Part 3: An Interview with Chris Rawlings: Father of the STO

The idea for the Security Token Offering (STO) started in the same place as many others: In a bar. On one fateful Tequila Friday, Chris Rawlings and his fellow 500 Startups “batchmates” were about to begin a rolllercoaster ride  that ended in the successful launch of the world’s first equity-backed security token, 22x – direct from the heart of Silicon Valley.

Chris is a serial entrepreneur and the CEO of the logistics and marketing startup JudoLaunch. He’s taken JudoLaunch through 500 Startups,  Chinaccelerator, and a successful VC capital raise.


Richard: Personally, I think it’s remarkable you decided to do the first startup equity STO ever, and you were able to raise four and a half million dollars. As you said, nobody really knew what an STO was, and everyone else was looking for the next 1000x-Lambo Moon-Coin ICOs.

Lambo, Moon-Coin, Lambo-Moon…That was bad.

Richard: You were certainly well ahead of your time. I mean, did you realize what you were doing? Did you think this was the future? Like “What we’re doing now, it could be absolutely enormous, like the future of equity”, or was it just kind of like a cool techie thing that you wanted to do?

No, I was (and still am), completely bought in, hook, line, and sinker. I believe in a tokenized economy. However, there are some applications that are over-hyped or misunderstood, but many do solve real-world problems. For example, just smart contracts in and of themselves have the ability to automatically execute unlimited numbers of transactions in a short amount of time, without having people sign their signatures on documents with pens.

It’s obvious to me that STOs will play a massive role in the global economy. What part it will play exactly still needs to be sussed out. But I am 100% invested in this. I was running my own startup at the time and JudoLaunch is still in the e-commerce space. I spent a ton of my time on this token offering because I really believed in it.

And I was very involved in the crypto community, but I stepped away for a while when I was starting a previous business, Kush, and then JudoLaunch. But the whole time I never lost the belief that this is a transformative technology and a transformative event in the history of humanity.

Richard: Chris, I think you’re exactly the sort of person that should represent the Crypto community, because you buy into the whole tokenization of the world concept, but you’re very grounded, you see real-world applications, and you’re an entrepreneur. You founded multiple successful startups, and you did the first STO. It’s an incredible story.

Thanks, Richard. I love what you’re doing here with STN as well, I think it’s great that level-headed people like yourself are talking about it and giving a platform for people to discuss it in a rational way. I agree and think it’s important to have a balance between optimism and realism.

Knowing that this is a technology that could transform humanity, the problem is that when you get deep into this community (and you and I both experienced this), there are people who have made a ridiculous boatload of money. I ran into this guy at a Miami conference. He grew up in a trailer park in Texas. He was a salesman and started making a little bit of cash, moved out of this trailer park, and then one day in 2009 or so, somebody told him about Bitcoin. He bought tens of thousands of them, like 30,000 Bitcoins at a couple bucks.

So at the very high of the Bitcoin bubble, this guy is sitting on hundreds of millions of dollars worth of coins. But the dude had never done anything. That’s the problem in this community, there are a lot of people like this who never had to build anything, but they just made a ton of money. So they see all this possibility and their mind just goes wild. The problem is that because they’ve never had to build anything, they don’t know what it takes – the resources that go into it, the people, the management structures, the resources, the money, and especially the time –  because time is a major component in building anything great.

When you talk to these people they’re completely unlatched from reality, of what it takes to build something great and to build a complex structure of any kind. They have these grand visions for the future (which is great) but have completely unrealistic expectations for how fast that can happen, and how and what can be done in that period of time. That’s why I am grateful to have thought leaders you in the space, who see both sides of things, that can dream big, but also know how to actually build things.

Thanks! I’d like to briefly touch on and expand your point about investors and funds. I’ve done a lot of fundraising, and I met a lot of successful people, and don’t hold anything against them. But clearly, they had made a lot of money when the market was spitting out a 100× ICO, four times a month. Then they establish funds, that are obviously very speculative – and then on the flip side, there’s the funding in the VC world where there are really strong fundamentals. I definitely skew towards the VC world even though I’m seeing lots of negative stuff about Venture Capital from crypto media…. You know, security tokens are the Devil’s coin or something, because it’s Venture Capital.

But VCs bring so much. It’s not just all about money. It’s the network and the fundamentals. For example, can this team actually build anything? Have they done it before? Is the concept viable?  I think that’s one of the great things that STO brings. And you put together those successful startups in Silicon Valley and pulled it off! So high-five Chris, well done.

Thank you, man, and thank you for everything that you’re doing. I’m really excited to see where STN continues to go… And I definitely want to continue being part of the story myself.

The Chris Rawlings, 22x Series