Investing Billions - E163: How Thiel Fellows Build Billion-Dollar Startups w/Zaid Rahman

Episode Date: May 13, 2025

Zaid Rahman is the founder and CEO of Flex, a breakout fintech startup that’s reinventing credit and payments for the middle market. Backed by the Thiel Fellowship and known for his “Delta 4” product philosophy, Zaid is building a multi-product platform that’s helping profitable, owner-operated businesses unlock capital and scale faster. In this conversation, Zaid breaks down how Flex is using AI to radically reduce underwriting time, why he’s obsessed with hiring 10x talent, and how “taste” and first principles thinking guide everything from product design to risk management. If you’re building in fintech, hiring in tech, or just obsessed with the craft of company-building, this episode is full of tactical insight.

Something like 10% of Teal Fellows have started billion dollar plus companies. A third of them have started companies valued over a hundred million. Some of the best companies in the last 10 years have come out of the fellowship, including things like Figma, Loom, Luminar, OE Rooms, Ethereum. Today, I'm excited to welcome Zaid Rahman, founder and CEO of Flex, the Fintech super app, transforming financial management for small businesses. As serial entrepreneur and Teal fellow, Zaid has recently raised capital at a $225 million valuation in order to build an all-in-one platform that bundles

credit, banking, payments, and expense automation for business owners. Without further ado, here's my conversation with Zaid. You were part of this very elite fellowship, Peter Thiel's fellowship, which is over 10 times more difficult to get into YC, which itself is elite. Tell me about that program and tell me about your experience. Peter Thiel started the Thiel Fellowship now 12 years ago or so. The idea was that he would select 20 people every single year and give them 100 grand with no conditions except one that he had to drop out of college. At the

time, it sort of started as a kind of like a social experiment. Over time, it sort of scaled into this much bigger thing. Something like 10% of Teal Fellows have started billion-dollar plus companies. A third of them have started companies valued over 100 million. And so the program itself is doing fantastically well. Some of the best companies in the last 10 years have come out of the fellowship, including things like Figma, Loom, Luminar, OU Rooms, Ethereum, and so on and so forth. And so it was sort of an awesome experience just being part of that. And from my kind of vantage point, I like to sort of joke that I'm the least sort of

qualified person in the room when I'm around these guys. Because to me, it's sort of been just about surrounding myself with the right kind of peers and the fellowship just comes in with this amazingly elite group of people that kind of all very driven to be extremely ambitious and kind of really change the way things are done and so it's been an awesome sort of experience being part of that. Last time you were talking about this very specific way they use the fellowship in order to scale flex and to solve problems. Tell me about how you benefit from the fellowship today. The Teal Fellowship has this amazing group of 285 people.

And so a couple of years ago, I thought it was crazy that we were not all in a WhatsApp group together. And so I created a little group chat, and that became pretty successful. I think the group chat is like 250 of the 300 or so fellows now. And in that context, if you go on the group chat is like 250 of the 300 or so fellows now. In that context, if you go on the group chat, even right now I can see it on the side, there

are people talking about all sorts of problems that they're running across. Just yesterday, someone mentioned that they're going through an M&A and there's a difficult investor and they're giving them a hard time in the M&A process. Has anyone gone through that? That three tail follows, some of them very successful, giving them advice on how to navigate that situation. It's been really awesome to see up close problems that this elite group of founders are facing together

and take that as an opportunity to learn and also be part of that community. So you're not only benefit from the camaraderie and everybody going through similar difficult problems, you're also building relationships with people, having a personal mentorship network. And also you get to see, maybe some of these problems are not as esoteric. So you get to see these problems solve live.

Some problems you may not even realize other people have the same problem. Exactly, right? Like the M&A context is an interesting one, right? Because at Flex, we have recently been stepping up on M&A. We've done two transactions and we're looking to do a third one shortly. And so seeing what founders are complaining about in the M&A process is really interesting.

