Preface: Who should read the Blockchain Economy book

The Blockchain Economy book.001

This book will help  you get on the right side of the disruptive changes coming during the Blockchain Economy.  Despite all the political talk about 1% and 99%, the economy is more like 10% and 90%, with plenty of professionals such as programmers, executives and creative people who do pretty well in that 10%. This chapter is about how to surf the Blockchain wave of change so that you can be in the 10% and not stuck in the 90% low paid gig economy. 

I wrote this book for a smart mainstream audience who want to invest the time to really understand the seismic changes coming during the transition to the Blockchain Economy. By mainstream I mean that you do not need to be a software programmer; don’t worry there are no code samples in this book. However this book does assume a reader with intellectual curiosity who will take the time to really understand what is happening. My promise to those readers is that your investment in time will be rewarded with actionable insights.

This is the Preface to The Blockchain Economy book.This serialised book is a practical guidebook for investors, entrepreneurs and employees who want to learn how to prosper during the transition to an economy where value exchange is permissionless and disintermediated. For the index/table of contents of The Blockchain Economy book please click here.

You will get value from this book if you recognise yourself in one of these descriptions:

  • About to enter the workforce after school or college and thinking about your career.


  • Re-entering the workforce after some period away from work and thinking about the optimal point of entry into the Blockchain Economy.


  • You are or aspire to be an entrepreneur and can envisage a new venture in the Blockchain Economy.


  • Nervous incumbent. You work in a market that is facing disruption from Blockchain. How do you guide your employer through this? Or if your employer cannot make the transition, how do your reinvent your career?


  • Investing your capital for the future. At 30,000 foot you know that this is like the Internet around 1995 before it was popularised by the Netscape browser, but you need some more context to make sense of the deal flow.

About to enter the workforce after school or college.

If you are entering workforce from school or college, you may have about 40 years of work ahead of you and may hit your peak earnings years in about 10 years.

The main advice to somebody entering the workforce is don’t sweat it, because nobody can predict what the future of work will be like. 40 years ago nobody predicted most of the jobs that we do today. 

However also don’t listen to anybody who is only urging you to get into a business that is hot today. That may not help you think about what the world of work will be like in about 10 years time when you are hitting your peak earnings years. Assuming you don’t want to be an entrepreneur and start your own venture (if you do, please read Part 4), the best advice is to work for a great entrepreneur. At what stage you choose to work for that entrepreneur will depend on your risk appetite. At one end of the risk appetite you want to be an early employee and make a fortune from success compensation  (such as stock options and tokens). If that is your appetite you need to think more like an entrepreneur and so you should read Part 4. Beware of survivorship bias. For every story of early employees making fortunes at a places like Google and Facebook, there are 100x of stories of those who worked for less than market rates who made very little on success compensation. So you must think like an investor, because you are investing your time. You need to build a portfolio over your working life. At the other end of the risk spectrum is somebody who just wants a good paycheck and benefits, which means working for a big established firm. The only trick there is making sure your big established firm is not slap bang in path of the disruption (e.g. working at Blockbuster when streaming video was going mainstream).

Re-entering the workforce after some period away from work.

If you are re-entering  workforce after raising children, being laid off, a sickness or some other life event, the key issue to navigate is how to leverage your great experience of how things work today when everything is changing so fast. You want to find a company that:

  • Is late enough to pay you properly. You don’t want to work for ventures that are too early stage – that may be too high risk for your life-stage. You take on more risk but have potentially more reward – just like an investor.


  • Early enough that they value your legacy knowledge. In the earlier stage venture, your legacy knowledge is hugely valuable to the founding team.


You are or aspire to be an entrepreneur

Please read the Chapter titled Creating a new venture in the blockchain economy.

Nervous incumbent – working in a market facing disruption

If you are employed in a big established firm but you have the nasty feeling that your employer is facing disruption – welcome to the world of the nervous incumbent. For example, you do not want to be at Kodak when digital films hit the market or at Blockbuster when streaming movies came along. The advice to nervous incumbents is to jump before you are pushed. It is much easier to get good work if you leave before the mass layoffs. 

When incumbents get to Act 5 in the Creative Destruction 7 Act Play there are a lot of layoffs. If you are nearing retirement this can work well. You get a nice severance package and you may get rehired as a consultant on a short term contract.

If you are younger and facing mass layoffs, your options are worse. To avoid being a low paid gig economy worker, driving a taxi before driverless cars take that gig, or doing menial tasks for those with good jobs, you need to do two things:

  • First, jump before you are pushed. If you see “the writing on the wall” you can be out and into the job market while your experience is still prized. If you wait until the layoffs, you will be on the wrong side of supply and demand. Read this book to see “the writing on the wall” before your colleagues.



  • Second, reinvent your personal brand. A LinkedIn profile is no longer enough. You need to drive your personal brand through all content marketing channels, so that  you tell the market what you know.


Investing capital for the future.

If you are investing capital for the future, read Part 3 of this book.

In the Blockchain Economy the lines are getting blurred between Investors &  Contractor & Entrepreneurs. This blurring of the boundaries is one of the differentiating factors in this wave of change. In earlier waves there was a clean boundary between investor, employee/contractor or entrepreneur. Today you meet people who:

  • buy/sell some Bitcoin and Altcoins (they are investors).


