Latest / The Longest View with Dez Fleming / How Fintech is Transforming Banking Operations with Jeremy Tsui, CEO and Co-Founder of Finely
Transcript
- [Desmond Fleming] (0:00 - 0:23) Maybe always start things out. It is the basic kind of question. You've had a bunch of podcasts in the in the past, but you know would love to learn more about how you um and your co-founders Josiah and Kevin kind of were able to link up tell us that story bring us into that Founding moment and obviously josiah is your your brother. So what's it like working with Finely? [Jeremy Tsui] (0:23 - 1:42) Yeah, uh, It's the easiest thing in the world now, uh, we can get started, but I'm Jeremy Tsui Founder CEO Finely technologies. We streamlined the end-to-end Credit management process for for leading banks private credit funds and fintechs prior to finley. I was a private credit investor at at golden sacks and so And now being on the other Uh side of the fence in the entrepreneurship journey, uh building software that I that I wish I had I was really lucky I had two co-founders that Uh were early literally the first, you know hires at successful startups uh that really uh brought me in and convinced me to take a bet on uh, you know myself the team and the problem space uh growing bigger and bigger within Uh banking and private credit really needing a facelift when it came to comes to kind of infrastructure and tooling And so we are in year five now, it's a blur Every year I went or the everything I guess the problems we face get more complex more interesting and larger And scale I wonder what what did we do all of last year? And so um, yeah having a awesome time and Excited to be here So did you get exposed to? [Desmond Fleming] (1:42 - 2:00) silken valley startups Entrepreneurships Through your co-founders or what was your influence? Was it was it largely them influencing you? Was it media? Was it you saying? Hey, you know, i've always wanted to run my own company To start like where did that kind of initial inspiration come from? [Jeremy Tsui] (2:01 - 3:45) Yeah. Yeah, of course. So I i'd always been entrepreneurial I with friends but uh Very traditional businesses i'd run a few escape rooms. I had I'd actually opened up a huge bike shop with friends during covid and and I really knew Very little about the world of technology Much less silicon valley kind of a rocket fuel field vc back startups And so I I remember vividly it was fall of it would have been 2020 and my brother Approached me. Hey, have you ever heard of y combinator? never heard of yc but Feel free to fill out an app and put my name on it Yeah, and so kind of fast forward we get the interview we get into the program and what really pushed me over the edge was Honestly, just how supportive everyone at at goldman sachs was it was hey jeremy What is when it doesn't work out because these things usually don't work out feel free to come right back We'll save your seat and then uh, can we invest in your startup? Yeah For for the friends and family around and so so a lot of a lot of people on the desk invested in in finley A lot did a lot did and for those that yeah, it's funny. Uh, you know now we're we're in year five I would say there's still a lot and plenty to do but for those of you that might have a banking or or buy side or sell side background every time we do business with goldman now, we have to clear conflicts because Yeah, because they're they're you know, like We're like loaded up with angel investors. So had I known that had I known what I know now I would not have Had them or it would have made them invest through like yeah You're like I want I want to I want to close goldman as a client easily with less friction. Got it So we'll we'll buy them out at some point. Yeah, jeremy's friends. [Desmond Fleming] (3:45 - 4:28) Yeah Cool so one of when I was kind of doing research on on you You've spoken to other media outlets a bunch already, uh, but one question, uh, someone asked you the question basically Or it prompted an answer from you of you know, you would love to hear more stories about you know What's the miracle that occurs within startups? um You know people often within startups talk about startups being as a series of miracles and obviously to get to year five presumably there have been some miracles that have Occurred for you for so that for the other founders that may be listening to this today like what's an example of one of those early miracles that have occurred for uh, for finley [Jeremy Tsui] (4:29 - 6:19) Just to double down startups are absolutely a series of miracles. I you know, you're trying to Grow like crazy year over year You're trying to bet on markets that might not exist yet You're trying to return the front and so like none of the none of what happens in startups is natural You are trying you need every advantage you can get to to win and so what does that mean? I I feel like your startup basically You know, especially a success compounds. You need a miracle every like six to nine months to keep going right, so, uh I think the the first handful of customers the first five the first ten customers before you have a product before you even know What your problem you're trying to solve those are quite miraculous because you Early customers investors to really believe in you before you have anything before you really believe in yourself, frankly and so right I remember even in getting our first customer who Who turned out to be ramp, which was we could not have asked for a better design partner But oh, yeah, we were we were probably doing everything wrong we were sending outbound emails from our gmails because we were in stealth that we uh, you know, we were using webex and not zoom we Right, uh, we were doing everything wrong. I remember um you know we were horrible at outbound but doing it because someone told us to do it and then We actually had ramp ranked last on our list of dream