We Built A $240K Per Year Bitcoin Exchange In Vietnam

Dominik Weil

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Published: September 5th, 2021

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Dominik Weil

Founder, BitcoinVN

$25K

revenue/mo

Founders

Employees

BitcoinVN

bitcoinvn.io

from Ho Chi Minh City

started December 2013

$25,000

revenue/mo

Founders

Employees

Discover what tools Dominik recommends to grow your business!

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Discover what books Dominik recommends to grow your business!

Want more updates on BitcoinVN? Check out these stories:

1. Update: How We're Navigating Running A Bitcoin Exchange In 2022 [From Vietnam] (2022) ➜

Hello! Who are you and what business did you start?

I am Dominik, born and raised in Frankfurt/Main in the Heart of Europe.

Back in 2013, we started researching and preparing the launch of Vietnam’s first Bitcoin Exchange, with the first product finally going live in March of 2014.

Since then we have expanded our products & services to a whole range of related products such as a dedicated crypto remittance platform, a high-volume OTC desk for corporate & HNWI clients, a direct market access trading platform, the largest fleet of Bitcoin ATMs in Vietnam and an online shop to provide our clients with access to tools for securing their Bitcoins the right way.

we-built-a-240k-per-year-bitcoin-exchange-in-vietnam

BitcoinVN ATM in Saigon near Tan Son Nhat Airport

What's your backstory and how did you come up with the idea?

When I first learned and heard about Bitcoin in late 2012, I was still quite skeptical - of course. It sounded all pretty confusing at first - which is normal, given that it was a completely new, unproven concept.

While entrepreneurship is the best thing for a certain type of person, make sure you understand what you sign up for, and the sacrifices you must make.

But the more I dug into it, the more I found answers to my questions. And grew more and more convinced that this thing has a chance to actually work.

After three months of intense study and research - I knew that this is something I need to become a more active part of.

Back in mid-2013, I took part in launching Frankfurt's original Bitcoin community at a time when none of your “normal life” friends and family members had ever heard about Bitcoin. Fun times were a lot of crazy and interesting characters started to mingle. To be interested in Bitcoin that early, you generally had to be a bit “out there”.

Germany however, pretty quickly proved itself to be true to its well-earned reputation to be a pretty horrible starting place for innovative entrepreneurship; a regulatory quagmire that leaves little room for the necessary quick, fast, and cost-efficient iterations you need to execute as a startup.

So the first wave of Bitcoin entrepreneurs left Germany for greener pastures in Amsterdam, Switzerland, London, or, in our case, Vietnam.

Building a Bitcoin exchange service was a pretty obvious idea at the time since access to Bitcoin was still extremely limited - it was a time where Mt. Gox in Japan was still responsible for 90% of the world's trading volume!

Basic infrastructure was lacking - and we were determined to build a part of it.

Take us through the process of designing, prototyping, and manufacturing your first product.

We did some initial market research on Vietnam in the summer of 2013 before we decided to go ahead with it by December 2013.

Very little information was available at the time; no obvious public groups or communities. After a while of digging and asking around, we found a few Bitcoin enthusiasts in Vietnam with whom we then started to converse & later on also meet up in person.

This gave us some pretty decent initial insights on the state of the market (extremely immature with no professional services around).

The product was initially built for the European market, however, as I’ve outlined above, Germany proved to be pretty unwelcoming for entrepreneurship, so we pivoted & rebranded it for the Vietnamese market.

The first product looked quite “clunky” indeed - but it worked and we got some very first clients pretty soon after who helped us to develop the product further.

We didn’t go through any interactions really - we basically launched with the first page we had ready which looked & worked halfway decent.

We didn’t try to build “the perfect product” - simply something which does the job and then improved it over time.

The product was built by our team member Alex, working part-time on it while spending the rest of his time at his student job or university. It took him about half a year in total until we were ready to launch (he was at the time still a very fresh software developer).

The other three members of our founding team were also all working part-time at the time; I was the first one to quit my job & go full-time by April 2014 (1 month after launch).

For the first three years, none of us received any income; any profit was put back into the company to grow it; so I had to live for three years from previous savings/loans and the salary of my wife in her day job at the time.

The first few clients came in rather immediately, since we already knew roughly our target market and how to reach them. That said, it was rather a trickle than a flood in the early days - but we knew we were on the right track by consistently serving our early clients.

BitcoinVN first UI in 2014

Describe the process of launching the business.

The idea to launch an exchange service was pretty obvious at the time. There was a severe lack of on-/offramps in 2013 in many parts of the world - so there was not much point in building anything “more advanced” than simply solving the very first question most people newly interested in Bitcoin have: “How can I get some?”.

The market research started around summer 2013; the primary medium for research was Facebook and the contacts we made there.

It’s important to understand in this regard that Facebook was back then (and still is) the major Social Media platform in Vietnam; where “everybody” was/is active; runs their business through; shares major parts of their lives etc.

