 Hey guys, how you doing? This is your boy Rich from Rich TV Live, and you too can join the club at richpicksdaily.com where you can learn how to win and trade. Hey guys, how you doing? I'm your host, Rich from Rich TV Live with our very special guest, the CEO of CoinSmart, Justin Hartzman. How you doing today, Justin? I'm doing awesome, Rich. Thanks for having me. Super excited to talk to you today. I'm very excited to have you on the show. Why don't we get you started with you telling us a little bit about yourself and how you got involved with CoinSmart. Yeah, absolutely. It's a long story that I'll keep really short for you guys. Myself and my two co-founders, we've known each other since we were six years old, went to camp together as children. We had four exits in the tech space before and we were running another quite large startup at the time. And my wife said to me, you know, you don't make a lot of money from your own startup. You spend no time with me or your friends. All you do is work. I think you need a hobby just to bounce things out. And me as an entrepreneur and an enterprise and guy said, fine, but I'm not going to go learn to play the guitar or go mountain biking. I want to find something that can make me some money at the same time. And I got into crypto really early on by mistake. A client owed us money. They didn't have cash. They had to pay with crypto. That's a story for another time. But 5,000 Bitcoin later, where I have no idea where they are, we were paid for a $5,000 job really early on. So I remember that it was 2017. Crypto was up and coming again. People were talking about it. And I like a good business partner and co-founder does. I wanted to invest in it, but I made cause I knew it was a little bit risky at the time. I wanted my co-founders to invest with me at the same time. So we're all in it together. So we started doing that. We loved it. We were trading it. We were making money with it. And over time, it just kind of bloomed into something that was pretty amazing. And for us, the hobby turned to a pet project that pet project turned into a company. People wanted to invest in it. And it just took its own legs from there. We got really early into the market again. We knew we could do it differently. Cause I was sitting around a pool in Florida actually, the year I started getting back into in 2017 and the market was going crazy. And I had a big trade and made a bunch of money through my wife in the pool. Do not do that if they have straight hair or they make straight hair. That's a big no-no for everyone out there. And I wanted to know what was so exciting. I said crypto went right over their heads. I didn't know what it was, what Bitcoin was. So I said, let's have a lunch and learn. Someone ordered lunch. I'll tell you all about it. Well, one hour turned into a day turned into a week. I couldn't get someone on a platform, couldn't get them verified, couldn't send money in. There's no email transfers at that time for crypto. It was a nightmare. And everything we've done in our career was, how do we make it the least amount of clicks? How do we make it the easiest fashion and solve all the problems for people we knew we could do it here? So three words we stand by from that day and every decision we make, which is making cryptocurrency accessible. How do we bring the crypto curious into the market, help educate them, make them a full member of the ecosystem in cryptocurrency, which makes for the community to grow. And that's really what we're trying to do each and every day in a very regulated fashion. I love it. I agree with you. I actually started in crypto in 2017. And when I look back at how much has evolved in five years, it's absolutely mind boggling. In fact, I got into crypto kind of like you kind of like by mistake. And I got involved in some projects that don't even exist right now. So I learned kind of the hard way, I guess a lot of people did in those days because there just was a lot of really poor projects. And then you look today in 2022, it's now mainstream, there's ETFs, there's institutions buying, there's credit card companies giving you access to crypto, exchanges like yourself popping up left, right and center and it's starting to become a mainstream topic of discussion. In fact, even on CNBC, they've got a Bitcoin ticker now that you can even see the price of Bitcoin trading literally day after day, minute by minute. And that didn't happen even last year. So it's really, really evolved. Now in saying that, can you tell us what some of the milestones are for CoinSmart that have set for 2022 which shareholders can look forward to? Yeah. Well, I think there's a couple of points. One is the journey of becoming a exchange is one thing but then becoming a regulated exchange to be going public as a whole other. So it was a very interesting year. We did some amazing things to get here. I'm pretty proud of my team for what they did. And being in the capital markets is more than just helping us to grow and scale the company. It's to help Main Street mainstream get in in a completely different way than they may have thought of before. Different than an ETF or different than a different ETF or a mining company that they have their value but you see the price really revolves around where the crypto prices