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00:00JOINING US IS A PARTNER AT SEQUOIA CAPITAL. LET ' S TALK ABOUT WHAT IS HAPPENING IN CRYPTO. COINBASE ' S HIRING FREEZE CERTAINLY DOES NOT LOOK GOOD. WHAT IS HAPPENING IN THE INDUSTRY RIGHT NOW? > > THE THING TO REMEMBER ABOUT CRYPTO IS THERE ALWAYS UPS AND DOWNS. IT IS A VERY VOLATILE SECTOR, ESPECIALLY BEFORE WE GET A BETTER REGULATORY FRAMEWORK. COINBASE IS NO STRANGER TO THE CYCLES AND CRYPTO. FOUNDERS IN THIS SPACE EXPECT UPS AND DOWNS. EVERY COMPANY IS DIFFERENT. I WORK CLOSELY WITH FTX. THEY ARE NOT DOING A HIRING FREEZE. THEY ARE WELL CAPITALIZED AND READY TO TAKE ADVANTAGE OF THIS PERIOD. THERE IS A HUGE RANGE IN THE WAY COMPANIES ARE REACTING TO THE DOWNTURN IN ASSET PRICES. LONG-TERM WE ARE OPTIMISTIC THAT THE BEST BUNNIES WILL EXTEND THEIR ADVANTAGE. EMILY: WOULD YOU SAY IN THE CASE OF COINBASE IT WAS A MISTAKE IN EXECUTION? THEY ARE A PUBLIC COMPANY NOW. MICHELLE: YES, MANY PUBLIC COMPANY CEOS HAVE HAD TO DEAL WITH THEIR STOCK PRICE CHANGING AND A MARKET PIVOTING TO ONE THAT VALUES PROFITABILITY. I THINK THE IMPORTANT THING IS THAT CRYPTO IS VERY DIVERSE AND THERE ARE COMPANIES WELL-POSITIONED THAT ARE NOT STRUGGLING TO MAKE AN IMPACT ON THE FUTURE. EMILY: SEQUOIA HAS A HUGE PORTFOLIO AND YOU ' VE GOT WORKERS MOVING BETWEEN COMPANIES ALL THE TIME. DO YOU SEE EMPLOYEES RETHINKING, OH, MAYBE I SHOULD STAY AT APPLE OR GOOGLE FOR A WHILE LONGER? MICHELLE: WE HAVE SEEN QUITE A VALUABLE MARKET IN THE MARKET FOR STARTUPS. ONE POSITIVE OF THIS PERIOD FOR THE STARTUPS THAT PLAY THEIR CARDS RIGHT, THEY WILL BE ABLE TO HIRE TALENT THAT THEY WOULD NOT HAVE BEEN ABLE TO BEFORE. THIS LOOSENING OF THE TALENT MARKET COULD BE BENEFICIAL FOR THOSE COMPANIES TO STACK THEIR STAFF AND TEAMS WITH TOP TALENT FROM THESE COMPANIES. WE ARE OPTIMISTIC THAT THOSE COMPANIES WILL BE ABLE TO SUCCEED, EVEN IF THERE ARE SOME NEAR-TERM SHIFTS. EMILY: SEQUOIA PUT OUT THAT GOOD TIMES -- IF SEQUOIA PUT OUT THAT GOOD TIMES MEMO NOW, WHAT WOULD IT BE? MICHELLE: WE GATHERED WITH INVESTORS TO TALK ABOUT HOW TO PLAN FOR THE DOWNTURN. THE KEY MESSAGE IS STAFFING TO INJURE. WHAT WE LEARNED -- TO ENDURE. WHAT WE LEARNED IS FOCUSING ON EXTENDING YOUR PRODUCT ADVANTAGE IS ONE OF THE MOST IMPORTANT THINGS YOU CAN DO DURING THIS TIME. PUTTING YOURSELF AHEAD OF YOUR COMPETITORS WHILE ALSO POTENTIAL CONTRIBUTING IN OTHER AREAS ARE THE MOST IMPORTANT THING. WE THINK THE BEST COMPANIES CAN COME OUT STRONGER, BUT THEY HAVE TO SURVIVE LONG ENOUGH TO HAVE THAT CHANCE. EMILY: WHERE IS IT SEQUOIA PLACING ITS CRYPTO BETS NOW? MICHELLE: VERY SIMILAR AREAS. OUR CONVICTION IS VERY ON RATTLED BY THIS -- UNRATTLED BY THIS HONESTLY. ON A 10 YEAR HORIZON WE HOPE CRYPTO CAN GROW FROM THE MILLIONS OF USERS INTO THE BILLIONS. WE ARE INVESTING IN A BROAD NUMBER OF AREAS FROM INFRASTRUCTURE TO INTERNET APPLICATIONS BASED ON BLOCKCHAIN. WE ARE VERY EXCITED, ESPECIALLY ABOUT THE INFRASTRUCTURE AND DEVELOPER TOOLS WE ARE SEEING THAT WILL HELP MORE COMPANIES BUILD MORE RESILIENT AND SECURE APPLICATIONS. EMILY: DOES IT MATTER IF BITCOIN GETS BACK TO 60? MICHELLE: LONG-TERM WE ARE NOT INVESTING FOR THE PRICES IN THE ASSETS. FTX IS A GREAT EXAMPLE. THEY ARE BUILDING AN EXCHANGE THAT WE THINK COULD BE AN AMAZING PRODUCT FOR CRYPTO DERIVATIVES MARKETS. WHETHER THE PRICE GOES UP OR DOWN, PEOPLE ARE STILL TRADING. IT HAS A FOUNDER THAT IS A

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Crypto Report: Coinbase's Hiring Freeze

Sequoia Capital Partner Michelle Bailhe joins Emily Chang to discuss the crypto winter and why it's causing companies like Coinbase to cut back on staff. Plus, her advice to crypto founders: embrace reality. (Source: Bloomberg)

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