Show 162 – Unicorn Interviews – Michael Gronager, Chainalysis

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The 30th in our series of episodes that we’re recording in partnership with the European PR agency Tyto and their own Without Borders podcast, where we are interviewing leaders of unicorn companies to find out about the key issues, pain points and challenges that start-ups face and how they can address them with a strategic approach to communications.

Russell Goldsmith and co-host, Tyto’s Senior Partner, Holly Justice were joined online from New York by Michael Gronager, CEO and co-founder of Blockchain Data Platform Chainalysis. Founded in 2014, the company reached unicorn status in 2021 and is now valued at $8.6 billion.

Company background

Michael thinks that every company in the world will become a crypto company so that any value will be tokenized and anything that moves around a value will happen on a public blockchain at some point. He believed this since 2014 and to this day continues to do so.  What Chainalysis are doing is indexing and analysing all data on blockchains and today using anything from helping crypto businesses to compliance to the public sector to keep citizens safe by being able to investigate cases and prevent them. Also using the data to help companies and business intelligence and market intelligence about what’s happening in this space. As Crypto grows so does Chainalysis and when Chainalysis is growing this makes the space grow.

Career history/ Entrepreneurial journey

Since Michael was a kid, he always saw himself as an innovator and coming out of university the first thing he investigated was Virtual Reality. After that he ventured into other parts of distributed computing and data. It’s the opportunity of analysing this data that interest Michael, the ability to look at data and gain insights has always been big. Before crypto he spent a lot of his time analysing data for high energy physics projects as there was a lot of big worldwide science projects. For example, he was in Europe and part of the large Hadron Collider project at CERN where he analysed data by moving around petabytes of data to different computer centres, enabling researchers to analyse them. When he stopped working in the public sector space, he wanted to do something else because again, he described it as being bitten by this bug around innovating and building something yourself. Through this he stumbled over crypto.

Back in 2011 there was Bitcoin and Michael was intrigued by this new technology. It was clearly a paradigm shift in computing, and it was also something that could become a megatrend at the size of the Internet. Being so interested in this, he dabbled around in doing crypto coding like building early services in Bitcoin. He questioned how he was going to build a company around this and got approached for working at Kraken. Not knowing anything about finance he took the leap as it sounded fun. The industry was growing a lot, so it became clear to him his expertise was in big data and a company that didn’t exist at that time, which was basically indexing and understanding all the data that is in the crypto space as it was growing. So that became his passion and he had to simply leave Kraken to build Chainalysis for that purpose.

The next steps for Chainalysis

Michael pointed out two important things to understand about crypto and how they are spending their funds. Firstly, everything is always changing and there’s a lot of innovation happening in the crypto space meaning Chainalysis need to be deep in the product side and innovate there all the time. Building products like Storyline and Playbook enabling investigations into smart contracts into how defi activity works. So, spending a lot of time and effort really building the right tools and products around the DEFI space. The other piece is on the business intelligence side, Playbook, which is another product that they are really focused on building and getting to the market. The other thing that’s permeating the crypto space is that it’s global. Crypto is everywhere and it’s born as being global. Meaning for a company like Chainalysis they can’t just focus on one jurisdiction on one country, they need to be global. So, they’ve been growing their footprint in terms of sales and marketing globally being in around 70 countries in terms of sales. Where sales grow in certain countries it is important to have a team there so growth is a big part of that.

Inspiring leaders

Michael said there are many individuals that have had an impact on him as a leader. He learns the most about leadership from discussing with other leaders and trying to understand how they do certain things. He mentioned a few leaders such as Todd Olson at Pendo and Manny Medina at Outreach who are people he speaks to frequently. He said there are lots of leaders out there and some from earlier on in his career who he keeps in his network because they would have experienced some of the same things. And as companies grow, they learn a lot from doing so and what to do and what not to do. Rounding up by saying many leaders have influenced his leadership style.

Main strengths

Michael explained he thinks his main strength is empathy and trying to understand the problems in a business and the problems of the individuals that they’re trying to solve. And getting deep into that and he has the responsibility of everything in the end. So, he needs to ensure that the priorities are right, that they look at it the right way and bring that into the different departments and bring that prioritization into the different minds of the different people there. So, his skill set is a lot about communication. It’s not about trying to understand the different areas as he is no expert in sales. But he can talk to the people there and build the connections there. And then he would say he has a skill set in going from helicopter view all the way down to the microscopic view and look at the actual problem. So usually when people present a problem to him, he discovers that isn’t the actual problem. And the management team are very strong leaders and with that all came from companies who gained unicorn status. Companies of $100 billion today and the biggest is SaaS software. And from these leaders he has learnt to not obsess over problem and find what is worth focusing on asking questions like: what are the things that worth focusing on? What is the time it takes to build things? What are the timescales involved? Because it’s easy to be naive. It’s like seeing at scale at the first time. He said it is important to be proactive as people can always leave things for tomorrow but starting today is where you start to see results.