  • pay the bills by working for somebody else as an employee/contractor.


  • build their own venture as a side project in their spare time (they are an entrepreneur) and wait until they see enough traction before quitting the contract/employee gig.

This wearing of multiple hats goes against conventional wisdom. When reality diverges from conventional wisdom it means that the (usually unspoken) theory behind that conventional wisdom is no longer valid:

  • Theory = only a wealthy person can invest. Reality = tell that to the techies who invested early in Bitcoin or Ethereum, most of whom had way more tech smarts than cash (they now have both). There is some move by regulators to only allow wealthy people to invest in early stage tech, but it is likely that the toothpaste is already out of the tube. You can argue that investing in these coins is dumb, but you cannot deny that people are investing, some of whom are way smarter than the wealthy investors who are supposed to be the smart guys at the table.


  • Theory = An entrepreneur must quit their day job. Reality = it is so cheap to build a Minimum Viable Product (MVP) and nobody wants to fund this stage of a venture, so a side-project is the best way to get past this stage. Being an investor makes you more conscious of what may work for your own venture.


  • Theory = Employees are expected to follow orders and complete tasks. Reality = many employers are entrepreneurs with relatively young companies who prize employees who can think outside the box and bring innovation to the table.


Building a portfolio – whatever type of investor you are.

Investors can fairly easily build portfolios of assets. Writing a check is easy if you have the capital. You do an allocation to early stage and within that you allocate some to direct investments (aka being an Angel) and make sure you do enough deals that the few successes make up for the many failures.

This is so much harder for entrepreneurs and contractors/employees.

  • Entrepreneurs are the risk takers in this ecosystem. It takes about 10 years to build a business with sustainable value. So, the maximum practical diversification for an entrepreneur is 2 or 3 ventures; this is a level of concentration risk that few investors would countenance. That is why entrepreneurs need so much equity to compensate for that risk.


  • Contractors/employees can get more diversification than entrepreneurs, but less than investors. A contractor/employee can work for say 10 ventures during a 40 year career window (changing jobs every 4 years to get full vesting and make a meaningful contribution).

Whether you are investor or an employee/contractor or an entrepreneur, you are sitting on the same surfboard looking at the same wave. Don’t worry, this is a huge wave with masses of opportunity.

Spot the right wave at the right time

Whatever your focus – as an employee, or contactor or entrepreneur or investor you need to have a clear view of where is your market in the Creative Destruction 7 Act Play. This book is an aid to your own creative thinking that will help you think through where your market is in the stages of disruption. Whether you want safety (not getting crushed by a tsunami) or thrills (surfing a big wave) you want to make sure you know where the the wave of change is and where it is headed.

Where are the agile incumbents with proven ability to ride disruptive waves?

There is a myth that incumbents always lose to startups during waves of disruptive change. When you look at what actually happened in the history of disruptive change, you often see a really dumb move by an incumbent that snatched defeat from the jaws of victory and gave the market to the startup. The two most famous stories are:

  • IBM handing the PC market to Microsoft. IBM did not understand that the real value creation was in the software operating system, not the hardware.


  • Blockbuster  handing the streaming video market to Netflix. Blockbuster did not understand that Netflix in those days was quite vulnerable and could be easily acquired or crushed.

There are very few companies with a proven ability to ride disruptive waves. One is the aforementioned IBM. Having learned their lesson from losing the PC market to IBM, the great turnaround under Lou Gerstner put in place the the culture that ensured customer-centricity no matter what the wave of disruption  was. Now IBM is a big player in AI, Blockchain and  IOT, while keeping a laser focus on serving enterprise customers and having crystal clear financial metrics to judge their performance and to guide capital allocation.

You can see the same in Intel and Goldman Sachs. What all three have in common is a succession process where the Board chooses the right CEO to ride the next wave of disruptive change.

There are very few companies like this. A more common story emerges from once-great companies such as Yahoo and AOL, which struggled to thrive after a new wave of disruptive change hit them.

As an employee, assume that most incumbents will be hurt by disruptive change, no matter what the PR machine says; but you can bet on the few that have proven ability, across multiple CEOs, to ride disruptive waves.

Disruption can seriously damage your health, wealth and happiness

Or disruption can make you healthy, wealth and happy. It all depends on your skill as a surfer.

The the old line about “do what you love and the money will follow” is too simplistic on its own. Just ask many a struggling musician, actor, writer or artist. On  the other hand, getting a lot of money for work that you hate so that you can be “nothing more than something you invest in” (Bob Dylan) is not a recipe for a good life.  You need work that is in that venn diagram between work you love and work that pays well.

The problem is doing that during times of disruptive change. Your employer going bankrupt sure impacts the “pays well” part of the venn. That is why you need to look at where the puck is headed, not where it is today. I wrote this book to help answer that question.

Bernard Lunn is the CEO of Daily Fintech and author of The Blockchain Economy. He provides advisory services to companies involved with Fintech (reach out to julia at daily fintech dot com to discuss his services).

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