The world of blockchain and crypto suffers significant acceleration. The global regulatory environment is convergent, and it converges on an operating model which allows a larger range of products and services. Companies that were seated on the sidelines and those who are already working on how to market a range of new products.
In most technological markets, the first winners are determined long before the general public adopted. While we are now entering the era of mass adoption for blockchain (my opinion), the options facing certain companies, act quickly or spend the next decades playing catch -up. If your CEO says, “There is no hurry, it’s still the start”, your business has already abandoned the fight.
For those who stay in the fight, speed kills. It is true on the road and it is true in business. People always forget that “getting around quickly” came with “Break Things”. This is why for those who rush into this market, risk management has never been a more critical competence. Done correctly, there are several ways for companies that wish to sprint in advance on this market in order to minimize the risk of catastrophic failure. There are three that I have in mind.
The first step is to set up checks and operations that close the past problems that other companies have encountered. It can hit you as a wrapping the door of the barn after the horse’s departure, but it is necessary because if you do not do, you risk repeating the story and it is much more humiliating than to make entirely new mistakes. The basics are not particularly difficult either: external auditors, commercial controls and standard best practices. We are also fortunate to live in a time when, for the first time, we have a good supply of experienced blockchain and crypto that can apply real lessons learned.
Second, I think it is essential for companies to think strategically and explicitly on the gender and the number of risks they want to take. There is a technological risk (very relevant with intelligent and defi contracts). There is a market risk. And there is a counterpart risk.
You can learn critical lessons from the three, but it is often logical to have controlled learning environments. One of my frustrations was to look at people jumping to extremely incorrect conclusions when things go wrong, sometimes because they took too many risks at the same time and cannot separate what were the causes.
Finally, it makes sense to be strategic about what you do internally and what is done externally. In technological companies, especially when engineers are in charge, temptation is always to build. I know. I have an engineering team. It is more fun than managing a seller. “I built it” is a million times more satisfactory than to tell someone “I bought it”. I never thought of quoting Mr. Beast in business, but as he said, “Consultants are a cheat code.” It’s so simple: someone else has already done so. Take the opportunity to reduce your risk and complexity.
There is no way to risk -free growth and this risk increases with growth speed. Consequently, for companies looking for accelerated growth, especially in ecosystems fueled by emerging technologies, good risk management policies are essential. Please complete your own safety and keep your eyes on the road.
Warning: These are the author’s personal views and do not represent EY’s views.