are. We're truly the plumbing in the industry, right? We're the ones who stand out and it doesn't matter if the market's going up or down we just want the volatility because as we have the volatility in the market that's when we create more trades. More trades means more revenue and more revenue we grow. So that's a very exciting thing and taking the regulatory approach first was interesting because what we wanted to do was allow to go public to allow institutions to play in a market that they couldn't usually play in previously. So it's all about the retail customers getting access for the ones. Now you can go to your TFSA, tax-free situation on that side and now we can have institutions and other ETFs pick us up to bring us in as part of that play. So for us, it's really exciting and we're just getting started because I think the idea here is we're still in the first half of the first inning of crypto. It's been 10 years but I think you're still at the very beginning if you look at the S curve of adoption we're still before we get to that huge inflection point and it takes off. So all this to say and getting back to your question and I apologize, I went a little tangent there is what are some big catalysts for us in 2022? Well, the reality is this we have some amazing plans in place. We have incredible announcements just keep watching for the next two or three weeks. We have coming out with sponsorships, revenue numbers, records that we're breaking, user numbers that are just incredible and a lot of what we're looking to do different than our counterparts on the Canadian market today and other exchanges who are competitors while we're looking to win and we're winning Canada as a market we're actually regulated in Europe as well for four European nations. We have a second one coming online right now and the whole plan, we just soft launched last year into Europe and now January one is our full launch and we've been going very quickly. The user numbers are astounding that are coming in from this European expansion. Latin America is coming online the first half of this year as well as Australia and we're doing that again I keep saying this word in a regulated fashion that's the differentiator for us and the other people on the market we can expand and we can do it right instead of having countries or provinces shut us down which we see a lot of going on with the other international exchanges who aren't taking that same approach and the rationale for moving internationally and not only staying here in Canada is because in Canada we can only offer what it is that we offer an OTC desk, a trading platform you can buy through brokerage services, advanced trading, we have crypto invoicing and processing but it really stops there but our expansion to Europe is now allowing us in Latin America to open up banking services, high yield savings accounts for your crypto, crypto lending, derivatives, margins, stocks and synthetics. So we're really excited by opening up the breadth of new product lines that are already been created, developed and ready to go live or they're testing to go live in Europe and then when Canada gets back online and allows us to do that through regulatory we'll turn it on instantly and be ready to go. So 2022 and beyond is super exciting for some immense growth that we're seeing happen today not that we're wishing for, it's going on now. Yeah, it's been wild watching the crypto verse and the crypto space grow. Now we see NFTs, metaverse, web 3.0, DeFi, it's such an exciting time and they're all in the infancy stages. So can you just imagine where we're gonna be? In fact, I heard a statistic and I don't know the exact numbers but apparently only 4% of the world owns or has exposure to Bitcoin. So just to answer that, to correct that if you don't mind there. Go ahead. It's actually one and a half percent of the world. So it's much less than we anticipated and that's based on the matter of all it's just crazy that it exists out there. You know, we're just hitting a $3 trillion mark in all of crypto and market cap. You know, we're getting towards gold as we get there this is only an explosive situation. And I think a comment you made just before that that we have metaverse, web 3.0, NFTs, all these incredible things that we'll offer other people are offering out there. But you know what the backbone and the pick and ax of all of that is you can't have any of that DeFi NFTs anything without centralized exchanges like ours because you still need to bring money from the traditional world fiat into that world. You have to buy what you want to actually go trade and swap in those other areas and lend out. And then at the end of the day, you can live in that world for a while but then you have to come back eventually because you want to take those profits you want to buy that home, that boat, pay your bills, pay your rent. So we are the necessary piece to making all those other things exist. I think that's really important to understand for investors out there when they're looking at making investment decisions into ecosystem players, who are the right ones and what are they doing? Now speaking on that, Justin, can you tell us a little bit about your management at CoinSmart and especially their past success in the public markets? Yeah, so we've