This Week in Startups - The future of fintech with Plaid CEO Zach Perret | E1818

Episode Date: September 28, 2023

This Week in Startups is brought to you by… Vanta. Compliance and security shouldn't be a deal-breaker for startups to win new business. Vanta makes it easy for companies to get a SOC 2 report fast. TWiST listeners can get $1,000 off for a limited time at vanta.com/twist. The Embroker Startup Insurance Program helps startups secure the most important types of insurance at a lower cost and with less hassle. Save up to 20% off of traditional insurance today at Embroker.com/twist. While you’re there, get an extra 10% off using offer code TWIST. Fount. Do you want access to the performance protocols that pro athletes and special ops use? With Fount, an elite military operator supercharges your focus, sleep, recovery, and longevity, all powered by your unique data. Want a true edge in work and life? Go to fount.bio/twist for $500 off. * Today’s show: Plaid CEO Zach Perret joins Jason to break down the behind-the-scenes details of Plaid’s canceled merger with Visa (1:21), Plaid’s origin story (16:44), tactics on growing a community within your early customer base (27:36), and more! * FOLLOW Zach: https://twitter.com/zachperret * Time stamps: (0:00) Jason welcomes Plaid CEO Zach Perret! (1:21) Plaid's canceled Visa merger, coming out the other side of a canceled acquisition stronger (11:30) Vanta - Get $1000 off your SOC 2 at https://vanta.com/twist (12:36) Zach breaks down Plaid's product and business (16:44) Plaid's origin story (26:08) Embroker - Use code TWIST to get an extra 10% off insurance at https://embroker.com/twist (27:36) Tactics for growing a community within your customer base (35:24) Competition, specifically from financial giants (38:58) Fount - Get $500 off an executive health coach at https://fount.bio/twist (40:28) FedNow, CBDCs, and the next evolution of payment rails (50:13) Silicon Valley Bank implosion from Plaid's POV (53:17) Surviving 2022, and the future of fintech in 2023 and beyond * Read LAUNCH Fund 4 Deal Memo: https://www.launch.co/four Apply for Funding: https://www.launch.co/apply Buy ANGEL: https://www.angelthebook.com Great recent interviews: Steve Huffman, Brian Chesky, Aaron Levie, Sophia Amoruso, Reid Hoffman, Frank Slootman, Billy McFarland, PrayingForExits, Jenny Lefcourt Check out Jason’s suite of newsletters: https://substack.com/@calacanis * Follow Jason: Twitter: https://twitter.com/jason Instagram: https://www.instagram.com/jason LinkedIn: https://www.linkedin.com/in/jasoncalacanis * Follow TWiST: Substack: https://twistartups.substack.com Twitter: https://twitter.com/TWiStartups YouTube: https://www.youtube.com/thisweekin * Subscribe to the Founder University Podcast: https://www.founder.university/podcast

We tried to have you on the program back in 2020 for a little history lesson here. Visa was going to acquire a plug. We sent you a quick email and you responded, hey, let's wait until the deal closes, but that deal never closed. Well, first off, apologies, if I pushed you off for so long. But, you know, we- It's reasonable, I think. This week in startups is brought to you by Vanta. Compliance and security shouldn't be a deal breaker for startups to win new business.

Vanta makes it easy for companies to get a sock to report fast. Twist listeners can get $1,000 off for a limited time at Vanta.com slash twist. Inbroker's startup insurance program helps startup secure the most important types of insurance at a lower cost and with less hassle. Save up to 20% off of traditional insurance today atembroker.com slash twist. And while you're there, get an extra 10% off using offer code twist. And found. Do you want access to the performance?

performance protocols that pro athletes and special ops use? With Fount, an elite military operator supercharges your focus, sleep, recovery, and longevity, all powered by your unique data. Want a true edge in work and life? Go to Fount.bio slash twist for $500 off. All right, everybody, I can't believe it, but the All-Star Summer continues. It's ridiculous, the guests who are coming on this weekend, startups, 1800 episodes in. we just decided, let's get all the greatest founders on folks who have really defined their categories, built huge, enduring companies, faced multiple crucible moments, as my friend Ruloff at Sequoia talks about. And let's just chat them up because, you know, they feel at home here on this weekend startups.

