Exploring Tokenizing Private Equities with Tessera

GM GM. Welcome to what's going to be another fantastic episode of DevNTell. So if you didn't know, DevNTell is a 30-minute podcast allowing founders, hackers, and anyone in between the opportunity to come on the show and showcase what they built. And today I'm excited to welcome Hadan Esperidiao, who is the community lead at Tessera. So if you're not familiar, Tessera is the first permissionless platform that lets anybody trade tokenized private equities with real share backing, instant settlement, and 24/7 availability. So if you stick around for today's episode, you'll get to meet Hadan, learn about Tessera, and how you can get started using them today. All right, let's get into it.

GM GM. Welcome to the show, Hadan. it's a pleasure to have you on, man.

GM, Narb. Good to talk to you.

Likewise, likewise. Uh, yeah, I guess, uh, before we get into all the- all the great things Tessera, uh, perhaps would you like to give a brief introduction about yourself?

Sure. Uh, I guess in a nutshell, my background is, uh, you know, undergraduate physics degree at Harvard. Post-Harvard, I was, uh, an investment banking on the sales and trading desk structured products at Goldman Sachs for about a decade. Uh, and then I stepped out of iBanking right around when, uh, DeFi really started to come online. It just was, you know, written on the wall to me that, uh, this was really the future direction finance was going in. Uh, initially I was just kind of a community member, trader, then beginning like in 2020, uh, I started joining and worked with different projects, initially in the Bitcoin DeFi space. And, uh, most recently I've long been very bullish on RWAs. Uh, and then, you know, when, uh, when Tessera kind of approached me that, uh, private equity RWAs, then, you know, kind of like all- all the sevens lined up on the slot machine, and I was like, I've got to be a part of this. So, uh, yeah, that kind of takes me to- to- to being here today.

Amazing. Amazing. And yeah, I've seen RWAs, um, really start to pop off, um, late last year and into this year. Um, I guess, do you- do you attribute it to any one particular thing that's kind of- helped bring them back into the spotlight?

Uh, yeah, you know, I think, um, I mean- I mean as early as 2021, I feel for a long time RWAs was kind of a buzzword, uh, that was, you know, kind of like suggesting mass adoption or something that was coming down- down the line in the future. Um, to me, this- this always felt like what the endgame of what we were building in crypto was. That, you know, we were building the rails and the infrastructure that were beginning with these, you know, on-chain tokens, collectibles, NFTs, meme coins, but that we were basically, uh, you know, testing out a system that would inevitably be able to handle the hundreds of trillions of dollars that trade daily in bonds, commodities, equities, uh, because it is so much faster. It is- it is more secure, settlement is more instantaneous. It's permissionless, it's global, it's 24/7. Uh, and so I thought, you know, inevitably we would always get here. Um, I think just in 2024 alone, we've seen like a 10x growth in RWA market cap. I think right now it's about 20 billion on-chain. Uh, of that 20 billion, uh, a good 19 billion of that is like, uh, treasuries, private credit, so like debt instruments. Uh, equities are kind of new, things like Ondo Finance, you know, that's maybe just like an 800 million dollar segment. And- and private equities are sort of just, uh, like- like brand new and fresh. But that's kind of the one I'm the most excited about because that's the one that retail doesn't have access to in any other way right now.

Yeah. Yeah. And you hit the nail on the head. Um, and I guess that's- that's kind of the obvious, um, one of the obvious hurdles of, like, the private equities space is not everybody has access to that. Um, I guess can you- can you speak to some of the other challenges, um, that kind of surround private equities and, um, why it may be that, like, regular folks can't access it?

Sure. Um, and so basically, you know, I guess- I guess just to put it in a nutshell, uh, you know, in the beginning of- of the sort of 1900s, anyone could sort of like raise a company, sell shares, uh, as a result, you know, a whole lot of people, um, were kind of getting scammed. And so, you know, like kind of following the 1929 crash and Great Depression, you have all these very heavy regulations that were put into place. Uh, and these kind of- definitely vary depending on where you are in the world. Uh, but, uh, particularly in the New- in the US where a lot of these very hot private equity companies are located, uh, in order to participate in private equities, so that- that means shares in private companies before they IPO and go public, you have to have, uh, accredited investor status. And typically the requirements for that are things such as a minimum of 1 million net worth excluding your home, typically a minimum of 200 to 300k income. Basically, you're writing a minimum six-figure check. You're signing up for a long- for a lock-up period that could be years long. Uh, and so this basically excludes a good, you know, 99% of the population from- from being able to hold and participate or have private equity exposure. And so that's what's kind of, you know, frustrating is that like every day we're reading articles about OpenAI, SpaceX, Kalshi, Polymarket, and as bullish as you feel about these companies, it's- it's wild how- how we've been conditioned to be passive about the fact that you can't just go out and, you know, have exposure to these things you feel so bullish on. And so I feel that with tokenization and through Tessera, we're finding a way to kind of bridge that gap and bring private equity to everyone, which is kind of the- the sort of Tessera tagline.

