E07: Marcus Lim - Global Banking & Immigrant Stories

Marcus Lim: We had an acquisition offer from Coinbase. We then proceeded to complete our um, due diligence process. Uh, with Coinbase. That took about four months. But during that four months, um, a lot of things started to happen. I mean there's a whole range of different emotions but I mean complete loss, anger, uh, disappointment, you know, super scared, um, because I've never been in this position before. Doubts will always sort of happen with anything I think, sort of. Even if you look at the best athletes in the world, they always have doubts on whether they can perform even before a match. The way I look at it is that, you know, you need to have belief in what you're actually doing, you need to have conviction and you need to be able to cut out noise.

Felix: Hi everybody and welcome to a new episode of True Founder Stories, a show where we talk about founders, personal backgrounds and discuss fintech, AI and cross border expansion. Today's episode's guest is Marcus Lim, who is actually a serial entrepreneur who founded three startups and raised over US$80 million. His latest startup, Pax, is a global stablecoin based neobank. Markus, it's great having you today.

Marcus Lim: Thanks for having me Felix. Great to be here.

Felix: Thanks. Fantastic. And you have a very um, strong track record as an entrepreneur but we also want to start by getting to know you better as a person as well.

Marcus Lim: Sure.

Felix: So maybe take us back all the way to the start. Um, how was it like growing up in Australia after migrating from Singapore?

Marcus Lim: Yeah, to be honest, I think it was um, a massive culture shock. Um, going from Singapore predominantly, and this is back in the 90s, mid-90s, very Asian culture, Ah, very Chinese culture. Uh, uh, obviously, you know, Chinese family moving to Australia, going to a primary school where I was effectively the only Asian kid. We call it Asians over there. But basically it's a classification of all types of Chinese people. Right. And uh, you know, and it was very different, um, you know, they spoke a different accent. I was ah, obviously teased at school, um, for not, not so much of how I look, but the way I spoke.

Felix: Right.

Marcus Lim: Because of the Singaporean accent that I had. Um, and so it was really uh, difficult I would say for the first three years, um, growing up there, um, to the point where I sort of wanted to come back to Singapore. But it was a really good sort of experience to, to be put in a very different environment and to be forced to be able to adapt, um, to change, um, all sorts of changes. Um, and I think independence also grew quite, uh, rapidly as well because we had a helper In Singapore. And then when we moved to Australia, there was no helper, so we had to be embedded into chores on a daily basis together with my mum. Um, so, uh, yeah, it was, uh, a very interesting time. I remembered being mocked, uh, when I went to Australia for the very first time, and they asked me, do you play cricket? And then I said, I catch grasshopper. Right. And that was actually true because in primary school, uh, at the back of the school, we had this huge field that was basically sort of, you know, untamed, and there were grasshoppers sort of jumping everywhere. And so for recess and lunch, we would go there and actually catch grasshoppers. And then when you came to Australia, I did not have any concept of the game cricket. Um, and so when they asked me that, that was my response. And my peers obviously, you know, sort of teased me on that.

Felix: You mentioned that one person had a huge influence on your life was your dad. Can you tell us about what he taught you as a child?

Marcus Lim: My dad was first generation Singaporean. Uh, Singapore, obviously, you know, is a very young country. And prior to that, you know, sort of forefathers and parents were either from China or Malaysia that came in. And during that period, I think instilling hard work, you know, um, resilience and a strong sort of focus to education, uh, were sort of the three key pillars in life. Amongst that, obviously, sort of family values and sort of, you know, heritage and culture and I think sort of growing up as well. What's sort of also lost is a lot of Chinese idioms, uh, that were handed down by verbally. Nothing, um, sort of written down. Maybe there were books. But obviously back then, literacy wasn't the highest. And so a lot of that has been sort of passed down from my, you know, forefathers, which sort of instill that into me.

Felix: Do you remember any of them in particular?

Marcus Lim: Yeah, I think one. One that sort of really sticks out to me, uh, and just sort of translated to English is you ride the bull to find the horse, Right. And what it really is saying is that sometimes in life you're not in the perfect situation that you want to be in, or that you are. That you want to be in that current position. And so you have to be on at least a moving object, that is the bull, to continue to move forward before and then whilst at the same time then find the horse, which obviously runs faster than the bull. Yeah. And that's essentially sort of what you would want, right, in life is to. To be on something that, you know, travels fast or that Gets you to your end destination a lot faster. And so that has always stuck with me ever since when I was young, which is, you know, be patient about your current situation because you might not. You will never get everything that you want, but be on a moving train so that you can find something faster and better going forward.

