What’s Kevin O’Leary’s Best Investment Ever? | Video

I’m kind of agnostic to politics. I don’t make money with politics, I make money with policy. And I would suggest to everybody to think about that a little bit in the end, don’t get emotionally involved in politics. That that’s a fool’s game. It’s Tuesday, July 23rd. And this is Markets Daily hosted by me Jen Sani. On this show, we navigate the current shaping the crypto markets, providing insights against the broader financial landscape. So whether you’re actively trading or simply fascinated by the volatility of the crypto markets, this show is your compass to understanding what’s happened where we are and where we’re going. Good morning, everyone. Happy Tuesday and happy E ETF approval to all of you. Market watchers out there, the spot E ETF got their final stamp of approval yesterday and they could start trading as early as well. Right now, we’ll keep an eye on the price of ether throughout the day. Our next guest is an investor, businessman, a shark and the chairman of o’leary Ventures, also known as Mr Wonderful Kevin o’leary. Welcome to Markets Daily. Thank you very much. All right, I got to talk about that background. It just looks so lovely. What, where are you sitting by a pool right now? It’s right behind me. It’s the Hamptons. I thought it would celebrate a summertime moment. This is, it’s a great summer we’re having in particular with crypto policy. So, why not enjoy it? Exactly. I am completely with you. Well, honestly, it sounds like you’ve been having a really fun summer. I saw you on stage on Twitter with the Jeff Tuy band on X just living life. Kevin. Yeah, I do that every year with Jeff’s band. Uh keeps my chops up. He gets better and better and of course, we celebrate that. I do a uh lunch every July 5th uh with Jamie who started ring, a very famous uh shark tank deal that got away. He sold it to Amazon for 1.2 billion. We become very close friends. We got our families together and then we go to, to Cisco Brewery and then I jam on stage. It’s a great time. It’s just celebration of the fourth. You know, I I’m so happy you brought up a ring because I got to ask you about some of your best and worst investments. I know that you did. Did you invest in ring? No, I was the only shark to make him an offer. Um I thought there’d be a lot of dilution and consequent rounds over and over again. I offered him 600,000 in debt with um 2.5% warrants, non of warrants. He didn’t take that offer. I understand why, but at least he got one. It would have been the biggest outcome in Shark Tank history, but you can’t win them all. You really can. It would have been a good one. When, when you think back, uh, not only to Shark Tank history but to your career. What’s the, let’s start with the worst, what’s the worst investment you’ve ever made? Well, I’ve made a lot of bad investments but I’ve gotten better from experience and I’ve learned something interesting. Um, I, I guess I would call it intuition over time. W when you, when you’re writing a check and making an investment and it doesn’t feel right in your stomach. That’s because it isn’t and it’s going to go to zero and it does. And I’ve done that to myself a few times. But now I listen to my inner gut on this, which I think is just years of experience and if it doesn’t feel right, I don’t do it. And it’s, I’ve been very fortunate, you know, I don’t, I don’t get it right all the time, but I get it right enough that it’s, it’s been an interesting ride and it’s really your winners that define your success. And I will say one thing about investing to everybody because I’ve been doing this a long time. Let’s say I do 10 deals. I’ll do, I’ll probably do 17 deals. This year, the ones I think are gonna be, the winners are never the winners. It’s the ones that I think that’s a flyer that five years later I get 100 x 200 x 300 Exxon. You just don’t know which is why you need that diversification in your strategy. You need to do more than one, particularly if you’re talking about venture capital. That’s what we’re talking about here. I don’t just do venture, I do private equity, I do debt, I do other things. But on the venture portfolio, it’s high risk and you need diversification. I mean, I think that the lesson that you just outlined there also applies to the crypto market, very high risk. A lot of projects launching every day. It’s really hard to kind of dec decide and also do due diligence on a lot of the projects that are launching a lot of the coins of the tokens that are coming to market. Would you say that that advice could apply to people who are investing in crypto? I would, I would also add liquidity to it because when you start to scale, you ask yourself, look, if, if I’m gonna be putting millions of dollars into a crypto asset, can I get millions of dollars out? And there’s very few tokens that are liquid enough for, let’s say a 2030 $40 million investment, which is where you get to when you start to grow a large portfolio. And so for me, my largest positions are obviously in and Bitcoin and I don’t hold