00:04:27 · Sadi Khan
We've invented all of the modern tech companies we see in Silicon Valley. From Facebook, Google, Nvidia, Amazon. But we haven't been able to reduce the cost of interest on a trillion dollars of credit card debt in this period of time. Heck, at this point, we're inventing entirely new currencies, from Bitcoin to Ethereum. But the cost of capital for consumers has really not changed. In the pursuit of helping society be wealthier, by helping consumers in America save money, and we thought we can build better products for consumers to help them save money. And that's how we started Aven, which is taking the largest asset class that US consumers own, which is home equity, which is also the most inconvenient to access. It costs thousands of dollars to access home equity, and today it takes about three to four weeks to get access to your home equity. And we decided to make that much, much more efficient by machining this process for maximal efficiency. We were able to bring this down to be almost as fast as fifteen minutes, with transactional costs that are orders of magnitude lower than anything else in the market, and put it in a form factor that consumers are comfortable and already are familiar with, which is a credit card. And we launched our flagship product, the Aven Home Equity Card. Through my time at Microsoft and Facebook, probably the single most important thing I learned is the value of an extremely elite technical team. The differential between the ninety ninth percentile or the ninety ninth point ninth percentile engineer and the ninety fifth percentile engineer is fast, is not small, is a huge amount. The amount of resources you spend on the and retention of the absolute best technical talent far surpasses any other investment you should make and can't make. When we look for the best technical talent, and at Aven, my and I think the team's single highest priority, is the collection and retention of the absolute best technical talent in the world. There are three main things we look for when we look for great technical talent. The first is raw intelligence. We are unapologetic about looking for the absolute smartest people we can find in the world. We will ask for SAT scores and other forms of standardized tests, as controversial as that may be sometimes.
00:06:38 · Sadi Khan
I will personally review transcripts and look at exactly what grades people got on what classes. For engineers specifically, we look for people who've taken courses in operating systems, distributed systems, compilers, games engines, the hardest technical courses one can take. And how did they do on them? And importantly, did they attempt the really, really hardest courses that can be taken? Intelligence is massively underrated and how important it actually is in helping build products and companies. So that is our number one and most important thing we look at in technical talent. The second is work ethic. You can have all the intelligence in the world, but if you don't want to apply it, if do not have the motivation and the endurance to apply that intelligence, you're not gonna create much output or much value to society. And so we look for people who have the endurance, the ability to work hard consistently over time. At Aven, every Sunday at 6PM, our entire leadership team meets to identify and finalize and lock in our roadmap for the next seven days. This allows us to operate with high precision and high velocity, and it gives us a very important thing, which is we should not be wrong in our roadmap for more than seven days, Cause we revisit our roadmap every seven days to make sure we're working on the right set of things in the right priority order with the right set of people. The third thing that's really important.
00:08:00 · Hannah Lee
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00:08:15 · Sadi Khan
[00:08:15] S0: Part in elite talent is an alignment of the mission of the enterprise, in our case, the mission of reducing the cost of capital for consumers, with the ambition level of that person. Trying to reduce the cost of capital for all of America is an extremely ambitious undertaking. So the person that we need to bring in needs to be super smart, super hardworking, and has to have an alignment with this mission and an alignment with the ambition level of this mission so they can sustainably work on this for a very long time and push the boundaries of how we would achieve this mission, day in and day out. If Aven are to be successful, we will drive the single biggest change in the cost of capital in American history. And we need to find the absolute best talent in the world so we can do that. And if we can't find the absolute best technical talent, we will not be successful. And that is why we spend so much of our time and so much of our energy on this specific problem, and it's probably the most important thing I ever learned at Microsoft and at Facebook. Aven's flagship product, the first product that we wanted to build, was a home equity backed credit card. The reason it was very important for us to understand the legal and regulatory landscape for this product is because this is a very highly regulated industry. It is both a mortgage product and a credit card product. And it's very important for myself, as the founder, to have a deep understanding of the regulatory landscape for this product to, a, understand, can we build it? And, b, to make sure we build it in a safe and compliant way. That's why I went through and read personally a lot of the regulations in this space, whether it be Dodd Frank Act, Card Act, TILA, and others. I think it is very, very important for the founders and the CEOs to be very deeply involved in the details of the products that are being built by the company. I think in the case of founding a new company or building a new product, even at a big company, oftentimes the core value is the inventing of something new, something that hasn't existed before or something that hasn't been built yet before. In order to build something new, I think you must first understand the history of what has been tried before so that you can efficiently build something new. Most new ideas are terrible. Most new ideas are bad.
