypto or, or stable coins. So people wouldn't do it unless you had real conviction that it was a thing you wanted to, you wanted to build.

Pablo Srugo (25:43):

It's crazy how this stuff ebbs and flows and on a tangent, I wonder what it means as a founder, because you know, when Web3 was hot, it was like ‘20, late 2020 and all of ‘21, right? It was super hot. And then when you started was the last month when it was kind of cool and then it became exceptionally uncool, you know, for like 18 months. But it was actually potentially a great time to start. Now AI is the thing, everybody's doing stuff in AI and it makes sense, but then you wonder what are the things that are like not that cool today that are actually massive and as a result just don't get nearly as much attention, competition, these sort of things and maybe make it a better place to operate.

Zach Abrams (26:22):

Totally. I mean, it's like if you show me a person who's building something in crypto, living in San Francisco and was working on it in 2023, I will guarantee you that they are a true believer and probably excellent be because it just requires a level of conviction in the space, you can't get it externally. Whereas someone building AI- there's a million applications for AI. And so I'm not saying it's a bad thing for someone to be, to be starting, but if you're just a random person, I just wanna start a company, your default right now is “I'm gonna do something in AI”. if you have no priors, but honestly I think it's good. each one of these phases brings in a wave of people and there's some attrition rate, you know, different spaces have different attrition rates, so I'm sure this like AI wave will kind of boom and bust and there will be some attrition rate and but what will happen is there will be tens of thousands of people who are brought in building in this space or hundreds of thousands or millions or whatever, who stay long term and set the foundation for the next phase.

Zach Abrams (27:35):

And, you know, that was true of me. I was brought into the crypto space in 2017, that's when I joined Coinbase.  I sort of stayed and helped, you know, in some small way build a foundation for what's happening now

Pablo Srugo (27:54):

I'm gonna ask you for a small favor, a tiny little favor. In fact, it's not even now that I think about it, it's not even really a favor for me. I'm actually trying to help you do a favor for you. Just hit the follow button you won't miss out on the next episode, you'll see everything that we release. If you don't wanna listen to an episode, you just skip it, but at least you don't miss out. 

So let's go back to September now, like you figured out that, you know, this is what you wanna do. You wanna build an API for developers to build an API for like stable coins and, and developers, right? So they can build kind of apps that use stable coins. What is the first move from there? Is that an inflection point? Is that when things start to get easier?

Zach Abrams (28:34):

I would say that that, that the idea-, it got easier in one respect, in that we felt such conviction in the idea that we could really- almost from the beginning, when we landed on this idea, we could simplify our thesis into a couple core beliefs that we were pretty unwavering about in the face of a lot of challenges. It was like, do you think stable coins are gonna be important and do you think there will be many? And, if you believe those two things to be true, then Bridge is a valuable company. So we didn't know exactly what use cases, what developers were gonna be building on top of it, what countries it was gonna be successful in. Now we have a much better idea of that, but we just believe that this infrastructure is gonna be important if stable coins are valuable.

Zach Abrams (29:25):

And there are many, there was nothing that - while we built a bunch of our infrastructure and we were trying to work with FTX and then FTX collapsed, you know, and then we were building on a new bank and then, signature collapse and that bank went away and then we're building out another, you know, as all these things happened, we were, we still were like, we would ask ourselves like, do we still think stable points are gonna be important? Yeah. Do we think there are gonna be many? Yes. Like, makes sense for that to happen.

Pablo Srugo (29:54):

Were there any - FTX especially- was that at all existential type conversations internally? Like, wow, <laugh>, like maybe this is a whole house of cards or really just unwavering?

Zach Abrams (30:04):

No, it actually made us more excited. Every time one of these bank failures, one of these situations happened, it became harder to build what we were building. And our thesis was unchanged. And so essentially what was happening was all this disruption in the market was making the moat around our business bigger. And so we had total confidence that we'd be able to solve this thing. But with FTX going outta the market, banks going, regulators turning against all, all this stuff happening made it such that if we solve this problem, which we thought we could and our thesis was true, that stable coins are important and there are many of them, that that bridge would be even more differentiated and even more valuable.

Pablo Srugo (30:52):

Why? And why is that? Like what's the simple story there? Like why does FTX falling make it harder to build what you're building? 

Zach Abrams (30:59):

So when we were first building the product, FTX had a bunch of APIs that nobody really knew about, but we kind of discovered that made it easy to convert between stable coins. So we were like, oh crap, we discovered this thing that makes it kind of easy to build our infrastructure. So if someone else discovers this thing, it's also gonna be easy for them to build competing infrastructure. And then when FTX went away, that went away. And the same thing when we went out to talk to banks, when there was like five banks that wanted to work with us, that was like nice, but there was also five banks that wanted to work with everyone else when all the banks went away and no bank wanted to work with anyone when we could find one. Like, that's actually interesting. The one thing that was truly existential was when SVB went under and USDC deep pegged because, and that was the week that we launched.