them in E in ETF, I don’t, I’ve never understood why I, anybody would do that. You’re paying fees where you don’t have to. But II I proved that they’ve been made that way because it makes it a lot more accessible to individual investors. So it’s great that it happened, but I don’t use them. I use exchanges. I’m far more concerned about the exchange that I’m on. Is it compliant? Is it liquid? Can I get, you know, transparency on pricing? Um How secure is it, what domain is it in? You know, obviously, um I do a lot of work in the UAE. So M two is important to me. I own a big piece of wonderly in Canada. I love the compliance. They’ve got up there. Um Around 60 plus tokens, they’re the largest there. They’ve got 1.7 million accounts and now they’re expanding into Australia. So I really like the idea of being able to work with my asset on an exchange with total transparency and compliance integrated in to my financial reporting platforms. We were just talking about the Hamptons and you on stage with uh Jeff Tuy and his band. I, I’m not sure that a lot of people get to actually walk up to you at events like this or when you’re out in public. But when they do, if they do what kind of advice. Are they asking from you about their investments? Well, everybody’s intrigued right now about crypto. They really are. We’ve kind of turned the corner from a, an asset class that was at war with the regulator to one that’s generally accepted now. And, and as a result, I would say, probably seven out of 10 questions I get are, what should I be doing with crypto if anything? And where does it fit into my alternative asset class portfolio? Because we’ve always thought about, OK, I’m gonna buy some gold maybe or I’m gonna do some private equity or I’m gonna buy some real estate which are a little different than traditional stocks and bonds which are far more liquid. But cryptos found its way into that into the psyche of the average investor. Now, II I would say it’s more than half the questions I get and, and which crypto and how to hold it and, and all of that is definitely part of the narrative. I know you’re not a fan of the ETF I think last I read it, I saw you have 11% of your portfolio invested in crypto. You can let me know if that’s changed. But what, what do you tell those people it has changed. We just did our mark to market last week. Um We’re at 18% now we’re probably gonna cross 20 soon. You know, you, you gotta remember, I also own positions in companies like circle. I’m a big guy on the picks, picks and shovels. I mean, I want to own, think about this. If you could have gone back in time. And somebody said to you, would you like to own a piece of the NASDAQ in its early days or the New York Stock Exchange and be an owner of the exchange where you’re yes, say yes, because you’re agnostic to the price of the assets that trade there, you get a fee every time they trade. And so for me, you know, when I start to think about digital payment systems outside of tether, I really wanna be us DC. But where do I get the leverage on us DC other than owning it and I can stake it or lend it? Which I do. But I wanna own circle where, which is where us DC comes from. So I own a piece of circle. So how do I mark to market the value circle? It’s obviously its IP O is delayed, it seemed perpetually, but now with a changing environment. Um and I have no inside knowledge of this. I’m just a shareholder. Uh I think the, the opportunity for that platform to become a public platform is higher than it was just say six months ago. And so I’ve held it for years. And so it’s, it’s sort of when I think about uh M two, I own M two through a company called Phoenix that trades on the AD X. That’s A to me M two is going to actually take out Binance one day. It’s slowly bleeding assets over to it because unfortunately CZ is in jail and is a felon now. So a lot of institutions can’t use that platform. He’s, he’s one of the largest shareholders, if not the shareholder uh of, of financing. Obviously, the lack of transparency is frowned upon now by regulators, there’s so much, so much has changed since we last talked, all the crypto cowboys are gone and now the regulators are in total control. And you have to think about that in the context of the global environment for owning this asset class. Curious if you look at any crypto adjacent stocks, I know you mentioned Circle, we have Coinbase microstrategy, the Bitcoin mining stocks that are now starting to diversify into A I. Are you looking at any of those as part of your portfolio or you really kind of focused on what we’ve just talked about? And then of course, Bitcoin and Ether, no, that’s a very intuitive question. And, and let’s go to what’s changed um in Bitcoin mining now that we know with certainty that the ETF is here to stay now that we know with certainty that large financial institutions want Bitcoin. Let’s just stay on Bitcoin for a sec before I go to E just Bitcoin, where is this going to be produced? Because it used to be, if you went to a state like um North Dakota, which has low cost of