Felix: Yeah, that's very interesting. And I think it kind of reminds me, um, to some of the parallels you can draw as being a founder. Right. Because when you target to ship the perfect product, the horse, right. And kind of build towards that, you might lose out on the race, but instead you kind of launch an mvp, something that just works, but, uh, something that moves fast. So just with the ultimate goal of ultimately getting to the horse, I guess.

Marcus Lim: Right, exactly. And the thing is, you have to be at least on the bull because if you're not on the bull at all to try to find the horse, you'll never catch up to that opportunity.

Felix: Amazing. Yeah. Um, and before you became an entrepreneur, actually you had a very structured career. You started out in the military as well as in management consulting. Um, would you do it again? And what were the learnings from that time?

Marcus Lim: When I was in Australia, uh, when I turned 18 after what they call in Singapore, sort of JC2, but over there was year 12, is that I had to come back to Singapore because my dad had actually signed a bond, uh, with the government and used actually property as collateral. So if I didn't come back, then the collateral will be forfeited and it's a fair amount of money there. When I was in Australia, everyone else, after sort of graduating year 12, went to university where I had to sort of come back and, uh, it's obviously sort of fairly disruptive, um, not just, you know, from an academic perspective, but also, you know, from a lifestyle perspective. Going from one country, one city with your social network to going to, you know, coming back where basically you have no friends or very little friends, um, and then having to adjust. And then it's not just adjusting to sort of your normal everyday life, but going directly into a military camp, uh, and then adjusting from there. So that was super challenging. And I would say that I would definitely do that all over again. I think one of the, one of the things that that is, you know, underestimated in the national service experience is the amount of, um, education, life education that you can get that you cannot get anywhere else even if you paid for it. Right. And I think ultimately in life you have to look at it from a different perspective. Some people go in and say this is a complete waste of my time. And this was back then, I, I not quite sure about how the current generation looks at it, but back then there were, you know, people are of a certain camp that says this is a complete waste of time for two years, you know, I can't complete my studies or I have to wait until I can go to university and you know, obviously then defer my career, etc. Etc. I sort of took the view that at the end of the day we all have to be here so might as well make use of the time that you're here and you know, um, try to maximize whatever, you know, we can learn out of this experience.

Felix: Um, what was the toughest part about the military?

Marcus Lim: I think it's sort of mental resilience was pretty hard. And what I mean by that is, you know, sort of where you're put in a position. You know, you haven't eaten for a while, you haven't showered, um, you know, you have lack of sleep, your body's aching, but you still had to carry out certain tasks within a mission. Um, that there's no exceptions for. Um, there is no complaints or excuses that you can provide. So I think having mental resilience is something that a lot of people learn when you go through that process and I think that's one of the toughest challenges.

Felix: And it seems that mental resilience has served you well when you're building your first startup. One flare actually, uh, in 2011. Can you tell us about Oneflare? What it was?

Marcus Lim: So Oneflare is a marketplace for local services. Um, we connected customers and service providers together. Um, and this was sort of during the era of marketplaces. Uh, we had marketplaces for designs and in Australia we had two successful ones. 99designs and um, now sort of design.com or uh, design crowd. Back then, what it was called and really what it is, we connected people who provided trades and services. So in Australia, you know, there would be plumbing, electrician, carpentry, uh, accounting, interior designer, builders, construction workers, stone masonry to customers who needed these services. Um, and, and the interesting thing was that there were already a lot of competitors out there, um, that started way before us, had raised a lot of money before us. And we came into the space because we felt that that was an opportunity set back then, um, that we felt, you know, we could do a better job. I mean very simply like we felt like we could build a better product. And it was my co founder and I that started this as a sort of a garage project back then. No office, sort of, uh, there was no zoom, no sort of Google Meet back then as well. So it was just sort of, ah, my place or his place over the weekends, over, you know, overnight to sort of like built this initially.

Felix: Yeah, and marketplaces often struggle with the chicken and egg problem and demand and supply. Right. How did you kind of overcome that problem?