Pablo Srugo (31:56):

Did your timing, your timing is incredible. <Laugh> like high level, perfect timing, but like when you zoom in, you're like, what's happening?

Zach Abrams (32:02):

It was crazy. I mean we thought for sure the world was conspiring to tell us to just move on with our lives. We were like, we gotta take these like signs from God that <laugh>

Pablo Srugo (32:15):

USDC pegging is one of- you go back to your two beliefs. Like that really actually is one of the few things that challenges one of those things that, wait, these stablecoin things might not be real.

Zach Abrams (32:24):

Yes, exactly. And that was like, that's why that one was existential. It was like, oh crap, if this thing does not recover its value by Monday, then stable coins might never exist again in a real way in the US and there might be nothing here. And then, you know, over the weekend it recovered its value and then developers showed back up to use our APIs and that was the nato that was like the lowest point in the company. And then from there we just slowly built momentum over the next like 18 months. 

Pablo Srugo (32:56):

How long did it take you to build V1?

Zach Abrams (32:58):

I guess a year and if you count everything, 

Pablo Srugo (33:02):

but like no, from September, let's say from September

Zach Abrams (33:03):

from September. So we launched. in late March is when we moved our first dollar. late March of 2023.

Pablo Srugo (33:11):

And how, like, who was adopting this mainly?

Zach Abrams (33:14):

So we had two customers, Maltese and General Galactic. They were our early design partners. They were both crypto focused companies, really, really good founders, really good teams. Their products did not scale early in the way that at least their integrations with us scale and work the way that we both hoped that they would. And so they were not sort of- us picking the early design partners. Like we did not do a great job there and, and <laugh>, but when we did launch, I would tweet basically, Hey, we just launched, we have these APIs, whatever. At the time I had like 2000 Twitter followers, so like not a lot of people, but I was like, I don't know how else to tell people that our product exists.

Zach Abrams (34:10):

and what would happen is every time I would do that, somehow we would get like two customers that would come inbound to our website and basically it's like, hey, I'm interested in using these APIs. Very quickly after we launched this customer, Zulu came to us, Colombian founder Esteban, we're still close today. He came and was like, Hey, I'm interested in using this for cross border payments. And I was like, sure, I have no idea what you're building and like why this is interesting to you, but like, Godspeed, let's work out a contract and like let's onboard you. And our first couple months were basically just Zulu. That was it, that was our business. Was like one customer. 

Pablo Srugo (35:03):

Were they at scale when they came to you? Or they just grew really fast?

Zach Abrams (35:06):

They just grew really quickly. Like they were moving money between LatAm and the US via stablecoin rails. And they're the ones who showed us that you can use stable coins for cross-border payments. Now people

Pablo Srugo (35:17):

What's the simple thing? Like you take USD, you buy one stable coin and then your stable coins whatever you want and you buy a peso or something like that.

Zach Abrams (35:26):

Exactly, exactly. So, you can do a local payment in the US. So you take a wire from a bank account, convert it into a stablecoin, send the stablecoin over to a partner in Mexico, convert it into pesos, and do a local payment in Mexico. So the stable coin replaces a swift rail. So Swift generally settles in T plus one, T plus two with a stable coin. You could do a US to Mexico payment in minutes without holding capital in either country. So they showed us that this existed. 'cause You know, I'd spent my whole career in FinTech, but it was all in the US and so I didn't appreciate the sort of opportunities that stable coins unlocked in, you know, Columbia or Mexico or Brazil or Argentina or Africa or you know, or Southeast Asia and so on. And so his business started scaling and then that basically gave us confidence that like, oh, our thing is working, even though it was totally fake, even though we were only working because we had one customer that was growing.

Pablo Srugo (36:26):

How long did you ride that? Like how long was that your, your number one customer by far?

Zach Abrams (36:31):

Probably our first like three or four months. And then it was like every month I would tweet and then we would get more customers. I would tweet and we would get more customers. And now in hindsight it's obvious. It's like, okay, clearly there was pent up demand for our product if I was tweeting and doing it, but at the time it was like-

Pablo Srugo (36:46):

You probably needed a better marketing channel <laugh> than your tweets. There’s probably a lot of people waiting for the message.

Zach Abrams (36:49):

Exactly. Exactly. And it was just- we would aggregate one and another and then we would eventually get them shipped-

Pablo Srugo (36:58):

Was cross border payments, was that a one-off or was that actually where most of your use cases ultimately landed?

