diff --git a/lib/api.js b/lib/api.js
index 91ae1598b..8f33f5efa 100644
--- a/lib/api.js
+++ b/lib/api.js
@@ -8,6 +8,7 @@ const Decrees = require("./decrees");
 
 const nThen = require("nthen");
 const Fs = require("fs");
+const Fse = require("fs-extra");
 const Path = require("path");
 const Nacl = require("tweetnacl/nacl-fast");
 
@@ -40,9 +41,19 @@ nThen(function (w) {
     ], w(function (err) {
         if (err) { throw err; }
     }));
+}).nThen(function (w) {
+    Fse.mkdirp(Env.paths.block, w(function (err) {
+        if (err) {
+            log.error("BLOCK_FOLDER_CREATE_FAILED", err);
+        }
+    }));
 }).nThen(function (w) {
     var fullPath = Path.join(Env.paths.block, 'placeholder.txt');
-    Fs.writeFile(fullPath, 'PLACEHOLDER\n', w());
+    Fs.writeFile(fullPath, 'PLACEHOLDER\n', w(function (err) {
+        if (err) {
+            log.error('BLOCK_PLACEHOLDER_CREATE_FAILED', err);
+        }
+    }));
 }).nThen(function () {
     // asynchronously create a historyKeeper and RPC together
     require('./historyKeeper.js').create(Env, function (err, historyKeeper) {