And it's sort of like an accumulated knowledge base. You could probably build an LLM to search through all the stuff that's being talked about. Another interesting anecdote, as Doge was picking up, there were a lot of fellows helping Doge optimize government spend. There was just a lot of chatter around that. It was super interesting to see people coming in from all sorts of industries talking about how the government can be made more efficient. And so that in itself, if someone just took that piece of knowledge and converted into

a report of actionable next steps, that could be a roadmap for the next 10 years. You're using AI within Flex to underwrite, to make credit underwriting decisions. Walk me through how you go about doing that and what have been some of your learnings. At Flex, our wedge product is our business credit card, where we offer you Net60 terms on every single transaction. So two months for free float, or you pay us early and we give you cash back in points. That NetSixie product has been extremely powerful. You can now use it to even pay for ACH and wire transactions through a bill pay later product.

Underlying all that, you obviously need to manage your risk really well because you're providing these business owners the ability to use working capital to extend payment terms. We have had significant amounts of investment in order to automate our risk management, our portfolio management, and just how we think about transactions at the time the transaction happens. Let's say you're a $50 million revenue business in logistics. Go up to a regional bank, which is what most of these business owners rely on for working capital in the mid-market, which is another counterintuitive thing. You go and ask for a credit line. What ends up happening

is that a banker will ask you for a bunch of documents, P&Ls, tax statements, bank statements, credit card reports, and those types of things, and spend four weeks going back and forth to underwrite this business. Well, it turns out the challenge that the SMB credit industry has not been able to solve for is all of this data is unstructured. If the data is unstructured, you have to first normalize that data to actually then use it to analyze it. Once the data is structured in a way that's normalized in the same format, it's actually

quite easy to build a basic algorithm and figure out what the current ratio and quick ratio and cash volatility of the businesses and so on and so forth. And so we started implementing LLMs for the specific problem of normalizing unstructured data in the SMB space in general. And that has sort of allowed us to take underwriting from 25 days down to 48 hours on average, which is allowing us to scale our business significantly. And if you look at the reports the LLM is able to generate, you won't be able to distinguish this from a manual underwriting approach.

And so it's showing significant improvements in time and sort of effort. And then beyond that, I think there's a huge opportunity to then re-underwrite these businesses on a daily or even multiple times a day basis to see if their quality of revenue and expenses is going up or down to offer even more credit over time. And so that's been a very exciting kind of piece of sort of improvement,

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How much paperwork is the AI analyzing on a typical underwriting decision? And why is it 48 hours? Why is it not five minutes? What we did with LLMs was we just feed it something like 40 distinct files per application, somewhat automatically, that is collected through these API integrations, and then basically spit out a report that takes 10 to 20 minutes for the system to generate. And then we have today at least a gatekeeping function where, you know,

one of our senior underwriters will then review that and sort of decide if, uh, the company is valid and maybe ask some follow up questions. But we've started to add LLMs even in that process. And so we think we can take the 48 hour window further down to maybe 20 minutes. How accurate is the AI today and how has that evolved since you've started implementing AI? We started implementing AI two years ago. It used to be not super accurate two years ago to, you know, a year ago it was like a

little bit better, but still not super reliable. As of Q1, the AI is like 90% of the way there. I mean, it's able to think of things, even our underwriters sometimes miss. And so we have started to ask ourselves the question, what else can we do based on this analysis? To talk about your competition, you have heavily VC funded Brex and Ramp as competitors.

How do you differentiate against these other competitors? It's a fantastic question. So if you take a step back on one end of the spectrum, you have these tiny micro businesses that are running with two or three employees, a few hundred thousand dollars in revenue. That's what historically the big retail banks have really, really focused on. So Bank of America, Chase, Citi, et cetera, et cetera. On the complete other side of the spectrum,

you have very large enterprises and venture-backed businesses that have large inflated balance sheets, right? That's what the sort of glamorous B2B fintech companies have focused on. Ramp and Brex being awesome players in that space that have done amazing work, particularly Ramp, which has gone very deep in the enterprise and has done hundreds and hundreds of integrations that are very specific to Fortune 500 businesses. However, there's a very large middle market, right?