Marcus Lim: So it was extremely difficult, um, because uh, we started from a point of basically no money, no resources. And so we had to sort of think outside the box on how could we effectively acquire customers for free. And I feel like capital constraint sometimes teaches you a lot of important lessons, a lot of important things, uh, makes you dig deeper in trying to find solutions. So how we addressed the issue was that we realized that in order to service the demand side, we needed to get the supply on board first. And in order to do so we needed to get businesses signed up. And so back then the way we did it was that we basically aggregated the databases of multiple different classifieds, we call them in Australia, so Yellow Pages, local, uh, or hot frog. We aggregated this and then what we did was we automated the communication in terms of SMS and also emails, uh, to these users. And so good, you know, the good thing was back then, you know, we had send grid so we can send out emails. But SMS's were more um, important because we talking about service providers that were on the road, you know, and they don't read emails, uh, so they needed to get alerted immediately. So we built out our own sort of SMS gateway system that allowed us to send SMSs practically for free or at a very, very, very low marginal cost, um, by basically, you know, buying SIM cards from Optus back then, unlimited plan that allowed us to send unlimited sms. And so over a period of time we were able to start to sign up tens of thousands of businesses for free. And we obviously provided this for free, um, and only sort of charge when they were uh, reacting to a lead.

Felix: What is the biggest difference of being a founder 15 years ago versus being a founder now?

Marcus Lim: Well, it's very different and I think if I was to talk about the infrastructure that we have today, I think the ecosystem is far more developed now. You obviously have a lot of venture capital, whether it's here in Singapore or whether it's in Australia. Um, back then, 15 years ago, I don't believe there were any sort of venture capital in Singapore or very, very, very few, um, maybe less than five fingers, uh, in Australia. Sort of the same thing as well, not, um, a lot of capital was sort of injected into the startup space, um, because it's such a sort of a new industry and so the infrastructure wasn't there, um, the network was barely there. And it was only sort of the start of 2012 where things started to pick up in Australia where people started to take note of, you know, the tech industry. And obviously this is a lot of it has to do with sort of popular culture coming from the us, popular startups that have sort of, you know, succeeded, raised a lot of money at sky high valuations and that has sort of transcended across to Australia as well. Uh, I remember when I, when I started oneflare, I mean Atlassian, which is now, you know, sort of a $60 billion company, only just raised at Series A with ASL partners. Uh, so this is sort of how long ago it was and so how nascent it was as well. So it was, it was really difficult. There was no support network, um, as well in Australia. So you really needed to sort of figure out on your own, um, to sort of make everything work. And on top of that there were no softwares or tools that you could use to, to automate AB testing for instance. Um, and a lot of the stuff that we take for granted, messaging over Slack at the moment, that was not available back then. So um, yeah, we had to make do with what we have um, back in those era.

Felix: And I mean after the whole one first story, you went on to your next startup which is in the Web3 space. So you launched Zipmex, which is a digital uh, asset exchange. Actually, um, tell us a little bit about that. And in particular, actually I remember there was a uh, single year where you went from 1 million in revenues to 30 million in revenues. So I'd love to know more about this phase of rapid growth in zipmax.

Marcus Lim: Sure. So the idea behind starting zipmax first was really to democratize financial access. And uh, this was a fairly powerful statement that I think made a lot of sense in Southeast Asia. Um, because I would say sort of seven years ago, only sort of the top 1% had access to what had basically all access to financial products and services globally. You know, the industry was sort of ripe for disruption and also the ripe for sort of democratization, cryptocurrency. Uh, obviously, you know, started, started off, you know, back in uh, obviously a lot earlier. But you know, sort of we saw a huge bull market that happened in 2017, then obviously a uh, crash in 2018. And so we basically started at the peak of the bear market, which is 2019, where Bitcoin back then was circa $3,000. And, uh, we started regionally in, uh, Southeast Asia, Thailand, Indonesia, Singapore and Australia. And we wanted to sort of build a platform that allowed people to get access to buying and selling cryptocurrencies as a form of financial access and also a form of, uh, investment as well. We grew fairly rapidly, uh, as you mentioned, in terms of our revenue, uh, from 202021 all the way to sort of like, uh, 2022, um, because there was a massive bull market that happened in 2021. And as they say, sort of, you know, rising tide lifts all boats. Um, so we were very fortunate to capture that momentum during that period of time. But I would say that we were quite disciplined during the times before that to persist to build during the bear market, which ultimately I think it was the best time to build, as opposed to trying to build during the bull market. And then sort of get ready and then the bear market happened. And that's obviously sort of the wrong way around. Uh, but it took a lot of gumption and conviction to start during that period, to see it through, to launch it, um, ah, and then continuously work at it, uh, in order for us to sort of experience that upside. Yeah, yeah.