power or Oklahoma or West Virginia, they were against Bitcoin because it was at war with the regulator that’s changed now. So Oklahoma recently changed at the state level, their taxes on Bitcoin mining and now it’s, it’s pro Bitcoin mining. So, rather than invest in stocks of Bitcoin miners, I’m just doing my own mining. I’m, I’m going and buying power contracts. Um I’m very fortunate to know some of the largest Bitcoin miners so I can go into partnership with them and build facilities at 2030 4050 megawatt um for sites uh Bit zero is one of those I’ve got in Norway. So I, I’m, you know, I’m an investor in mining, my own Bitcoin and we, we hold those on the balance sheets of the companies that I’m a shareholder in and that’s the, the majority of my Bitcoin positions, which is why I don’t need ETF S but what a change in the last 12 months, I mean, I used to go to Capitol Hill and people say we’re never gonna in New York State, we’re never gonna mine Bitcoin. Well, Bitcoin is now mainstream. So why wouldn’t you want to be a miner of it? Particularly when you’re storing hydroelectricity that’s going over a waterfall and turning it into an asset that holds value in perpetuity. So I, you know, I there’s a different argument, there was a very big negative green thing on it initially, that’s going away now that there’s solar wind hydro. Uh And so I see Bitcoin mining almost like a real estate play. And um we, we have right now three different projects within our shop that are in that 20 to 50 megawatt range. And those are significant investments. I want to turn the conversation shortly over to the E TT F because you and I have spoken about this before you brought it up just now. You’re not a big ETF guy, but this is big news in the crypto space. Those E TT Fs finally got approved yesterday. Um Several different market watchers. Um Asset managers are saying they expect to see billions in the next year a year and a half pour into these ETF S. Do you think that the, so some of the advertising I’ve seen for the ETF for the education out there really seems like it’s targeted to an older crowd, the boomers. Um Do you think that we’re going to see these inflows into these products or do you think people are going to start learning more about the spot products and investing directly in the assets? Like you’ve just said, well, I think both, I think what will happen in it will be 20% of the flow will be held in the ETF because so many advisors on their compliance back offices do not allow uh wallets of any kind. And so they could buy the ETF very much like AAA stock and show it directly to their clients on their statements. And I think that will suck up a lot of demand. I think it will be very successful. I just would never pay the fees myself. I, I can’t even imagine why I would do that. Um, you know, it’s sort of when you become educated about the whole crypto uh opportunity and, and digital payment systems eventually. And also when you look at what’s going on, um let’s take uh back to upper Canada wonder five, they’re building their own second layer on top of their platform uh to provide wallets and security and make ease of use for holding assets in their, in their own, you know, um secure wallet system. And I think, you know, the Coinbase did the same thing was very successful. So these exchanges and the one that Wonder five is gonna do in Australia is gonna do the same thing M two, same thing they’re all gonna do it so that you, you have a decision to make, let’s say you’re gonna put a 5% weighting into uh crypto or maybe 10% you know, five E five in Bitcoin, the most liquid of the, of the tokens. Uh And so if you could do, if you could just open an account on an exchange like M two or wonderly transfer in whatever the dollars you want from fiat and then actually have that as an app that’s secure and, and it’s completely compliant with your regulator and your tax authorities. Why would you pay the fees on an ETF? I, I don’t understand why you would do that. I think many, I think 80% of the people will eventually go to the exchanges the same way that they go to exchanges for stocks. And so I, I see very low fees. I see total transparency. I see complete compliance and lots of liquidity in the traditional manner. So it’s kind of ironic that we’ve gone through the whole crypto cowboy phase and we’re right back to where crypto should be integrated into the world’s global financial services system. It’s been a remarkable ride. You’ve, you’ve actually detailed it yourself. It’s been a crazy 36 months. It has been absolutely crazy. I interviewed Anthony Scaramucci recently and he told me, I, I’m actually curious to hear your thoughts on this. He told me that he thinks that Gary Gansler actually did a good thing for the industry by slowing it down and, and allowing the, um, fraud, the, the dark parts of the industry to be washed out so that we could get to where we are. Now. I actually took a lot of heat from my statements about Gensler. I went, I’ve spent a lot of time on the hill. I’m an advocate for digital payment systems, you