Ep 289- Perpetuals CEO Patrick Gruhn

**John** (0:00)
Hey, it's the FinTech Newscast. My name is John, and with me as always is Steve. Welcome to the podcast.

**Steve** (0:06)
Thank you, John. Happy to be here. Not on the beach, but we know we're here.

**John** (0:11)
We got you out of the way. Let's get to our really special guest for the week. Patrick Gruhn, the CEO of Perpetuals, among many, many other things. The word serial entrepreneur gets thrown around casually these days.
But we really have to put a capital E on entrepreneur for Patrick. So glad to have you on the podcast. Yeah.

**Patrick Gruhn** (0:36)
Thank you for having me.

**John** (0:38)
So many things to ask you, but we'll start with your most recent press releases that we saw, your newest product, I think, UpsideOnly, which says it has risk-free trading. So people suggest or bring trading ideas. And when you trade on it, they can participate in any gains that come about from it. And I guess if they have bad ideas, you just don't trade on it. So there's no loss that's expected anyway.
Is that a fair summary of UpsideOnly?

**Patrick Gruhn** (1:14)
Yeah, that's pretty much accurate. Yeah. I mean, so how it works is people trade like they would usually do. The only difference is they have no real money at stake.
We just give them virtual money, so monopoly money, if you will. So and then they do their trading strategies. And we have an AI build, that's basically the main secret source in this, which selects the goods from the bad trades. And if the trade is good, we do the trades with our own capital as a prop trader. And if we win, we pay 50 percent of the profits to the clients that gave us those trade segments.

**John** (1:48)
Oh, great, that works out really well, because all I have is monopoly money. So that's the only way I can trade.

**Patrick Gruhn** (1:56)
Yeah, the real problem is that more than 90 percent of the people, actually 99, if you look at longer studies, are losing money. So that's why it's really a big deal. So because if you go into retail trading, like day trading or leverage trading specifically, then you will just lose. And that's really the problem we are tackling here.

**John** (2:18)
Yeah, a lot of people treat the market, especially these days, more like gambling.
Or has it been so gamified? Gamified with like a Robin Hood, that kind of thing.

**Patrick Gruhn** (2:30)
But if you go to the casino and you go to the roulette table, you have almost a 50-50 chance. And like the numbers, the empirical studies say on trading with leverage, it's less than 1 percent.
So, I mean, this is way worse than gambling.

**Steve** (2:45)
Wow.
So, how is, you know, I'm curious, you mentioned this trade as well. How quickly can you do this? How quickly will the AI that you have created, determine whether this is a good trade or not? And then how quickly can you actually action that trading? Because, of course, in trading, time is money. So, how short is that window of action?

**Patrick Gruhn** (3:05)
So, this is analyzed in real time, but we need from every trader, let's say roughly like 3, 4 weeks, it depends on how much they are trading on historical data, because it learns from the historical trades and it identifies where are they good at. So, like one person might be great in gold long trades, but very poor in everything else. So, like Bitcoin, he always loses. So, and this is basically what the AI is discovering.
So, it needs like 3, 4 weeks, but then it's basically instant. If the people enter the trade, it's analyzed in real time.

**John** (3:39)
From your website, you see, it looks like it spits out a percentage probability that this will happen or not happen.
What counts as a good trade? What triggers you to action? Is it a certain percentage? Or does it depend on the type of trade?

**Patrick Gruhn** (3:56)
Yeah, technically, it's really like a probability score that at the end, our AI determines for every single trade. So, I mean, it's a little bit more sophisticated in total. So, it's a cohort of traders. It's usually not a single trader. So, it's like, let's say, five or 10 traders together. If they all enter to the same direction now, if they would like go into gold long right now, this might trigger basically the signal. So, it's a group of traders because it's all about collective intelligence. So, in very simplified terms, as I said, 99% are losing when trading or are only flat. So, really, the data shows 90% are losing, 9% are plus minus zero, right? So, hovering around, break even, and 1% is making money. And this is basically identifying the 1%.