And these middle market folks, we call them jumbo shrimps internally. They're small, but kind of large. And now these folks have very interesting dynamics, right? They're running EBITDA positive businesses, they're owner operated, they tend to be really profitable. And if they're profitable, they tend to spend a lot of money. This is the client base that Amex's black card really serves today. If you go around and see someone with an Amex Centurion card, more likely than not, they're actually a mid-market business owner running a business in some sort of boring kind of traditional industry like construction or logistics or kind of a large franchise restaurant

or something like that. And so we are really focused on these types of folks capturing every single dollar in their financial journey from the time they make a single dollar of revenue to the time they spend it on their personal lifestyle. You've ramped up Flex very quickly. It's your CEO entrepreneur. This isn't your first startup. How did you go about building your team and recruiting in a hyper competitive market that is the startup ecosystem?

It's a great question because recruiting is something that we spend a lot of time thinking about. So there are a few things. Yeah, this is my third company. I've sort of gone through the ups and downs of being a founder. And the reality is that the team you build is the company you build. And we know what Kosa has a saying, there's a huge difference between a zero million dollar company and a zero billion dollar company.

And so from that context, going about how you hire is really, really important. And so in our context, we have really, really focused on making sure that every single person is quote unquote a 10X hire, right? Where you know, you've heard the phrase 10X engineer, what if you could hire a 10X salesperson, 10X marketing person, 10X, you know, customer success management person, and so on and so forth. And so in order to do that, you have to be extremely selective.

And so now we're about approaching a hundred people. We have been very sort of selective in who graduates through our funnel in recruiting. Typically the last interview is me, and I've replicated, it's not sort of a novel thing. A lot of very successful founders have done that. And one of the things I do just as a sort of a practice is, you know, on average, I try to say no to two and three people

that are presented to me, just to sort of up-level our bar in terms of who we're hiring. And then over time, I think our team has gotten better at pattern matching and who are the most amazing people who have brought onto the team. That typically sort of involves people who have extreme sense of urgency and agency and are very intense in the work they do and they don't mind working super hard and working super smart and are very obsessed with creating amazing user experiences for our customers across

every single aspect of the company. Thank you for listening. To join our community and to make sure you do not miss any future episodes, please click the follow button above to subscribe. High agency, obsessed people, delivering customer value. Double click on some of those characteristics. If you look at your best employees today, what are some patterns among them? I came across a framework a while back by one of these sort of

unicorn Indian founders. The framework itself is called Delta 4. So have you come across this at all? No. So it's a really, really interesting framework. So if you think about the most impactful products in the last 10 years, they all share this characteristic which he describes as Delta 4. So I'll give you an example. What was the user experience quality of hailing a cab in New York City in 2008 on a scale

of 1 to 10? In New York City, probably a 6, in San Francisco somewhere around 2. Okay. Let's say San Francisco, right? The experience is 2 on 10. Now, think of an Uber, right? On a scale of one to 10, what is that sort of experience like? Probably nine or 10.

Right? So the delta from going from two to nine is greater than four, right? So when you have this delta of greater than four, three things happen. The first thing that happens is that it is totally irreplaceable, right? Like you're never gonna go backwards to hailing a cab in San Francisco, right? The second thing that happens is that

it's extremely brag worthy. You know, you're talking to all of your friends about it. Like the first time you use an Uber, you probably told 20 friends about it, right? The third thing that happens is that you have a very high tolerance for bugs, right? You're willing to withstand just a ton of issues. Like even if like an Uber ride for whatever reason wasn't super high quality, you're still going to call another Uber tomorrow.