It's a founder to founder, capital allocated to founder talk. We try to keep it 100. We keep it a buck here. And, you know, a lot of the value in the technology ecosystem is becoming the, the platform, the backbone, and helping other people build businesses. We've seen this over and over and over again. Is it a sexy business to be in? Maybe some people would rather touch the consumer directly, but these foundational companies are so important. One of the greatest ways to build a big enduring company is to help other people build companies, small to medium

size businesses like HubSpot, who came on the program recently, Invidia. That's the backbone for this whole movement right now in AI, and then of course open AI with their chat chipt for it. That's a backbone for a lot of apps. And Plaid is a company that if you're in the technology space, if you're an entrepreneur, you know because it's the backbone for so many consumer banking applications. Fintech has had a complete revolution thanks to companies like Plaid. Now, you don't know you're using it, but they do a lot of the backend for people like Shopify, SoFi, Venmo, the things that do touch consumers.

And I'm really excited to have Zach Corray on the program today. He's the CEO and co-founder of Plaid. How are you doing, Zach? I'm doing well. Thank you so much for having me. I've long loved the program. I'm happy to be here. Oh, thanks, pal.

I appreciate that. And you started, what, 2012 with Plaid? So it's been a 10-year journey now. I did. I started in 2012. It's been a little bit over 11 years now. Wow. And it still feels like we're just,

getting started. Yeah, this is the crazy thing about when you find a great, when you find great product market fit and you delight customers, you know, it does feel like even in the second decade, you're just getting started. I hear that over and over again. Even when people, I was talking to Stanley Tang, the co-founder of DoorDash, and somebody asked him what it's like to be a public company now. And he said, you know, being a public company is like, you're a great team, you know, playing

in college and then you get into the NBA and it's just a different league and like the game starts over again if you will. Now we tried to have you on the program back in 2020 for a little history lesson here for people who don't know Visa was going to

acquire a plan and we sent you a quick email and you responded hey let's wait until the deal closes but that deal never closed. Tell us a little bit about that crucible moment to Kreb Rulof's term for the visa transaction and it not closing because that must have been in the short term, I'm guessing,

absolutely crushing and in the long term, it's turned out to be absolutely one of the great trades of your life, I think. Well, first off, apologies, if I pushed you off for so long, but, you know, we- It's reasonable, I think. We decided in, at the end of 2019, very early 2020, to sell the company to visa. And this was for a wide variety of reasons, but largely because we felt like we could accelerate the business much more inside a visa than from the outside. So I think you and your listeners probably know what Plaid does, but we build the infrastructure

that enables fintech companies to interact with bank accounts. So the way that your Chase checking account talks to your Venmo app and the conversation between your checking account and the Venmo app, that's the infrastructure that we build and apply that across almost every application that your bank account touches. So chances are most of the people listening to that. I could probably use Plaid in one format or another. And the decision to sell the visa, while a very hard decision was one that we thought could really accelerate the business on the other side, having access to a lot of visas technology,

having access to their distribution. We were pushing on internationalization at the time. And obviously, they're a large international company. So having that access, we thought would really accelerate the business. Now, we made the decision kind of end of 2019. We signed the paperwork in, I think January, I think it was January 15th or so of 2020 to sell the business. I guess you reached that to me sometime thereafter. I don't remember the exact date.

Some of these times are a little bit of a blur. I wasn't sleeping all that much those days. It's pretty nerve-wracking, I'm sure. Exactly. And kind of fast-forward, a couple months and then begins COVID. And, you know, you have this very difficult decision to make to sell your business. And I think it's the hardest decision that a founder ever makes if they make it. And, you know, I was conflicted about it at the time.

It was a 51-49 decision when we decided to sell. Then it hits COVID in the market's crash. And all of a sudden, we have this all-conciful. cash transaction that was locked in. Interestingly, in our docs, there was a clause that says, even in the case of a pandemic, Visa cannot walk away from this transaction, which was a bit funny for me. And so you look like a genius at first, and then little by little, the market turns and so forth.