Excellent. And- and it- it's a- it's a perfect, uh, segue again. Um, into, uh, I guess what would you say is your pitch of Tessera? Like what- what is it? What problems does it solve?

Sure. And so, um, so what Tessera does is that, you know, we go and we buy positions in these massive companies that are looking to IPO. So, you know, just- just a week or two ago, we had, uh, our first, uh, alpha vault launch of- of- of a SpaceX, uh, exposure, SpaceX tokens. Uh, and so we sort of take the- these positions, we- we tokenize them. Uh, we have them in basically a portfolio segregated companies, may- meaning a company that just exists to hold the shares. Uh, we have these independently audited. Uh, that auditing is fed through Chainlink reserves, and so you have, uh, basically online verification that there is one-to-one backing of your exposure to shares held. Uh, and then basically, uh, once those tokens are unlocked, you can trade them 24/7, uh, on Meteora, for instance, right now SpaceX trading is live. Uh, so you can either, you know, trade that if you want to get into or out of the position instantaneously, or if you want to hold it through IPO, once there is the- the IPO, whatever that sort of, uh, wherever Tessera is able to- to, you know, get out of that position at, is where you can then take your Tessera tokens, uh, and come to the- to the platform and during the redemption window, you can- you can burn them for- for stablecoins. So basically, you know, you capture that kind of spread between the valuation, the implied valuation of where you purchased that to where, you know, you have that exit. Uh, if not, you know, if- if you have a shorter timeframe, you can of course, you know, buy and trade on Meteora. But that's basically the sort of idea in a- in a nutshell how you get exposure to private equity companies, uh, on-chain and permissionlessly, permissionlessly, uh, on- on Solana at the moment.

Awesome. Yeah. I was going to also ask, uh, what chain you guys, uh, are starting off with. Uh, yeah, it seems like a lot of- a lot of companies that, uh, are looking to get or bring RWAs and private and equities and whatnot on-chain, a lot of them are kind of shifting towards, um, the Solana side of things, whereas, like, early on you saw, like, a lot of- a lot of people were going on the Ethereum side of things, anything EVM, Layer 2s, but that kind of- sentiment has- has shifted slightly. Um, I guess, um, um, from your- guys's perspective, like, um, why Solana? Why- why go with them first?

Sure. Uh, so yeah, I would say, you know, so Solana first, I would say that, you know, we do have a medium-long term multi-chain vision. But I think beginning on Solana, um, you know, one is- is- is the- the infrastructure, it's the very low fees, it's the instantaneous settlement. Um, it's the high on-chain, you know, volume and activity. It's a- it's the community, as well, that I think, uh, is very kind of, uh, active and- and apt to- to prompt and trade, whether it's kind of like meme coins or RWA tokens. And also support from the Solana Foundation, who have been, you know, basically made internet capital markets one of their core metas for 2024. Uh, 2024 also being what the New York Times describes as the year of the mega IPO. So, you know, I feel like these matters are really like lining up in a- in a really strong way towards exactly what we're doing and what we're building and taking to market.

100%. Yeah. And- I mean, there's a lot of big-name companies rumored to be IPOing, like SpaceX, you mentioned, is one of them. Uh, OpenAI, maybe Anthropic, uh, like who- who knows what else. And, uh, I guess in from your- from Tessera's perspective, like, um, what goes into determining, like, which equities to kind of- bring to the public first? So, you mentioned SpaceX is live now. Um, any- is there, uh, I guess, any, um, any formula, any strategy kind of behind which ones to bring up- up next?

Sure. I mean, uh, I would say initially, especially since we're just a few weeks out from launch, we're basically looking to, uh, we're- we're basically looking to the community and to bring to- to market the names that people recognize and the names that people want. And also companies that we know that are one, both- both massive and also likely to IPO in like a 12 to 24-month period. And so, you know, that's- that's essentially where we're looking at one is that, um, this allows the community to get familiar with how that, you know, once a company IPOs, uh, how that redemption period burn token receive stablecoin mechanism works. Um, another is also just the sort of brand recognition, um, and sort of supply and demand, right? It's like- if people recognize these names, these are names that people are- are highly bullish on, that they- that they sort of like read about in a news article and they feel this kind of FOMO of like, man, you know, like I- I wish I was a holder, I wish I had some- some Kalshi or, you know, Polymarket or OpenAI. Uh, that makes them all the more likely to participate and engage with the platform. So just kind of as sort of like an- an icebreaker, that's kind of what we're targeting.

