Max Levchin, Founder & CEO @ Affirm:The Biggest Surprise Scaling to $18.7BN Market Cap

1. 0:00 – 0:38

   Intro

   1. MLMax Levchin0:00

      I think opinionated is exceptionally valuable. The hard red line for me is always once I can't trust you, I can't ever trust you. The story about knowing the letter grade of every person you hire in your company, whether it's 2,000 people like a firm, but that's just silly.

   2. HSHarry Stebbings0:16

      Ready to go? (instrumental music plays) Max, I am so excited for this, dude. It has been a long time. So thank you so much for joining me today.

   3. MLMax Levchin0:34

      Thank you for having me.

   4. HSHarry Stebbings0:36

      Not at all, but I'd love to start

2. 0:38 – 6:05

   Should You Hire Brilliant but Extreme Personalities?

   1. HSHarry Stebbings0:38

      with actually something that you've said before when it comes to hiring brilliant people. You said brilliant people have extreme personalities more often than not, and when I thought about that, I thought do you want them in your team as a result of these extreme personalities?

   2. MLMax Levchin0:54

      You mostly do. Everything is a range, and so you inevitably find yourself asking the question, you know, how extreme is extreme and, uh, what will it cost me if this person, you know, blows up or goes into some sort of a behavioral tailspin. But most of the time, truly brilliant people are worth the quirks, and it's a hallmark of a good manager who knows how to bring out the best from the people even if they are extreme.

   3. HSHarry Stebbings1:25

      Can I ask when we think about extreme levels, often extremes are dislikable. They're not that amiable. They're very opinionated. How do we think about that being a pro versus a con?

   4. MLMax Levchin1:37

      I think opinionated is exceptionally valuable. I think that the sort of pinnacle of teamwork achievement is to have really strong opinions, not hold them back, and yet manage to not so profoundly offend the person or the teammate that you're judging or providing feedback to that they choose to opt out, whatever that means for the problem. But you on balance, you want someone who can walk into a room and say, "That is a pile of garbage and I love all of you. You're amazing people. I'm proud to be part of this team, but what we've built here together is not gonna ship because it's terrible. And now we're all gonna regroup and rethink and build something better." Like that: that is the way, at least one of the ways, of trying to couch the blow. But if you don't give the blow, you're gonna ship garbage.

   5. HSHarry Stebbings2:26

      Teach me. I do that and people get offended. They get emotional and they get upset and I get told that I'm too direct. Help me. What do I do?

   6. MLMax Levchin2:34

      (laughs) Empathy is important. Understanding that when you're judging someone's work, there's two possibilities. It's bad. It's they done the best and circumstances intervened and they can do better, but it wasn't, it isn't good enough and they need to know, but you know they can do better. And the moment is about telling them, "This isn't your best work, but I know what you can do and this is just like, it- it's an embarrassment, but it's not an embarrassment of your ability. It's the embarrassment of the time you had or the effort you've been able to put in and that's okay. Like that we can fix." Sometimes you look at work and say, "Wow, like this person cannot do better." Full stop. Don't worry about being direct. The conversation you're gonna have with them at some point very soon is, "I don't think you have a place on this team anymore," and that: that's a much harder conversation, but you have to have it too.

   7. HSHarry Stebbings3:20

      Can I as- So I- I- You always have said to me and I initially you said this years ago, you said when there's doubt, there's no doubt and I always loved it and I always think to that. But on the extreme element, where does extreme good transition to extreme bad? Have you had that before and what have your lessons been?

   8. MLMax Levchin3:37

      Any form of narcissism or selfishness, self-orientedness is probably the most important trigger of turning an extreme personality from good to bad. Or said in the opposite way, you can be as great at throwing tantrums or as direct in your criticism as you want to be if you maintain a good degree of humility and just remember that the second it becomes about you being better than everyone else, everyone else will start hating you. And if you're their boss, they're gonna hate you quietly and that's the worst possible situation. And so what do you really want is to constantly remember that you are but a part of this team and when you're criticizing someone's work or you're telling them, "This has to be redone," you're always redoing the work together. Like maybe you're not going to personally move the bits, but you're gonna have to be involved 'cause they're not gonna be happy with a second round of the, "Well, this is still garbage." And so I think that: that's really important. I think there are many ways where extreme personalities flip into being toxic and so you just have to constantly watch out for it, but it is the price you pay. Brilliant people are often over the top and that's part of the ingredients that make them brilliant.

   9. HSHarry Stebbings4:55

      When they flip into toxic, is there a redeeming route back or is that generally a one-way road?

   10. MLMax Levchin5:02

       You know, I believe in second chances in general in life, except in matters of integrity. So the: the hard red line for me is always once I can't trust you, I can't ever trust you. And that: that's a from that one in my worldview, there is no walking back. It- it's not true with kids. Kids lie because they're exploring what to, uh... But even with my own kids, I've had sort of very, very difficult conversations where I'd said, "Look, th- this: this is a thing that in my professional and personal world of adults, it's the hardest thing to come back from. And the fact that you just told me something that isn't true is really hard for me to hear." And saying that to a teammate, you know, you're not gonna talk to them like you're talking to a 13-year-old. You're gonna say, "Look, I can't trust you ever again. Get out." So other than that, I think there is a way to walk back a lot of the sort of, no matter how crazy toxic a situation could be if it's a situation. The: the judgment you have to make as a leader is, is the person profoundly toxic or did the situation turn toxic? Situations come and go.... people don't really change that

3. 6:05 – 9:17

   Balancing High Expectations vs. Realistic Effort in Teams

   1. MLMax Levchin6:05

      much.

   2. HSHarry Stebbings6:05

      You said earlier, has the person done all they can to execute on the task and to achieve what they want to? Where I struggle is, we have differences in expectations around what one should and can do. If you are a head of sales, listen, there's always more you can do.

   3. MLMax Levchin6:22

      (laughs)

   4. HSHarry Stebbings6:22

      There is always another gift you can send, like you can click, thoughtful comment you can do, additional resource you can send. I will do everything to fucking win. And people on teams don't always think quite as, bluntly, obsessively as that. How do you think about that alignment between what is rational to expect?