While Facebook as a platform these days rightfully receives a lot of criticism and gets increasingly abandoned by many people in the Western parts of the world, in Vietnam it is so far still the unchallenged number one platform.

Even if you don’t “like” the platform for a variety of justified reasons - if you run a business in Vietnam, you can’t really get around being present on the platform; it receives a lot of attention and screen time every day by a large part of the Vietnamese population.

The company was incorporated by Mid-December 2013; obviously, we did our research around the legal status of Bitcoin upfront - which was as undefined back then as it still is for the major part these days.

So you had to be comfortable with working in an area that had no clear regulatory guidance - but I mean, that’s what you got to do if you want to work with new technology and set sail to new uncharted territory.

At the time when we built and launched our business, we were all still working full-time in our old jobs.

I was the first person to go full-time and “all-in” when I quit my job in March 2014 and moved to Vietnam by May 2014.

The other founding members went full-time in 2017.

We fully bootstrapped the firm from the beginning - none of us had wealthy parents or any other financial backing.

In 2013/14 almost no people were willing to invest in any Bitcoin companies apart from a few mainly US-based investors - and there were also barely any people willing to invest in Vietnam-based startups apart from a selected few.

The overlap of those was basically zero. A Bitcoin Startup out of Vietnam was too far out of the comfort zone for anybody.

Our starting budget was about $5,000 - personal credit card debt.

I would lie if I said the first few years were “easy” financially; you had to count every $ three times.

We managed to arrange a business trip to Hong Kong with two people for (aside from the flight tickets) less than $100 for a whole week. Couchsurfing to sleep, using WiFi in public parks to work during the day, eating so much at the lunch buffet at the Bitcoin conference that it lasted until you came back the next day. A pretty challenging time, but if you have nothing, you have gotta make things work.

Pretty happy that these days are over now, but it’s also a very strong learning experience.

You don’t forget those days of struggle and misery.

And while I would not want to live through it again, it also brought us one thing:

Freedom.

Back in the day, we were “startup noobs” - still bamboozled by the Tech press which indicates that VC funding is the only way to go to be successful as a startup.

Nowadays my strong recommendation for founders is:

Stay independent, avoid VC funding (unless you really know what strings come attached with it and that it is a part of your game plan).

In most cases, it’s a deal with the devil which will limit your upside drastically and quickly turn your business into something which diverts from its original mission and ideals.

VCs are putting other people’s money into your business because they either a) want to generate an outsized return on their investment b) they have other motives why they want a stake/control in your business.

If you don’t fully understand what you sign up for, you are most likely better served to stay independent and own the equity yourself.

In early 2019 we took our first Angel Investor, Hugo Nguyen, onboard.

He had been a happy client of ours for several years before that and knew us and the team - and we knew him.

There is a very strong alignment in how we look at the industry and what matters - as well as in the area of overlapping expertise and interest.

Hugo is the first (known) Vietnamese contributor to the Bitcoin protocol codebase; with a strong focus on improving Bitcoin Storage & Custody solutions (and himself Founder of the Multisig-focused Startup Nunchuk).

He has a similar long-term outlook as us on the industry and business in general - build for the long-term rather than trying short-cuts for quick profits which lead you nowhere long-term because you sold out your reputation.

For the world we are heading towards, reputation will be the strongest currency of them all.

Guard it.

Since launch, what has worked to attract and retain customers?

I think we have built a pretty solid foundation and reputation in the market in Vietnam.

Provide a solid and trustworthy service; thinking long-term (time horizon of a decade or longer) rather than cutting corners and making promises you can’t hold.

Optimizing for short-term benefits without thinking about long-term implications is the wrong mindset. It might help you at the moment but puts you long-term in a much harder spot.

Additionally, it is our strong belief that with the impending end of the current fiat monetary system and all its depravities the world will start to rebalance and long-term thinking and sustainability will be much more rewardful than the short-term profit maximization strategies seen in the past.

Vietnam is not an easy market to navigate, but having been around here, and surviving for so long, despite many ups & downs along the way - builds trust.

Nowadays, besides operating our Social Media channels (Facebook, Twitter, Telegram) and our own News page we rely for a large part on word of mouth to attract more customers.

In Vietnam word of mouth is always the strongest driver; since people naturally tend to trust goods and services recommended by their family and friends.

So make your customers happy - because if you do, they might bring you a whole lot of more business down the road.

Could we have done some things better?

Always.

There are always things to work on, improve and refine - and we will keep working on them despite all the limitations, regular setbacks, and other hurdles thrown in our way.

There are always new fires to put out - and while it’s tiresome at times, on the days when you get feedback from happy customers, telling you how you made their lives easier makes it all worth it in the end.

How are you doing today and what does the future look like?

Right now we are in a challenging period in Vietnam.