Cool. Yeah. That- that sounds amazing. And, uh, you mentioned you're- uh, you're a couple weeks from- from launch. Um, is there any, um, any way for- for people who are watching today, um, to kind of- get into- get into like a waitlist or- or get- basically front of line to start playing around with Tessera?

Yeah, sure. Uh, so you know, we took our- our alpha vault launch live on- on February 12th. Uh, so- SpaceX tokens are, you know, uh, T-SpaceX, it would be, are- are trading live on- on Meteora. Um, I would say for people, you know, to definitely give, uh, our X account a follow, Tessera_PE. Our- our website is tessera.pe. You can check out, you know, our- our sort of app there. Um, and to, you know, follow just also just for- for news updates, the- the next that we have in the pipeline will be- will be Kalshi, which, uh, we're very- very excited to- to sort of launch as well. And so, um, yeah, I think, um, especially the way our sort of like alpha vault, you know, launches worked with- with- with- with SpaceX you had to be whitelisted to participate. So there was a reason right there to sort of like join and sign up. Uh, I believe it'll be- I'm going to see what the Kalshi mechanism is going to be. We might kind of tweak that a bit based on community feedback, but, you know, knowing about it, being the sort of first to- to participate is definitely an advantage. Um, and I'd also add in that, um, you know, we've kind of structured our token, uh, it's- it's baked into the Tessera tokens with the- with the 2022 standard that, um, 60- that basically 35% of all- of protocol revenue goes to our referral network. So, if you go to, you know, Tessera and you sign up and you create a referral code, um, you know, anyone that you provide that referral code to that signs up, um, you receive 30% directly, uh, of- of those fees, then it's- it's 3% of whoever they refer, and then 2% of those friends of friends. And so, you know, we definitely believe in kind of rewarding our users, uh, and building these kind of like- of- of viral mechanisms into the token itself. And so that's another reason to kind of get in early, 'cause the- the earlier you do, the bigger your potential graph can grow as Tessera gets discovered, as people find out, you know, uh, all of these very hot companies are- are live and trading and you can get exposure to them on it. So these are all opportunities that, you know, uh, are available by being early to- to sign up and join.

Amazing. Amazing. And yeah, we'll have- we'll have all those links, um, in the description of the- the podcast below. Um, so folks can- can get- started there. And- I'm just curious, um, like- this- this sounds like a really amazing product. Like- what- what's the origin story behind it? Like, what was the- um, the- motivation behind kind of starting it beyond kind of just, like, the- private equities, um, barriers?

Sure. Um, you know, I think really, you know, in- a lot of the- of a lot of the- sort of Tessera team, um, comes from, uh, a finance background. Um, and so- there- there's always been this kind of vision of kind of democratizing finance. You know, I- I think- I think so much of what TradFi, you know, like is, um, is- is sort of propped up by these- by these, you know, um, artificial standards and gates that are meant to make what they do inaccessible to the sort of general public. You know, it's almost this kind of like- like- like cabal-like, uh, you know, like insular world where they have their own language and you have these expensive buildings with like big marble lobbies. Uh, but really at the end of the day, that's because they deal with such a- a concentrated pool of the sort of, you know, wealthiest. And if you look at what private equity is right now, it's basically one of the biggest wealth creation engines in existence. It's one of the big reasons why the rich get richer, because they have access to buying SpaceX really early on and you don't. You know, there was even a story about like how- how Google wrote SpaceX a check, uh, for 900 million when they were at a 12 billion valuation. And if SpaceX IPOs, which, you know, seems to be the general discussion at around 1.5, 1.6 trillion, uh, that means Google will have an over 100x return. And you're going to hear about that 100x, and most people will think like, man, you know, like I- I kind of- I was late. But- but you weren't late. You were never allowed in. You've been locked out by design. And so, you know, Tessera is about just like breaking down those gates and breaking down those barriers so that right now you can go connect your wallet and get SpaceX exposure really like literally within like minutes, if not seconds, if you're quick of listening to this on this podcast. So, you know, that's- that's really what we sort of believe. We believe that to close the wealth gap you have to close the fairness gap. And so if we, you know, these products that we know well, that we've in the- in the past life delivered to the wealthy, if we can deliver that universally to everyone, I think that is more of the kind of world that we want to live in and that we want our kids to grow up in, where just, uh, you know, equality of opportunity is universal rather than kind of segregated by caste.