actually, we're lucky and I'm on a sky, I say it how I see it here. Myself, my two co-founders, two other co-founders, we don't have the capital market experience. This is our first rodeo. It's a very exciting, it's not something that's extremely hard to pick up and people who are enterprising been in business for 20 years but we brought the right people all around us. Starting with a gentleman by the name of Zachary Goldenberg. He's taking multiple different companies public before he works on everything from the shell right through to the structuring the finance of bringing the banks in, done it in the cannabis industry, in the psychedelics, in the mining, you know, all across the board and other finances. He's awesome. We also some really good people on our team like Pierre Soulard. He's a former top partner at Miller Thompson Canada. He took ClearNet, which then became Telus Public and then 50 plus other companies. So he's our chief legal officer here who helps us work on this day in, day out. Gord Brockohurst or CFO, multiple NASDAQ listed companies that he's been the CFO for. So, and the list goes on from there. Our chief compliance officer, Joe Tossi, former chief compliance officer of Questrade and then before that CI Financial, the biggest financial companies in Canada. So really ensuring, and that's kind of the strategy that myself, my co-founders take here is, we have great history. We understand how to operate businesses and how to grow and scale them, but we're always trying to be the least smart people in the room. Bringing the really smart people with a really good experience to come in, help us achieve their goals that we're looking for with a vision that we set forth and really give them the autonomy and the rope to go out there and do that. So that's kind of how we set ourselves up. That's great. That's the way we like to see companies that are set up. I believe in the same thing. You may, everyone's good at what they're good at and allow them focus on what they're good at and then surround yourself with experts in other areas to allow your company to grow. It just makes sense. You guys are definitely doing the right things. Now, I'm really excited about this next question. The company recently announced record preliminary unauded monthly revenue in November, 2021 of approximately 1.94 million, which represents a 7% increase from October, 2021. Can you tell us what this means for Coinsmart? Well, I think it's just what you're gonna see from us for some time. Like I thought we did one in October. We did that for November. We have some announcements coming out next week that might talk about December's or other things that are going on. Quite frankly, if you looked at our management projections for January last year, we expected to do $12 million in revenue for 2021. We recasted those twice, ended up at 14 million in October when we looked at it. And I can say without saying too much that we've completely blown through those numbers for our full year end right now. So we're on a very good run rate trajectory into 2022 to meet or exceed some of our goals that we've set out at the end of last year, 2021. And we think that we're only getting started. The ability to offer new products and services and new jurisdictions will help us grow with our current customer set, will help us grow with new customers that are coming on. And we have some really good M&A opportunities and sponsorships that we're working on worldwide right now that will take us to a completely next level. So I think you can expect some really important announcements to continue to come out. And the fact that we are right now as you mentioned earlier, quite undervalued for where we are today. I think that bodes really well for investors to come in and take that. We see insiders buying right now and backing up the truck right now because it is on discount from when we offered our RTO. And that's basically for one reason. There is a couple of sellers who are original investors who own stock at 13 cents. They're taking some money off the table. And that's fair. They rode through the hard times, the good times, the bad times. I have no hard feelings on that, but what this is going to look like is an overnight success to people. Soon there's not gonna be any of those shares available at those price point because everything else is locked up. We can talk about share structure later, but once they're gone, there's only people that own stock that's worth more than that and it's going to go north from here. So I think that's important to know. And the last piece of that is just look at us versus our market comparables, whether you have a HUD aid, a Voyager, a big digital, the list goes on or even the private sale to the public company of WonderFy earlier this year which I know your community is a big fan of, anywhere and bit by purchase was great for WonderFy because it was undervalued at market. If you look at market comparables, when you look at it, the average is 8.9 times their run rate in which they're trading at the open market today. So you have a big digital somewhere in the 14, 15 range, you have Voyager in the 12-ish range and we're trading an enterprise value minus our cash which we have $23 million in the bank. We're not looking to finance right now which is a good