Zach Abrams (37:04):

that was a really big one for us and you know, continues to be a really big one today. And after we signed Zulu, we were like, oh, this cross-border payments thing, it works. And then maybe in June or something, we ended up signing Bitso, which is the largest exchange in LatAm. And then Bitso became kind of a big enterprise customer for us. We launched with them in September and then, and then the business really started to inflect, you know, now I just can't say this enough to our team. And as I think about it now, it's like someone joins Bridge and they say. Maybe it feels like Bridge was inevitable in some ways or like they think our success is inevitable. But then I think back to the very beginning and our success was like one tweet, one customer, you know, one person scan. Because if, because if they didn't sign, we would've had, our first two customers went to basically zero. We would've launched and our first like four months done no volume. And who knows what that would've done to our psyche after the USDC defect. 

Pablo Srugo (38:10):

There's a lot. I mean from the outside looking in, and I always say it's like there's so many companies that look like complete rocket ships and I'm convinced that almost all of 'em inside feel like total roller coasters and disasters and it's just, it's never that up and to the right. But even in your case, like there were a lot of times where you could have given up, frankly, for lack of a better word, like a month in for sure. You know, FTX is another time. Like the, the unpegging is another one. And even the first few months you could have pivoted away from it because, you know, the two customers didn't really hit, you know, it's just things can turn out very different ways. It's pretty incredible how it all works out. Like none of this stuff is, is inevitable. Not at all, I would say.

Zach Abrams (38:57):

I think like people talk about the grind of a startup and like to me the grind of a startup is just doing an enormous number of low probability things to, over time, accumulate enough of those, such that there's a decent probability of some sort of success. And the reason why the grind is hard is because you're just doing things that each individual action has a very low chance of being productive. If that makes sense. And most people just stop or don't do them because the rational decision for each one of those individual actions is to not do it because it's not a good ROI use of your time. But if you don't do an enormous number of those things and compile them all together and your company has a very little chance of actually succeeding.

Zach Abrams (39:44):

And like for us that was like, every customer spending time with them, doing all this tweeting on Twitter, putting ourselves out there, spending all this time with S1. Like I was about to fly to Columbia to try to close him 'because he wasn't following up on my emails. It was cold emailing anybody who we felt could potentially be a customer and so on. It was brutal at the beginning. Only by doing all those things that we then began to sort of compound sub momentum,

Pablo Srugo (40:16):

I think, I mean, as a founder you have to almost ignore probabilities. The best analogy I could think of is I dunno if you've seen the show Band of Brothers, but that to me is the best kind of war miniseries, but you really get into the mindset of these soldiers and it's like, if you're a soldier, you might know that the odds of you coming home are 20% like World War II soldier, like 20% chance coming home, 30% chance coming home. You can't think about that. Like at no point can you think about that because if so, like you're not coming home or you would've never gone to war in the first place if you could avoid it, right? Like, and as a founder, it's the same thing. Like if you think about the fact that, okay, my startup has like a 99% chance of failure you're either gonna fail or you're not gonna start it.

Pablo Srugo (40:57):

And if you think about the fact that like this reach-out has a 1% chance of success or this new test that we're running has a 10% chance of success, you are either not gonna do it or you're gonna hit like the 99 or 90% more likely. So you have to just somehow, in a weird way, you have to take on and off the blinders, right? Because you do have to kind of gauge what's realistic and what's not. But then you also have to put blinders on at different times and just say, I'm just gonna go for this, you know, and see what happens. You have no choice.

Zach Abrams (41:25):

Totally. I mean you just have to-I tell our team this, you just have to brute force luck. You know, luck is like some low probability action taking place and you just layer enough chances to get lucky together that eventually one of them hits and you're just trying to like DDoS luck. We were able to have that happen to us. Like, you know,the beginning of our company was just individual low probability events happening, you know, every three months. If one of those things didn't happen, the trajectory of the company would be totally different.

Pablo Srugo (42:07):

And so give me a sense of, I wanna talk about the acquisition, but give me a sense of the time that you really start to hit, which is like, you launch in March 23, maybe you're starting to hit in summer or early fall of 23 until the acquisition, which is basically a year. What kind of growth are we talking about? Like how much? whether it's payment volume or whatever that kind of gross metric that you look at?

Zach Abrams (42:29):

I mean, we were probably pretty consistently growing somewhere between 20 and 50% a month. The weird thing is I feel like on the spectrum of founders, I'm a more experienced person as a founder, but I had no idea that it was good or that special it just kind of felt like because because every month I was looking at it and I was like, well, we had this one customer come on board, it was super tenuous. You, you know, we had this one customer,

Pablo Srugo (43:03):

It felt like it was not repeatable. Like, oh yeah, this educated-, this one thing happened, I'm not gonna be able to do it again.