I- I- yeah, wonderfully said. And I think it- it complements kind of the whole ethos of- of DeFi and- bringing kind of payments on-chain is- um, like- not- not a lot of people outside of like North America realize like how hard it is to even set up like a bank account, for example, right? It's like- yeah- like a lot of this technology kind of brings people from zero to one and then to get from one to two to three and so on and so forth, we're kind of like build on top of this. And I think, yeah, Tessera sounds like- certainly part of the- part of the solution here. Um, in terms of like, um, the broader landscape of- of similar, um, competitors, like- what would you say- Tessera does, um, better- better than those? Or- or differently than those?

Sure. Um, I would say, um, one of the big differentiators is one, uh, we have, you know, 100% transparent on-chain verifiability as to our proof of reserves through- through- through Chainlink. Uh, you know, like all our token minting, burning, creation, uh, is handled through- through- through Fireblocks for- for- for security. Um, and also, you know, having come from a financial and structured products background, um, we've- we've really brought a bit of legal innovation to the way that Tessera exposure is set up, so that there is- there is absolutely no KYC, uh, upon cash out or at any point in using the sort of Tessera platform. So keeping just like privacy first, uh, I think is- is, you know, like a huge leg up that we offer that- that- that others don't.

Awesome. Awesome. And, um, I mean- this year in particular, we've really seen kind of like the- the rise of- of like AI. Like AI has become much more mainstream, much more capable. Um, and a lot of people have started messing around with- at least the people in the crypto scene have been kind of messing around with agents that can trade, agents that- can trade with each other. Um, I guess are there any plans to integrate AI in- in any- any form on the platform? Or- or does it already exist there?

Uh, no, well, I- I would say, um, yeah, I- I would say already, you know, just like- uh, in building out our sort of our- our- our workflows, uh, in building out sort of like- our sort of like- uh, our FAQs and our TG chat supports. That- that's- that's definitely implemented. Um, you know, like- like our devs, and that's, you know, kind of including myself, we're all, you know, just kind of- like- like AI, like fanatics across the board. Uh, so, you know, I would say at the moment, um, our kind of key points are kind of like rolling out those first few, uh, private equities to- to, you know, build out that sort of Tessera portfolio. Uh, but- uh, without a doubt that's- that's- that's- that's the direction I think everything is going in. I think, you know, like the vast majority of online trading is going to be, you know, agents trading- trading with- with agents. And so, yeah, I think- I think actually just on last week's call, just maybe a little bit of alpha, but we are building, uh, an- an MCP version of our website that is, you know, specifically geared for bots to be able to browse and- and scrape and get the info they need, uh, um, uh, so that they can respond most accurately and also just let users who ask know right away, uh, how they can right away get plugged into Tessera or even have their bots, you know, uh, interact with- with- with Tessera. So, yeah- yeah- absolutely. We- we- we love it, in- in all the ways.

Awesome. Awesome. Yeah. It's- yeah, it's crazy- a lot of the- the different kinds of ideas people are having around- around this and- yeah, I think- definitely it's going to be like agents trading with agents. Like, we'll all have our own like investment agents, like kind of- build up our portfolios, trade with each other and what. Exactly. Wouldn't you rather, you know, like be outside, like lying on some grass baking in the sun and have your agent just doing that for you and it just sends you, you know, uh, a TG message that your order was filled, order was hit, what your PnL is, and then you sort of like get back and you talk to it and you're like, uh, you know, I think we got to tweak this a bit because I think you could have made like 5% more or- you know, so- yeah, I think- I think that's without a doubt that's where it's going and that's where at the end it should be and people will be glad that it is. Yeah. Absolutely. I mean, time is one of the most valuable things people have in their lives, right? And if we can get more- more of it back with agents kind of doing the boring- boring work for us, like why- why not? Right? Exactly. Exactly. Um, yeah, so certainly very exciting and interesting time, uh, we live in, um, to say the least. That's right. That's right.

Uh, but- yeah, I guess- as we're kind of coming into time here, um, I- just- kind of- wanted to have- have you have an opportunity to maybe give some advice to- to some of the people watching today who might be kind of on the fence of wanting to get involved in- in DeFi or maybe they want to kind of- take the leap of faith and start- start their career in- in the blockchain space. Um, with sentiment kind of- low, um, the- now, um, maybe because of the market or- or what not, like- what words of encouragement would you give- um, for a person kind of- oh, like should I- should I step into this space now or not?