Recruitment process

Michael describes getting these leaders to join Chainalysis was a humbling experience. He remembers jumping on the first call with them and thinking they will never be hired but he knew this would be transformative for the company.  He had to go all in telling them why this is a very unique company that they are building. It’s not one of many, it’s the only one in the space. And what they are doing is truly an iconic company. That’s something unique. He won their hearts and mind to Chainalysis, but it was not easy. A lot of conversations, discussions and building trust with them is a big thing and his ambition got them there. It was a good challenge.

Perception of the company on becoming a unicorn

Overall, the perception does change. Internally in the company it is the realisation that it is real, realising the journey where it is becoming something that is a big deal. It also makes the company look like a company someone would want to join and it’s on a growing trajectory. It’s very promising. It’s being talked about in a certain way. And he thinks that it also enables you to make certain high-profile hires that would be hard to make otherwise. Another piece of this is the perception from customers where they’re going to stick around for a while. They trust them as a company and can see that they have the size where it makes sense to really work with them and to dive deep here. And Michael thinks that’s another perception that changes in that capacity. And finally, it goes for all the hires. When you hire people, it also means that everyone that joins the company looks at the size, the valuation, the scale, the future of the company and will be like this is probably less scrappy now than it’s been in the early days. And it means that now he’ll have a career path, you understand how to talk about benefits and other things. So, it’s a real company in many ways, and he thinks that that has opened the door for talent that would otherwise be hard to access.

Differentiation in the marketplace

There’s a couple of unique things about Chainalysis that’s actually helped them differentiate over the years. And Michael thinks that one of them is that what they are building is unique. So, they’re not one of many and not operating in a red ocean. They are building the market for themselves and growing the TAM by every day and working with new customers. So, he thinks that’s always intriguing to be part of because that’s not that many companies that does that. Usually, you have a better version of something and then you disrupt the market. And it’s very simple to understand what you’re better at and selling that way.

The other piece is that what they are doing is very mission driven. If you look at some of their customers, they have around 150 public sector customers in 35 countries in the world. And all of those, they are there to keep society safe, to keep the nation state safe, to protect them, anything from terrorists through to nation state actors and other things. So, it’s largely mission driven and ensuring that you can gain the trust of that kind of institutions. And that is a lot of serious work that’s involved there. That’s a huge part of Chainalysis culture to really deliver high quality data and be humble about what they’re doing and building trust in their relationships all the time. He thinks that’s been a core part of the cultural drive and how they are working with the customers and internally as well.


The culture at Chainalysis is mission driven. Everyone has a purpose because they see that getting better understanding of crypto, indexing it, understanding what’s going on in the crypto space, but grow the space and make this world a better place. Michael thinks that’s one of the things that people clearly believe in within the company. And that’s an important piece. He also thinks that cultural wise, there’s a little bit of like an academic side to things where understanding and knowing things about the blockchain drives this curiosity. So, there’s a curious side to the company as well. And then people who know Michael, they usually say that it has to be fun. It needs to be fun to work and it needs to be part of that. He always promised everyone that is hired that this is going to be a fun journey. It must be inspiring. Getting to know a lot of very interesting people and what you’re doing is fun.

External communications

Michael explained what happened in the markets, if you look at 2021 to 2022/3, is that in 2021, a great company where a company that was basically growing like crazy and nothing else, nothing else really mattered but growth because access to capital was very, very easy. Raising money was super easy and it was cheap. It’s hard because the any dilution and so anything. So, the main focus last year was growth. Now looking forward, they are kind of back to maybe something that was an area to five, ten years ago where it was more like you need to have a path to profitability. You need to understand how you build efficiencies into the company. And I think that’s very much like how Chainalysis was born. Like you’re born out of a crypto window. The space was really hot that time. It was almost impossible to raise our seed round. They’ve been used to that kind of rapid growth, so you put it that way, but still growing. What they have changed in terms of communication is clearly that we focus right now much more on efficiency, a cautious, sustainable growth of the business and like ensuring that they do that with the mindset of becoming profitable at some point. This is just like how it is to be a great company of today and tomorrow.

