Harnessing Wind Power: How Simple Mining is Revolutionizing Bitcoin Mining in Iowa

Hello everyone.

Welcome back to another Stocktritz executive interview.

I'm Katy Perry joined here by Nick Garland, COO of Simple Mining, a really fascinating company that just made the Inc 5000.

Nick, thank you so much for joining us today here on the floor.

It's great to see you.

You as well.

Thanks for having me.

Looking forward to learning more about you and obviously this really fast growing company that you're with out of Iowa.

We don't talk to a lot of companies from Iowa normally, so this is exciting.

Yeah, I am, I am New York born and raised, so definitely not an Iowa native, but You have an appreciation for the state and a connection because you are a former baseball player.

So tell us about that.

How do you go from professional?

I see you played professionally for a couple of the Twins, the Pirates.

How did you go from being a baseball player to bitcoin mining and helping run a Bitcoin mining company?

Anybody that's familiar with baseball or minor league baseball players, that was not did not make it to the big leagues, but.

We don't get paid a lot of money, so I came home from an off season with a couple of dollars in my bank account.

My little brother actually at the time, he had had an idea that we should get into the Bitcoin mining.

So actually Adam Haynes, our CEO, met him on Twitter one day, started.

You know, talk and shop with him and became a client of Simple Mining.

So this is when the company just started, so we became one of the first clients of Simple Mining and then asked him not to charge me anything and that I'd refer him a lot of business and kind of just worked out a good relationship and we built the company from from there.

So it's been a lot of fun.

There's 75 employees now and you mentioned In 5000.

We've been growing very, very quick and Happy to dive deeper.

I want to get into the growth.

I'm fascinated where it's coming from.

I feel like we all have a crypto brother though.

I have a crypto brother too.

He's more on the Ethereum side, but he was pushing me in that direction a few years ago as well.

I probably should have listened. to him, but let's talk a little bit back up.

Let's talk about the company, because Bitcoin mining, I think for a lot of people who are interested in it.

They kind of understand it conceptually.

They might own some Bitcoin.

What does simple mining do?

And when you say you were a client, what does it mean to be a client of simple mining?

I think I like to use a lot of analogies.

I think the most simplistic view is we're a property management company.

If you have a condo in Florida, you probably have somebody manage it for you if you're from New York.

So basically that's what we do.

We have in Iowa specifically a very low cost of power.

So Iowa is the leading state in the US from a wind energy percentage standpoint.

So 65% of our energy comes from wind.

It's a very good state, very low cost of power.

Adam coincidentally is from Iowa, and that's where the company was started.

Basically we just make it very easy for anybody in the world to mine Bitcoin.

You know, so you like you have these physical location we have we have data centers if you go on our website or Twitter or LinkedIn or whatever, you'll see massive data centers with like what look like shipping containers.

OK, and those shipping containers are filled with physical bitcoin miners that are you know 30 to 40 pounds each.

They're.

No different than the computers behind us basically and they mine Bitcoin.

Mining Bitcoin in New York, for example, would be very difficult because our cost of electricity is very high.

So we have access to cheap power.

All of the infrastructure is very expensive to build out these sites.

So we build the sites, we manage it, and then kind of handle the day to day operations if the machine breaks.

We'll fix it.

So the property management, I guess.

Analogy is a good one for this.

How big is this footprint?

Is it like a warehouse, a mall?

Yes, so we have currently 9 sites.

So we're the largest bitcoin mining company in Iowa.

OK.

We actually just set up the largest mining site in Iowa.

It's a 50 megawatt hydrocooled site, so the machines are physically cooled by a liquid, basically, but these containers, like I said, they're think of like a shipping container and any individual site could have anywhere from 5 containers to You know, 50 or 100 containers.

So it's not a massive footprint, you know, like as far as total land goes, but from the standpoint of how much energy we're using, we are effectively the largest customer for every utility company we work with.

I was going to say your energy bills, yes, you won't.

I won't ask about the raw numbers, but I would love to see them because I feel like that would be hilarious.

Like I complain about my air conditioner unit.

It's pretty interesting because we, and not to sidetrack, but There's a lot of misconceptions about energy usage in Bitcoin and just energy usage in general, and there's a lot of misconceptions in the media about energy usage being a bad thing.

If you look at any of the, you know, the US, China, India, any of the Countries who have the highest quality of life generally have the highest.

Energy consumption per GDP.

So when you kind of look at that and you consider we have, especially in Iowa, a lot of renewable energy.

If renewable energy is not used, it's wasted.

So we come in as kind of this like consistent buyer for this energy actually allow the government and utilities to build out additional infrastructure to accommodate.

More renewable energy because they know there's a consistent buyer and then when there is an excess of demand on the grid, so let's say it's very hot out or very cold, we have a storm Friday, I think, right here in New York.