design partners We had yeah, but all these other startups before them that are all now out of business and so right I think back to like getting the email back from ramp and pitching them and landing them as our first customer and Even like even that we were like, oh like we don't want that. They're not. Yeah, you're like and it turned out to be a great, uh, a great first customer and partner that like Very hard to replicate. [Desmond Fleming] (6:19 - 6:41) Yeah, that's that's that's Fantastic when you think about the software you sell is it to the ceo? Is it to the cto? Is it to the cfo? I'm sure at that time the cfo was Eric or is it the vp of finance? Like how do you think about your Go-to-market motion and what have you learned about that? [Jeremy Tsui] (6:41 - 7:54) Yeah today as it stands we sell to Uh finance leaders in private credit in capital markets in banking Uh, we know the pain points we're going after in uh risk and operations and so Uh, but in the early days as a founder when you're going after your first 10 customers You just use every advantage you can get you're like, right i'm the founder. You're the founder you know i'm in yc used to be in yc like let's let's chat and so uh, we did pitch eric and kareem, uh directly and um What what's like a funny story? I I there are all these now, you know now having seen that Uh Seen this story unfold a few times. I think we were like Uh, literally emailing the wrong people we thought their emails were, you know first dot last but it was just first and so we were Like why are we getting all these bounce backs? And so yeah, you know, we'll never say no get into someone who is level like a level or or two above The buyer or the user but yeah, you really just got to use every advantage you get in the early days [Desmond Fleming] (7:55 - 8:45) Yeah, yeah so one of the um one of the reasons why I specifically wanted to have you on is To talk about capital markets to talk about private credit the debt side Uh of private markets as well And I want to talk about one How you see that market evolving since you're kind of right in the epicenter of it and then two how you think about? uh the software stack Within these kind of fund managers asset managers banks people with massive credit facilities How you think about them evolving their tool stack over time? So maybe to start would love to get your kind of ten thousand foot industry view of where kind of private markets and capital markets are evolving and then two let's let's transfer to Talking a little bit about the software stack and how that's changing too [Jeremy Tsui] (8:45 - 10:28) So, yeah when I was at Goldman Sachs, there were basically two camps of people There are the mds that thought hey private credit's eating the world Uh banks are going to be extinct extinct in 10 years You kind of see that private credit's like two trillion dollars now And then there were the other there was the other camp that that really believed. Um, banks would never go away they would always play a role in the financial ecosystem and uh And yeah banks are maybe maybe they're consolidating but they're largely still here um But I think the really interesting thing now is the lines between banks or funds are actually just blurring in a ton of ways Right, uh, they compete for the same deals with the you know, corporate credit. They actually participate in the same deals with all these bank non-bank partnerships And then even even when banks don't do the lending anymore They're just lending to the funds like the aries and the apollos of the world and then the funds are doing the lending so I think we're in a really interesting age. It's it's kind of like the many-to-many age of lending where None of the old software was really designed to handle these weird complex webs of relationships and so, uh To answer your question, I think you know software core banking software You know these old school bank erps were really just Meant to handle banks single bank singular banks lending to singular companies Whereas now the relationships are way different. There's a bunch of kind of ledgers or I think of those like separate splitwise accounts to maintain for All these different counterparties. [Desmond Fleming] (10:28 - 10:40) So are you a splitwise user or you you you create your own excel when you gotta react Oh, man I'm an excel guy. [Jeremy Tsui] (10:40 - 11:05) Yeah but I think most of that is my my like My memories of splitwise are from like I think like I think I might have been one of the first users splitwise Oh, wow and it was like, uh I got like annoyed that you couldn't Settle the balance once and so i've no problems against splitwise The easiest way to describe our business But i'm uh, yeah, i'm an excel guy [Desmond Fleming] (11:05 - 11:37) All right, so you've you've architected this kind of one-to-many Uh relationship embedded deeply into the software because that reflects more of the real world today Uh, you know, how do you how have you seen the software stack change? Like when you were at goldman two questions, what did you guys use? Was it just you know pen and paper excel and and email and then also where did you fall on that line of? Hey big banks are going to get eaten by private credit versus, you know, big banks aren't going anywhere. They're here to stay [Jeremy Tsui] (11:39 - 13:31) Yeah, fascinating, uh, so most of the tooling at um at goldman sachs Um, like a city or jp morgan's actually a lot of it's internally built and so one distinction we draw is Hey, while there's an extreme software need across the whole financial sector The problems that like a goldman jp morgan city essentially anywhere with in-house teams and large mainframe systems and on-prem are actually quite different than regional banks like, uh, basically anyone outside the top 10 that inherits the the uh You know the legacy issues with like a ficer or an fis So we used a lot of in-house systems