And so from my kind of perspective, in order to create a Delta 4 experience for our customers, it starts with people who really, really care about providing that Delta 4 like experience, right? And so when you think about FinTech, the reality with FinTech is that it's a commodity, right? Like all these products using a credit card, a bank account, sending an ACH, the reality is that these things have existed for decades. But the opportunity that exists is making the individual experiences super duper simple to use and stitch it together with each other so that it creates one large cohesive experience. Much like an iPhone or driving a Tesla where you know

the individual units in a Tesla have existed for a long time. But when you add all the components and vertically integrate it, it becomes a very interesting experience for the customer. And so effectively, my definition of what makes a great teammate is, how much do they care about creating

these Delta for experiences for our customers. Double click on that. Why would somebody care? What are the characteristics of someone that cares about these Delta, creating these Delta for experiences? The first starts with taste. You can't teach an employee taste. And so you have to, you know, I think the job of the founder in some odd way is

actually to be a tastemaker. You're curating the taste of your company and the products you create, right? And it sort of boils down to every single thing. So how you commit code and what do we think is high quality code in production? How we think about architecting systems? Do our systems work well together, which is allowing us to move faster? And then when you think about, you know, abstracting code even further in an AI first world where you can use something like cursor and generate entire sort of parables of code in seconds, you know, that's not possible if you haven't modularized your systems in such a way that you can move faster.

The really subjective, hard to quantify thing here is taste. You will see that in every single successful founder out there where there's some kind of X factor that's hard to describe. And I think that's sort of the X factor thing that we're looking for in every single person we hire. I think what happens at most companies though is you do that really well for let's say the first 20 people or even 50 people or maybe even 100 people. Then you start compromising on quality. It sort of becomes really hard.

You don't have the bandwidth to interview every single person at the company. And then soon, the company culture dwindles. And that's when you hear about these cases where the company needs to lay off hundreds of employees and you have bloated middle management of people who are just managing people and not really contributing to the underlying code or the marketing collateral or sales or risk or whatever that person may work on. And so I think there's an opportunity to really, really focus on just keeping the bar super duper high and finding people that have insane amount of care about their craft and, you know,

a highly proactive sort of high agency resourceful people working on building this amazing thing. And how can you tell somebody's taste through recruiting process, through the interview process, what exactly are you looking for? The easiest way to figure out if someone's full of shit or not is just ask them, what is the most complicated project you've worked on? What were the challenges you faced? And how did you solve it?

And then just listen. And then ask follow-up question after follow-up question to figure out if they are BSing their way to an answer that's interview appropriate. By minute 20, they typically will start cracking and showing signs that off their actual work. And so that's when you start deciphering how they think about making decisions.

And you can apply this to every single role. We ask this for literally people working on our risk automation engine, all the way down to folks working on brand design, to folks who are sort of, you know, even, I should you not, we even asked folks, you know, who are sort of talking to customers, you know, in the we ares of the night, right? So it's just a matter of like, what is the most complex thing you worked on? And how do you think about solving these things? And then you just decide subjectively if you as the founder of the company would have gone about making similar decisions. And sometimes you'll be surprised, you'll learn some things, right? And you'll learn kind of ways to sort of

operate better. And it's just that simple. What's a great answer to that? So you ask somebody how you create a risk management system and they start going into details. What are you trying to ascertain? There are a couple of things that we're trying to ascertain, right? So the first thing you're trying to ascertain is what ends up happening at companies, especially employees that worked at bigger companies, that worked at a fang business, for example, you have no idea what they actually contributed at that business, if anything. And so what ends up happening is that you'll hire these folks and then they're really good

at appearing like they're working, but you have no idea if they're actually contributing and moving the needle every single day. So what you want to decipher really, really quickly is how much actual individual contribution did they bring to any team? And by the way, you should apply this to even executive recruiting, right? Because you don't want to hire people who all they do is just manage people, right?

And so by doing that, you're deciphering like their level of involvement at the kind of nuts and bolts level of whatever their work is, right? The second thing you're sort of deciphering is as you hear them talking about all the problems they face, the challenges they face, you'll start understanding that, oh, actually, this person is very clever in finding shortcuts to solving really complicated

problems. Or, oh, this person thinks at a first principles level. Or, oh, this person has really good taste in comparables or inspiration for solutions to replicate. Stuff that you should look for in terms of stuff not to say, probably giving away too much. Stuff they should not be saying. The first kind of thing they say, and it's like a negative sign, is the words, best practice.