Felix: And I think that's a theme that we often see, is that the companies that were launched just, you know, one to three years before the bull market or the inflection points happens, uh, often the ones that win the market. That's the case in AI, certainly. But it's also the case for anything related to Web3 a few years back. And then now stablecoins, which is kind of the next wave. So you can see those that had two, three years, um, to kind of build an isolation and kind of when the market was not looking at them, um, those companies are seeing extraordinary growth in the current years. At some point you'd raised over $60 million, uh, in equity funding and you even got an acquisition offer for Zipmex. What happened then?

Marcus Lim: Yeah, so we had an acquisition offer from Coinbase, uh, and I recalled sort of signing the term sheet in March of 2022. I remember that day was a Chinese New Year Day, I think was the first day, Chinese New Year. And we then proceeded to complete our, um, due diligence process, uh, with Coinbase. That took about four months. But during that four months a lot of things started to happen. Firstly, we had the Terra Luna, uh, event that. The catalyst that started the sell off in the market, in the crypto market.

Felix: Yeah. Maybe we could listen as a quick overview of what happened with Terra Luna.

Marcus Lim: Well, effectively Terra Luna, um, uh, had something called Anchor Protocol where they basically had their own stable coins that allowed people to earn 18 plus percent yield, uh, APY. And um, essentially what happened was they had their own token as well, Luna, uh, which started to sell off, um, and it went from a couple hundred dollars, uh, and then basically less than a dollar in a couple of days. Um, when that happened, obviously that spooked a huge sort of unwinding of positions in the market, uh, especially leveraged positions. And also, um, a lot of people started to withdraw their funds because there was a deep egg that happened, uh, with their actual stablecoins. Uh, so then there was a massive sell off on their stablecoins as well.

Felix: And just to clarify, this was actually an algorithmic stablecoin, kind of lost the stability throughout the course of these events, Correct?

Marcus Lim: Yeah. And so that sparked the massive sort of sell off in the market, uh, which then had the contagion impact and risk on other parts of the market as well. Because there were a lot of big institutional funds, crypto funds that had put a lot of their collateral and a lot of their treasury, uh, into anchor protocol as well. And so effectively anchor protocol, I mean, effectively their stablecoin went to close to zero. Um, so a lot of that collateral got wiped out. Um, and so then that had sort of a domino effect onto other, you know, sort of institutions that were sort of doing borrowing and lending with them as well. So I would sort of classify this as sort of the crypto financial crisis, uh, in a way similar to the 2008, 2009 global financial crisis that we had. Right. Um, this was the moment for crypto,

Felix: just specific for that asset. Right. And when we see actually some of the companies that had raised very large amounts of money from reputable VCs that all went down. Right, during that kind of period.

Marcus Lim: Correct. And obviously culminated with ftx, as we all know, uh, which attracted, you know, top tier VCs globally. Um, and they, uh, unfortunately also sort of, ah, suffered a bank run which um, you know, essentially sort of happened within a day, two days max. Um, and they had to sort of file, uh, at the end of it. Um, so it was a really sad and stressful time. Um, but, um, obviously because there was a lot of leverage in the system that needed to be unwound and it did in a very big way. But also in the sort of the traditional financial markets, you had seen the, you know, the Fed increasing interest rates, um, and that obviously starts to have the impact on the stock market. In the US which obviously had a ripple effect across the world as well. So you had a combination of these two things happening, um, that really had a massive correction Overall, um, in 2022.

Felix: So you basically had that acquisition offer in front of you. It was very concrete already. And then over the course of, of due diligence over those few months, everything collapsed. What happened to zigmax?

Marcus Lim: Yeah, so. So we're actually about two weeks to signing the spa. Um, but, uh, you know, Coinbase sort of pulled out of the deal. Um, weren't to really say what the reason that they gave, but, um, what I would sort of point to was when we started to speak to them, their share price was $200. Uh, when we stopped speaking with them, their share price was about $48. Um, so once we, you know, once we understood that the deal was not going to happen, uh, we then started to go out into the market to raise capital because we were under exclusive activity, um, where we were sort of doing the due diligence period. And then as sort of the whole Terra Luna was happening and then that sort of had ripple effect, we were then impacted by, uh, Babylon Celsius, um, and so Celsius, uh, you know, obviously had to suspend withdrawals. Babel had to suspend withdrawals. Uh, we had customers funds, um, basically locked up in these two venues. And so we, uh, at that point in time tried to look for rescue financing. And we spoke to quite a number of, you know, exchanges, um, you know, investment funds to see if could bring money in to basically cover, uh, the gap that we had.