know, stablecoin bills, all the things that came through. I worked the hill on those, what I saw with Gansler was consistency. I watched him getting absolutely fried like a chicken in front of the Senate and he held his ground. He was consistent. He never varied. So you got exactly his position. And I, everybody else made the assumption you could just go in there and beat him up and he changed his mind. He never did. He was completely consistent. And he said I want this to be compliant over and over and over again. And after a while I thought to myself, the guy has made it clear if you’re going to be successful in this space, you’re gonna have to get on board with his vision of what this looks like. And lo and behold, he went after the FTX crowd, he went after the Binance crowd and he won it. You know, they say, oh, you lost cases. No, he didn’t. These guys are in jail. I, I don’t, I don’t know how you say he lost and he’s not even finished yet with the civil litigation on B he just keeps going and, and I think Congress has gotten comfortable with him. So I, I’m in his camp because I’m now in a safer place to be an investor in places like B or like uh M two. Sorry, I’m not an investor in Binance. I make that clear. Um M two wonder if I uh those are compliant, you know, they’re, they’re Biden, they abide by Gensler’s code of AD GM is the regulator in M two over in Dubai and, and uh in, in Canada, it’s a Canadian regulator, the OS C, but they listen to Genzer all the time. So for me, I now feel comfortable that I’m not in some conflict with a regulator. I just don’t want that. It’s just, it, it doesn’t what everybody learned. It creates no value going to war with Gensler is dumb. It’s dumb. It’s interesting that you say you feel more comfortable because a lot of the industry says they, they feel uncomfortable because of the slow move to get clear regulation. What would you say to those folks? So what I would say to them is the reason you want to get on the Gensler train, even though you’re holding your nose is that gets you the other 80% of the market that won’t play until they feel that they are compliant with their own compliance departments. These are large financial institutions, pension plans, sovereign wealth. They don’t play until they’re safe because the majority of their assets are trading on the S and P 500 where they have to be 100% compliance so that they’re, they’re not interested in a rogue 5% position if it’s gonna cause them headaches every day on a mark to market basis. And so I think a lot of the early um pioneers, if you wish, if you want to call them that the crypto pioneers that are still around. Understand that compliance was the key to unlock value and it will remain that way. And I’ve certainly come to that way of thinking. I don’t think any other way I have no interest enraging against Gensler or any other regulator at all because I think the world has decided that Bitcoin is here to stay. Digital payment systems are here to stay e is here to stay. Some other tokens may be too. Solano looks good right now. There’s a lot of different ones. Everybody has their, you know, their favorites. H bar. I mean, I have a lot of positions and I keep them because I want diversification and they’re slowly been growing. We talked about, you know, uh 11 now 18 on its way to 20. That’s a pretty good waiting if you think about a portfolio of assets and we spend a fair amount of time in my shop looking at it and looking at opportunities and I just think I like the harmony. You know what I mean? The calm lake, the peace, the tranquility, the ability to make money without firebombs hitting you all the time. That’s how I felt three years ago now I feel I’m at peace. Uh That works so well with the background we’re all looking at, you know, just so har harmonious and peaceful. Now, I gotta ask you, I asked you what the worst investment you ever made was. What’s the best investment you’ve ever made, I know you’ve made a lot of good ones, but what sticks out to you as one of the best? Well, I always say this to pe, to encourage people to take their first step. The, the best investment I’ve ever made was in myself to make the decision to go out on my own and, and be in first start a business and then eventually become an investor. Two thirds of the people never do that. They, they just can’t get there from the risk profile. And I really urge people to do that, that your number one investment should always be yourself and, and that will reward you in many good and bad ways. Obviously. I mean, it’s not a life for everybody but the whole purpose to that comment is, it’s not about the pursuit of money. It never was about the pursuit of money. It’s the pursuit of personal freedom that, that really is the reward of entrepreneurship and investing and being a business owner. And it, it’s, it’s where you decide what your life is going to be. Now. It’s not easy. It’s difficult and there’s lots of challenges. But look at us right now. We’re sitting here having this interesting conversation. I want to be doing it. I can