The moment they say best practice, done. They're out. They are not a first principles thinker. So let's say you're starting completely, maybe even new position in the industry. You're trying to understand how to build your bonus system for heavy credit card users. First of all, how do you even define that position and how do you go about finding somebody to do this unique position? Yeah, it's a good question. What we have found time and time again is when we have hired people who have worked on those explicit problems in the past, often they come up with mediocre long-term solutions because they're too married to their existing way of doing things.

So for example, you talked about creating a new reward system for credit cards, right? We hired someone from Anex and lo and behold, they replicated Annex. We asked ourselves the question, why do we need to... If you go to American Express Doc and they're an awesome company, they've done a lot of things really, really well, but you go and look at some of these big bank credit card pages, they'll have 10 different credit cards. This card does travel well. This card is, you know, when you're dining at a restaurant, use this card. You know, when you need to float for a transaction, use this particular card.

And the question we ask ourselves, why can't this be just one card? And you know, the customer can choose your own journey. And so, you know, we, And so we dramatically kind of changed course. And this idea actually came from an engineer on the team that had no credit card experience. They came from a consumer startup. And they were like, well, actually, the reality is that business owners are people.

They're consumers. They just want a good experience. They don't care. And one of our contrarian a good experience. They don't care. One of our contrarian thoughts is our business owners don't care if it's a commercial card or a consumer card, care if it's XYZ network or ABC Bank partner. All they care about it is it just works. Whenever we do our orientation, we have the slide from Steve Jobs,

where Steve Jobs is pondering, and it says behind him, it just works. We throw in the Flex logo. Our goal is not to innovate. Our goal is to make it just works. And so in order to do that, you just have to really, really obsess over that Delta for customer experience. And the first thing to do is really, really understand what the problem is that we're

solving and then go about creating a solution versus going and copying a best practice that some other company did. Quarks might be a combination of high levels of innovation, or really, there are some best practices that also do work as well. So it's not about you innovating, it's about the customer experience ultimately. If you were to apply like truly first principles thinking to like every single problem set, right? You may come to the conclusion that actually the way this has been always done is probably right. And, you know And we actually concluded that in one area,

which is credit underwriting. We realized that for a century, companies have been underwritten and there's some elements of underwriting that just works. So it doesn't need to be innovated on. Maybe we can make the user experience of how you go about getting working capital a lot better and then combine that with a software kind of ecosystem such that we're actually helping you become a better business owner. But I

think you know my thought process has always been you got to break down problems to its most finest kind of units and then sort of go from the ground up rather than go from the top down. Have you found a magic number, magic number of interviews that takes to understand the context of the problem set you're solving around, for example, points? So you're 30 interviews in, you're like, okay, these are like the legacy solutions. I now know more or less what people are doing now. I could actually write or think about what I actually want and talk to me through the evolution

of creating a new position. The other kind of hack that I learned over time is that let's say you're a founder in a space that you have not operated in the past. Interviewing is actually a really easy hack to learn a lot about that industry. And so for example, let's say I did want to learn a lot about rewards. The easiest thing I can do is I can call 30 leaders who have built various

reward systems and interview them and sort of talk to them and just like learn, like how did they go about building it? And over time you'll actually form patterns that will inform you that, okay, this is the best practice and this is how you possibly innovate and this is what customers truly love, right? And how do you replicate the best parts and not the parts that don't work, right? And so the magic number to answer your question varies on every role, but we had a senior role where it took us over 200 final interviews to get to that final person.

And it was a hard one. It took us a year and it was very challenging. It was mentally and psychologically exhausting. But you don't want to compromise on that bar because that, you know, by hiring the wrong person and them investing and creating like solutions that sort of contrary to what you're trying to do is actually going to cost you much, much more in the long term than just like waiting a little bit longer and hiring the right person. One of the reasons you were interviewing so many people is you hadn't yet found the excellent. You knew what excellence looked like and you hadn't yet found it.