Felix: What's actually the role of those two companies, Bubble and Celsius?

Marcus Lim: The role of Celsius was Fairly similar to BlockFi as well, was, you know, they allowed you to deposit certain tokens, uh, and that you'd get yield for that. And what they would do then is to deploy to wholesale these tokens to people who wanted to borrow it. And at least what I understood was that some of this activity was sort of done uncollateralized, uh, which is obviously the big risks there, which is uncollateralized lending. Um, some obviously were done on a collateral basis. Um, apart from that, I think there were a lot of different things that they did as well that really moved them up the risk curve. And so when there's a huge depreciation and value of these tokens, um, and also when there's a huge bank run, this is where I think they could not meet the maturity of these loans, uh, and essentially did not have enough assets or Funds to be able to pay back. And so therefore they started to, you know, then they, they, they, um, stopped, um, customers from withdrawing. For Babel, they were more sort of institutional focus. So they only worked with exchanges, uh, liquidity providers. And so again, the activities of what they did were, you know, sort of boring and lending, which is primarily, um, you know, um, their business model. Basically one day, uh, you know, they basically told us, or at least they didn't tell us, but they, uh, send a, an email, a notification to us to say that they had suspended withdrawals. Right, right. So, and then obviously from there I had to sort of call up the founder and understand what had happened. And then there were a lot of events that preceded that thereafter.

Felix: Um, and you're now able to walk us through this in a very pragmatic and technical way. What were some of the emotions that you were having during that time?

Marcus Lim: I mean, there's a whole range of different emotions, but, uh, I mean, complete loss, anger, disappointment, uh, um, you know, super scared, um, because I've never been in this position before. I mean, obviously super stressed as well. Um, because a lot of this thing, a lot of these things were sort of happening at the same time. And we had to basically try to find a solution to solve this problem. And so that's why we started to speak to a lot of different investors as well, basically do a fire sale, essentially. Uh, which is obviously not what I want, obviously not what I want for shareholders as well. Uh, so it was a complete roller coaster going from what happened prior, which was sort of the acquisition, to having to deal with the fallout. Um, completely two ends of the spectrum that happened in the course of, I would say three months. Um, so definitely not fun.

Felix: Yeah. Now, looking back at this whole experience, which is, I think, an extremely unique founder experience, what would you do differently today?

Marcus Lim: I would say, um, I mean, sort of, for anyone sort of looking and observing this is to take a more conservative stance, um, and obviously to sort of deploy more due diligence. Um, not to say that we didn't back then, um, because we had a whole credit risk committee, we had a risk committee as well that basically did the due diligence on all of the venues that we would lend out to and had to meet a certain criterion threshold. And we had a committee, um, there were a number of people in the committee, and we had to make a unanimous decision in terms of whether we would lend, how much we would lend, uh, and what was our exposure. But I think what I would sort of do today was to Be more aggressive on actually the due diligence component. And I think where we are heading today in terms of sort of tokenized yield, you know, tokenized assets I think is sort of the right direction that the industry is taking now as opposed to sort of, you know, a black box, um, process of people not knowing how boring and lending was done. I um, think tying this to sort of real world assets that have full transparency um, is I think quite critical for the broader market to ah, mature.

Felix: Right. And I think in those times of tumult you often see that there is an extreme euphoria in the market. But as long as assets go up, people don't really care of what they're pegged against. So there's rehypothecation, there is lending in a sort of a black box as you describe it. And uh, it all goes well until the tipping point. Uh, which is now why I think the market is moving to this approach of asset backed stablecoins for example, that provides a lot of security to the end users. In the end, um, do you see this as a big paradigm shift in terms of investor confidence as well?

Marcus Lim: Yeah, absolutely. Um, I think fundamentally there needs to be trust in the technology, uh, in terms of how we capture value on chain. Uh, and if that's done properly. Right. Then uh, I think it's about sort of representing real world value on chain, uh, which I think in its sort of purest form and its earliest form is stablecoins.

Felix: Right, right. So with those lessons learned, um, you're starting something completely new which is pax. Tell us about pax.