Zach Abrams (43:08):

Exactly. and my mindset, I'm constantly living in where the company was, not where the company is or even where it will be in the, in the sense of - I still think about Bridge as a smaller company struggling to find product market fit. Everybody else outside the company looks at us and like, oh wow, you were acquired by Stripe. But yeah, I mean it was a lot, it was probably 20 to 50% every month. And this is where like Sequoia's our investors were super helpful. They were really, really helpful in pushing us to think about what this means if it compounds for another N number of months and how unique that will be in, in the whole space of companies.

Pablo Srugo (43:56):

Because you raised- that seed round was March 22, and then you raised another round one.

Zach Abrams (44:00):

We raised our series A from Sequoia in December of 23. 

Pablo Srugo (44:04):

How much was that?

Zach Abrams (44:07):

That was, we raised 20 million from Sequoia.

Pablo Srugo (44:08):

Okay. And is that it or did you raise more after that?

Zach Abrams (44:10):

We raised that. That's mostly it , we raised a little bit more from Rivet after that in the new year. 

Pablo Srugo (44:18):

Okay. so walk me through how the whole like Stripe thing comes about.

Zach Abrams (44:24):

Honestly, I still don't know exactly what happened <laugh> so I met the founders of Stripe over the summer and I think that they have been interested in and are excited about and have been thinking about stable coins for a long time. I don't know to what extent and how how much, but I know that it has been on their mind for a long time and you'd have to ask John or Patrick, what exactly went through went through their minds, but I think that, you know, they asked me- many people at Stripe asked me once we were sort of in the process of like, why hasn't this been built already? And so I take that as a sign that folks really thought that when they saw what we were building and had priors on the belief and value of stable coins, this sort of way we had positioned our company and like, and these two core premises of, our stable coins are gonna be important.

Zach Abrams (45:33):

Yes, they believe that. Will there be many? Yes, they believe that. Then we're perfectly positioned to be extremely valuable in this world. And so it just clicked,

Pablo Srugo (45:43):

But they came inbound to you and kind of said, Hey, like, we wanna, we wanna acquire you, you interested? like high level.

Zach Abrams (45:49):

I would say that we did not set out to sell the company. I actually thought that we were unacquirable as a company because mostly because we were working in a frontier space and our belief of how big this space could be has consistently been way more optimistic than everyone else's belief. And so I thought it would be very, very hard for anyone to match our excitement. And so yeah, I thought that for Sean and I, we thought we would be building this thing independently, you know, and the only viable path for success was to go public at some point in time.

Pablo Srugo (46:39):

But I guess I'm curious about the, you know, you have your classic- I don't mean to compare it to Instagram all the time, but <laugh>, I'm not the first one to do it. You have your classic like Zuck thing, hey, if you don't come here, we're gonna build it. We're gonna crush you, so you better come here and like whatever. those stories, like, I'm curious I doubt that they did that, but, I do wonder how they kind of get you into the room and how they come up with that valuation. I assume it wasn't based on, you know, your revenue, it was probably more based on the value to them and where they thought it would go if they didn't buy it and the opportunity costs and these sort of things. But I don't know, you tell me

Zach Abrams (47:15):

A company like ours that's sort of growing at the rate that it's that it, that it's growing and like in a space that is what it is. Like I, I don't know how you would repeatably put a value on a thing. It's kind of a belief, I guess. and that sort of thing. We certainly believe that our business is going to be very, very, very large. And, and at least for us, the thing that's exciting for us about the acquisition is that, you know, over the course of the last year and a half of building and launching with all these, all these customers and developers, it became super clear to us that like, this is a whole new, you know, way of building, you know, global financial services.

Zach Abrams (48:07):

And folks in FinTech are generally slow to adopt things. We've just seen it a few times where Stripe does a thing or launches a thing and the whole industry snaps behind them. And it became very clear to us that if we were to combine, it makes it so much more likely that Bridge achieves more and achieves that more, much, much faster than if we go about doing it independently. And, and since things have been announced and like, you know, the whole regulatory landscape is in the process of changing too. So there's been some compounding variables there, but it's meaningfully accelerated the rate at which we've been acquiring developers and they've been launching and scaling and so on, which has been super exciting to see. So some of those initial ideas are panning out already. I thought it was gonna take more time

Pablo Srugo (49:05):

And then walk me through the feeling because I think, you know, especially the billion dollar piece is just like the allure of it or whatever. I don't think you necessarily set out to go and exit for a billion, but it's just kinda like, you can't be in startup land and not think about it, not dream about it, and, and it's called a unicorn for a reason. But it's even more rare when it's an exit versus like a mark. And I know it wasn't, you know, an all cash offer, like I am sure a lot of it was equity, but either way. What was that like when you actually- what was the process of getting it closed? How much tension was there, and then what did it feel like when it was real? You kind of alluded to this before, like, I still dunno what happened, <laugh>. You know what I mean? Like, did it feel a bit, a bit surreal?

