In Conversation With The CEO of tZero Saum Noursalehi
We had pleasure interviewing Saum Noursalehi, the CEO of tZero. tZero is a majority-owned subsidiary of Overstock.com. The alternative trading system, operated by tZERO ATS, is the first SEC and FINRA regulated ATS to enable support secondary trading of digital securities. This system includes democratizing access to enhance transparency and an increase in overall efficiency. After several years of development, tZERO has positioned itself to capture the fast-growing digital securities market.
Can you tell us what inspired you to pursue this career path? What do you want others to take from your story?
From an early age, I was always interested in creating things, whether it was art, stories, film, or later, building computer software. Once I got to college, I decided to pursue my passion for technology by studying Computer Science at the University of Utah.
After graduation, I started my career as a software engineer at a few companies, where I first learned about a fun, innovative company called Overstock.com. I applied and got a software development job there, and the rest is history. I worked at Overstock for around 12 years and held various roles within the company, including Vice President of OLabs, Senior Vice President of Marketing, Senior Vice President of Product Development, Chief Revenue Officer, and eventually, President. After over 12 years of eCommerce, I began to think about the next chapter in my career and started to explore options in both artificial intelligence and blockchain spaces. It was at this point when the opportunity arose to become the CEO of tZERO, which I could not pass up.
While it seems that some people know exactly what they want to do with their lives from an early age, it took me some time to find the passion that I wanted to dedicate myself to. It was only through the exploration of a variety of roles that I discovered that my greatest interest was in leading technology teams in a product-focused organization. I recommend others in a similar situation to do the same.
Could you tell us about any of the interesting projects that you are working on currently?
An interesting project that we are currently working on in partnership with Box Digital Markets is the launch of the first regulated national security token exchange through our joint venture, the Boston Security Token Exchange (BSTX). With BOX’s experience in building and operating a sophisticated securities exchange and tZERO’s industry-leading blockchain technology, we have brought together our organizations’ combined expertise to improve the marketplace for digital securities fundamentally. We expect this to launch in 2020.
Is there a particular person who you would like to credit with helping you get to where you are? Can you share an anecdote about that?
There are three individuals I would like to call out: my father, my mother, and Former Overstock CEO Patrick Byrne.
As a Computer Engineer, my father has always been passionate about technology and Sci-Fi, which sparked my interest in technology. He encouraged me to follow my passion and pursue a career in the industry.
Growing up, my mother pushed my brother and me to try a variety of activities and applied the appropriate amount of pressure for us to reach our potential. She really instilled us with a mindset that we can do anything that we set our minds to.
Lastly, Patrick was my business mentor and provided me with opportunities to apply my skills.
What are the five things that you think are most fascinating about blockchain and crypto? Why?
- Efficiency and automation brought by smart contract technology. In our case, regulatory compliance can be coded into the assets themselves – to do a lot of the jobs that have historically been done by a matrix of intermediaries with inefficient results.
- Transparency: The blockchain keeps a permanent, non-changeable (i.e., immutable) record that can be viewed by anyone that needs to see it.
- Enhanced security: Records are highly secure through cryptography (i.e., digital signatures and encryption).
- Decentralization: Blockchains are not controlled by any one person, group, business, or government. They allow for the record-keeping and rules to be determined by the consensus of the majority of participants. Incidentally, this also reduces the impact and risk associated with “too-big-to-fail” financial intermediaries.
- Reduced costs by eliminating intermediaries (as noted above, and including, as and when regulation allows, through enabling peer-to-peer transactions).
What are the five things that concern you about blockchain and crypto? Why?
- Performance and throughput: Blockchains are still in their infancy (analogous to the internet in the ‘90s), and writing new blocks to the chain is slow, limiting the number of transactions that they can process in a timely manner. This will improve with time.
- Transaction costs of current blockchains: Gas fees are relatively expensive and can fluctuate wildly based on the volume of transactions.
- Power consumption: Today the proof-of-work consensus algorithms are expensive from a power consumption standpoint. There are several projects/solutions in the works, such as proof-of-stake that aims to address this, but they currently have their own set of tradeoffs.
- Regulatory reform and acceptance: tZERO has adjusted its products and services for the current regulatory landscape. However, it would take regulatory reform to fully unleash the five fascinating things about blockchain listed above (particularly for digital securities). For example, updating the rules regarding custody and control of digital assets, as well as further democratizing access to traditionally inaccessible private investments through further reform of rules regarding private offerings and resales of securities. Today this is defined by income or net worth rather than financial literacy.
- Lack of education: Many still do not understand blockchain or distributed ledger technology, and the learning curve is steep. This is slowing adoption.
How have you used your success to bring positive change to the world? Can you share a story?
At tZERO, we are building the next generation capital markets platform, capable of tokenizing, trading and settling digital securities, which will democratize access to investments that were previously not open to the world, such as real estate or art. By opening illiquid assets up to ordinary people, not just the wealthy, I believe that it has the potential to increase people’s quality of life, which in turn could bring positive change to the world. While we are still a growth-stage company, we are excited about the potential that our robust platform could bring.
What are the three things that you would advise someone who aspires to emulate your career? Can you share an example of each idea?
I would advise someone who aspires to emulate my career the following advice:
- Discover your talents and interests at an early age by trying various activities. Become obsessed with your passion and master your craft.
- Find a mentor/role model who provides you with guidance and constructive feedback.
- Be courageous and take risks.
What is the one “Life Lesson Quote” that you stand by? Can you tell us how that had relevance to your own life?
Albert Einstein once said, “We cannot solve our problems with the same thinking we used when we created them.” This is a life lesson quote that I stand by and believe holds to what we are doing at tZERO.
We continue to work toward our vision of creating a robust ecosystem powered by blockchain technology for investors to have venues to buy and sell digital securities, integrating the technology to tokenize assets and establishing direct relationships with customers (subject to our wholly-owned subsidiary becoming approved as a retail broker-dealer). Since we are a pioneer in the space to advance capital markets through blockchain technology, we continuously push our teams to think ahead.
When a hurdle arises, we push our teams to be nimble and think outside of the box to find a solution.
Who would be one person (living or nonliving) in the world that you would love to have a private breakfast or lunch with, and why?
I would like to have a private lunch with Steve Jobs, who I believe built the greatest technology company of our time. He was able to pull together several ideas into a product effectively. As a technologist, what I find to be more impressive was that Steve and his team were able to execute that product in a way that no other company or individual could have. I would love to sit down with him as I admire his company’s attention to detail and the ability to continuously innovate.
Where can our readers find you on social media?