   5. MLMax Levchin6:42

      So my brilliant wife frequently reminds me that more often than not, it's about incentives, and the- the unlock for you. The reason you are so obsessed with fucking winning is because it's your company, it's your project, it's your passion. Like, you've been doing this since you were 14 years old, and like-

   6. HSHarry Stebbings7:02

      (laughs)

   7. MLMax Levchin7:02

      ... your only goal is to do more of you. And so, you don't need motivation. Like, your incentives are aligned, like you were essentially born with a microphone in your mouth, l- just trying to get bigger. And-

   8. HSHarry Stebbings7:14

      Literally. Literally. (laughs)

   9. MLMax Levchin7:14

      Yeah, and- and I- I- I don't think it's, uh, you know, d- nothing to be ashamed of. Uh, drive and grit, that is the- the other side of that coin, are rare. And people who have it end up being entrepreneurs or something resembling entrepreneurship because it is such an unstoppable force, which is amazing. Like if you don't have it, it's a thing you can't really teach, or at least it's very, very hard to teach, I think. On the flip side, there's plenty of other people that you not just need, you require to achieve your goals. Like no one is an island in pursuit of their entrepreneurial ambition, and you have to figure out what it is that motivates them. And in many cases, the motivations are not at all relatable for you. Like you had decided at some point that you're willing to work Saturdays and Sundays to succeed, and that's just it. And like yeah, some people go to the pub, and others go skiing, and you know, everybody has their thing, and you decided, "No, I'm just gonna work, and that's what I'm gonna do." And having that conversation with someone who's just joined your team, like, "Hey, we're all gonna work on Saturday and Sunday because I want to succeed," is not gonna do anything for them. What you need to do is figure out what is it that they're looking out for, and what- what is their goal?

   10. HSHarry Stebbings8:29

       Mm-hmm.

   11. MLMax Levchin8:29

       And if their goal is to go skiing three days a week instead of two, you may have made a hiring mistake. (laughs) But if their goal is to feel great about their work, the investment you have to make isn't about beating them up about this work quality is garbage, or telling them, "Go work harder," it's just saying like, "Hey, I know you're motivated by quality. Let me spend all available time to just get to a place where you look at every pixel you put down or every sound you record, and you're just falling out of your chair about how good it is, and it can't really get any better. That's what motivates you, I know, and that's what we're gonna do together." That- that's what team leadership is all about. The- the difficult part of leadership of teams is always deciding that this is irredeemable, 'cause you want people to have second, third, fourth chances. But at some point you're like, "Well, okay, you're great, but i- you are a hiring mistake and

4. 9:17 – 12:57

   When Do You Have to Hire B-Team Players?

   1. MLMax Levchin9:17

      I'm so sorry."

   2. HSHarry Stebbings9:17

      At what stage are you forced to hire B-team players? I find it absolutely absurd that we think we can only continuously hire A-team players. A-team players, by definition, are exceptions. And you can for the first 50, maybe 100, I still don't think so with 100, but when you are the size of a firm, you know, i- it's impossible to only have A-team players. When are you forced to hire B-team, and how do you think about that?

   3. MLMax Levchin9:41

      The story about knowing the letter grade of every person you hire in your company, whether it's 2,000 people like a farm, or I don't know how big you guys are, but like that's just silly. Like you don't know. People are these days coached and trained and fine tuned to be exceptional interviewees. And so somebody coming in and telling you their life story, like you know they have watched probably an interview you conducted with someone who's a professional interviewer who spelled out what it looks like when you're hiring an A player. Like you know, someone's gonna be like, "Hmm, extreme personality is very important," Max Levchin said. So, how do I get myself more extreme? What I need (laughs) and so I- I- I don't think you can really judge A or B overall grade at hiring time. I think you can assess someone's coding ability, but a really, really good assessment test requires a take home because like you can, you know, implement quick sort on camera very quickly, but, you know, so can a C player these days. And so you have to give people a lot of time, and giving people a lot of time, they will, you know, inevitably stray from the rules of whatever the test is. So anyway, the point is, you can filter out C players, you can definitely filter out D players. Differentiation between B and A is what happens once you've brought them in. You're like, "Oh my god, that is a brilliant hire." And more often than not you say, "Hmm, I thought this was gonna be a great hire. It's a good hire." Like I- I'm happy, I'm happy we have them. And the question there is, what do you do to get the absolute best work from this person, and will they have the- the Steve Jobs quote, "A players hire A players, B players hire C players," is profoundly true. There should be an asterisk explaining why this is true, and reason for it is fear. A players love working with other A players 'cause they know the demands of the job and the team dynamics just make them better. So you want to have people who challenge you and tell you, "Hey, I know you're an A player, but that just wasn't good. Let's go redo this together, or you go redo it," whatever. And so A players just want to escalate away or accelerate away from the pack. B players frequently say, "Look, I'm a worker bee, and I know I'm not an A player, and that's okay. I am just going to grind out good code."... art, sound, whatever. But some of them are fearful and say, "Well, if I have too many B players around it, let alone A players, I will look terrible. It will be very obvious that I'm just not that good. There are people here who are a lot better than me. So the way to fix this is for me to become a manager and for me to hire a bunch of people who aren't very good at all, like much worse than me. And then I'll look like the tallest mushroom, and that'll be great." And so, that is the- the real danger of B players. Like having people who are perfectly willing to do good work day in and day out is not the worst thing in the world. There's plenty of things that A players will turn their nose from because it's just not that challenging. It's not accelerating them out of the A pack. And Bs are very, very good for that. And a lot of B players over time grind their way to being A players so you're investing in their future and they know it. So that- that's also positive. But B players who have fear of being found out are the ones that you have to watch out

5. 12:57 – 17:43

   Biggest Calculated Risk – Success or Failure?

   1. MLMax Levchin12:57

      for.

   2. HSHarry Stebbings12:57

      In terms of, like, you know, the actions that they take, I love this statement you said. You said, "We take calculative risks, do the calculating." And what I wanted to ask there was, when you review the journey, what was the biggest calculative risk that you took? And success or fail, what did you learn from it?

   3. MLMax Levchin13:16

      When I started the company, I sat down with a bunch of bankers and said, "Hey, I'm gonna start a company where I'm going to do away with this i- imbalance. I'm going to eliminate fine print so consumers do not have to read fine print of, you know, to find out what the business model is." And- and so on, many other sort of ideas like this. And several of them, including some very sort of well-known people whose names will not be revealed, basically laughed at me and said, "Oh, like, you're insane. Like, this is not just, like, the way you make money in this industry. It's the way you make money. It's the only way. Like, you..." This all had been competed down to the only money you have is in the form of things that the customer doesn't understand 'cause everything else has been, you know, wiggled out. And I said, "You know, I don't think so." And I don't actually have a full model in Excel or in my head or on paper proving that I'm right. So this was a- not a calculated risk. But I think it's not really worth running a company that fits neatly into the mold of, screw the customer, make some money. Like, I want to run the one that says, never screw the customer, let's see if we can make some money. And, like, at this point, we're public. Our financials are visible. We do very well financially. And so, it is- it was totally possible. But this was a non-calculated risk at the very beginning of the mission that I just sort of decided, like, we're- we're gonna do it. And so, the calculus of the first bet was, like, not a calculus at all. It was just like, "Ah, I think it's gonna work, but I'm- I'm okay finding out that I'm wrong." The second part completely worked out. Like, if you look at the esteemed quality up and down the stack at Affirm, it's really exceptional because of this. Or one of the reasons it's-

   4. HSHarry Stebbings14:49

      What calculated, what highly calculated risk did not work out? Where your process was right, but the outcome was wrong.