Uh, sure. Well, I would say, um, you know, it's- it's funny because when- when everything is kind of like- like- like- like booming and you're nearing all-time highs, that's when, you know, everyone catches FOMO fever and decides to jump in. And then when that kind of wave kind of pulls back, everyone's like, oh, like- like- like crypto is dead, crypto is a scam, I want nothing to do with it. And so, you know, I guess consistently, just speaking as from like a career as a trader, um, most traders do well because they- they sort of play that contrarian position. You know, like- when- when- when- when a trade gets crowded one way, you kind of go the other. And so I think right now, um, in that kind of like a bear market, it's a great time for building. Um, it's- it's a great time to sort of take a step back, analyze the sort of fundamentals of what's on offer and understand that, you know, these- these- these may be, you know, discount levels to kind of get in. Um, understand also that the world is changing faster than it ever has. And what we've known as blockchain and crypto is going to be evolving as quickly as the AI space is. And I think already, with- with RWAs, like you are seeing that, you know, where- where crypto isn't necessarily so much going to be defined, uh, by kind of, you know, the- the meme coin casino, although of course that- that will always be there, but these are, you know, again real-world assets, like real companies, you know, thousands of employees, real cash revenue and income flows that we're sort of taking on-chain. And again, you're going to have an access through it through the blockchain, just through your crypto wallet, um, in a way that you cannot get in the real world. You know, you can't go, you know, to- to- to- to your broker, you can't go to Robinhood, uh, you know, I mean- just- just try it. Go out and try to see if you can get, you know, shares of SpaceX and all the- all the flaming hoops you're going to have to jump through versus taking, uh, you know, literally like 30 seconds, 2 minutes with it with an on-chain wallet and you can have that real one-to-one backed exposure. So, um, yeah, I mean- you know, look at those fundamentals. Are you- are you bullish space? 'Cause SpaceX to me, it's more than just like rocket launches and, you know, uh, and- and- uh, it's- it's the fact that- kind of as Elon says, if you think the AI boom is going to continue, without a doubt the- the best place for sort of data centers and in the future, you know, quantum computing centers is in orbit, where you have near-zero temperatures and you have unfiltered, you know, sunlight 24/7. Um, and so, you know, so- so- yeah. I'm- I'm just very- I'm very bullish on these theses, very bullish on these companies. Um, you know, I'm really excited that, you know, through Tessera, you know, uh, I can have exposure, we can bring that exposure, uh, you know, to- to- to anyone else who's willing to sort of participate. And that- and that the time to get familiar with things is again, when you're early. You know, and now you have that chance to sort of be early before everyone knows about it, before it becomes, you know, crowded, before, you know, those- potential pricing opportunities are arbitraged away. So, you know, it's- it's real, it's live now, more are coming. You know, um, always do your own research, you know, not financial advice, but hey guys, you know, check it out because this is, you know, very- very kind of like- like- like frontier both finance and very frontier for, you know, RWA crypto.

Excellent. And- the- perfect way to- to- end things off here. Uh, Hadan, uh, thank you so much, um, for taking the time out of your day, um, to come chat with us today. Uh, I- know- I'm- I share the same sentiment with you. I'm very bullish, um, on basically all the things that you just said. Right? Yeah. And- um, yeah- I mean- Tessera, like- breaking down those barriers, having- having- giving people the opportunity to invest in- in these amazing companies before they- they go public, uh, I- I think that's- that's- an awesome thing and- really shows the power of- um, of- bringing all- all of finance kind of on-chain here.

Yeah, yeah. And Narb, you know, to- thank you so much for having me, you know, on the- on the- on the show today. You know, uh, awesome questions, you know, great vibes. Uh, especially for someone who's currently in Mordor. Right?

Right? Yeah. I- thank you, thank you. Yeah. I try. The- the fumes- uh, I'm- I'm immune to the fumes now. Nice, nice. Yeah. Real frontier. Right? Exactly. Exactly. Um, but- yeah, I guess- um, as we're kind of coming into time here, um, I- just- kind of- wanted to have- have you have an opportunity to maybe- give some advice to- to some of the people watching today. Oh, wait, we did that already. Sorry about that. Uh, so thank- thanks again and, um, yeah- um, anytime, you know, happy to have for any follow-up questions and hope we have a chance to sort of talk again and maybe- meet in person at some of these conferences one way or another in the coming months, years. All right. So thank you. Absolutely. Absolutely. It- we'll- we'll leave it there. All right. And thanks everyone for watching. Appreciate you guys. 100%. And- yeah, with that just want to wish everybody a very happy Friday, happy weekend wherever you may be. And we'll catch you back here for another episode of DevNTell next week. Till then, have a good one, folks. Cheers.

Bye guys. Private equity for everyone. Indeed.