Bitcoin Depot ATM

Interview with Josh and Zach from Lamassu at The Block

In this video, you will see Kevin Loaec interviewing Josh and Zach Harvey, co-founders of Lamassu. They are pioneers in Bitcoin ATMs, and they are hiring!

In the beginning, Josh and Zach talked about their interesting decision to manufacture their machines in Portugal. As they were looking for an industrial designer, firstly they found out that China is good for large production, but not so great when you are getting started with just a prototype machine made out of wood and assembled in their backyard. So, they continued to search, and by coincidence, they stumbled upon Claudio in Portugal, who managed to understand their needs immediately and they are working together ever since.

When asked the question, if they ever considered going into the operating business, they reply with a firm no. In their opinion, it is simply too much. It is a completely different business with so many different aspects. They respect the operators, saying that it requires a lot of hard work to operate machines, getting the cash flow, finding the locations, dealing with customers and of course dealing with banks and regulators.

Another point that Zach and Josh made is the fact that things are not moving fast enough and there are some countries where there isn’t too much competition, thus the fees are much higher. They mentioned Germany as an example where there are almost none Bitcoin ATMs due to the strict stance that the regulator took setting up really high upfront costs for obtaining the license in order to operate a Bitcoin ATM legally.

After that, they touched upon the Location topic, where they agreed that the bars and restaurants are probably a bad idea because of the disturbance that ATM users can cause to other customers and vice-versa. The best locations, as they say, would be the convenience stores, because people could go in just for the ATM without disturbing anyone else, and most importantly, they are available 24/7. The bottom line is that people just want a place that’s convenient.

That led them to one of the good points related to the operating business, and that’s scalability. In other words, if you managed to organize the operating business for one machine, it is going to be much easier to organize it for 30-40 more. The reason is that you already dealt with the regulator, you already dealt with the bank, you already have the server up, you already have some experience in picking and setting up the location. So, the point is that operators should definitely not focus on operating a small number of machines.

The next question Kevin had for Zach and Josh was about the problems involving the loss of funds. In other words, has anybody ever accused them of putting a back door, or in any way being responsible for money loss. They say that it happened before, but every time it was proven to be the operator’s fault. Usually, because they were using some shady wallet. As they say, nowadays it’s very hard to secure your Bitcoins, but their machines are holding pretty well in these circumstances.

Later on, they gave us some insight into organizing the Bitcoin ATM manufacturing business. Basically it is a combination of coordinating the manufacturing, actual shipping of the machines, sales, marketing, and all the software stuff at the same time. They also emphasize that the manufacturing business consists of two different segments: the software side and the actual manufacturing of the machine. That means that some manufacturers actually handle only the software side, and get the generic kiosks to put it in. While other manufacturers, like Lamassu, design and manufacture their own machines from scratch. That way they have something that’s unique.

Finally, they talked about the need to allow other coins besides Bitcoin. About a year ago, the fees for Bitcoin got super high making it unprofitable to buy through machines. Therefore, they had to have some other coins, with lower fees, that people would want to buy on ATMs to secure the cash flow. Currently, that is not the situation since the Bitcoin transactions make about 90%, but it is good to have multiple coin options in case that fees go up again.

Summary

To summarize, manufacturing and operating are two totally different businesses. In operating, you have to deal with many different aspects, but the competition in certain countries is low and scalability is high. If you are a manufacturer it’s better to design your own machine and allow multiple coin options.

2 thoughts on “Interview with Josh and Zach from Lamassu at The Block

  1. IMPORTANT ADVISE ABOUT LAMASSU CRYPTO ATM COMPANY

    We are Near Nepal Associates S.L company in Spain. We bought a Crypto ATM machine called Sintra to Lamassu Company 10 months ago and this is been the worst purchased and business of our lifes, a real nightmare with this machine and it company members. 10 months ago that we bought the atm and only has been working for less than 3 months. First it took 4 months for the company people to realise that the error was in the hardisk, meeting after meeting every day for 4 months. Once the hardisk was replaced, then it works for 2 and half months, after this time, the atm again stop working and now it is more than 2 months that they are trying to find a solution but nothing yet. We do have to pay all our expensives every month and they don´t take any responsability on this. Support always late reply on e-mails, they don´t give us faster communication with social network like telegram, whatsapp, All the online meetings we had were just using text messages. Support is not professional at all. They don´t give us any solution like sending another atm so at least we could be working while they find a solution, and of course now we ask them to take back their machine and pay us back the money of the atm machine and they don´t want to do it. This company and his team are not proffesional at all, and they just lie and put excuses everytime. Our worst business experience ever had and we lost so much money because of them.

    This is our experience, so just to let you know how this people of Lamassu work.

    1. Lamassu’s response:

      We acknowledge that Near Nepal Associates purchased a machine and were unhappy operating it.

      Our support team is professional and courteous and continuously attempted to resolve the issues they were experiencing. Unfortunately, from an early stage Near Nepal proved to be extremely uncooperative, unjustifiably abrasive towards our staff all while threatening to sue us for compensation throughout the process. We continued to provide support despite this, but after months of their unreasonable attitude we insisted on respectful behavior in order to receive further support.

      To be clear, by uncooperative I mean that rather than simply follow tech support’s instructions, they used each support ticket reply to create more friction. Had they simply wanted our help, rather than to extract money from us, support could have moved a lot faster.

      Near Nepal also threatened a smear campaign on us if we did not surrender to their terms of compensation which are clearly contrary to our Purchase Agreement.

      We understand that the experience must have been very frustrating for them, but we can’t put all of our resources into one operator. They wanted to monopolize our time and caused stress and anxiety to our team which started to have an effect on the rest of our operators. There was no excuse for their behavior, and we would do the same if any customer thinks yelling, screaming, threatening to sue, and threatening smear campaigns is a legitimate way to get our attention.

      We will not reply any further on this matter. We have been manufacturing Bitcoin ATMs since 2013, have produced over 1,000 machines and our reputation speaks for itself.

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