How Lyn Alden Will Take on Bitcoin DATs and Private Equity With Orange Juice

**Lyn Alden** (0:00)
We think in our case, because the whole strategy is really about building this diversified set of uncorrelated AI-resistant cash flows and then attaching a Bitcoin treasury to it, accumulating those retained earnings into Bitcoin. We generally think that that sum of parts analysis makes sense.

**Laura Shin** (0:17)
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Today's guest is Lyn Alden, co-founder of Orange Juice. Welcome, Lyn.

**Lyn Alden** (0:51)
Happy to be here. Thanks for having me again.

**Laura Shin** (0:54)
You announced last week that you had raised $40 million to launch Orange Juice, a permanent capital holding company that will acquire, improve and permanently holds cash flowing businesses backed by a Bitcoin treasury. How did you come up with this idea for Orange Juice and what problem were you trying to solve?

**Lyn Alden** (1:11)
Yeah, good questions. I mean, first of all, we have a very strong team. It's certainly not just me. Some of the headlines will put my name on it, but this has been a really big team effort. So it's the partners at Ego Death Capital, along with Ruben and Adrian from other ecosystems.
The idea actually goes back to early 2025 We've been working on this for a while. This isn't just something we put together this year.
It's been a process to figure out the exact structure, how to bring it to market and all that. The main focus was that there are a lot of treasury companies out there, Bitcoin treasury companies.
One of the biggest criticisms against them is that they don't have cash flows. For those seeking pure play, levered Bitcoin approaches, that can be a plus in some contexts. For others, it's a minus. It certainly adds volatility to the upside and downside. Whereas we view that if you have a stable cash flows, like operating cash flows, that provides a really good foundation that you can then use to build a Bitcoin treasury. If anything, ever since I saw the first company come to market and add Bitcoin to its balance sheet, I've been expecting to see a variety of other companies want to add some Bitcoin as well. But they've actually been quite slow to do that. Most of the ones that have done it are more Bitcoin adjacent type of companies or they're springing up specifically to do the strategy. Whereas I'd actually love to see just boring companies add Bitcoin to their balance sheet. If anything, I think value stocks that are underperforming in this winner-take-all market, they slowly become a smaller part of the economy over time. One of the ways they can protect themselves by owning a truly scarce asset. Instead of sending all their cash flows out as dividends or as buying back their own shares and stuff, they could be holding this asset.
After years of waiting to see more companies bring this to market, a couple of us, a bunch of us decided, let's go and make this happen. The other reason is that there is a really big, strong demographic force of American business owners. In general, are aging. Many of them are looking to pass on the wealth that they've built, and there's a variety of options to them. One of the hardest things you can sell is a business, because of the size and uniqueness of each one. The main option for companies in that small to medium size is private equity. Private equity serves a very important spot in the market. It obviously provides liquidity for these businesses that are otherwise quite illiquid. It can be very hard to find a strategic buyer. But many would say they have a negative reputation, and I think at least some of it's well deserved, which is PE funds generally have a 10-year life. The typical life cycle, what they want to do as a business is go in, and within a three to seven-year period, they generally want to flip it, so they lever it up, they cut costs pretty aggressively. They try to find ways to boost the multiple, and then they want to either bring it to IPO or otherwise exit that position to optimize for that more short-term gain, potentially at the expense of that long-term success of that business. Studies show that companies that emerge from PE have a higher than average bankruptcy or financial distress rate, and it's because they're in some ways hollowed out. They might otherwise have a good business operation, but they've been hollowed out for that short-term flip. Whereas it's rare, but there are other options, permanent capital vehicles that actually want to own that company roughly in the format that it's already in. Happy to make modifications and help them where possible, bring additional scale, but otherwise keep in tact the legacy that they built and not have that kind of four to seven year or three to seven year mandate to flip and get out of it, which just totally changes our incentive structure.