number. We're trading under two times our run rate. So if this is not the opportunity right now based on what's going on the market, I don't know what is. So I think, I'm biased, but I know where we're going. I know what the market is and where we're sitting in the market and it's so nascent and early still and where we're priced, I'm excited. And to be honest, we'll talk about share structure which I think you're gonna ask me anyways. The co-founders of the company own 46% of the shares at the company very tightly held. And then another 40% of the shares were owned by large institutions worldwide. Very big ones that aren't in this for the short run they're not looking for a 5%, they're looking for a really, really big return on this. So the float's very little. Get the shares while you can. Now that leads me to my next question. If CoinSmart were to compare itself to its competitors in the crypto sector, what would you say sets you guys apart from other exchanges? Well, I think it's simply a few things, but most importantly is our customer experience. The product that we offer for them and how we offer it and our actual customer experience team. So we're the only exchange worldwide that offers 24 seven, 365 Omni channel live support. You know, walk to us anywhere where they're live to talk to you, email, live chat, phone call and certain instances, all the above really, really interesting things for us to be doing. That's one, because we wanna be there when you're thinking about getting in crypto, when you wanna send your first dollar or make your first trade, make your thousands trade. And that's part of why we're growing because not only we're giving you a good experience, but then when they go and talk to their friends and family, they're going, this is the place you can be and get the support that you want to actually achieve this. And that's different than everyone else. And we build our tools for those new entrants into the market while also offering advanced trading capabilities for those who know what they're doing. So as an example, different than anyone else, very simple, we've had it since day one. I made sure it was there the day we opened up this business, we call it smart trade. You can go from any coin to any coin, any fiat to any coin and back and forth without having to know how to pair this versus that or this with that. So we do all the transactions that take to get that done with three clicks in the background at one fee for you and you have it completed. So I wanna buy this with that for this much, send, we do everything for you. And just simple things like that make us more efficient, easier to use and take the crypto out of crypto, as we say sometimes. And then other products I think that also make us stand out are we do a lot of crypto processing, whether it's for e-commerce sites or for advertising agencies when they wanna do payments. We are there to support, if you wanna pay with crypto, you can do it. And that's a really big part of our offering. And in part of that, we also have what we call auto sell wallets. So which we're seeing a lot of now, if you, for example, let's say you have an advertiser who wants to advertise on your program or someone gets, they work for a company in Hong Kong but they get paid in crypto. It's faster, it's cheaper to send. But the problem is, I'm in Toronto, my employer might be in Hong Kong and they send me my payment at four in the morning. Well, as we've seen in the crypto industry, prices go up and down, which is excellent for us as an exchange, but not good for you who are looking to receive your salary and you're expecting that $5,000 for your month of work or whatever it may be. Once it hits our wallet, because you've given them the wallet, it automatically sells that for you at market price. There's no, you don't take on any market risk. And then we wire it out to the next morning. So again, just tools to simplify, make your life easier, bring it into that and do it in a much fashion where we can support you all the way along there and educate you at the same time. I love it. I love the fact that you're making it simple because that's always been the complicated thing with people that are new to cryptos. They don't know how to do this. They don't know how to do that. They don't know where to get a wallet. They don't know how to send. They don't know how to receive. But someone that's been in the game, like you, like me for years, it's the easiest thing in the world. It's like sending an email, right? But we've been in the game. So we understand how everything works. We've gone through the ups and downs. We've seen where it's been before and we see where it is today. And it's really evolved where it is simple and it's getting simpler. And when I first started, you needed a roadmap just to figure out how to do anything. So I love the fact that you've simplified it because it is a major issue, especially with people that are a little bit older. I've noticed that people that are like, you know, 50, 60 years old, a lot of them struggle with how to set up accounts, how to transfer money, how to pull their money out. They just don't get it. Well, to that point though, also how do they secure it and how do they do the right thing? And you know, we've noticed a lot. It's a big part of what we