Zach Abrams (49:54):

Yeah, I mean, honestly, I still don't like, let myself think about it that much. We haven't closed yet, so- we expect to close next year. And so I don't- maybe that's why it hasn't totally sunk in yet <laugh>. It's like some sort of defense mechanism or whatever else. But you know, I've seen many other folks who've gone through this where it hasn't worked out. So it's never done  till it's actually done. and I would say on the process itself, I mean, it was, it was really hard. Like we built a team that we like really, really that is truly special. And you know, Sean and I have had the most fun we've ever had in our careers building this company. And there's a lot of fear around that changing in some capacity.

Pablo Srugo (50:53):

How many people are you now?

Zach Abrams (50:55):

We're mid fifties. We're like 54 people.

Pablo Srugo (50:58):

Okay, so still a small team at this point.

Zach Abrams (50:59):

Yeah. So as we are going through the process and thinking about it, there is the selling the company piece, but it becomes a deeper question around what and how you want to spend, you know, this very meaningful chunk of your life. And that became the harder part, both for, for Sean and I is were we willing to, you know, give up some of this independence that we have in return for, make it more likely that the company ends up being successful and the product that we build reaches more people and impacts more lives. We're also giving up some meaningful amount of upside if like the business scales, the way we think that it will continue, will continue to scale. And there's like no -

Zach Abrams (51:54):

It’s hard- It was many, many, many sleepless nights. when the thing was announced, I would have family or friends call me and be like, wow! This is amazing! This is- I think the perception of how you think someone should feel when this happens was also quite different from like how our emotions were very, very mixed mixed that we very much believe we made the right decision and are extremely excited about joining Stripe, but it's still-  there's some fear, there's some regret over, there will always be some regret over the path of not taking.

Pablo Srugo (52:31):

Yeah, that makes sense. No, that makes total sense. Well listen, we'll stop it there. Let me ask just the last question. We typically ask about product market fit, but I think in your case it was pretty clear when, when you found product market fit. But I'll ask this other question, especially since you've gone through it twice now. What would be your top, your number one advice that you might give early stage tech founders?

Zach Abrams (52:54):

I'll try to give advice that I think other people won't give. I think the only reason why,- I think one of the biggest reasons why Bridge is what it is, is because we started the company outside of San Francisco and outside of New York and so on. And the reason why this was really important-

Pablo Srugo (53:14) 

Where did you start it? 

Zach Abrams (53:15) 

I was in Austin and London. And the reason why this is important is if you can get away- as you're starting a company, especially in the early phases, there is an immense desire to benchmark yourself versus everyone else. And there's always gonna be someone who's growing faster, who's in a hotter space, who's more popular than you are or what have you. But the most important thing that we found for our company is building real first principles, conviction and the thing that you are building and the impact that will happen.

Zach Abrams (53:51):

That is what carries you through FTX and Silver Gate and whatever else.  and it was very easy for us to build that conviction when we were away from all the noise that happened elsewhere. Once we started scaling, it became very important for us to come back and be a part of the community here, which helped us scale. But being able to remove yourself from the status gains that come with starting a company, especially early on, was one of the things that was hugely helpful for us. There's a lot of other things that other people probably tell you, but that's probably the one bit that was really, really unique for us.

Pablo Srugo (54:31):

I love it. I mean, I think it sets you up to chase problems instead of chasing hype, which is, which can always be problems, especially in the, in the really early days. Cool, man. Well Zach, it's been an absolute pleasure having you on the, on the show. Thanks for doing it.

Zach Abrams (54:43):

Yeah, thanks for having me.

Pablo Srugo (54:45):

So guess what, I met this founder who listened to every single episode of the product Market Fit show. He just called me and he sold his company for over a billion dollars. That's right. If you listen to every episode of the product Market Fit show, that's what's gonna happen. That's just, it's, you know, I can't say it's guaranteed, but it's what I've seen. It's just, it's what I've seen in the past. But you won't know for sure unless you, you know, tried it out for yourself. So go back 'cause there's over a hundred episodes of the product Market Fit show and you haven't listened to most of them. Check them out.