But along the way, the regulators came in and said, hey, we want to investigate Visa for antitrust and nothing to do with Plaid. And this regulatory investigation continued. But as we went through COVID, you know, we went from having the markets crash, the bottom fall out of the markets to all of a sudden consumers came around and started saying, I don't want to go to the bank, but I need to do things in financial services. I don't want to go to the bank, but I need to apply for a mortgage. I need to do all of these different things that a consumer needs to do in their day-to-day life. And so we saw this massive increase in adoption of digital

finance. So it was the banks building things. It was the non-banks, the traditional fintech startups building things. It was retailers jumping in saying, hey, I want to build this into product too. So we had this huge acceleration of our business kind of going through COVID. And, you know, I joke that if I'd written a Hollywood script to accelerate our business, I might have written a script like this, except realistically, I am not creative enough to write any Hollywood script ever. Yeah. But we had a visa brand moment, huge acceleration of the business.

The DOJ investigation, the antitrust investigation, took so long that we actually lapsed exclusivity on the other side. So a year after we'd signed the deal to sell the company, we got to the end of it and had the opportunity to say, you know, do we want to stick in this in this deal or do we not? And at that point, we made the decision to go on the independent path for many reasons, but mostly, you know, our business had transformed and marketed transformed. And, you know, looking back, I think it's one of the most formative, best, most interesting experiences that I've ever gone through. And I think we were lucky to have the outcome that we did. I couldn't be more thrilled for the independent

path that we're on now. But man, did I sleep so little in that year? That was so stressful. I mean, I'm assuming Visa was bummed. And then my friend, Brad Gersner from Altimita, led your funding round in 2021 if my research is correct. And that was at like a $13 billion valuation. So, you know, essentially the price of the deal more than doubled, or the value of the company more than doubled. And Visa must have been bummed to not have you in the fold. But these things are very hard in today's day and age. it's hard to get the regulators here in America.

I'm wondering what you learned in that process. For me, the thing I learned, and I'll also list all the entrepreneurs that are listening is if there's regulatory risk, you should get a substantial breakup fee put into your deal. I think we, did you have one or no? Is that like a lesson after?

We did not have one. So less and after. But it is, you know, it was interesting because the regulatory climate shifted right around the time that our transaction is going through. So we kind of sold, kind of like end of the, end of the Trump administration shifted into the new administration. The climate for antitrust regulation got much stricter.

Plaid was one of the deals that despite the fact that we didn't get kind of finally blocked nor to be finally closed a deal, we decided to walk away before we got to the final steps. Pud was one of the deals that caught a lot of headlines and in some sense kind of set a precedent for future antitrust. Now, obviously, the anti-trust climate has changed in, in the economy over the past 10 years. And for me, I think the big learning is that try to try to do what you can to understand

exactly what's going on regularly, but also protect yourself on the back end. Yeah, the breakup fee has become kind of standard. I had one of these. When I sold my blogging company to AOL, we negotiated like, and this is a small transaction, $30 million transaction, but we, because we were in the thick of this deal, you know, it's obviously a distraction for management. And so I think they had a $500,000, not breakup fee, but the way they did it was, we'll buy $500,000 worth of advertising on your blog network in advance if we hit this date. And so we hit that date.

And I said, okay, ship it. And they're like, we're like four days away. And I was like, okay, ship it. And they wrote back and they're like, okay, can we ship you half of it? And then you give us a one, you know, whatever, two-week extension. And my attorney's like, yeah, that's totally reasonable. So they wound up giving us like half of it or whatever. It took the edge off.

And then we didn't seem like we were complete jerks. But yeah, I think and I think a lot of the acquirers are happy to do this knowing that, you know, that gives them the room to complete the deal. But yeah, you have to know the game on the field. And the game on the field right now is tech equals bad. Tech has too much power. Therefore, it doesn't matter what the acquisition is. Even if it's a creative to consumers, even if it increases consumer choice, even like in the case of Activision of Microsoft, even if it lowers prices.

Yeah, we're just going to block it because capitalism equals bad, according to the current administration and Lina Khan or the EU, you know, and I understand it for some of the larger companies, but I'm not sure if I understand it for this size acquisition. I think we need some rules of the road. If you're a SaaS or Services company that stores customer data in the cloud, then you need to be to Khm, SOC2 compliant. You knew that from a third party. and you need that third party to close big deals.