Yeah, it's like that. It's really hard, right? Because I get asked this question often. It's also taste, essentially. CEO taste. Yeah, exactly. What is that excellence, right? And I think the taste piece is really important, but I'll give you an example that's a little

bit more quantitative, right? We were in the market looking for someone to run risk. And, you know, we came across a lot of people who had done, you know, that job at a lot of very sizable companies, many of our peers, many large banks and those types of things. But, you know, the thing that I kept sort of running across is that everybody was sort of like very kind of formulaic in their thinking. No one was able to just question their own formula, if you will.

And so the easiest kind of cracks in most of these interviews was by simply asking them, why is it done that way? And most of them were like not able to like truly like get down to first principles. And so it became like really apparent when we brought on Vishal who used to run co-branded cards at Citibank. If you've ever seen the American Airlines card or the Home Depot card,

he was part of that team. In that context, it was very clear that he was able to think at a much deeper level of physics rather than at level of underwriting. level of physics rather than at level of like underwriting. And so we brought him on and that's sort of giving him a huge compliment. But I think you can sort of apply that to almost every single role down to even an account executive you bring on. I'll give you an example from just a few weeks ago. I was interviewing the sales guy and And most of these sales conversations, the guy's usually selling, guy or girl is usually

selling me on something, right? But in this particular context, he actually pitched me a new product idea. And he very passionately explained how this could improve the optimization of our sales conversion and so on and so forth. We ended up talking for two and a half hours about this new product. By talking to him about this new product, I got to learn how much he understood the

customer's problem set, which effectively was a very easy sign that they would crush the sales job. What do you do when you're 70, 80 interviews and you find somebody that looks excellent, but they're not a culture fit? You want to hire people first and foremost for the culture fit and then for their expertise. Because if they are the right cultural fit, which in our context is having really high standards and really thinking through first principles and really, really caring about our customer experience and so on and so forth, they naturally will learn what they need to learn in order to go about solving these problems.

It may not be the perfect solution if you're trying to hire somebody who comes in with a wealth of experience in that specific area and just kind of comes in and applies frameworks that they've learned from the past and just sort of get the job done. But oftentimes you will find people who are able to ask bigger questions and actually move the needle much more effectively. And there's a founder that I came across that likes to say that the best people they hire tend to have an impact week one. If they haven't created an impact within one week,

they're the wrong. In my experience, the people who have had the most impact within the first week are not the experts, they're the people who are able to think in our sort of cultural terms. Expand on that. If you think about it, you know, the best people you hire,

and you've probably experienced this in your own experiences, right? Within the first couple of weeks, they come in and they're able to like very quickly understand where, they come in and they're able to like very quickly understand where the gaps are and they're able to go attack and solve for those gaps, right? Now, of course, you need some level of skill and expertise if you're completely blind or not knowledgeable, it'll be quite complicated to do that. But oftentimes, the people that tend to sort existing things and propose solutions that

make it better are the people who have the freshest eyes. From our perspective, we're looking for people who are willing to think different about the same problems and just ask, how can we make things better? And so oftentimes that does not come from people who have a very like, kind of, they're very dogmatic about best practices and those types of things. Have you ever found somebody with a high skill set that has learned culture? Is that something that is learnable? A few things you cannot teach people, in my opinion.

You cannot teach people to have high integrity. You cannot teach people to work hard. You cannot teach people to have the right taste. Is taste another synonym for what we call it, uncommon sense. For some reason, common sense is extremely rare. But I don't know why it's called common sense. But is taste another synonym for common sense? That's actually an interesting way to put it.