   5. MLMax Levchin14:57

      If you do a good job calculating, you have the right hedges where even if it doesn't work, it works. That- that's sort of the- the stock answer.

   6. HSHarry Stebbings15:04

      That's the PR answer. (laughs)

   7. MLMax Levchin15:07

      Well, I mean, it- it- it's also factual. If- if- if you have done a lot of calculating and it completely backfired...

   8. HSHarry Stebbings15:15

      Is everything calculable?

   9. MLMax Levchin15:17

      No, absolutely not. There are many things that you stare at, you know, into the void and you ask yourself, "Will it work out?" And the honest answer is, "I have no idea." Try to minimize those, but it's- it's not possible.

   10. HSHarry Stebbings15:29

       So what strategic decision didn't work out, and what did you learn?

   11. MLMax Levchin15:33

       One of- one of the other things I must have said seven years ago is that I really don't believe in regret. I think it's a wasted emotion. And so, as a result, I have a hard time recalling these profound moments of like, "Ah, shouldn't have done that."

   12. HSHarry Stebbings15:43

       Do you not think that's where lessons derive from?

   13. MLMax Levchin15:46

       Oh, I do. I, but, uh, we have a whole culture of postmortems at Affirm where we record every decision we make, especially... I'll give you, like, a very retail one 'cause I- now that I said postmortem. Postmortem culture comes from engineering and, uh, obviously I'm an engineer by training and- and past, and so it's easy to reason in those terms. But years ago, we had decided to very rationally scale our infrastructure because we expected a giant launch with just a crazy amount of transactions, and like it was all gonna be very, very, very, very big, like 10X bigger than what we were at the time. And so, we were prepping at breakneck pace and just, like, scaled up every part of our backend infra and then our frontend infra and everything, everything. And then the day of, it just fell apart massively because we basically overloaded our backend with our frontend. And so we were all dressed up with no place to go and the entire database data layer of Affirm was just in shambles for several hours while we were cleaning it up. And, but it- it really was a self-inflicted wound where we were like, "Well, we- we just don't know how big it's gonna be, so let's assume it's gonna be super huge." And it- it was very (laughs) modestly sized at launch and turned out to be just a giant. So...

   14. HSHarry Stebbings17:05

       What did you learn from that?

   15. MLMax Levchin17:06

       Do the calculating. Like, the line about do the calculating comes from, like, someone... And this was not a- an unforeseeable error. Someone should have sat down and said, "All right, so we're scaling the front tier faster than we're scaling the back tier. At some point, given the architecture of the system, you will have what's called an oversubscription of frontend connections to the backend, and the backend will start choking. Because even if frontend doesn't do anything, just holding these connections is expensive. If you have, like, a 10X mismatch, you're going to bring down the database." And that is what happened. So, someone should have done that work and that would've been a calculated risk that did not- would not have backfired, but this time it did. This was a long time ago.

6. 17:43 – 24:24

   How to Build a Postmortem-Centric Culture

   1. MLMax Levchin17:43

   2. HSHarry Stebbings17:43

      You mention the postmortem culture there. (laughs) People always say you learn so much from your failures. Do you learn more from your successes or from your failures, Max?

   3. MLMax Levchin17:51

      Failures for sure. Like, analyzing success-

   4. HSHarry Stebbings17:53

      Why do you say that?

   5. MLMax Levchin17:55

      ... is always... I- it- it's boring to analyze success. Like, "Well, we did well. It's good. I'm tired. I'm gonna go to sleep," is kind of the- the natural, like your oxytocin is in your brain-

   6. HSHarry Stebbings18:04

      Do you not think that you can actually learn the same thing? We just don't analyze success because it's successful. It's like, "Yep, move on." And actually, if we analyze why you were successful, it's because we actually were really thoughtful about, you know, um, CAC over time.

   7. MLMax Levchin18:18

      The problem is that with successes, the texture of each individual decision is much harder to detect. If you, if you look at the world as a funnel analysis, which is a really good way of thinking about a lot of things, you start over here, like become aware of a thing, start thinking about it, start considering it, start deciding it, deciding succeeding or failing, there's a real kind of a blur between the first five steps. And like-

   8. HSHarry Stebbings18:45

      Mm-hmm.

   9. MLMax Levchin18:45

      ... this is true of web apps and checkout funnels and advertising and all, all kinds of other things, if everything has gone pretty well, there's a lot of effort that has to go into like, "All right, well, that step to this step of the funnel, the conversion rate was 95%, and the next one was 95%, the next one was 95%." "Well, which one did the best?" "I don't know. They all seem like 95% is pretty good." Now, you should ask the question, "Well, could it have been 96?" Like, "Why didn't we do better?" And so you're inevitably asking the question in terms of failure again. You're not really saying, "How were we so good and smart that 95 was, you know, that's really high. It's really good. Should we have done 94? Would that have been enough?" Like, those questions are kind of boring and pointless to ask. I, I really believe in asking the question in terms of, "What should we have done better," even if it's the most successful thing ever. It's nice to take a victory lap and sort of high five the team. But ultimately, the question has to be... Like, this is a, uh... I have a friend who, uh, grew up in a very managed parenting environment, where his parents would ask him when he showed up home from school with a 98% result on a test, like, "What happened to the other 2%?" And, uh, you know, I'm not sure it's a great way to have a childhood, but it's a great way to run a company.

   10. HSHarry Stebbings19:55

       Can I ask you, if I'm a founder listening to this and I'm going, "Wow, I really want to have a post-mortem-centric culture, but I don't really know how to do that, like as of today, implementing that," what advice would you give to me on how to implement and start a post-mortem-centric culture?

   11. MLMax Levchin20:10

       So for everything, create a document space. So every time we have a blip, for whatever definition of, in our systems or in our processes or in our models, anything, a separate conversation is carved off on Slack, a separate conversation is documented in a Google Doc or a Notion or any, whate- whatever tool we're using for this topic, but it's segregated. It's very difficult to peel away details having to do with event one if you're commingling it with event two. And so fi- first sort of most important thing is make sure you have separation of data streams. 'Cause if, if you get good at post-mortem culture, you will gather a lot of data, and a lot of it'll be irrelevant. Like people will say, "Well, this also happened at the same time. I see it in the logs. Like, something just went down." And inevitably someone will be like, "No, that's unrelated. This was because of," whatever, something else. And so you want your data plentiful. You want as much of it segregated into a separate pipeline of raw content as soon as possible. You want preservation of this information in a special place. You want someone responsible for writing it up and distilling it from pages and pages of kind of raw data into a, essentially a white paper. And then you want the entire team to go and comment on it. And the most important thing you can do about the entire process is you have to completely separate any form of apologizing, responsibility taking, you know, "We should do better next time." Like, you have to be clinical about it. Like, "This happened. It wasn't good. Here's why." Like, you have to give people who were feeling directly responsible for the flop, whatever the flop was, to feel very free to comment on what happened. Like, you, you need to encourage them to speak to the fact that they screwed up yet without any sense of like, "Well, I need to make myself look better. I need to create a... cast a certain light on the decisions that I made." Like, just get rid of all emotion. Exactly describe what happened.