Vietnam entered increasingly hard lockdowns two months ago - currently, everybody in Saigon is imprisoned in their homes with, at best, access to grocery runs twice a week to selected supermarkets via some form of the voucher scheme.

And even though we are an online business for the most part; it is also quite disrupting for us.

You have to learn to take some time for yourself, otherwise, you will burn out fast.

Some of our foreign team members fled the country to greener pastures where they can better take care of their health (leaving your own home even for a walk is currently criminalized in Vietnam) and therefore be more productive.

In the current situation that just makes sense for them and us since they can do their job remotely - but of course, it’s nicer if you actually have the time close-by and can have regular dinners with the whole team to discuss things in a more casual atmosphere.

That said, we still believe that Vietnam and the region, in general, have pretty strong growth ahead of it.

We are in for a couple of months of hardship here in Vietnam, but we also hope that soon the realization sets in that lockdowns are not a way to effectively deal with the challenges posed by COVID-19.

We will get there eventually - and the sun shall rise again.

Not the first tough times we had to go through in our business.

Otherwise, we are working on in-housing and consolidating more of our products which should bring increased margins and speed of development, and started investing increasingly more resources into the Lightning Network; so far among other things making VBTC the first Asian exchange to support Lightning Withdrawals and leading the Seed Round of Vietnam’s leading Lightning Service Provider Neutronpay.

Through starting the business, have you learned anything particularly helpful or advantageous?

Running your own business definitely and massively changes your view on life and the world.

It’s not for everybody - working a job is much less stressful, less risky, and you have more time off.

Running a business - you can't just take a week’s vacation. You can barely take a day off. It’s always on your mind; you always think about what to do better; what to do next; what things to do today, tomorrow, next month.

You have to learn to take some time for yourself, otherwise, you will burn out fast.

It’s extremely important to manage your time well - and include sufficient deliberate and active rest.

You must learn to manage the stress that comes with it.

Also, you learn a lot about people and their behaviors - and what drives their motivations.

When you start, you are open to talk and work with everybody - which makes it easy to take advantage of you because you are too naive and inexperienced.

You have to get burned a few times.

It hurts, it’s annoying, it causes anger when people backstab and betray you - but it also makes you stronger and smarter about who and how you chose to engage with in the future.

Nowadays we have become much more selective about who we are spending our time on and working with.

One key lesson:

If somebody is waving red flags into your face - don’t ignore it or explain it away citing “cultural differences”.

Set your bars and standards high - and keep them there.

You will always regret working with people who can’t match it.

It will never work out and you end up wasting a lot of time and resources on things that don’t work.

That said: Many things are just recognized through experience.

That’s normal, you will get burned a few times in your life - just make sure it’s not fatal (even if we came close to it a few times!).

What platform/tools do you use for your business?

Well, Facebook - as horrible as the platform, in general, it - is still a strong lead generator in Vietnam since it's still the leading social network for the time being.

Otherwise, we increasingly rely on word-of-mouth by happy customers - that’s the best advertisement and endorsement you can get.

And in this regard: It makes a lot of sense to invest in tools that help you to reward your loyal customers (e.g. Affiliate schemes and similar).

What have been the most influential books, podcasts, or other resources?

I am very interested in Austrian Economics, history, philosophy, and similar topics.

So, there is not one “classical startup/business” book that inspired me.

It’s a more foundational, generational literature which inspires me rather than the more current business-focused content producers.

One book which helped me to understand what we are signing up for is Friedrich August von Hayek’s Denationalization of Money.

I think reading this book certainly had the most positive impact on my life since it allowed me to understand Bitcoin before I even knew about Bitcoin.

You can not understand Bitcoin if you do not understand the concepts and background described in this book.

Otherwise, there are a whole bunch of great writers, thinkers, and doers from a wide range of expertise and knowledge.

Most of my daily influences you can probably find through my Twitter following list; otherwise our local Bitcoin community in Saigon also provides a lot of reading & listening recommendations on a steady basis.

Advice for other entrepreneurs who want to get started or are just starting?

Don’t waste your time on business plans and pretty PowerPoint presentations.

Be extremely careful and mindful about your expenses.

Always think clearly and carefully about the risk/reward of any action. Does the investment of resources; time/money justify the possible reward?

Play for the long-term.

Build relationships that last - with people who look to play the long game as well.

Keep your circles tight.

Build with resilience in mind and be ready for regular suffering. It’s not all the “high life” that you see in the Tech press - often pretty much the opposite.

While entrepreneurship is the best thing for a certain type of person, make sure you understand what you sign up for, and the sacrifices you must make.

It can be very rewarding - but you must have the personality type for it.

Are you looking to hire for certain positions right now?

Currently, we have all open positions covered, but if you are keen to work with a Bitcoin company in Vietnam, you can always reach out to us and we will see when/if there is a fit in the future.

Where can we go to learn more?

If you have any questions or comments, drop a comment below!