that had just been duct-taped over. Uh, yeah the last like 30 40 years They might have i'll give you an example the systems Maybe they were meant to handle like a consumer lending use case, but they would just try to repurpose it to Say, oh we can definitely use this database to store Information about private credit loans as well and so you saw this time and time and again where Systems were just retrofitted for these newer more complicated than ever credit products then yeah, your second question, where did I fall on the uh the spectrum I Uh, I hate to say it I I was probably uh Long banks or traditional financial institutions Yeah, um, I remember distinctly going into a lot of these fundraising pitch meetings, uh, maybe 2021 Crypto heyday and we would describe the platform, right? We would say hey, we're building a ledger It's two-sided workflows. It's extremely, you know You're reducing Inefficiencies in the financial system and they're like so it's like blockchain and i'm like no no, no, no Yeah, it's like these real It's a real sequel database. [Desmond Fleming] (13:32 - 13:32) Yeah. [Jeremy Tsui] (13:32 - 13:44) Yeah, it's like it's real technology. And so uh, yeah, i've probably Uh been a little bit more on the traditional side. Um But my yeah, my personal view is banks aren't going anywhere private. [Desmond Fleming] (13:44 - 14:19) It's all it's not one or the other I think They will need each other and actually right Banks and non-banks will become uh more intertwined yeah, yeah, it's it's like a It's a spectrum people will value distribution, but then if you're trying to Making this up if you're trying to syndicate a 20 billion dollar loan Lots of people are going to be involved. So that's gonna might get originated by You know a private credit desk But that private credit desk has a relationship with goldman or or or morgan stanley or or city or whomever still [Jeremy Tsui] (14:20 - 15:00) yeah, yeah, that's exactly right even when I you know catch up with like my Like all my former colleagues at goldman like I think one really interesting stat is goldman sachs is actually one of the biggest borrowers of private credit and so What is goldman goldman's a lot of things. They're a big bank. They also Manage all these private credit funds through their asset management arm And then they're also a massive borrower so they're borrowing money and yeah relending it out to others and so it's actually just like Not it's not obvious how all these relationships tie together at the end of the day Do you think that creates any systemic risk in the ecosystem? [Desmond Fleming] (15:01 - 15:24) You know, sometimes we talk about you know, why do people purchase things people purchase things out of fear and greed? Obviously, there's one component where you know, there's a fear component of like hey You may not know like your total loan exposure across the entirety of your book so Use finley to solve that like I i'm just generally curious if you're a if what your perspective is on that Yeah, do I believe there are systemic risk created? [Jeremy Tsui] (15:25 - 17:25) Oh, man. Um, I think there there's been a ton of literature on it. Um, my my view is Go find someone much smarter more academic than me, but I do think if there is systemic risk, it's probably Different than anything Uh, you've seen in the past because private credit is at least now maybe not in the future It's still relatively illiquid. And so right I think unlike like mortgage-backed securities which are relatively liquid or like bank runs you see With like deposits, uh fleeing banks, uh Private credit would be very difficult to unwind just given the duration of these assets, uh, even bank loans So yeah, I I think there is systemic risk. I Probably like a lot of people pretty curious how it could manifest, uh, yeah, yeah once like even if we found out all these loans were just like Misrepresented. I I actually it's not totally clear how that would play out not these are not the opinions of finley, but um I think when you you think about like a loan the the banks and the funds Uh have really different uh different positions when it comes to like how much leverage they're taking on sometimes they're like Hey, i'm gonna Fund this loan entirely with my own money. That would be the least amount of leverage yeah, and then sometimes they're like i'm gonna borrow 95 cents on the dollar and then fund this other portion on my own and so put to your point that systemic risk comes in and Somebody is like oh this loan's only worth 90 cents on the dollar you are like In deep trouble with all the people who lent you That the original like 95 cents and so yeah uh, if something happened, I think it would be like The funds who are basically like borrowing the most amount of money to To make their own loans being at risk [Desmond Fleming] (17:26 - 17:47) Yeah. Yeah, I I always think about it. What's the exogenous shock into the system and How to your point on the illiquidity How painful is it and how quickly are those people either trying to claw back money or in need of money? um And that's where it becomes a little challenging to me Yeah. Yeah, that's right. [Jeremy Tsui] (17:48 - 17:58) Um But yeah, knock on wood. I'm long private credit and bank lending and Hopefully that's the thing. It's like a it's a it'd be a weird one to unwind. [Desmond Fleming] (17:58 - 18:28) So yeah, it's like so better or worse One other kind of thought and question I had for you is in many ways um you were one of the entrepreneurs that is earlier on to the idea of creating a vertical sass platform For the professional services industry, you know, you start you said you started in 2021 That's right. We started [Jeremy Tsui] (18:28 - 18:32) Uh in earnest in january of 2021 [Desmond Fleming] (18:32 - 19:38) yeah, so you guys started in 2021 and you're building for lenders bankers fund managers And you're building a core operating system Now