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They also automate up to 90% compliance for GDPR, HIPAA, and more. You can't afford to lose out our major customers. We all know that. Listen, it's a hard year. Last year was hard. You can't lose those major customers because you don't have your compliance dialed in. Just work with Vanta. Get your compliance automated and tight and tight is right.

Lock down those big deals. Here's the best part. Vanta's going to give you $1,000 off. That's 10 hundies. Get $1,000 off at vanta.com slash twist. That's Vanta.com slash twist for $1,000 off your stock two. So just explain to the audience what Plaid does, who your biggest customers are, and essentially why they don't do this themselves, right? Because being able to, you know, if you're spending a lot of money with Plaid or Stripe, you know, there's always this buy versus build conundrum.

So maybe you could discuss that. Definitely. So the core thesis of Plaid, and this is kind of coming out of our own personal experience. in 2012. Myself and my co-founder, we tried to build a bunch of consumer fintech products and it learned a bunch of things along the way. The most important one was that the infrastructure to connect with a bank account between your consumer fintech products and bank account, it didn't really exist.

And so we decided to go out and build it and I can come back and tell that founding story if it's interested. But what we build is basically the ability to link your bank account to an application. This could be anything from a budgeting tool that you use to an application that you're using to make an investment or pay a friend. On the investing side, we work with companies like Robin Hood and many others. On the peer-to-peer side, we work with Cash App and Venmo and all sorts of other period of peer companies. The connection between a bank account and application historically really didn't exist. So in a budgeting application, you'd have to upload documents or type in

transactions manually. Now it's digital. You just get a feed of transactions that occur in the bank so that you can get your budget updated automatically. In the case of a peer-to-peer payments application, you either had to use a credit or debor card, which is relatively expensive, or you could try to do an ACH transaction, which is a bank-to-bank transaction, but those are relatively clunky and the onboarding is difficult. And so we created kind of this digital linkage that enabled a much more seamless bank-to-bank payments experience. And these days, the products have expanded a lot. So we've gone from just doing bank account linking to now we have an identity verification product, and we have a risk-and-fraud product suite. We enable kind of bank-link payments more broadly. And we do kind of

of credit analytics. So if you're applying for a loan, chances are you might have used Plaid to kind of upload your employment data or verify your asset data if you're applying for a mortgage or something like that. So it's now become very broad. And you guys dip your toe into crypto or jumped all the way in the pool and maybe your experience there because a lot of the crypto products were trying to build these bridges. I assume that they try to use Plaid to do that. And obviously that's created regulatory friction. It would say it would be the kind way to say it. Well, I don't think the regulatory friction had anything to do with Plaid. But what I'll say is we work with crypto companies in two formats.

First is, there are customers. We help them do account funding. So let's take Coinbase, for example, how do you transfer money from your Chase account into your Coinbase account? Well, we help set up the transaction and make sure it lands. And then we do a bunch of fraud analytics that sit on top of it as well. So that's part one is they're just a standard customer of ours. Part two of working with crypto companies is we found that a lot of our budgeting customers,

or our wealth management customers, and they wanted to be able to see crypto assets as well. So, for example, if I'm using a wealth management tool to see all of my assets, I don't just want to see my traditional assets. I also want to see my Bitcoin or my other coins that I have. So we integrated into a bunch of the exchanges, we integrated directly into a bunch of the blockchains

so that you can connect your crypto data into your wealth management or your budgeting application as well. We haven't gone a lot further in crypto. Maybe we will eventually, but those are the two ways that we do. now. Yeah, I think a little more regulatory clarity would be great. But you're actually in the good guys in all of this because you're making sure, like, nothing you do is on the crypto side in terms of anonymity or permissionless. Everything you do is fill with permissions and know your customer, obviously, and a lot of regulation. Exactly. And actually, I mentioned that we do identity verification previously. For the companies that are using Plaid to do account funding, we're also in many cases doing their identity verification, doing their KYC check. that kind of identity verification and risk and fraud analytics business for us has been one of the most rapidly growing ones over the past couple years. It's been really fascinating to get a lot of exposure to that market and see kind of all of the things that are going on.