do here and where we stand out again is there's a lot of elderly abuse that goes on in crypto and we really are here to stop that and fraud. So, you know, if you're over a certain age and you've done more than an ex deposit, our compliance department's calling you right away. Is it you that's doing this? Is it, do you want to be doing this? Is anyone coercing you to do it? Are they telling you you're gonna get unbelievable returns if you send it somewhere else? And are you betting the farm on this that's your inheritance for your children, grandchildren? And if we feel that there's any way that that is the case, we just don't let those transactions happen. And what a metric that you'll see coming out from us on I think a quarterly basis, don't quote me on that just yet, but a regular cadence will be the amount of money we've saved from fraud and elderly abuse from our customers. And I'm not talking, you know, in the last quarter of this year, I'm not talking hundreds or thousands or hundreds of thousands of dollars. I'm talking millions of dollars that we've saved from people that we're gonna go to fraud or being stolen from or whatever it may be that we've saved. And it's not like we sold them crypto. We could have let it go through like other companies and that would have been revenue that we made at the company. We send it directly back or we help educate them on why they should keep it here and the best way to do it and how to keep it with us as a safe manner, not in one of these places where they'll lose it by someone just stealing it from them. So that's a very important piece to us at the same time. Wow, that's impressive. I haven't heard anything like that before. Sounds like you guys are really taking this to the next level. Now you talked a little bit about the share structure. Let's go through it in detail. Can you talk about the capital structure of the company? Like maybe how many shares are issuing outstanding and you talked a little bit about the insider ownership and institutional ownership, which is really impressive. And can you also talk about how you plan on attracting more institutional investors as well as retail investors? Yeah, absolutely. So there's just about 65 million fully diluted shares outstanding. Very nice, I like that. Yep, so under that 100 million mark that a lot of people hover around. Of that, as I said, 46% of it is owned by the co-founding team at the company. Another 40% is owned by large institutions worldwide. So whether these are hedge funds, large venture firms, venture firms of other larger technology companies. We have people like Purpose Financial here in Canada, which I'm sure a lot of people know about. We're one of those 5T capital of Switzerland, Regal out of Australia, Orca out of Germany. So really big names who are in this place, who are in it. They're also strategic for us. Some of them are in the banking industry like in Switzerland and they're gonna help us on the online. Some are in jurisdictions like Australia, where we wanna be and they can be helpful for us. So very important for our growth and we structured it that way. To be frank with you, we went out and did our capital raise prior to going public. We were well over subscribed and we were lucky enough to be able to choose who we wanted to take capital from at that time and keep our dilution where we still wanted to be. We gave everyone an allocation. We just defined who and how much in those situations that what that looked like. So that's the share structure that's institutional. And you asked me about one more thing. Retail investors, more retail investors. Do you guys have a plan on how you're gonna track more of those? Other than obviously being on Rich TV Live? Yeah, no, listen, I'm a very public person. If you go search my name, you'll see I'm a, I spent a lot of time as a thought leader at conferences at in the newspaper all the time on doing interviews because I think part of what we're doing is giving back and helping to educate big piece of what we're doing out there. Plus we have a very significant IR program that's going out right now. I do at least 30 meetings with, you know, a month with institutional desks and IA's that have retail clients out there and discretionary funds looking at that. We have a large marketing campaign. Social media advertising is my, where I came from before this to go out there and do it. OTC is going to hopefully be coming online in the state soon to go over that market. We have a huge PR campaign, one of the biggest companies out there that's done very good job, ready to go as soon as we get that stamp of approval. We have hundreds of thousands of users that are grown. We use that to market too. They believe in us, they use us, they invest in us as well. So the list goes on, but I think people should be aware that I'm a salesperson, I'm the marketer's marketer and I'm bringing that to the table as a CEO here. I want to ensure that we get our name out there and a lot that's going to come from M&A activity too that we're working on that will bring some more eyeballs to what's going on and you'll see a lot more of this sort of stuff going on. Excited, I love what I'm hearing. If there was one thing you would want shareholders to know about CoinSmart today and potential future Frick shareholders, what