   12. HSHarry Stebbings22:21

       Do we have a structured time for these post-mortems? This is like, "Hey, we have a weekly post-mortem on what happened last week." How do we make sure that we don't just go, "Yeah, it's a really nice idea," and then actually not do it?

   13. MLMax Levchin22:32

       You have to give people responsibility to do them. You have to have a directly responsible individual for authoring and presenting the post-mortem. That's very important. You need to make sure their manager knows that their list of responsibilities has now been enhanced by this post-mortem and they're on a hook for it. Uh, we typically try to say, "Hey, it's a week, maybe two weeks." Like, that's the most you're allowed to take to generate a real post-mortem. And then there is a weekly review that takes place within the teams that are post-morteming something, basically going through like, "Hey, this happened. The post-mortem's been prepared." And then someone even more senior will say, "That's a reasonable explanation. I buy it." Or like, "Mm, you know, this is not quite deep enough, like we need a better analysis of what happened," or, "I don't actually think these are accurate." And this is where you need your A players in the room, 'cause they will have the experience and the intuition and sort of past knowledge of how these things go to kind of say that that's a deep enough post-mortem, or, "This is just like..." You know, y- you describe what happened, but you didn't explain it.

   14. HSHarry Stebbings23:33

       What was the most controversial post-mortem, where the, the causes that led to the outcome were highly differentiated in opinions?

   15. MLMax Levchin23:41

       These days, the ones that I see are very matter-of-fact. It is never about the individual. It's always about the events. It's always about the... Th- and it, it will always come down to a, "This happened. This choice was made, either by a program or a human." And if it's a program, it's a bug or a poorly calculated outcome. If it's a human, it can be a judgment error. Like, "I thought I would flip the switch and the lights would go on. It turned out to disable power for the entire city." Like, that, that's a conversation like we've, we've had here. But it's never controversial. It's, it's in the past. We need to do better. What do you do? Like, you add a big guard on the switch that says, "Before you're gonna turn off the lights for the entire city, please read this two, uh, two-line warning."

7. 24:24 – 27:18

   Reversible vs. Irreversible Decisions

   1. MLMax Levchin24:24

   2. HSHarry Stebbings24:24

      Speaking of kind of the decisions that lead to the post-mortems, you said before, "Make reversible decisions fast," and it kinda makes me think of the one-way, two-way doors. Honestly, I think everything's really a one-way door.I mean, there are very, very few things that are two-way doors. How do you respond when they think about that?

   3. MLMax Levchin24:42

      I, I don't agree. I think things that change your reputation, things that change relationships with partners, decisions that do that sort of thing, are basically irreversible. Once you-

   4. HSHarry Stebbings24:56

      But you think

   5. NANarrator24:56

      Mm-hmm.

   6. HSHarry Stebbings24:57

      ... so, like, when you look at, I always use this i- as an example. When you look at the transience of news and reputations, you know, Chamath on All-In said about the, you know, Uighurs and it being below his line. A week later, he was number one on Spotify, and Chamath is Chamath, and honestly, it has not impacted his reputation one bit.

   7. MLMax Levchin25:17

      You know, there are probably some people who would disagree with you on that topic. I, I don't know exactly who they are, but I think we can guess. Uh, but I agree that superficial statements, even explosive or incendiary even, fall off the news line faster than you would expect them to. I think people's reputations recover and get managed and manipulated, and maybe it's true for companies too, but I think rational people have long memories and do not forget, do not... are not easily persuaded by Spotify top 10 or, you know, whatever is the front page of the Wall Street Journal today. The decisions that probably I care about a lot more are architectural decisions. You can decide to invest a year into rebuilding your systems in some new fashion, and if that's a bad decision, you're going to look back and say, "Well, we're too far in." It was a terrible call, but, you know it's just, you know, it's so far in, like, what do we, we can't just uproot this. So many people will be upset. Or you agree to a deal that is economically non-viable and you have... you're staring at a giant black hole, and you want to get out of it but you signed a contract, and you can't. And i- maybe it's, like, not that much money so you don't care, but sometimes it can be a lot. So, I, I believe in one-way doors, and I think part of the post-mortem culture is all about identifying one-way doors that you thought were two-way doors and saying, "We shouldn't have done that because that turned out to be not a thing we could easily come back from." I agree that a lot of decisions that seem like one-way doors are not. So that, that's a, that's probably a very fair statement.

   8. HSHarry Stebbings27:02

      Is there a decision that you thought was really reversible, make it fast, and it turned out not to be so reversible?

   9. MLMax Levchin27:09

      I think for every ten of the ones that I thought were not reversible, only one, (laughs) maybe two were irreversible.

8. 27:18 – 29:50

   Why the Quality of Invisible Work Matters

   1. MLMax Levchin27:18

   2. HSHarry Stebbings27:18

      Uh, you've also said something that I love, which is, "Care about how we make things, mind the quality of the invisible parts."

   3. MLMax Levchin27:25

      Yeah.

   4. HSHarry Stebbings27:25

      I really like that, and I'd love for you to expand on it.

   5. MLMax Levchin27:28

      Yeah, that's another reference to Steve Jobs, who was obviously such a brilliant product guy, and I aspire to be a good product guy myself. I think the notion of... so it's a oft-repeated story where they signed the insides of the, um, motherboard on, I think, the first Mac or something like that. And so th- the team put their signature on it, and the narrative around it was if you built something beautiful and amazing, you don't mind, in fact, you take pride in signing the insides because if anyone ever looks, they will be blown away by just how beautifully the whole thing is designed, and so th- that's where you want your artist signature. And so I think there's definitely a natural and very healthy tension between shipping fast and building things beautifully, and building things beautifully requires design and time and consideration of what the next version will look like so you don't have to rebuild it from scratch. And there's not a hard and fast rule to know what matters so much that you want to do a great job, and therefore you will always have a team cleaning up or refactoring code or dealing with tech debt like that. That's a, a property of every startup that's been a startup for a decade. You have someone undoubtedly who's refactoring some part of your code because it's grown enough moss that you need to deal with it. But there are parts that are obviously going to be important and valuable, and it could be as simple as some basic UI decision or some- something as complicated as machine learning model that deals with credit underwriting, which is, you know, one, one of our sort of crown jewel-type achievements. We have some very, very, very advanced ones. And so those things you know matter. You know you cannot let them be anything but the absolute best you can possibly produce, and so when somebody tells me, "We're doing X and it's gonna be a month late," my natural reaction is to sort of jump up from my chair like, you know, "How can you possibly... how dare you be so late with this thing, like, why can't we ship it yesterday?" I absolutely make exceptions for things that I know are going to be crucial for months and years to come, and that's where you have to mind the quality of the invisible parts. A lot of times these are in the backend, be it credit or scalability or f- you know, infra, et cetera, and it doesn't make me... it doesn't make it any easier to cope with to hear someone say, "Yeah, it's, it's slipped by a month because we found something that has to be redone," but you know it's important and you sort

9. 29:50 – 32:09

   Lean Startup & MVP – Shortcut or Smart Strategy?