No, we can actually shut off 100% of our load and allow the rest of the grid to Use that that it's helpful to understand sort of the physical layout you have.

I'm picturing this in Iowa.

So somebody has their unit in your space that they're paying you for when someone makes that decision, I want to be a client of simple minding or someone else.

Why are they choosing that path in addition to or maybe instead of owning Bitcoin in a coin-based wallet or something like that?

We, we very common question you know why mind versus buy Bitcoin.

I think there's a lot of different considerations and by no means are we, we are not financial advisors and we don't know what the price of Bitcoin is going to do tomorrow or a year from now, but really what we're in, we're in the service industry and why mind Bitcoin versus buying spot for a lot of investors we get a lot of family offices, business owners, you know, some public private companies, but It's, it's a lot of, there's a lot of tax benefits with mining specifically where most people don't know this, but with the big beautiful bill 100% bonus appreciation coming back and not a CPA, I'm not a tax advisor, so to get that out there, yeah, but you can, you can write off 100% of the purchase price of your equipment and again there's different variables depending on your tax bracket and what state you're in.

New York's different than Iowa, but on the federal side you can write off 100% of that purchase.

So for a lot of investors there's a tax play there.

Um, and I think for a lot of people also there's very much so an emotional side to mining versus just buying spot, right?

You're getting Bitcoin every single day with these mining machines.

It's you have a fixed input cost of your electricity.

Your electricity bill never changes.

You're very stable energy pricing, so your contract with us is fixed, and the benefit to mining is that you are accumulating that Bitcoin at a discount in the current market, basically.

So if you put $7 into Coinbase to buy Bitcoin, you're only getting $7 worth of Bitcoin.

If you put $7 into your electricity with a mining machine, that machine could produce, let's say 14 to $15 in Bitcoin today, right?

So the bull case is that you are accumulating Bitcoin at a discount.

If you think Bitcoin is going higher and Bitcoin doubles tomorrow, that same $7 input into Coinbase still only gets you $7 with mining.

You have a fixed input of $7 and now instead of $15 you're getting $30 in that scenario.

OK.

There's some other variables, you know, not not to get super.

It's helpful just in general scenario just to sort of it's, it's an emotionless DCA at a discount as long as the price of Bitcoin continues to increase, basically.

OK.

Tell us about your customers.

I mean, your, your trajectory into this company.

You're in the farm system. and then you landed doing this.

Tell us about some of your customers.

Are they, is this like a side hustle for them?

Are they all in?

What does that look like when we started the business, it was all retail customers, you know, John Doe, wanting, you know, $5000 budget, wants one machine, and we quickly realized there was a much larger institutional interest.

So we have about 800 customers around the world, so we kind of have our hosting model we call it like our.

You know, people buy machines with us, we manage it.

You own the equipment.

It's all serialized and all that good stuff.

Our clients can come to our sites in person, but our average customer is, I'd say more of a high net worth individual.

It's a lot of, a lot of family offices, a lot of business owners, you know, so on and so forth there, but we do allow the MOQ 1 client minimum order quantity of one client to come in.

So even if you just had a small budget, you can start mining.

Um, at a smaller scale, so we do work with several large institutions, and some of that's public, some of it's not, but we'll go as large as building and managing sites for public and private companies as well.

So there's very much a different scales to what we can offer. you know, but we can service several different types of clients.

OK.

And then tell me a little bit about, so if someone invests in this and they're like sitting around they're tracking at home, what's like the interface or experience of them getting updates or understanding of total ownership?

Yes, so we, we actually, there's no.

Bitcoin and crypto, I guess, is very much like the wild wild west, so we've had to build everything from scratch.

So for example, like when we started the business, we, we set up Stripe for credit card payments.

Stripe shut us down because we were a bitcoin company.

We've been debaned half a dozen times over 5 years and now we're at a point where it's very stable and that must not be the case anymore.

No, yeah, so it's the point being is there's no kind of like one size fits all solution that we can just go.

You know, plug and play into our system.

So we've had to customize every part of the process from payment to our management system.

So we have remote management software and on-site staff 7 days a week where it's a complete white glove service for you as a customer.

So you don't have to like call us and say, Hey, my machine's offline.

Our system will actually notify you that there's an issue.

It'll show the details of the issue.

You have as a user just like you have a Chase Bank account or any other account, you have a log in to view your machines, your serial numbers, talk to our support team.

Um, see what is going on with your machines, what the production looks like, and so on and so forth.

Yeah, I imagine people might be eager to check on something like that versus a bank account when usually it's going down over time outside of a couple of times a month.

Let's talk a little bit about institutional because we talk a lot on our programs about institutions diving into crypto.

You mentioned being debaned before and now it's Like they're all they're investing in these companies.

They're, you know, Mastercard, other companies working on stablecoins kind of a different story now.