I never have thought of it that way. But yeah, I guess you could call it common sense. Because the best solutions are the most obvious solutions. When you use an iPhone, of? Of course, like you touch your screen, it's like so much more obvious than having a keypad, right? But I guess you needed a lot of kind of leaps in, you know, thinking in order to get to that point where you came up with this insight that,

oh, we should put a screen on every device and then go through the exercise of technologically making that possible. When you look at these 10X engineers, 10X salespeople, 10X fill in the blank, do you see any correlation with high egos, low egos, or is it completely an independent quality? The common denominator, if I were to really take a minute to think about what are the most common attributes amongst the people who are doing the best at Flex as an example, they really, really care. They really care not only about the customers and the quality of their work, but they also

care about their peers and they also care about the company. And, you know, if you really, really care, right, you will actually learn what might be the right taste, right? What might be the right decision-making framework? What might be the right way to do things, right? And so you can often tell even a few high-end intern, let's just say, and they really care about excelling and they're very sort of ambitious, they will quickly learn how to get things done. Is there room for a non-10x person that's a glue and just a culture bearer and just makes everybody better?

There are kind of two answers to that, right? The first answer is one of the elements of our culture is high quality performance, right? So if you're a culture fit, you're definitionally performant. But those are sort of subjective things, right? Like what is high quality performance? It's not someone who necessarily is working 18 hours a day. That's not high quality performance. High quality performance is ultimately, you know, comes down to results, right? And so that's kind of my perspective on that. I think the second thing is when you have people who are not performing at the level of your peer set, it actually is demotivating to the people

who are performing. Every time we've had to make the very, very tough decision to terminate somebody who was not performing, the morale of the company is actually increased. There's this concept in psychology called negative contagion, and where it's just really intense. When somebody is not performing, it significantly decreases everyone's performance non-linearly. So literally you could have one person on a team of 10 and it has this massively negative contagion events.

And sometimes you can also have positive contagion, but the negative tends to be even more pronounced. You'll hear the kind of the phrase that we are a family. Right? And the reality is that that's a disservice to everybody, including yourself. The reality is that we are a team. If you go to a high performing team,

whoever wins the championships, right? The members of those teams are really, really happy to be there. They are excited. They work hard. They really care. And they are winning together. And so we want to create a team that wins together. And what we have found is that it might be challenging

for the wrong people, but for the right people, it is the most rewarding place you can be. And we have found that our retention is effectively 100% because of that winning culture and that sort of strong alignment that we have created that this is the bar of performance. We talked about this at dinner last time, you guys work these crazy hours. And I'm really starting to double click on burnout.

Do you believe that burnout is really when there's not momentum or is it just the amount of hours somebody's works? In other words, could it be sustainable to work these crazy hours for many years without burning out? It's a, it's a great question. I think this is something that I'm trying to learn myself, because I work as much as I possibly can every single day. It's not even 996.

I think it's like seven days a week. I think it's a good question. I ask myself, is work-life balance a real thing? You hear the Jeff Bezos thing of work-life integration. Then you ask yourself the question, what is work-life integration? Well, it turns out, I think the people who work very hard for extended periods of time, you hear them do that for many, many decades. You hear someone like Warren Buffett that is literally running

Berkshire Hathaway at the age of 95. It's not because they have work-life balance. It's because they love what they do. They quote unquote tap dance to work. And I've actually found that, you know, those types of people have very little risk of burnout. Yes, if you create a bad culture that's toxic and they're like workplace fights happening and there's someone underperforming and they still are on the team and

demoralizing the whole company. Like, yes, you will have, you know, sort of misalignment and you'll feel like, oh, that, you know, the company doesn't care and those types of things. But if you have extreme alignment of setting the standard and the intensity that's needed to perform and create this awesome place, I feel like the risk of burnout is very minimal for people who love what they do. Alex Hermosy, previous guest on the podcast, says that people that complain about work-life balance are really bad at both. I look at burnout as working a lot for a sustained amount of time with no positive feedback.