   1. MLMax Levchin29:50

      of try to, uh, try to cope.

   2. HSHarry Stebbings29:54

      How do you feel about the concept of like the lean startup and MVP? Ship when it's ready, just like the first thing you can get into customer's hands, ship. Does that lead to a generation of shit software or is it actually a great way to get customer feedback?

   3. MLMax Levchin30:06

      I think there are definitely things that you want in the hands of the customer as quickly as you possibly can, like we have a prototyping team at Affirm that is trusted/empowered to ship stuff that is just not really (laughs) beautiful or production quality even to get customer feedback, because it's really important to find out if something, some crazy idea that we have has any sort of odds of success. Once it's out there and you get data...... and you think the data tells you that this is great, you don't just say, "Cool, let's leave it out there and go to the next one." We basically pull down the feature, pull down the product, and say, "Okay, now we're gonna do it right. We're gonna make it scalable, we're gonna make it beautiful, we're gonna make sure that it actually stands the test of time." The idea of- the finding out of the idea was really important, but if you believe that ideas speak for themselves so much that it can be garbage, you will end up with a collection of garbage and generation of garbage software. And, uh, I think you just have to know when the moment is to say, "Actually, that really does have traction. Someone will build a better version of this if I don't do it myself." And that- that's what you have to do.

   4. HSHarry Stebbings31:21

      Do you think speed is the most important determinant of success in startups?

   5. MLMax Levchin31:25

      It's one of the most important. It- it's very rare that... Like, I cannot think of more than, like, fewer than a handful of companies who had gotten to huge success, huge scale by just kind of rolling along. And I- I'm sure I don't know the inside story, and what seems to me like rolling along is probably not rolling along. In fact, may- they were probably feeling like it's breakneck pace on the inside, they just didn't show it very well. Like, there are some founders and some CEOs who have the duck foot property where they're, like, placid above water and the feet are going at crazy pace below water. I am not one of those. You can always tell if I'm trying to go faster, you know, from- from the feet up. Uh, but there are people who are capable of maintaining composure and maybe their teams are composing

10. 32:09 – 34:42

    What Makes a Strong Writing Culture

    1. MLMax Levchin32:09

       themselves too.

    2. HSHarry Stebbings32:09

       It's interesting, you said, "We are a writing culture. Favor short, pithy one-pagers to novels or live rants." I personally like a live rant, being born with-

    3. MLMax Levchin32:20

       (laughs)

    4. HSHarry Stebbings32:20

       ... a microphone in my hand, as you kindly suggested. Um, what does a writing culture truly mean to you, Max, and why do you think it's optimal?

    5. MLMax Levchin32:28

       So, it feeds back into that notion of postmortems, right? If you have depository... And we literally have a postmortem depot where people can go and review every major or minor thing we did going back to the beginning of a firm time, and learn from it, it's really valuable. We have a library of case studies that are internal to the company saying, "Well, that was a screw up. Like, the great outage of XYZ, what happened there? Oh, we managed to overload the backend with the front end," and- and so on. So, it's just very valuable to have these things in a- not in a form of oral tradition, but, like, written down. Like, the, you know... I- I think it's just- just a very valuable thing to have. And then to do that well, you have to have writing culture where people just, you know, aren't typing up random words that come into their mouth and are in their minds and basically say, "All right, well, read this. Makes sense in my head, but, you know, I don't know. Maybe you'll make sense of it too." So you- you have to have some baseline quality requirement for writing. And basically, the most important thing about technical writing and business writing is simplicity. Like, if you're reading a 12-page thing describing a feature, you're probably gonna miss details. And so if it's a feature that's meant to be confined to, like, 25 by 25 pixels, the description should be two pages, maybe three. You should not have many, many, many pages of prose describing the, you know, impact on the world you expect to have and how this relates to world hunger, et cetera. And so, pithy is important. Live rants are good as motivation sometimes, they're good at sort of aligning the team around a story and a strategy that the story represents, but in my experience, and I host an all-hands meeting at least once every two weeks, more often than that usually, you end up saying twelve things and people remember two. So, the shorter the better. Like, it just- just being short and pithy is way more valuable. Even- even spoken. But in writing, people just run out of time. We have distractions, notifications are popping up. Like, you have a twelve-page to read and you're like, "Oh, man." And some people are very good at focusing, but I think majority of people are less focused than they'd like to be and less focused than they think they

11. 34:42 – 37:07

    Remote Work

    1. MLMax Levchin34:42

       are.

    2. HSHarry Stebbings34:42

       Max, are you back in the office now?

    3. MLMax Levchin34:44

       It's quite hybrid, and it really depends on the geo. So we have offices now worldwide, which is pretty cool. And by offices I mean places, because some places do not have an office. You know, world headquarters notionally is still San Francisco, so that's where I'll be today. And, uh, I think it'll be on the order of half full, maybe a little bit more than half full. Our other coast office in New York will have standing room only. There will be not enough seats, not enough cubbyholes to hide in because people will be there in- in such quantities, um, and everything in between. So, it- it's not true that we are fully back.

    4. HSHarry Stebbings35:21

       Would you like to be fully back if you could? Every CEO I speak to says, "I wish we were remote. I- I wish we were fully back," or, "We are fully back."

    5. MLMax Levchin35:30

       I think there's a ton of value in being fully back. I think, again, like everything else, there's texture to this value. If you have a C-level team, one way of pushing them into B level is you make sure they all sit together and are surrounded by A players who are constantly telling them, like, "Hey, go. Go better. Do- do- do more." If you have a great team, some people are actually more productive when they are able to cut out all distractions, and so they can hide themselves in their spare bedroom and just write code for 12 hours or design product for 12 hours or- or whatever it is. And so I care a lot more about output and productivity than I care about where you are physically. But the thing that I'm completely non-compromising about, there has to be enough together time. And so the notion of everybody back in the office even if all of your meetings are on Zoom because you're talking to our team in Madrid from San Francisco, it's hard to make that argument. It's just not a very productive use of commute time. If you live in East Bay and you need to get on BART and you ride across and you get to the office and you get into a cubbyhole and then you're on Zoom for 12 hours or 5 hours or 6 hours, whatever it is, it's hard to make the argument that you should have been on that BART train coming in and coming back.... the argument of, "I've never met my team, but I'm as productive in person, I only see them on Zoom," is a stupid argument. That's just not true. Like, you form relationships. You understand each other's decision-making style. You break bread together. You form camaraderie. That has to happen. Like, that, that is entirely non optional, and I think everyone who's saying, "I can be fully remote, and these people don't ever have to meet in person," is kidding themselves.