as i'm sure you're tracking, you know chat gpt comes out november 30th Uh 2022 And this whole ai boom and wave has been Released and now at least both with investors and founders themselves people say hey bankers lenders fund managers we can now build Core software for them that helps them with their workflows helps them with their professional knowledge work and you were earlier to that trend you started before that trend occurred, so What are your perspectives what are your lessons learned of selling into this marketplace and then also how do you think about ai as You know, presumably a tailwind or maybe a headwind to your business. I'm curious how you think about it [Jeremy Tsui] (19:38 - 21:04) For us, we know it's a win condition for ai to be at the center of everything we do and what that means is to always be the beneficiaries of models improving and Not to be short that Banking is not going to change So if you just assume banking and lending are going to be just as impacted in the next two five ten years as any other industry That should be your north star and you don't want to be on the wrong side of of that wave um, I would say the biggest mindset shift that we had as it relates to capital markets, but also ai is 2021 we believed that capital markets was just one big workflow we're gonna create a big process map of how loans get distributed and originated and repaid and we're just gonna Build really pretty uis for each of those steps and so I think that was wrong for two reasons one Capital markets Are actually quite dynamic. It's not really a workflow It's not you're not filling out taxes or or like submitting like an employee form into an hris The way these counterparties transact change change like every changes every few years and then you could be in a low or a High interest rate environment and it's really different what types of financial products businesses are using to finance their [Desmond Fleming] (21:04 - 21:12) Their operations and so said another way the business logic isn't Rigid it's dynamic now. [Jeremy Tsui] (21:12 - 22:12) Yeah That's exactly right. And so when we started our product in 2021, we weren't configurable. We were like Lending is just going to look the same Every year forever We just have to create the perfect like user experience around this one form of capital markets, but we quickly had to reorient And shift our focus to hey, what do the banks care about? What do the funds care about? What do the lps in these funds care about? and Really like rebuild it our system into like a configurable headless credit management system and so They were the first system Uh that serves the borrowers the lenders the banks the non-banking institutions and so Uh, I can't tell you if it's gonna be banks or private credit that that eats the world But we do know that we have to build for all these people uh, because uh They're all going to play a role in capital markets in some capacity for years to come. [Desmond Fleming] (22:13 - 23:09) Yeah, and as you as you think about Developing that headless system One it sounds like there's already been You know a thinly 1.0 And certainly a thinly 2.0. Maybe you're on to 3.0 today But how are you thinking about? either Embedding ai into that headless system or using ai to help you develop that system More quickly said another way. Are you know, are you man and mandating engineers? Hey, everyone needs to be on cursor. Everyone needs to be on windsurf. You need to use a co-pilot religiously Are people finding that organically? Um, are you thinking about ways to? help people Summarize their exposure across their book enabling people to chat with kind of their effectively their own Ledger of their entirety of their book. Like how are you thinking about those product features and how it affects your development? [Jeremy Tsui] (23:09 - 25:28) I think of finley like 1.0 as As essentially like a financial data entry, uh system And honestly, that's so much of banking and analysts work. Yeah taking numbers from here. Put them in there uh running them and so that was 1.0 it was Hey, what are the types of structured data? We need to capture from these contracts these credit agreements How do we get financial data from companies on financial performance Into our data schema. What are the right uis that like loan officers loan servicers portfolio managers? need to see but there was not much ai in 2021 even 2022 it was just uh, why were we 10x better because the software was intuitive it was cloud-based and You could capture a ton more data and metadata in our software than the core systems on your transactions but I Zoom ahead to like finley 2.0 It's really hey, how much of the financial data entry can we rely on agents and llms to to do so every implementation We have these 200 page credit agreements We feed them into the system and it's like 95 97 correct and We still have our own in-house team of experts capital markets experts ex-bankers Review and make sure the information is perfect because it has to be and so we don't know if it's in six months or 18 months where the models will finally catch up and do the 100 pass of all of our implementation and configuration of the software but We do know that it's gonna continue to improve right with every with every release and so Today, it's it's largely like our benefit is largely on the configuration and cost to serve for these It's not just like beautiful data entry software. It's beautiful software that implements itself 95 away but you know our our success to get this to be a company that really Can scale with any type of credit any type of institution will be predicated on solving that last five percent yeah, let's um Let's double click into that because that was actually maybe Non-intuitive or unintuitive to me. [Desmond Fleming] (25:28 - 26:30) So let's say i'm I don't know i'm victory park white lane credit advisors and i'm you know new hotshot 500 