When you have, you said you have individuals coming to you, but also just like businesses, I'm curious who's usually the person at the business who's making that decision?

Is it like the a lot of it's a lot of C-suite executives we've had, we've actually had customers even just recently we've had.

Normal you know customers of just one machine that have orange pilled their companies and have, you know, orange pill fancy convincing, you know, convincing their company to buy Bitcoin added to the balance sheet.

So we've had several of those situations where the companies have actually bought, you know, machines and made a large investment due to just an individual that was an employee, but the average person from the company reaching out is generally a C-suite executive.

We have a lot of different CEOs that work with us across.

Public and private companies that a lot of them aren't like You know On LinkedIn or we do, we do work with a lot of it is a lot of C-suite executives from these companies.

Yeah, that's been we've had guests in the past talking about this from the Dei world saying like you'd be surprised at some of these like traditional finance people who when you get them in a room and you talk about crypto, they're like they're very into it.

They're just not we aren't, so actually some of the local banks and going to Chase Bank or TD Ameritrade is very difficult for anything, but we've We've actually orange peeled some of the local banks in Iowa where they'll work with us, our customers, if they need accounts for if I go into Chase to open up a Bitcoin specific LLC, they're going to shut down the application, or at least they used to.

I don't know if they still do, so we do have some banks that are comfortable with the business and they're more open to, you know, kind of.

What the business model is here, yeah, I mean the Midwest is making moves.

I think last week South Dakota launched their own stablecoin.

They didn't see that coming, so you know something something's happening.

Let's go to the growth because you mentioned Inc 5000.

That's a huge achievement.

The growth I guess to what do you attribute most of the growth?

Is it just the mainstreamification of Bitcoin and crypto, people understanding it more understanding sort of like the yield narrative that you laid out, or were there certain strategies in the go to market, kind of what led to that that surge of growth because you have to grow significantly to make that list.

There's a lot of credit and people that we can attribute to.

Our growth as a company, there's definitely external factors.

You have the President of the United States actively talking about Bitcoin.

You have his sons who I think you started a Bitcoin mining company and you know there's BlackRock.

You have the fastest growing ETF in history with the Bitcoin ETF.

So it's there's definitely external factors with the ETFs and institutional adoption as far as like specifically our company um.

The tax benefits also have been a large piece as well, but I think just our ability and you know can credit all of our individual employees and people that have helped us get to where we are today.

I think it's just been a lot of word of mouth and just we started as a very small company and you know we always kind of our models just under promise and over deliver and again there are a lot of external factors, but in order to build a good company you need good people and you need to execute and all the way from our on-site technicians to Our marketing team to, you know, whoever else is involved here has played an equal role in getting us to where we are today.

Yeah, you touched on briefly the regulatory landscape, obviously a lot of movement there.

How are you feeling scale of 1 to 10 right now about how things are?

Are you pretty happy, or are there other policies or things that could happen in DC that would further help your growth?

Yeah, I am not a politician, but I think I think at this point the industry is here to stay, you know, again, like with the amount of dollars being invested in these ETFs and again I mentioned the president openly talking about Bitcoin and I'm not a crypto, you know, we're very much so kind of Bitcoin only, but just crypto in general is obviously not going anywhere.

And I think I think at this point in time, specifically in Iowa, I was a very good state, very pro kind of bitcoin and data center business.

Apple, Google, Amazon, Facebook have data centers here a lot of the AI companies are building in Des Moines and some other, some other areas, so I don't think it's going anywhere as far as like additional framework that could could help.

You know, I think there could be better tax incentives on, you see a lot of things about transacting Bitcoin.

I think just like from an adoption standpoint, if there were more pro tax friendly, you know, tax friendly laws that are more advantageous to, you know, use your Bitcoin on a day to day basis without paying taxes on them.

I think that could be a big step forward that a lot of people speak about, but specifically for our business, the bonus appreciation is like the biggest one that just incentivizes new business growth, I think for us and also for our customers.

So, um, yeah, I think overall the geopolitical landscape I think is very, very positive right now, um.

So lots of updates there for sure.

So for people listening at home, maybe they are long term Bitcoin holders, they've been thinking they're interested in learning more.

Curious how this all works.

Where can they learn more about simple mining and how to get in touch with you guys?

Yeah, our website, the best place to be on our website, simplemining.io.

We're on Twitter, we're on LinkedIn.

We're all over the place.

You can DM them you get a job.

I don't know, sure we've had we've had quite a few employees come from DMs actually.

Probably half a dozen employees come from just customers that have provided some good insights.

How do you know people like your product.

Actually, I would also like to work there.

Yeah, our website, our website will be our best place to reach out to us.

All right, well, Nick, thank you so much for swinging by here at the NIC and everyone again this is Nick Garland, CEO of Simple Mining out of Iowa named 5000 fastest growing business.

We'll see you next time with another Stock executive interview.