would that be? I think the question, what I want them to know is that we're only scratching the surface right now. Well, it looks like we've had a tremendous run so far and we're only getting started. And I think that's the key. There's so much more to do. We're doing it in the right way, regulatory first. And it's something we haven't spoken a lot about today, but being the first FinTrack regulated crypto asset trading platform in Canada, they denied us twice in 2018. Now you're forced to do it. So we're one of the first to do that if not the first. We're FinSend regulated in the US for our OTC desk down there. We have our FIU license as Estonia, Lithuanian license coming online right now. And we are one of two marketplaces here in Canada registered fully with the OSC and CSA. So our whole plan is to build the right. And while we could have been much larger, a much quicker by offering every product to every person that we could in the world, we decided to build a big up into the right company. And for as much my, for me as much as all of our shareholders was to have that regulatory approach first, where we can have the foundation for future success and building more markets and more products, where we see our competitors and these are really big billions and billions of dollars large companies, we see their markets decreasing because they're not taking the regulatory approach first. So I think that's a key aspect to know that we're very early, while it might seem you've heard about it for years, we're like this only the tip of the iceberg, we haven't got to the water level and everything that's below it right now as cliche as that might be, it's time to get on that ride and I think you're picking a good company with us to do so because we're undervalued now, we know where we can go and we're putting our money where our mouth is. I love the fact that you guys are focused on regulation because one of my biggest concerns when I got into crypto and I saw what happened with Quadrica, I'm here in Vancouver, I had friends that visited them were buying Bitcoin from them and they disappeared. And it was just terrible for crypto in Canada. Love the fact that you guys are focused on regulation because it's going to make investors more comfortable to invest, they're gonna feel like it's safer, they're gonna feel more comfortable and I think that's gonna go a long way. I don't think that a lot of people really recovered from that Quadrica crash. Luckily for me, I didn't have a lot in Quadrica but had I had a lot of money invested it would have been really difficult to deal with because they just literally disappeared with everybody's money and they were the largest exchange in Canada at the time. I love the fact- I think you're from the largest in the world to be honest at the time. Yeah, so it was devastating. So it's phenomenal that we've come full circle now, you guys are focused on regulation, you're focused on protecting your customers, enhancing and engaging and educating your customers. I think that that's phenomenal. And it makes me more comfortable to want to invest in a project like this when I know that you're really focused on regulation. And my last question for you is what is the best way for investors that are watching this interview, watching this video to get in touch with the company if they have any questions about Coinsmart? You know, awesome. You can just go to coinsmart.com slash investors our investor relations page. There's a form there to fill out it gets directed to me or to the right person there. Also, if you wanna get directly to me, JH at coinsmart.com is another way to do it or IR at coinsmart.com. The whole point is to be accessible here to answer questions, do what I can to help you guys out. Anything under the sun, I'll do my best. And I appreciate the support across the board from you and from all your viewers. And happy to be here. So thank you very much for asking me to come on today. Hey, my pleasure. I'd love to invite you back in the future again. I must remind everyone that Rich TV Live is strictly for information and education purposes. Please do your due diligence, do your research before you invest in anything we talk about or discuss here on Rich TV Live. In saying that, I'm really impressed with coinsmart. It's in one of the hottest sectors in the world. You guys know I love Bitcoin. The Canadian symbol is SMRT. As you heard Justin say, they are getting listed in the US very, very soon. IIR is the listing in Frankfurt, Germany. If you liked the video, please smash the like button. Comment down below, share the video everywhere and subscribe if you're alive. This is your host, Rich from Rich TV Live with our very special guest, Justin Hertzman, the CEO of coinsmart. Thank you for joining us today, Justin. Thanks again, Rich, really fun. Look forward to doing it again. Yeah, we'd love to invite you back anytime you have any big breaking news, anything you wanna discuss. We'd love to invite you back on the show. Congratulations on all your success and a record November. Can't wait to see the numbers in December. Thank you guys for watching. Remember, if you're not winning, you're not watching, we're bringing the winners and we bring them to you first. Thank you for watching everybody and have a nice day. Take care.