million uh dollar fund and I invest in super bespoke You know assets whatever or I lend to super bespoke, you know equipment back financing whatever it is um and i've got you know, really detailed credit agreements that are not Agreements that you've seen before and you need to code those into your headless system in the onboard your onboarding of me you ingest my agreements to make sure that the unstructured data that defines my business is captured in your structured data data format and you've got a Presumably an llm based pipeline that is helping Transpose that unstructured data into a structured data format. Did I understand that? [Jeremy Tsui] (26:30 - 27:03) Yeah, you nailed it. You nailed it. Okay. We've just been stockpiling Credit agreements for five years So that helps when you just have a bunch of reps with all the different institutions who of course like to document things differently um But but you nailed it. It's uh, how do you come up with like the universal? You know uh credit agreement digitization gun that you could just point at any credit agreement or Set of financial data that needs to be extracted Yeah, that's cool. [Desmond Fleming] (27:03 - 27:15) So you would say that the leverage today A high ai is giving you is largely in like your customer service in in onboarding So it's a part of your overall go-to-market motion and cost to serve [Jeremy Tsui] (27:16 - 27:41) that's right, that's right, it's critical because like the the bar today at the you know at the at the customers is quite low where You need people to read the documents the documents themselves are full of errors and the documents are actually, you know with of course like private credits getting uh more fragmented and actually less standardized the more Emerging managers enter the space, of course. [Desmond Fleming] (27:42 - 27:44) Yes victory park white lane capital. [Jeremy Tsui] (27:44 - 28:02) Yeah yeah, yeah, that's right and so um it's a weird space where usually as like, uh As an industry professionalizes it usually gets more standardized, but that's actually not the case for Uh for private credit, so that'll be an interesting Uh tailwind for us, honestly [Desmond Fleming] (28:03 - 28:17) Yeah, similarly on the you know non-intuitive lens What is something unintuitive non-intuitive that you've learned about building a business? So five years in hopefully doubling it back another five years from now, you know, what's been the most surprising? [Jeremy Tsui] (28:18 - 30:25) aspect of building a company from scratch Basically, not if it's intuitive if it was intuitive Yeah, if it feels intuitive you're probably not doing it, right and yeah You should get a better mentor or set of coaches. I think a pretty Simple example that something I relearned over and over is when you're Finding product market fit which you kind of have to redo as a scaling company every 18 24 months as these new markets surface it's actually the The nose that you get that are way more helpful than all the yeses. I think especially as you Make more progress as a startup people are nicer to you because You know you're on to something they don't want to get on your bad side And so everyone's like, oh, yeah, that's a great idea. You should you should build for private credit or like you know you should um You should just use agents to replace your whole customer success team Uh that definitely solves the pain point and so it's actually really hard to cut through the noise as you you grow in scale one because You're further along and people don't want to upset you and then two you just like know your industry the best So it's hard to get objective feedback from others and so Whenever you do get nose whenever you do get hey, like this isn't valuable for you. Why what would make this valuable? uh, we really uh cherish that and so that's quite different and Not super intuitive at this stage of company building when like, you know we want to launch new products when expanding new areas and we just have to get to truth whether it's like a good idea or not Contrast with that with like the seed stage days where everyone will tell you it's a terrible idea yeah, um and yeah, and then you kind of have to buckle down and Kind of develop a new type of conviction versus now. It's it's quite different where I would say it's the opposite everyone already Thinks they understand what you do even when you're trying to solicit Feedback, you're like no no, no like Yeah We're we want to expand to this market. We're not there yet. It's like what do you think and so yeah, it's really How do you combat that? [Desmond Fleming] (30:25 - 30:35) Do you feel like you have people who are you know? the proverbial canary in the coal mine or to your point because you've been doing it so long and you're on the edge like You kind of are the vanguard. [Jeremy Tsui] (30:36 - 31:34) Yeah, I would say like money talks like if you want to combat it and you ask people if they would buy it and kind of ask for them to Truly give you their you know their time their product usage and their funds and so I think that's the only way to cut through the noise because we're at a stage now where we have awesome technology for credit funds and banks and um and You know like with startups, you're kind of just starting a new company every like 18 months or so where right? We could go this direction. We could go that direction. And so there are a lot of really big Anything I think there are like multiple companies that we're building out of like, you know, like capital markets is huge and so uh, you just have to stay super attuned to like Yeah calling people on their bs and um Kind of inclination to actually like use your product as like the stakes get higher. [Desmond Fleming] (31:35 - 32:27) Yeah Transitioning a little bit To What you've observed about building teams and being a leader of a company What have you seen is the pattern of success for Team members