12. 37:07 – 41:59

    Lessons on Leadership

    1. MLMax Levchin37:07

    2. HSHarry Stebbings37:07

       When was morale lowest in the company, and what did you learn about leadership from that period?

    3. MLMax Levchin37:12

       We had to do a layoff in... about two years ago, and that was morale lowest point for me and, I think, everyone around me. And those are never easy, and I've had to do more than one in my life, and every time it doesn't get any easier. It's always brutal and no matter how-

    4. HSHarry Stebbings37:38

       Did you learn anything about messaging from the first time taken to the second time?

    5. MLMax Levchin37:42

       Very first time I had to do it was certainly not Affirm, which... and every time I have done it, I said I ho- I hope to never do it again. But the very first time I did it, I didn't know what I was doing, and I was terrified of owning the responsibility that I screwed up. I, I, I was the CEO every single time I had to do a layoff and, uh, the first time you feel like everyone's gonna blame me. It's my fault. I just want to run and hide. This is terrible. Like, I, I have to go through with this, but I can't wait for the moment to be over, for the day to be over. I just need to, like, not be here. And actually, a good friend of mine who was at the time an exec at that company took me aside and said, "Hey, this sucks for all of us. You are the leader." Like, "You have to be out there helping people pack their boxes. Like, you have to be part of the goodbye. This is not a death sentence, it's a professional event. It sucks no, no less than any other really major trauma, but you can play this from the comfort of your office or in the middle of the floor that's crying," and, like, "Go be with the people. It'll feel better in the end, and they will feel better in the end." And so that's what I did, and it was sort of between cathartic and therapeutic, and I, I... That was, that was a really important lesson to learn. Y- you cannot hide from the grief that a layoff is. And then the other thing that I learned over the years of watching my friends ha- you know, having to do it, and certainly having to do it a couple times myself, empathy is really important. This notion of being... be there with them in person, help them pack their bags and, you know, give them a big hug is really important. The other things that you will find is people actually... if you've built a great culture. This isn't a thing you can fix in the moment, but if the culture of the company is great, the blow is much softer than you think it'll be because people understand that you tried with every possible strategic or tactical idea to not have to go through this. And so this is the decision... It was the last decision of a long list that you could have taken, and they are inevitably more understanding and less hard on you than you are on yourself. Like, one of the more amazing and sort of emotional events for me of the Affirm layoff, a couple years ago now, was every single person I talked to had said, "Hey, I get it. This happened. We grew too fast. We overhired. I understand. I even understand why me and not the next person. I hope there's an opportunity to come back. I really love this place. I want to come back."

    6. HSHarry Stebbings40:25

       Is overhiring a calculated risk?

    7. MLMax Levchin40:28

       Yes, it certainly is. Actually, and maybe that's a good answer in retrospect to your question about calculated risks that did not pan out. You decide that you want every incremental engineer to build more features while the fundraising is good, and then suddenly it's not, and what do you do? And, and there's nothing you can do other than to say, "So sorry, but some of you cannot have a seat anywhere."

    8. HSHarry Stebbings40:50

       And so the theory was, hey, the features will pay off and that will return cash? Good. Uh, and it didn't? Or it was like, hey, we will have a continuous cash tap of fundraising that didn't happen?

    9. MLMax Levchin41:01

       I don't think it's ever that simple. The analysis is typically about how fast something will grow, how well you can have the market protect your cash flow if it doesn't, how profitable something will be. So it, it, it's roughly what you said, but the calculus is a little bit more complicated. You're typically estimating more than a few variables. One of my favorite internal lines at Affirm is, "Affirm is a constant multivariate analysis problem solving." Like, it's very rare. It's like, well, that thing. Do we think it's 5 or is it 10 or is it b- is it gonna be 500? Like, those are very easy to estimate. It's like, well, we have nine variables and they're all non-linearly distributed, and some of them multiply with the others, and some of the other ones we don't really know how they relate to the first pack. Uh, we're gonna have to estimate all of them and predict the outcome based on that, and so it's hard problem to solve not just for Affirm but for, for any company. You're, you're inevitably evaluating a bunch of variables

13. 41:59 – 44:34

    Klarna’s the US Expansion

    1. MLMax Levchin41:59

       concurrently.

    2. HSHarry Stebbings42:00

       Man, so you said about growth there. Can I ask a, a blunt one?

    3. MLMax Levchin42:03

       Yeah.

    4. HSHarry Stebbings42:03

       Um, is Klarna growing faster than Affirm, and how do you think about that in, in terms of Klarna's US expansion?

    5. MLMax Levchin42:11

       I think they announced that they grew 32% last quarter. I think we announced that we grew 35%. (laughs) Uh, I... In the last few quarters, and their, their numbers aren't public. They're about to go public so it's, it's, uh... it will be a little bit easier to track their numbers, I think, for, for all involved. But for the last several quarters from estimates, so we have been taking share in the market against all competitors, not, not just them.... and so I think that's a good sign for us. We, we offer more services though. A majority of our competitors specialize in paying for or something very, very specific. We made the decision from day one to provide every possible service from the 45-day super short term loan all the way out to four years. Very, very few people do everything, and so it should be a natural consequence of our ability to serve all that we would take disproportionate share.

    6. HSHarry Stebbings43:10

       Can I ask, that entrance into the market is, is, is pretty well done. Is that the size of the market? Is that the not grabbing the opportunity from your side? How do you analyze that? Because it's a big task to go after the US market from Sweden of all places.

    7. MLMax Levchin43:26

       (laughs)

    8. HSHarry Stebbings43:26

       Um, like (laughs) respectfully, um, how do you think about that? Is that like, "Fuck, we dropped the ball," or like, "Fuck, it's a massive market"?

    9. MLMax Levchin43:35

       Are you, are you asking me to analyze their strategy? I think that's a... that's a postmortem they will have to write for themselves. I'm not sure I'm qualified.

    10. HSHarry Stebbings43:47

        (laughs)

    11. MLMax Levchin43:47

        I, I, I don't have all the information. Also, I, I think it's very healthy, incidentally, for CEOs of startups, of which I am one, to spend very, very little time on other people's strategy. A competitive analysis is valuable at the product level and sales strategy level and sort of like, "What do they do that we could do better?" is a really good question to ask. What is their strategy is like asking what weather will be 12 weeks from now.

    12. HSHarry Stebbings44:18

        But you could say, "Hey, they've been really smart in this part of that go to market or their partnerships decisions."