afford to do it. Um If I want to jump in that pool, I can go do that. If I don’t want to work at all today or take any phone calls, I can do that too, but I can do whatever I want. And I wish that for everybody. And my whole point is that is my best investment. And yet having said all that I work harder today than I ever have. I, I work sometimes 20 hours a day and I love everything I do because I’m now a global investor. I was on the phone to the wee hours to Abu Dhabi yesterday. I mean, I just think it’s what’s going on in the world today is so interesting, such opportunities, you know, just I was working on a new watch um being designed in Geneva for 2025. I’m a big watch collector, a great asset class, one of my best performing. And so, you know, things that really interest me so that, that’s my best investment now, specifically uh recently a remarkable outcome and this is going to the idea of you don’t know what’s gonna work. I remember a woman named Anna Skya three years ago pitching me and I’m gonna use Shark Tank platform again. Although I do many deals that are not Shark Tank, but this one was, she came on and had a cat DNA testing kit. I saw that episode. You remember it? I’m glad. And I said, why would anybody spend $29 when you go buy a new cat for five? It made no sense to me, but she was so persuasive. She, she, she articulated such an incredible vision about collecting data and nobody wanted to give her a dime. But I did because I just said, I mean, how can I say no to this woman? I, she just won’t stop. II I basically gave her a quarter of a million dollars to stop. And, and then she turned around and turned that into a huge company. It was the, and it was so big. It was bought by uh Zoetis, which is a spin off from pfizer and we had an ND A on the purchase price. It was all cash deal. I was, I was stunned, I was stunned now, I love cats. I used to hate cats. I love cats. I was gonna say you must love cats now. I love cats. I mean, I, and that company has gone on to do incredible things and, and Anna has moved to Florida with me. She lives in, in um in Miami, um wonderful entrepreneur. Uh just, you know, it’s really funny that 70% of my successes over 20 years have been companies run by women on the venture side of things. That doesn’t surprise me. Well, I’m, I’m very proud of it because I’m agnostic. I’d give money to a goat if I could make money. I mean, I, I don’t, I’m not into the sex and sexism stuff. II, I think women are fantastic managers. They, they reduce risk immensely if you want something done. Give it to a busy mother. I’m thinking about Sarah right now who runs Blue Land, another monster company that is, that is crystallized, cleaning fluids. Um, she’s gonna hit 50 million in sales this year. I invested in her when I think she had no sales. So, I mean, it’s, it’s another start up run by a woman who’s just got my opic focus on success. She’s a beast. And, um, this is the kind of person I wanna back and I want to invest in while I do the other things I do. So I’ve got a family of entrepreneurs. They keep me busy. Um I’m very active now. Uh as we talked about, you know, Bitcoin mining going just back to that, that’s actually real estate. That’s what that is when you’re building these data centers. Um These are real estate. I’ve got a deal I’m working on right now just before we got on, I was working on the PNL uh for this and uh I’ve, I’ve got the contract to purchase the land and I won’t say which state it is because it’s very competitive, but it’s, it’s over 100 acres. So, um I’m very active in this space. So would you say when, when we’re looking at Bitcoin miners, the real estate, the land that they’re on is maybe worth more than the business as we hit more and more hs and the rewards become less and less. You’re, you’re very, very astute on that. I mean, here’s what you need, you have to find a state with power. You need to find a state with fiber. You need to find a state with permits and you need to find a state that allows backup generators. Um, these are not easy to do it. It’s, it’s, it’s, it’s taken me years to form the relationships I have with states like Oklahoma, West Virginia, Pennsylvania, Montana, North Dakota. I have to go there. In fact, I’m going there this Saturday, I’m going to Iowa. I mean, I actually believe that these states have been ignored for so long and yet they have such tremendous opportunity from the, from, from providing power and permits. You can’t do business in New York on Bitcoin, but you can certainly do it in other states. I mean, New York should be number one in Bitcoin because they’ve got behind the meter in Niagara Falls. But you can’t get anything done there. Everybody knows that they’re kind of in the penalty box right now and nobody invests there. But one day that could change with different management. So I work the path of least resistance. I go to states where the governors and the senators make sense and are pro crypto and our pro digital payment systems, pro digitization, pro Bitcoin and pro Bitcoin mining and pro data centers. All