of finley right because it's it's one thing to be a founder. That's a certain archetype of person It's another thing to be Uh, like your brother and your other co-founder, you know first 10 or first 12 people At a company, but those people, you know drive a lot of impact. So What have you seen for the people that have worked within finley like really spiked? Like what have you seen out of them any characteristics or or patterns or observations? [Jeremy Tsui] (32:28 - 34:28) First i'll say like we've been really lucky with our early team at finley. I think like Um People really like glorify the founding team and the founders, but the reality is it's like it's a total dogfight for uh all the early team members who Kind of sacrifice a lot to go early and be early um and then for the people that um Really make it through. I I think it's I I think intuitively I would be like, oh, do they love capital markets? Do they like? You know, did they did they feel this pain, you know in their own lives prior to this? but I think it's really just people who love the energy of being uh early and so It's people who you know, it's the it's the cliches. They love ambiguity. They love pain Um um You know really like staying up all night to deliver this this solution, uh for like a design partner Poc type customer and that's the world and so yeah, I think like being early is really special. I'll that'll always be one of my favorite stages at finley and I think it's just the people who really embrace like what a special moment that like You know, you're you're you're being uh, you're like grinding all night to get this release out to this customer who's like You know just like another peer startup like you and and you're kind of like in it together. And so um Yeah, it's it's that uh, it's it's not it's never like the head knowledge or The skill I would just say it's like that Really weird grit or where i'm like are you know? I know why you know, I know why i'm doing this like I faced the problem at goldman i'm like i'm near me but like You just love startups. [Desmond Fleming] (34:28 - 34:42) So I I love that about you Yeah, like what's your what's your underlying desire? What what drives you by the way? What what was um, what's the most important thing you've learned that you learned at goldman you were there two years? I was there. [Jeremy Tsui] (34:42 - 36:16) I was there a total of three years, so I Yeah, I loved my experience there and i've actually um, you know, there's so much to company building and startups But even on the subject matter side, I thought yeah, I I really valued my experience there. I never really felt under equipped for My time and call it gone from finance to finance related startups. And so I think the biggest thing there was Just probably like never never being afraid to keep the bar really high like impossibly high So, right. Yeah, I remember so I even at goldman I was in the special situations group. So that was like a Stato organization like one of those profitable groups at goldman sachs. And so the first few months were really tough on me I had all the the classic imposter syndrome everyone was like Way more direct than I was ever used to brutally honest and just had like a really high bar And so I never lost that mentality. I kind of brought it over to vc back startups where You know, everyone's trying to build a generational company and return the fund and so like by definition there's only going to be a few winners and so I think just like without being like too much of a hardo of Keeping the bar high for everyone around you and just reminding everyone that like we're not kind of grow to x or like Get profitable but like there's So few opportunities to kind of like change the space Like a ton of money doing so and kind of we have that opportunity these few years. [Desmond Fleming] (36:17 - 37:03) So yeah, how much did you internalize that? Act of trying to return the fund because I I could say very candidly when I first joined Avc back startup, which was prior to first mark I didn't really know Or was I wasn't super aware of that system and downward pressure Around you so when when did you kind of internalize that moment of hey You know, like we're trying to build a five ten billion dollar company because it's not I don't know again my end of one experience like I wanted to be an entrepreneur, but I had no idea of Like oh return the fun. I'm just trying to build a cool product and thing that I would like to use. Uh, Nvc seems like a good financing route to help me do that. So when did you internalize that? [Jeremy Tsui] (37:04 - 38:47) It is like the third talk they give at yc where they I'm, it's gonna sound really abstract, but they kind of like, you know, their big thing at yc is helping you understand that They call it the metagame and like basically understand the rules to the game so that you can you could win the game and so pretty early on They're like, hey, there are these funds. There's like Round sizes. We got like 200 of you guys in the batch Most of you guys are gonna die with the next amount of time But you know five of you guys are gonna make it and you're gonna be like and we're gonna have you back for the next talk like uh Yeah, like airbnb and stripe and so pretty early on they they kind of like everything in life they help us understand the funnel of um You see back to companies and the kind of a game we're in And I would say that helped me understand the rules to the game and just like the statistics And then I wouldn't say I internalized it until Fairly recently when you're like like, oh shoot. We have something special, you know, you got to go from Playing not to lose to like playing to win and being like we have a special company. Let's pour gas on the fire And then you're like, okay You know, how big does this need to get to be? uh material for your your investor and so I don't think that like Drives our motivations