Internal Communication

Internally they share as much as they can, so they keep a very open culture. They like people to know what’s going on. And it’s on the mind of the leadership team where the company is headed and sharing those things, so that’s a core part of it. Access to the C-suite and to Michael is another important part where he’s always happy to do a coffee walk with people and say, hey, I want to chat this thing through. There’s a thing about communication that is the one thing you can say publicly in a big room. And it’s very simple, but it also becomes very easy to misunderstand. So, there’s many nuances. And that’s why communication through leaders, through managers is an extremely important thing. And also, the access to Michael, to the C-suite is important where employees will have that access and ability to raise questions, have a conversation where it’s not like 200 people in a room, but just a one on one. These are key pieces of communication to keep the different layers going all the time and understand the different parts where they matter.

Michael still does onboarding for everyone. So once a month he does on board the latest cohort of Chainalysis people. He likes to do that in person. It means that he presents something about the company. It always changes slightly from month to month and people have the opportunity to ask questions or chat to him. He has office hours once a week where people can jump on a call with him. Or usually what he prefers is if he meets them in person, go for a coffee with them. They are more than 700 people today so it’s a lot of people and it’s a lot of people who got hired the last year. They did an all-Hands event in DC a couple of months ago with 650 people or so in one room. It was great for Michael to meet everyone and that was a core part of building for the next coming years to have the ability to see everyone in person. He loves that part, and they’ll probably do it again at some point. It’s not happening yearly. It’s probably happening less than that but it’s still important to have the opportunity to see everyone Michael explained.

Role of representative of the business

There’s a couple of things that Michael learned from being a spokesperson. First of all, and it goes in all communication. Michael said: “If you want to state something, you need to tell the story differently because you can’t just say whatever. If you are a crypto exchange or an exchange or bank, you would say your money is safe. As soon as you say your money is safe, everyone is like, were they not safe? What happened so soon? As you point people in a certain direction, they go nervous around the topic that you are talking about. So, I’m always focused on how do you build trust? How do you say the bigger picture? What is the bigger picture of things? And then people will form your own conclusions. You cannot tell them whether it’s A or B or whether it’s blue or red. You have to tell them and include them in the journey and do that all the time. So, I’m doing that also in external communication, doing that internal communication. Being the spokesperson is a big responsibility. And I think that’s just part of, of my job. So, I enjoy it. I have to say that.”

External communication differences in Denmark

Michael explained in the US everything is faster and there’s just bigger in the US compared to Denmark, where he is originally from. Denmark is a country of 6 million people and is a part of Europe where everything is smaller, and it is moving slower of course. The podcast listeners who are interested in tech is also a lot smaller over there and doesn’t have the same critical mass as it does in the US. He thinks that changes because people are focused on questions like:

  • What are the companies that you are building?
  • What are the number of people that you have hired?
  • How did you hire them?
  • What are the problems around that?

Michael explains you don’t get the same focus in smaller ecosystems like Denmark. He enjoys the change and the pace.

He has always enjoyed communicating and has his own style. It’s much better at improvising than at preparing. And he would say he’s in the journey of becoming a better and better communicator, he had a couple of times where he got advised, let’s try to practice this first. Let’s do this, like for real, and it just doesn’t work. He tells a story in his own way and then people can work something around that and can kind of home in on what the pieces of the story that the work does but trying to present more like being very overprepared on a story. It just doesn’t work for him. And he learned that over the years that he needs to somewhat improvise. And that’s how he likes to have these communications. Part of what makes it fun.

Communication challenges

The first challenge was when he worked at an accelerator early on in Chainalysis and was doing an opening pitch the first day of the accelerator, opening Techstars accelerator. And it was 90 seconds or maybe 3 minutes. And one of the challenges around 90 seconds and 3 minutes is it’s too short to improvise. You basically don’t have enough time to go on a tangent. So, you actually need to just say something and it’s also long enough. So, it’s just a one liner that you can go up on the stage and basically just repeat. So, you need to rehearse that. He finds that hard; to build a story and a narrative that you just start saying and continue to do that. He’s not good at super scripted stuff. He needs space to tell his story in his way. Today the way might be different than yesterday.

Advice to your younger self

Michael’s advice is that when you communicate, you need to overcommunicate. When you said it three times, you probably need to say it three times more than that. It’s really a huge part of communication that the receiver is from another part, looking at it from another viewpoint. And for them it’s really hard to understand what you are saying and remembering that all the time. And communicating is probably his biggest advice there.