right, Kevin, we got to wrap it up, but I have to ask you about the election here in the United States before I let you go as we know, President Joe Biden said he’s not going to be running for re election. Trump has emerged this kind of as this pro crypto candidate. Um I would love to get your perspective on if you think that a new democratic nominee could win over some of that crypto audience. And if you think a Trump presidency will be good for crypto. Well, we have heard from Trump already on crypto and he is a pro digitization uh pro digital payment systems, pro crypto pro Bitcoin. So we know that’s in his policy. We don’t yet know any policy yet from. It’s just been hours since uh Kamala Harris has been uh well, I don’t know if it’s firm yet. She doesn’t have all the de I mean, I’m, I’m a little surprised to be honest with you. They didn’t run a process after the Biden dropout because um she doesn’t actually have much of a track record on anything. And I’m not saying it’s a bad thing. We’re gonna have to wait and hear what she’s got. But I remember in 2020 she was the first to uh drop out of the the race. She got no delegates. So she’s never been tested and I’m surprised the party just gave her um this coronation, so to speak. I would have liked to have seen a process, but, you know, she’s obviously an intelligent woman. So maybe she has to read the room a bit and the and, and, and the country has moved more to the middle. So we have to wait to hear her policy including crypto policy. But I’m for me uh as an investor in energy, I’m very interested to hear. I’m tired of, you know, I understand the uh the rhetoric between parties and if you know, if you hate Trump, you hate Trump and you won’t vote for him. But I’m, I, I don’t, I don’t really care about that. I care about the policy of each party. So I have the policies now on energy. I’ve got um you know, a tax policy from Trump. We’ve got border policy. We don’t have much foreign policy, but some inkling of it, we had a speech from Doug Bergen last week, which many people think he will be, by the way, a North Dakota guy. So pro energy for Energy Secretary. That would be interesting. I have nothing yet from the uh Democrats. So I’m looking forward to hearing that. I think it’ll be a very competitive race now. Um But it’s really gonna boil down to a policy and we’ve, we’ve got to hear what, where the country wants to go. I think it wants to be in the center. I think it wants to be pro crypto, it wants to be pro digitization, Procon, I’m always an advocate for entrepreneurship. 62% of our jobs in America are created by companies between five and 500 employees. So I want to see a lot of support for them. Um And then I will continue to do what I do. I mean, I’m kind of agnostic to politics. I don’t make money with politics. I make money with policy. And I would suggest to everybody to think about that a little bit in, in the end, don’t get emotionally involved in politics. That, that’s a fool’s game because it changes all the time. If you say stay focused on policy, that’s how you can actually become a good investor, a good manager, a good business owner. Um And you can pursue the American dream. It’s all on policy. Well, let me ask you this. I know you recently said that everyone in financial services knows that Jamie Diamond wants that treasury secretary position. I know you said that he’d be fantastic at it. He has been outspoken against Bitcoin. What do you think that would mean for the crypto industry if Diamond took that position? Um He’s pragmatic on crypto his own clients wanted. He’s not a fan, he’s sort of in the Warren Buffett camp. I don’t think you’re gonna change his mind on it, but he’s also pragmatic if, if his, if, if, if his customers, the institutions he services wanted and they do. Larry Fink, the largest institution on earth has basically said yes to Bitcoin, it’s going to get an asset allocation. The game’s over. I mean, he’s the largest asset manager in the world. And so I think Jamie Dimond understands that um I am an advocate for him to be uh somewhere involved in giving financial policy. I think it would be very important to have that experience, that international experience. And so for either party, I mean, either for Trump or for the Democrats, he would be fantastic. I mean, I, I want the best for America. I want the best managers because I don’t care who’s in the White House. I care what the policy is. I want to see it well managed because I know who’s ever there now was gonna could change in four years, but my investments won’t. Kevin. Thank you so much for joining me on Markets Daily this morning. As always, it’s been a pleasure, take care. And thank you to everyone who’s watched this episode and come on this journey with me to better understand the crypto markets. If you enjoyed the episode, please be sure to subscribe to the Coin Desk Podcast Network on your preferred podcast platform, subscribe on youtube and leave us a five star review. Your support means the world to us. Have a fantastic day and we’ll see you tomorrow.