or our product roadmap, but it is uh, really interesting as you kind of go into managing investor relationships because Their fund sizes are all different. They all came in at different cost basis And so I think it's just like something in your founder toolkit to better understand people that you partner with Can you talk about managing? [Desmond Fleming] (38:48 - 39:30) investor relationships specifically vcs, uh, you know speaking on behalf of vcs we can suck Uh, a lot of times and we can be very annoying and demanding Uh, but again, I think for the other founders that are coming up behind you Can you help them understand the difference between? uh The relationship you may have with your seed investor How that changes over time the relationship you may have with your series a investor How that changes over time and also let's bucket all of growth together like how you think about Engaging, uh the growth stage community, uh, you know, maybe my own like, uh [Jeremy Tsui] (39:30 - 41:06) Short-sightedness, I probably bucket all investors the same where You know, i'm i'm in a pretty i'm in the pro founder camp where hey like how are the founders, you know, it's it's really your company and um, you gotta have you need a vision for Product and sales and how this gets to be a massive company like kind of no one could tell you otherwise Even if you wanted them to and so I have been very lucky with my set of investors where they've always been really empowering Hey, jeremy. It's your company. We'll help you um Level up wherever you need to be will surround you with the right help You're kind of like you're in the f1 car and driving the car like we can't drive the car for you and so I think in finding good vcs it's It's people who share the same set of values and so a lot of my conversations are not like hey, like Uh, do you have a playbook for selling into like, uh top 50 banks if they know that great but I my my expectation is hey, like Help me find another company in your portfolio or someone in your network like with this expertise and then Help me download that knowledge into my brain or my team's brain like as quickly as possible And so yeah, I hold a high bar for our Venture investors. I don't expect them to run our company nor do I I want them to but I I do expect them to like be all on board with um Kind of helping us to you know, be the best driver build the best car possible. [Desmond Fleming] (41:07 - 42:21) Yeah What else uh, yeah, I mean I love investors I think it's like um Yeah, it doesn't have to be antagonistic we all like, you know, we're all trying to win on the topic of trying to win and I know we're kind of coming close to time here, but What are your thoughts on competition you're operating in a competitive space? There's other direct competitors or some people who view uh the world through a real estate specific lens Others with you know broad agnostic view How do you think about competition let's talk about that and then also how do you think about Risk, you know, how do you think about the personal risk you took, you know going from goldman where you know Lots of people, you know, candidly make a lot of money at goldman over a period of period of time uh, uh and granted there's you know more opportunity in other spheres, but you know, you're leaving a pretty high npv uh, you know career Uh opportunity on the table at goldman. So how did you think about risk then? How do you think about risk? Uh now as well Multi-part questions. [Jeremy Tsui] (42:21 - 44:12) I love it. Yeah, we'll start on the competition though. I find the risk stuff a little more interesting um, yeah on on competition, I My my main view is just hey like let them come like just be aware that everyone's trying to stab you and it's a dog fight And you know, it's like a lot of things where i'm like, hey just like these are shutting down just build a good company and like Don't worry about the competition. Like if the market is there if the tailwinds are there because you choose the market you play in um, and if you're listening to your customers and have a kick-ass product like You're gonna be fine. And so, you know on the contrary when I you know, when you get in that mindset That's like oh it's like it's an arms race or like did you see their latest product docs? Like what should we do? That's I think that's when your decision making uh, really yeah can like deteriorate or kind of get biased incorrectly and so um, yeah, I think I think it's I think a competition the same way I think of fundraising just like Build a good company and then the competition and the fundraising will will work itself out and then kind of tactically we assume that At any given point in time we have like a 12 to 18 month product edge over anyone so we assume that anything we put in email any products like especially in the age of ai like Anyone can catch us from 12 to 18 months from like a product perspective. It's not like a did you beat the competition? this year, it's just it's just always there and like yeah, my my uh you know, what is my recurring nightmare that You could say hey chat gpt build me like a finley clone and uh And it could and then you're like, okay, what's my edge? I gotta have like a kick-ass sales team And so i'm pretty long like ai gods just being able to take over more and more so you gotta develop your own notes [Desmond Fleming] (44:12 - 44:44) Otherwise value value will accrue to people in distribution and just on just to put it out into the world you can clone not finley obviously because I I assume they don't have your source code But what you can clone is, you know, the ui of like a notion today like i've literally tried that prompt uh, and just run it locally on my device and it's like Halfway decent of creating the ui not all of the components and widgets, etc um But that was something I was like, oh, holy shit like and i'm not it's crazy. [Jeremy Tsui] (44:44 - 