Two minutes into his discussion at Grace Ford Salvatori Hall Tuesday night, it was already apparent that Max Levchin did not fit the mold of an intimidating executive.
The PayPal cofounder, who spoke to students from the Viterbi School of Engineering, kept approximately 140 audience members engaged and comfortable with his good-natured humor.
“He’s truly a gracious, humble leader,” said Brooks Hosfield, deputy chief of staff at Affirm, a financial technology company that Levchin founded in 2016.
Ragini Holloway, the head of talent at Affirm, introduced Levchin by joking she’d need to peek at her cheat sheet to do justice to his veritable catalog of accomplishments: After co-founding PayPal, a widely used online payment system, Levchin went on to found photo-sharing company Slide, help launch Yelp and start Affirm and Glow, a reproductive health app for women.
Despite his impressive resume, Levchin said he almost felt awkward coming to the podium with the pressure of living up to such high praise. After noting that his PayPal days are well behind him — he founded the company in 1998 — Levchin launched into an hour-long explanation of how Affirm came to be.
Levchin discussed how he translated an individually damaging credit experience into a wider objective of improving transparency in lending.
“I was obsessed with the idea of building something different from my financial services background,” Levchin said.
He did so by venturing into the media and entertainment realm with Slide, but later realized that his passion lay in technology and intentionally seeking difficult problems whose solutions would positively impact as many lives as possible.
“How do you codify this problem of finding something that’s valuable and implicitly hard?” Levchin said, referring to the question he constantly asked himself.
From this cross-section of philosophies rose HVF Labs — short for Hard, Valuable and Fun. The fun component, Levchin said, encompasses Levchin’s emphasis on doing what you love.
“You can build a great company … but not having a lot of passion underneath, it crumbles quickly,” Levchin said.
The entrepreneur specifically chose to tackle the financial world after experiencing a financial struggle during his college days at the University of Illinois at Urbana-Champaign. A four month-late payment came back to haunt his credit score years later, Levchin said, even after PayPal led him to rake in millions.
“The entire system is designed to permanently keep you down,” Levchin said.
This frustration led him to start Affirm, a company structured so that consumers who want to borrow money know the exact amounts that they’ll be paying ahead of time, without any hidden fees.
This “reinvented credit system,” as Hosfield described it, helps consumers avoid the vicious debt cycle, echoing Levchin’s own problem-solving philosophy.
“I feel most alive when I feel like I’m fixing something really important,” Levchin said.
The founder and CEO also noted that his main point of pride is Affirm’s Net Promoter Score of 82.
A company’s NPS essentially measures customer loyalty. For Levchin, building a company that people want to recommend to their friends is crucial, especially in a financial landscape full of banks with negative NPS results. He places a much higher priority on trust and individuals than on profit.
“We’re happy to take a lower cut but provide a better service,” Levchin said.
As for the future, Levchin said that he can see himself continuing in the finance industry even decades from now. Like a true engineer, Levchin constantly challenges himself to create better products, build significant solutions and solve hard problems.
“Nothing beats just heads down, working on something that’s going to be impactful,” Levchin said.