    13. MLMax Levchin44:22

        Yeah. We, we, we do lots of that. Like, we, we tear down all competitor products, all their sales products, s- sales efforts. Like, everything we can get our hands on, we learn from because it's free. Like, someone is making mistakes for us, we should learn

14. 44:34 – 45:36

    Is Regulation Helping or Hindering Buy Now, Pay Later?

    1. MLMax Levchin44:34

       on those too.

    2. HSHarry Stebbings44:34

       Is regulation a friend of buy now, pay later or an inhibitor to growth?

    3. MLMax Levchin44:39

       You know, I think we're always on the record as pro thoughtful regulation. I think you shouldn't be paying any late fees, but, you know, late fee cap I was very happy about because I think that's a, it's a good development. People should not be building their profit models based on, "I'll just raise the amount of late fee." Anyway, so I think generally speaking, I am pro thoughtful regulation. There's always the risk of regulators deciding, "Oh, I understand. It's black and white. Don't do this, do that," and that has chilling effect on the industry or, you know, products that should've been there become non-viable. We've mostly, I think, historically stayed on the right side of these decisions, and so I think that's, generally speaking, been a positive. But the best thing you can do as a company, certainly of our size, is you engage directly with the regulators and speak very clearly to, "This is a good idea, this is a bad idea. We'd like to offer you some feedback." Like, they're also human. They make mistakes and you want to engage

15. 45:36 – 46:55

    Being the Public Company

    1. MLMax Levchin45:36

       with them.

    2. HSHarry Stebbings45:36

       Do you like being a public company CEO?

    3. MLMax Levchin45:39

       (inhales) Uh, some days yes, other days no. I think it, it changes all the time.

    4. HSHarry Stebbings45:44

       What are the days when you're like, "Yes," and what are the days you're like, "No"?

    5. MLMax Levchin45:47

       Days when it's yes is when it's not very different from being a private company CEO. The... Being a public company, generally speaking, gives you access to more capital, exposes you to really smart investors you can engage with, so there's lots of things to like. There's some investors out there that will only invest in public equities, and they are brilliant people. Like, they've seen it all before. They could write books about what a great public CEO looks like. And you wanna go spend a half an hour with them and ask them, "Teach me how to be as good as blank," if you're a private company CEO, they might take your meeting, but they're probably busy. If you're a public company CEO, they might own your stock, and then they want to talk to you because they want to assess you as much as they want to help you. And so that's an... a cheat code to access some of the best brains out there. The days where you're like, "Oh, man," is inevitably when you're like, "Well, I now have to read this filing that we have to make because it's part of my responsibilities to make sure I understand everything we're putting out there in the public and can't, can't avoid that." And, uh, I think those are, generally speaking, small prices to pay, but y- you do have added responsibilities that were not what you thought you'd be getting into when you were getting a computer

16. 46:55 – 50:03

    How to Detach Mentality from Market Cap

    1. MLMax Levchin46:55

       science degree.

    2. HSHarry Stebbings46:56

       Is your mentality tied to the market cap of the company? It's so difficult to detach yourself from the valuation of your company. What've been your biggest lessons on that?

    3. MLMax Levchin47:08

       The short answer is I'm sure it is, but I'm sure I put an enormous amount of effort into making sure it's not. And so it's a balance you're constantly trying to strike, where the... the, the thing that is hard, harder is when you think you're doing a fantastic job and you can look at the internal numbers and you look at the external numbers and you're like, "I am absolutely crushing it," and so sometimes it's very tempting to say, "Well, by now the market should know, and they should just give us high marks and that means the stock goes green, green, green." And more often than not, you have a temporal mismatch where you're doing great, you know you're doing great, and the market thinks you're not. And if you're a startup or fairly high volatility stock, you end up with, "Well, I did great. Why am I getting punished?" And the short answer is, it's the market. Like, you, you just don't get to tell it when to react to good news or bad news and, and how. And so the more you sort of convince yourself that in the end it was great, um, uh... I think it's attributed to Warren Buffett but it's actually from, uh, Graham, his mentor. Uh, "In the short term, the market is a voting machine. In the long term, it's a weighing machine." I take great comfort in saying this to myself whenever the market, I think, misjudges me. (laughs) But I also... I- I- I've gone through some great lengths, by the way, to make sure I don't accidentally stumble on my ticker. So, you know, my Apple desktop, if I click in the top right corner and Stocks drops down, I cannot see my stock ticker. So, I, I don't accidentally discover that today's a red day or a green day just to make sure I stay focused. You have to think long term. If, if you are catching yourself thinking short term, and by short term I mean-... let's have an amazing quarter, and, like, you're, you're in trouble.

    4. HSHarry Stebbings48:55

       Do you see a dip in employee morale, though, when stock go down?

    5. MLMax Levchin48:58

       I don't, but I think I make it my business to... Every time I talk to our outcomes as a company, I take great pains not to talk about the price of the stock. The only time I talked about the price of our stock to our employees at length when it was flying very high after the IPO and sort of the, the heady days of, uh, '21, I'd actually repeatedly said, "Look, just, like, do not, do not get accustomed to whatever numbers you, you're reading on the screen today. Like, we will not know what this company's worth for years. And so, just... Like, if you think it's too low, good for you. If you think it's too high, it may well be. Like, just do not look, do not get conviction that this is actually correlated to some tangible metric." Like, first we have to get profitable, then we have to show revenue growth rates, then we have to show net income growth. And that's what, you know, long term, the, the weighing machine, that's what that weighs. It's not weighing sentiment. It should not be weighing

17. 50:03 – 1:03:41

    Quick-Fire Round

    1. MLMax Levchin50:03

       sentiment.

    2. HSHarry Stebbings50:03

       Max, we're gonna do a quick fire round, so I say a short statement and you give me your immediate thoughts. Does that sound okay?

    3. MLMax Levchin50:09

       Sure, but sometimes I will take a very long time. You'll have to edit out the awkward silences. (laughs)

    4. HSHarry Stebbings50:14

       It's the joys of podcasting. What do you believe that most around you disbelieve?

    5. MLMax Levchin50:19

       I have this conviction that I can learn anything very, very quickly, and, like, eight out of ten times I'm right and two out of ten times I'm completely wrong. I decided that I'm gonna teach myself-

    6. HSHarry Stebbings50:29

       What have you recently been wrong on?

    7. MLMax Levchin50:32

       I decided two years ago that I was just gonna read the attention paper and become an expert in LLMs, and, you know, just read all the papers after that. And I'm, I'm still in the process of getting (laughs) anywhere near expertly status. I try to keep up but, uh, it's a lot of, uh, really interesting stuff happening in AI.

    8. HSHarry Stebbings50:48

       (laughs) I just had Marc Benioff on the show about 12 hours ago, and he said, "We're getting to the upper limit of LLM efficiency." Agree or disagree?