Marcus Lim: Yeah, so pax, uh, as you sort of explained in the beginning, it's a stablecoin Neobank. And what we're looking to do is not so indifferent to what we were trying to do at ZipMex, which was, you know, trying to democratize financial access. I think here what we're trying to democratize is global banking for everyday people. Right. And I think this is very important because ultimately we are living our lives. All of us, uh, from all parts of the world are living our lives online, which has no boundaries and jurisdictions. And we are traversing across multiple countries on an annual, if not sort of a daily weekly basis. So everyone is essentially graduating to becoming a global citizen to some degree. And we sort of see this with, you know, you know, previously with borders opening up, people sort of traveling, um, and this is obviously post Covid era as well. And what is sort of lacking is you know, people, people's access to global banking products. Um, that are not afforded by traditional and local banks in the countries that they're in. Now obviously this sort of varies different, you know, by country by country. But I believe that there is a stand, you know, a standardized way that we can sort of bring these products out at scale to everyone across the world. And I see that that's sort of quite, you know, that that is much needed, especially in certain countries, you know, like for instance in Africa, uh, where Visa and MasterCard are not present, uh, in a lot of payment solutions over there because the banks aren't actually issuing visa or MasterCards. And so international payments are uh, uh, dominated by Visa Master. So a lot of these guys can't actually make international payments. Very simple international payments, whether it's paying to Google, to Meta or even to Twitter, uh, these are not afforded at the moment.

Felix: Got it. What are the features that are now live with Pax?

Marcus Lim: Yep. So what's live at the moment is that um, we allow users to deposit stable coins, namely USDT and usdc and those are the two that we focus on, uh, across multiple different networks. Uh, and then we allow them to uh, invest into tokenized U.S. treasury bills. Right? Uh, which is then sort of provided by a company called superstate in the U.S. so this is, you know, U.S. uh treasury bills are obviously sort of the safest bond in the world, uh, where they're getting three and a half percent per annum and we pay that yield out on a daily basis. So very conservative, very well known, very uh, vanilla, nothing uh, spicy about that. And then the third is, uh, we provide virtual um, cards and also physical cards. And we're providing these cards uh, to users all across the world, uh, MasterCard where they are able to then, you know, top up in USDT or USDC and then be able to spend instantly, uh, to you know, online or offline. So through Apple Pay or Google Pay, uh, and then we have cross, uh, border payments, um, to 20 plus different currencies where they can convert their stablecoins at the moment into you know, multiple different currencies that they want to, uh, whether it's in Southeast Asia, whereas in Europe, US um, and then eventually sort of Africa and Latin America as well. Um, so then we're looking to go live fairly soon as well with US Dollar virtual accounts where we would enable users to be able to open a US dollar bank account anywhere in the world. Um, that is, um, that is uh, provided and be able to receive US dollars and then convert that into stablecoins or to sort of other currencies. Uh, so these are sort of the four core products and we have a sort of a fifth vertical that's coming out, which is lifestyle and it's super exciting. Um, which will combine esims, it will combine hotels and flights, all available in one singular app.

Felix: Got it. Um, so you mentioned that this can be in particular interesting for people in emerging markets, right, where you don't have access to US Dollars, uh, to tokenize T bills and all these things. But even if I think about my own banking experience, right. I'm probably banking with eight different institutions now. So there's one that's best for FX transfers, there's one best for local, uh, QR payments and instant, uh, transfers in Singapore. There's one for large USD transfers abroad. So I need to use at least three or four to optimize for these different things. Is the vision of PAX to bring everything together in one thing?

Marcus Lim: Well, that's correct. Yeah. We're going to try to bring everything together. And, and I think what we're trying to do is ultimately we want to provide as much value for the end consumer, um, whether it's in terms of being as competitive as we can be in terms of fees, uh, or whether it's being, you know, being able to provide, you know, uh, payment or transactions as efficiently as possible for them. Uh, because ultimately I think payment needs to be fast and cheap. Right. That's sort of really the key value proposition for a lot of things. When we can actually bring all this together, I think this becomes fairly powerful because we have now given this access where typically it would have to be with a global bank and you'd have to sort of have a lot of money in there. Right? Now you can sort of start off with no money, right? Or very little money to actually get access to these products and services. And when you start to do this, I think it has sort of a ripple effect and that sort of copy compounds to, you know, trade, you know, um, economic activity within a country. You know, we. What we see is that there are a lot of sort of solo founders, entrepreneurs from, you know, all around the world, sort of using our product and services to be able to pay for things like Google, things like Facebook, advertising like Twitter or even Telegram. And these are sort of like basic utility, you know, software. Yeah. That is required to run a business nowadays, right?