45:20) Yeah. Yeah, it's crazy. Um What i'm really proud of the product we've built world-class product but like like longer term our our moat you know our view on our moat is uh it's really just like trust within the financial system For now, it's still like a very much a relationship-based space and like yeah We've been at the same conferences with these banks for like five years. And so, uh Yeah, it's gonna be hard for agents to show face They can't show lending trade conferences, yeah, yeah, and so you got to pick the markets you play in Yeah, and then what are your thoughts on risk? [Desmond Fleming] (45:20 - 45:26) How have they? Will that what are your thoughts on risk? How have they changed over time and then we'll wrap with with one final question [Jeremy Tsui] (45:27 - 47:04) i'll start with a story, um About my co-founder and my brother and so he's always like hey like We talk about our superpowers as founders And so My co-founders my brother and my third co-founder kevin are always we're always hyping each other up because startups are brutal You're just getting told no all day Yeah kicked around and then there's another fire to put out and so um you really gotta you know dial in that like inner monologue and so Uh, just I was really good about encouraging me. Hey, like why does finley win it wins because Like leadership teams the founders making the right calls and you have incredible like founder market fit. Um Uh, it really takes someone to Who's to kind of experience the pain? To communicate that and sell into all the same banks. That's like a huge asset And then he's like, what do you think my competitive advantage is and i'm like, I think you're just competitive. I think you just love winning and uh That's kind of how I think about startups as well. It's like if you are Just like optimizing for npv and like or like ev and super financially motivated uh Startups probably aren't for you. Most of these companies like don't work out and like yeah uh Yeah, and it's like not rational economically But if you're hyper competitive you love to win and you love to control your own fate uh, and you believe in like agency startups are totally for you and so i've always been like a risk on type of person and yeah, I would I would like I had rebecca recommended for anyone just like Bet on yourself like at least once because it's like the most rewarding thing [Desmond Fleming] (47:05 - 47:22) Yeah, and then the final question um is you know if you were talking to You know a high agency person that wanted to build in capital markets today What would your advice be to them either at a high level or tactically? [Jeremy Tsui] (47:22 - 47:47) Oh, yeah, I I got it tactically You know, we got this wrong like a billion times but I think just choose you want to build for within capital markets and then Trust them and build for them. And so in capital markets, there's like 50 different counterparties you could build for there's like a sell-side desk there's like the banks the funds the investment bankers like Whatever the lawyers doing diligence like negotiating the agreements. [Desmond Fleming] (47:48 - 47:51) So, uh, I think early on fund admin cfo. [Jeremy Tsui] (47:51 - 48:53) That's right That's so there's so many uh counterparties and so I think there's a ton of value in like any one of these like workflows that you wanted to kind of like, uh Create to disintermediate that uh called the capital markets stack and so, uh early on we I think we spent a lot of time. Um and we were very thoughtful about it, but Just even like figuring out who we wanted to build for and not try to be like all things to all people and so Like I definitely don't we don't claim to do to be all things to all people within all of capital markets capital markets is like an umbrella term, but for any aspiring like capital markets founders, um Yeah, just kind of like figure out who you want to build for. Uh, it could be the investors It could be the companies it could be like Debt equity there's so much and then trust them and then uh, then you can always change later You find out there's like there's not value or product market fit in that part of the value chain Yeah, so that's tactically. [Desmond Fleming] (48:53 - 49:02) What about at a high level? You're you're high level sweeping uh advice for founders uh Sweeping advice for founders. [Jeremy Tsui] (49:02 - 49:39) I think it's hey, you have a lot more control than you think. I think it's easy to be like uh, we're too early or like the tam's not big enough or like the investor told me it's a bad idea, but those are all things in your control like you Choose who you take money from you choose the markets you play in like I think good founders just like figure it out so yeah, um Yeah, just keep going and don't be too hard on yourself. It's like even if you succeed you kind of like It takes five ten years. And so yeah I would give yourself like an ample time horizon to see it there I love it. [Desmond Fleming] (49:39 - 50:39) Take the longest view in the room, which is the name of the podcast. So we're gonna we're gonna we're gonna Yeah, yeah, the name of the pod is uh, the longest view. Uh, it's something we get taught here at at first mark So try and take you know, the viewpoint of not in time frame not of months or years, but actually of decades So and build build build with that in mind. Um, because you know, I think I think you're 33 33 maybe Yeah, I am uh turning 32 this year so time flies Yeah, yeah, but you know for lack of a better word, you and I have you know, another two decades of work most likely Oh, yeah, or more if uh, if we want or are so fortunate. Um So jeremy dude, thank you so much. This was awesome I really appreciate you you coming on a ton of like a bunch of great like bite-sized bits of information both Again tactically high level industry specific not so Uh, i'm excited to edit this up and and get this out into the world