    9. MLMax Levchin50:57

       Agree, but I don't think we are going to stay with LLMs forever. I think we're going to expand the systems that use LLMs. Reasoning models already are not pure LLMs. They have some iterative processes within them, and I think we'll, we'll invent more really interesting things with that.

    10. HSHarry Stebbings51:15

        Like what?

    11. MLMax Levchin51:16

        An obvious idea, which I know has been explored and will be explored more, is a notion of multiple competing LLMs basically debating each other for the right answer. Like, that's not a pure LLM model. Like, you, you can amplify intelligence of humans by having three smart people in a room instead of just one person.

    12. HSHarry Stebbings51:34

        As a public company CEO, do you have to have an AI story today?

    13. MLMax Levchin51:38

        I generally really dislike stories that have no substance, so I think you have to ask yourself, "Are we taking full advantage of the best available tools?" And the most interesting available tools right now are AI, so if you sort of look through your closet and say, "Hmm, we're not really using any of this stuff, I gotta have a story for the market," you're doing two things wrong. You're telling a story that isn't true and you're not using the most interesting available tools. If you're using the most interesting available tools, your investors might be happy if you told the story, but if you didn't, I don't think they should really care that much. Like, as you go public, a lot of this becomes are you growing at the right scale, are you taking appropriate risks, are you managing to profitability? The storytelling hour of, like, "Oh, by the way, we have this shiny item that we're so excited about," that feeds the voting machine, and I'm, I'm sure some of it is important, but I spend a lot more time feeding the v- the weighing machine.

    14. HSHarry Stebbings52:30

        Max, what would you do if you knew you couldn't fail?

    15. MLMax Levchin52:33

        Basically do exactly the same thing I do now. So before Affirm was a thing, I made a list of difficult problems that I thought required solving, and I decided that financial services, or money, were sort of at the core... is one that I am well-suited to solve, just given my past and, you know, experience that I bring. But if I knew I couldn't fail at anything, I would revisit my list of hard problems and that inevitably had things like food, water, shelter, energy, and just solve them all.

    16. HSHarry Stebbings53:05

        If you could start a company with only one member of the PayPal mafia again, who would it be?

    17. MLMax Levchin53:10

        Peter.

    18. HSHarry Stebbings53:13

        Why?

    19. MLMax Levchin53:13

        He's amazing. Like, he's brilliant.

    20. HSHarry Stebbings53:15

        More so than, like, Elon?

    21. MLMax Levchin53:17

        Um, Elon is brilliant too, right? If I could have a choice between starting a company with Peter or starting a company with Elon, it'd be a very hard choice to make. (laughs) I think Peter is a more known quantity for me. That's why I answered the way I did. So we started the company together. Elon's company merged into PayPal to form the, the modern PayPal, so I know exactly what he's like under pressure and stressed out and trying to raise money and not succeeding for a time, and dealing with personal life issues, and so I've, I've seen him go from, you know, mid-20s to, uh, older.

    22. HSHarry Stebbings53:55

        How's he changed over time?

    23. MLMax Levchin53:56

        When you observe someone closely for a long time, you don't actually notice the change. You see the episodes, but you don't know how the person really changes. He's, you know, we- we've all grown up, we've all become probably more measured and slightly more careful, slightly less crazy, maybe slightly more crazy, I don't know, but he, he hasn't changed very much. The, uh, the, the thing that makes Peter Peter is... And by the way, actually very similar to Elon in that sense, so the- there's, there's a really interesting echo between the two. They both have this amazing quality that I spent as much time absorbing as I could over times that I worked with them where they bring out the best effort in people around them. Like, they somehow make you feel that you can and should do better work. Like, the, the conversation with Peter always left me thinking, "The problem that I thought was really too hard to solve, I should go give it another try. Like, I think I can. I think this, this is actually doable." And he is genuinely excited about you solving this problem through the...... capacity that you have, and I think that's an amazing thing to work with someone on anything, because they're just fueling your desire to stay late and, you know, do more work.

    24. HSHarry Stebbings55:09

        What's your favorite consumer brand and why them?

    25. MLMax Levchin55:11

        I love Airbnb, less so because ... Like, the overall brand is amazing and obviously it's a super successful company, but their tagline, at least the one they promoted for a while, was Belong Anywhere, and I think it's such a profound two-word brand statement. Like you know exactly what it means, you know exactly what they stand for. It's evocative. You imagine yourself in all kinds of crazy places, you know, the Himalayas or in the Amazon, and you're like, that is an amazing story told with two words. But back to my brevity, love of brevity. I think, um, kind of the old world, the, probably my favorite brand that I look at every morning, so I'm a huge fan of coffee and bicycles. The, not, not at the same time frequently, but sometimes at the same time. Uh, so every morning I roll out of bed, I stumble downstairs and make myself an espresso, and my favorite espresso machine brand is La Marzocco. It's this, like, I don't actually know that much. They're not Affirm customers, so I have to f- full, full disclosure, uh, but they were a huge favorite of mine long before I convinced them to give Affirm a try, and it tells this amazing story of Italian manufacturing and, you know, the, someone with a mustache smelling the coffee fumes going, "Oh, this is perfect espresso." And like, it, it's this sort of a story in a cup that you just think of it has to go hundreds and hundreds of years back. They must have been making coffee in Venice, you know, with mortar and pestle or something. I don't think it's nearly that old. I think it's maybe on the order of 60 to 100 years old, but it's just this, like, timeless coffee awesomeness that I love, and I use it every day, and every time I look at it, I'm like, "Mm, yes, yes, my coffee machine." Love it so much.

    26. HSHarry Stebbings56:54

        You can be CEO of any other company for a day. What s- company would you be CEO of?

    27. MLMax Levchin56:59

        I have all these unfulfilled dreams of running a much smaller company that makes widgets. I've spent my entire life making things out of bits. I would love to make things out of atoms. One of my favorite executives came up with a brand name for a company that would sell pickles called Lethal Pickles, and this has to do with a story in the very early days of Affirm, where I tried to teach people how to make pickles, 'cause I love pickles, too, and I managed to screw it up badly enough where they eventually turned, like, toxic and grew mold, and it was terrible, and I was briefly trying to persuade people that it's fine. It's not, it's actually not a problem. You should eat them, and well, basically alm- almost single-handedly wiped out the entire Affirm team, but fortunately, no one ate any, and we threw them away. But the story of Max's Lethal Pickles survives in the annals of Affirm post-mortem history.

    28. HSHarry Stebbings57:49

        (laughs)

    29. MLMax Levchin57:49

        And so, uh, someone said, "Well, you should eventually go fulfill your dream of making things out of atoms, and, uh," molecules in this case, "and sell, you know, sell pickles online and call it Lethal Pickles," so one day, I'll, I'll start lethalpickles.com. I have the domain.

    30. HSHarry Stebbings58:04

        We're, we're gonna name the show Max's Lethal Pickles-

Episode duration: 1:03:51