Felix: Yeah.

Marcus Lim: Yeah.

Felix: So it's a lot of this digital nomad or global sort of freelancer type of user that will benefit from this, right?

Marcus Lim: Correct. Yeah.

Felix: Now, this whole thing is based on stable coins, right? And stablecoins have seen a huge regulatory change in the last year. Uh, basically an uh, explosion in adoption basically crossed the volume of Visa and MasterCard in uh, 2024. Um, why do we see this huge adoption wave of stablecoins globally now?

Marcus Lim: I think to put it quite simply, it is the easiest way to move money around. Right. And for people, uh, I think sort of human nature is that, you know, people want to find solutions that are easy for them, uh, and low cost. So going back to efficient low cost. And stablecoins is sort of that purest solution there. And so before sort of all this regulation and sort of the uh, the penetration that really started happening over the last 24 months, you know, it was sort of seen as, you know, um, a lot of people sort of unsure about these stable coins because, you know, whether it's actually real, whether it's actually really backed one for one. And obviously, you know, sort of back then there were a lot of questions around tether who's obviously the largest stablecoin issuer in the world, whether they really had one for one backing of the number of uh, you know, know USDT that was actually issued in the market. Yeah, this obviously, you know, um, went through its evolution and you know, um, sort of government from around the world, the US in Asia, Singapore, Hong Kong started to regulate stablecoins because they ultimately see this as not just, you know, something that is for crypto traders that lived on exchanges, but for cross border trademark.

Felix: Right.

Marcus Lim: Which ultimately again sort of is very important uh, for GDP role around the world. Um, so where a lot of the friction that still exists today can really be, you know, made redundant going forward and more of that value goes back to either the transfer or the transferee. Right. That obviously has then better impact on, on gdp. Yeah. So I think sort of the going forward, you know, this is where people have now sort of built up that trust in being able to transfer that value. I think obviously sort of the last sort of two years, you know, the volatility of that, that peg for one to one has reduced. Um, we obviously see a lot of that in 2023. Yeah. With USDC and then obviously with USDT as well, that has sort of stabilized. Um, but there's still inherent risks obviously in um, a deep egg that could happen. Right. And has happened before. And I think having regulations coming in is definitely a great platform to ensure that that deep would not happen going forward. Yeah, yeah.

Felix: And I would say that one of the biggest drivers for stablecoin adoption is not necessarily the technology itself. But the ability for people anywhere to hold US Dollars as a stable currency, especially in markets that are very volatile, um, or that have inflationary tendencies are, uh, those markets that PAX can solve.

Marcus Lim: Yeah, no, absolutely. Um, there's obviously a lot of m. Demand for US Dollars, um, at the moment. Dollarization has always been a common theme, um, especially sort of like for countries like in Argentina, um, uh, uh, in parts of Africa. A lot of emerging economies essentially where there is hyperinflation, volatility in the dollar, lack of trust in the government, lack of trust in local currency, um, there's huge gravitation towards that. And you're completely right. The easiest way to sort of own a representation of a dollar is in stablecoins. And there is no fee in holding that money. You can hold it in a Web3 wallet, um, and no one's going to charge you a monthly fee to be able to hold that. You can transfer it out as cheap as, you know, less than, less than a cent. Right. To anyone around the world, uh, as much as you want. Um, and immediately I think has so much benefits to that. So I think people are obviously sort of starting to see that very, very clearly.

Felix: Yeah, yeah. And it would be great to see given that it's 2026, um, that we enter a world where money is and finally moving at Internet speed, given that data has led to this whole level of globalization. But I think our money still has to catch up. So, ah, it's a big vision.

Marcus Lim: Yeah, definitely. And I think um, one of the interesting sort of debates that happen online is you've got sort of US dollar stablecoins and then you've got local currency stablecoins. And there have been a lot of um, issuers around the world issuing local currency stablecoins. But uh, if you can see know based on um, you know, market cap, it's quite clear that you know, US dollar stablecoins still dominate and it still earns about 99% plus of the total stablecoin market. Yeah, yeah. I think my view is, I think local currency stablecoins still need to find a proper use case for it. Um, and that's why the market adoption for local currency stablecoins is still not there. I think if it's trying to sort of provide that for retail users, I think they'll be quite challenged. Especially you know, in Southeast Asia where moving money in a bank account, you know, in Singapore we have pay now that's done, you know, near instant and it's free. Yeah. Uh, so trying to compete with That I think will be very challenging.