00:10:40 · Sadi Khan
There are very, very few new ideas that are actually better than all the old ideas before. And so in order to assess that, in order to deeply grok whether or not your idea is better, it is often very useful to understand what were the ideas, at least the big ones, that have been explored and built before. Why is your new idea better than what has already been built before? And in order to do that, you must often invest the time to understand and learn very deeply about this industry and this domain and all the smart people that have come before you, so that you can come up with good new ideas and assess that they are indeed better than what has been built before. In the first two or three years of building Aven, we made a series of product decisions, and a series of people decisions, and a series of process decisions. I think in the product, we would have been even more ruthless in prioritizing the feature set that we were building for in the first version. And I think this is, you know, generally true for for most PMs when they launch a new product. They... If you were to look back and ask any product manager what products they've launched before and what they would do differently, almost all of them would tell you, I would have cut these, you know, five out of the 10 features and shipped a smaller, narrower version of this product to a fewer set of people and really deeply gone into a kind of a more focused product feature set. And so I think that also applies to Aven, and I think it applies to the product that we built. I would have kinda made it narrower and simpler in the first version. The other big thing is in the early days, there were these really funny stories of consumers going through our origination process, not sure that this was real. And we would get tickets and calls to say, we don't know if you guys are a scam or not. And we'd have to respond, including sometimes myself, saying, no, we're we're very real. We're a real company, and we're here to help you get access to your home equity, and we have a real product that you can use. And sometimes it was that ability to talk to somebody at the company, and they were to hear from somebody's voice at the company that gave them the confidence to continue and go through our application process.
00:13:00 · Sadi Khan
I do think one of the interesting things that happened with with Aven is that we were able to find people who were kind of on the on the on the border of potentially considering a home equity line of credit. And many folks were actually sometimes in the process of applying for a home equity line of credit to other lenders. And then they would see an ad from us and go, I wonder if this is true. Can I get a home equity line of credit in as fast as fifteen minutes? And they would almost test us out as like a... Almost like an experiment to see if this is, like, real. And when they went through the process, they would be kind of amazed and shocked. And then they would actually book an account with us instead of whoever they had started off a home equity line of credit application with before us. And so that was, I think, an interesting kind of lesson learned. You know, many people in the beginning didn't believe that this was possible to do. My ideal form of leadership is one that maximally rational. I observed and and learned a lot of that from Mark at Facebook. The reason this is important is because being extremely rational is a very predictive behavior. And being predictable as a leader is very, very important because people can then replicate or predict what you would do even when you're not there. That is important for people to be able to reproduce your decision making system, even when you're not present. And my goal as a leader is to make decisions that are so rational that if everyone else also had the same information that I had, they too would all make actually the same decision. And the two incremental things that I provide as a leader that, let's say an individual contributor in the company don't necessarily have, is that I have significantly more context and a lot more information sometimes than others. And my job is to actually make sure as many people have that context as possible. And two, I have the privilege of being able to optimize for a much longer time horizon than anyone else in the company. So these two things are the incremental value propositions that I bring to a decision that is not always possible for every single other individual contributor to always bring. But if they were to actually have those two things in their mind, they should be able to compute to the same conclusion that I come to. And that is my goal as a leader.