So essentially a lot of work and nothing coming back, but as long as you have those milestones, you celebrate those milestones as an organization and you're able to internalize some of that success. I found to the same people could go decades. You have a paradoxical belief that FinTech is back in now May 2025. Why do you believe FinTech is back? Taking a step back and zooming out. If you think about financial services, financial service is literally one of the oldest industries out there. Banking and enabling people to move money and borrow money and those types of things, this has always existed and will always exist. So that's kind of a first principle kind of statement.

The second kind of statement is if you think about where incumbents are today, the average incumbent financial services firm, the reality is that the amount of bad user experiences that they have created is insane. And there are a lot of technical reasons for that. They're maintaining code bases that was written literally in the 80s and 90s. So it's really, really hard for a large traditional financial institution to create a user experience that

has that Delta IV, that amazing taxi hailing to Uber cab experience. From that standpoint, I think that we're still very much day one in fintech. Now, if you think about statistics, fintech is something like less than 3% of banking assets globally. You have these massive companies, New Bank has publicly traded at $60 billion in latam. Revolut has raised massive rounds in Europe, trading at well over $40 billion in the private markets.

You have these massive companies in Southeast Asia and whatnot, in India. And yet, fintech still represents less than 3% of banking assets. And so from that standpoint, we are very, very much day one. If you just look at Flex today operates in a bunch of discrete markets, not just cards, but also stuff like banking and B2B payments and things like personal financial tools, and we're going deeper into the stack, becoming the single source of truth for the business owner. If you really take a step back and think about it, it's insane to me that the corporate card

market in the US is $2 trillion and all the corporate card companies combined are doing less than something like 3% of that. I think the best one is at 1% of that market share. Highly fragmented. Highly fragmented. It's not the best sort of log that's at the top. There are so many regional banks and so many random kind of companies that exist that just have subpar user experiences.

Right? And so I think there's a massive opportunity to create a much better experience with the customer, such that they have a much better time building their aspirations. And so the tagline that we've sort of started playing with internally is flex fuels ambition. And so there's a real kind of there there to that where, you know, we want to sort of partner with the best and most ambitious and help them succeed. And it's still very much day one in the industry. And it is very much day one in most of our customers' experiences.

What's next for Flex? What's on your roadmap? There's not a lot that I want to sort of over kind of share. Okay, I'll give you this. Now that LLMs are true, what is possible, right? Their entire industries that have existed in accounting, in financial advice, in wealth management, that frankly, perhaps should be reimagined from the ground up. The thing that LLMs today, especially the open models, are sort of lacking is deep proprietary understanding of the individual user and business owner in the financial context, because financial data is still very much sensitive and it's not sort of overshared. And so we have been thinking a lot about that. Given our level of understanding of

the customer where we have all of their inflows and outflows, we have all of their credit card transaction history, we have all of their counterparty information, who they do business with and who they employ, there is so much advice we can give them in optimizing their business. I was having a conversation with a very large audit firm with their head of AI and he shared something insane with me. The big audit firm has built an internal LLM to do audits faster. Found that their LLM was able to have a 98% accuracy from an audit perspective. So one of the partners of the firm was like, 98%, that's like a 2% inaccuracy, right?

Well it turns out the humans have a 65% accuracy at the big audit firm. So this is an order of magnitude leap that we've made with LLMs. And so we have started asking ourselves the question that, hey, what is possible today, which was not possible three months ago, six months ago, 12 months ago, and really sort of provide this kind of full stack solution. And our strategy is kind of well positioned to really capture that because of our approach of being a multi-product ecosystem where average customer uses four or more products. This has been fascinating. I didn't get to all my questions. We got to do this again sometime.

How should people follow you? How should people follow Flex? I'm on X at ZaidRMN. I'm also the same on Instagram and LinkedIn. And in order to sort of sign up for Flex, just go to www.flex.one and would love to support ambitious business owners. Thank you. And as I mentioned, I'm not getting paid for this, but I'm a very happy user. So thanks for providing solution for our firm as well.

Thank you so much. Thanks for listening to my conversation with Zaid. If you enjoyed this episode, please share with a friend. This helps us grow, also provides the best feedback when we review the episode's analytics. Thank you for your support.