Felix: Exactly. Well, it's an exciting journey that you're on and I think throughout your founder journeys you have seen, you know, a lots of ups and downs. Um, certainly you had a lot of doubt over time. How do you overcome doubt as a founder?

Marcus Lim: Doubts will always sort of happen with anything, I think, sort of. Even if you look at the best athletes in the world, um, you know, um, they always have doubts on, uh, whether they can perform even before a match, um, before a big event. And for me, the way I look at it is that, you know, you need to have belief in what you're actually doing, you need to have conviction and you need to be able to cut out noise. But obviously from a human psychology perspective, um, you know, emotions do come in and there's always going to be doubts about whether this is going to take off because you don't have a forecast of the future or you don't, you don't have a crystal, exact crystal ball of the future. So that's where sort of doubts sort of come in.

Felix: Before we close our conversation, I want to cover a personal topic. Uh, you recently became a dad. Um, how has that changed you as a person?

Marcus Lim: Yeah, I think the interesting thing is, is perspective in life, um, which, uh, you know, sort of going back to my earlier years, sort of moving from Singapore to Australia, then coming back to Singapore, then doing startups. I think all of these things sort of give you different perspective. Um, obviously a lot of the startup is business perspective, um, and you learn a lot from that. And I think in life sort of getting different perspective is about, you know, learning about things and understanding from, you know, looking at things a different way. So obviously it's, it sort of changed me in terms of my responsibility now, how I, how I sort of see, you know, risks that I would take, um, in respect to, um, you know, sort of physical risks, you know, sort of doing certain activities.

Felix: Right.

Marcus Lim: Um, you know, last time you'd be like, yeah, you know, let's just go skydiving. That's no problems at all. Let's just, you know, um, or sort of, uh, do rock climbing, you know, um, in, know in the bush, you know, where, uh, you know, highly risky or jumping off a cliff.

Felix: You went skydiving before?

Marcus Lim: I've done skydiving before as well. Yeah. In the U.S. um, I've done, you know, sort of, um, uh, cliff jumping as well. Uh, not, not massively high, but, you know, probably like, I don't know, 15ft, 20ft. So, so I think Those sorts of activities, you know, you sort of reconsider.

Felix: Yeah.

Marcus Lim: About. About sort of doing this. And sort of it weighs into your mind about, okay, if you were to do this, then what would happen? And then I think you sort of start to think about. I think to sum it up is really you start to think about not just yourself, and you have to start thinking about not just yourself and also about what's going to happen in the future. And you have to really start planning ahead. Yeah, um, as opposed to just living in the moment.

Felix: No, certainly. And, um, to close this, I'd like to ask you to maybe think, Think of a piece of advice that you received that you would like to pass on to the next generation of founders.

Marcus Lim: Number one is to have absolute persistence. Right. Um, and. And this is. This. This walks a very fine line because it's either you're completely crazy or you're sort of too stubborn to understand what's really happening and whether it's in the right direction. And this is really, really hard to understand, um, until in hindsight, really. So. But persistence, I think a lot of the times, and, you know, a lot of people sort of give up before actually hitting that inflection point. Um, and that's why sort of a lot of startups also fail. They fail for multiple reasons as well. But the key is sort of to have this persistence and also to have the right people surrounding you to give you guidance on the continued persistence that you have. Uh, and I think now, you know, in today's sort of generation of founders, you have, you know, that infrastructure in place now, which is wonderful. Um, so I think that is what would be sort of like the key advice I would give.

Felix: Yeah, that definitely resonates. And I also believe in the concept of surrounding yourself with five friends and you will kind of become the average of them over time. With Kadan, one of our values is aim for iconic. And that kind of means surrounding yourself with the best people to become. Become the best over time.

Marcus Lim: Yep. Yeah, absolutely.

Felix: Marcus, thanks so much for your time. That's all the time we have for today and appreciate you coming here today.

Marcus Lim: Excellent. Thank you, Felix. Thanks for having me.

Felix: That's all for today. Thanks so much for joining us and see you next time.