Crypto Boy On Netflix – An Examination

Today I’m going to write about something slightly different. Instead of a book review it’s going to be a movie review which is currently running on Netflix: Crypto Boy.

Well, it’s not going to be a typical review like a review of the cast, the sets, the soundtrack, the costumes, the script, etc., but rather an exploration of the content of the movie, because I think there are some interesting patterns when it comes to sort of „a first contact“ with investing – and the financial mindset overall.

Disclaimer: So for those of you who haven’t seen the movie yet, there are going to be lots of spoilers in the following text.

Although this movie is rather a family tragedy, the frame is the following: A 20 year old dutch, Amir, discovers rather by accident cryptocurrency, applies for a job in the company who runs and sells that crypto, invests in it, and eventually loses it all – while being revealed it was a big scam (Ponzi scheme).

 

Lesson 1:

Amir lives with and works as a delivery boy for his dad, Omar, an Egyptian immigrant who runs a Mexican restaurant in Amsterdam. The business is bad. Besides few customers, new investors are taking over the neighborhood, trying to buy-out the owners of the old established local stores and businesses. But Omar does not want to sell – his reasoning in short: he has his principles. Even Amir’s attempts to convince him to just renovate the restaurant to attract new customers fails.

Fast forward to the end of the movie: Omar eventually renovates the restaurant and sells it.

My two cents: This was actually a smart move from my point of view. Even though we do not know the final amount he gets, we can assume he got more out of it as if the restaurant was not renovated. Flipside to the investors: Successful entrepreneurs buy businesses who do not use their full potential, turn them around (make them profitable) and then re-sell them for a nice profit.

Side note: I’m aware of the many bad stories about such hedging companies who don’t care about employers or traditions and leave a lot of human drama buy buying-in, turn around every stone, and eventually leave – with their pockets full of cash while leaving a bunch of burned soil. This happens especially if the employers are not brought along for a new philosophy.

 

 

Lesson 2:

Amir accidentally comes across an investment opportunity (in this case, cryptocurrencies) while listening to a speech by the CEO of that crypto company at a live conference taking place in a random building where Ami has to deliver food.

The vibe of the conference is rather emotional than rational: Hyped by the possibilities of receiving 3% on their investments (as promised at the speech), and the horrified vision of never leaving the hamster wheel in a normal 9-5, he immediately applies for a job the very next day – and eventually gets hired almost on the spot after one conversation with a potential customer.

(To be fair, I guess they just need to speed up the action for the audience…). Oh, and of course Amir gets a nice „first bonus“ (a roll of cash), too, before heading home.

My two cents: The curiosity, passion and decisiveness to get the job is real. If you can bring that to the table, you are basically good to go for any job interview. Flipside to the companies side: Those are the people you should be looking for – more than any school degrees.

However, the naivety is unreal. Amir’s dollar signs in his eyes when he hears 3% makes him blind to think rational. This pattern is to be seen throughout the movie by a couple more characters by the way – and they all fail on that level.

Do I think it is “forbidden” to get excited when it comes to making money or finding a new investmen opportunity? No, of course not. But you should know what you or/and the opposite site (your business partner) is up to. Transparency and knowing what is going on is the key. Buffett is famous for saying that you should not invest in something you do not understand. The step before falling prey to the „get-rich-quick“ fallacy is the „invest-quick“ action part.

So in this case, Amir just runs into something he has no clue about. He is only a prey to (empty) promises.

Interesting though is in my opinion, that Amir does not fall prey to status that much as one could assume. His motive of making money is quite noble, actually, because he deeply wants to help out his dad. Although he parties with the other guys, and surely enjoys the exclusivity that comes with it, you do not see him buying fancy stuff at all throughout the movie. That is a good thing if you are serious in building wealth!

 

Lesson 3:

While working in the company, Amir trades clients’ money back and forth – while he does not fully understand the Why behind. He also invests all his money into that cryptocurrency. Worse, he also puts all the savings from his parents in it, too. Worse worse: he did not even tell his dad but did it secretly while his dad was in the hospital.
Of course it eventually turns out that the money trading which he had to do was part of the Ponzi scheme. Authorities eventually freeze all accounts and charge the CEO for fraud. Amir’s private account is of course among those frozen accounts – and all his and his parents money is gone. Not only that, by doing those illegal transactions he has to defend himself now, not only to the authorities, but also to his dad.

My two cents: Amir went all-in. This is usually considered to be a smart move. It’s decisive. It shows courage.

But not necessarily in investing, especially if you have not done your homework! The viewer never gets to see one single argument why Amir should invest into that cryptocurrency besides a promise of 3%, a shady claim at the convention speech that the banks play with the money of their customers, and the demonizing of a 9-5. All these claims were not even made to deliver valid points or provided hard facts in order to present a valid (crypto) alternative as a smart and superior investment opportunity based upon proven numbers, but only rather to rise the emotions of the crowd.

Summarize

 

Ok, so even though there are gazillion more things that could be discussed, here are my personal key investment lessons of the movie:

1. Do not invest (or sell) out of emotion.
2. Don’t bet everything on one card. Either diversify your investments or work out a certain percentage of your savings to invest in one thing.
3. Don’t sell yourself short: Don’t position yourself that you eventually have to sell and are forced to make a bad deal to get at least something. This happens if you either wait too long (for example while trying to hope to cut losses), or don’t take any action concerning your properties.
4. Use the incoming money from your profits to invest it back, not to consume it. The goal should be to become financially independent, which is accomplished when your incoming money exceeds your spendings – without you working for it.
5. Make thorough investigations in what you want to be invested.

 

I’m sure you have any additions. I’m happy if you let me know them.

Learn from a pro: Did you know that in the biography of Warren Buffett you can also find some mistakes of a flawed mindset by him? Check out the book in the book section here.

Remember the Winklevoss twins from Facebook? Well, they got rich by investing in Bitcoin…! Check out this super interesting book and their story here in the book section.

PS: By the way, I enjoyed the movie.