What was the origin story? How did you come up with the idea? And then how did you know you had any kind of product market fit? That's always like a very interesting thing I think for the audience here is that triangulation. and then knowing if you have light product market fit or you medium, strong, or even market pull, right? Maybe you could take us through that journey. Our founding journey was circuitous. It was a bit messy and certainly required a lot of hustle. Yeah. Exactly.

This seems to be standard these days. My co-founder and I had the idea to start a company that helped consumers live better financial lives in 2012. and we were fortunate that some friends let us let us let us squat in an office in New York City just off of Union Square. And if you remember in 2012, that was kind of towards the tail end of Occupy Wall Street. Yeah. And in 2012, they kicked all of the Zucati Park protesters out of Zucati Park. They all moved up to Union Square.

And so it was almost every day that we were walking to the office that we would walk through these protests. And setting the politics of all that aside, the fact is consumers are really frustrated with financial services. They felt like banks weren't serving them. They felt like banks weren't putting their best interest first. And they wanted better access to deeper rates, so and so forth. And so being kind of naive kind of entrepreneurs in our early 20s, we said, great, let's go build an app to help consumers, you know, solve this problem. We can, we can solve it ourselves. So we set out to build a consumer budgeting application. We ended up building six or seven

different versions of kind of consumer spin analytics tools. And through their process, we realized two important things. First is, all of the applications that we were building didn't work. And they didn't work because we would tell consumers, hey, you're spending this much money and you should spend less money. Turns out when you tell a consumer,

like, hey, you're doing this thing that you want to do and you should stop doing that thing that you want to do, the natural reaction is just to delete your app. So pretty quickly we realized that the price we were building just weren't getting any traction. The second important thing was that getting the data from the bank was immensely hard. So we wanted to build a budget that updated

every time you swipe your credit card. That was really hard to get that bank data feed. And so we ended up talking to the banks and then kind of building these integrations to their systems in order to collect that data and structure it really well. And that was what we spent, like, 80% of our time on. We never thought that this could be a B2B business until one of my friends actually came to me and said, and so this was, he worked at another fintech company at the time. He came to me and said, hey, Zach, your apps are really dumb, but I'd like to license your backend. Can I just pay you money to license your back end?

And that was the first inclination for us that maybe we should make a pivot. And so little by little, we started working on. hey, could we turn this into an API. At the time, we only had one bank that worked for this. So we literally building a budgeting for one bank. Which bank did you get first? And how did you get them? They must have thought you were crazy when you came in there and said what you wanted to do.

Well, yeah, that was a whole other story. But the first one that we actually worked with was American Express. So not technically a bank, but a car provider. And yeah, when we first talked to them, they said, an API for what? Like, how does this work? And then we should have been to demo. And we ended up building it in a relatively like brittle way. So, you know, we integrated through their website to collect the data and kind of structured.

That was the first version of the API. An API would put in, we put in air quotes there because obviously the scraper. And eventually, like, you know, we got to the place where they understood what we were doing. They built an API for us. We did this kind of like big enterprise agreement with them. This took years. American Express is actually an investor in the company. So like we ended up getting to a really good place with Amex and all the other banks.

But at first, it was really brittle, as you would imagine. So anyway, so our friend had come to. and said, hey, can I license your backend? And we kind of sputtered because we weren't ready for that. We couldn't do it. But we did realize that that was a much better business model. And so little by little along the way, we ended up making this shift to saying, all right, well, we're now going to build an API.

And then all of our apps that were out there, we put them on top of the API. And we got to this thing where we had our first customer and we were super happy. The first customer that was using it was they were basically building a corporate expense management tool. And so they said, all I need is American Express cards. It turns out, like you do all your corporate expresses on American Express and it works. But we got to like five customers and that was it. We couldn't find anyone else to use this thing. So strong, I don't even know if you could call that product market

fit, but five customers that were happy. Yeah. And then we did this thing where we said, all right, we don't know this is a business, but we got to try. So we went to the TechCrunch Disrupt Hackathon. We built this API. And we went and talked to every single company at the TechRange disrupt hackathon and said, hey, you want to win this hackathon? This is a new financial services API. No one can ever build financial services products at this hackathon, use our API. And a few of them did. And then we also built a product on top of our API in like 24 hours that ended up winning the hackathon and the publicity for that.

What do you do? So it was a spotlight in all of your spending. So literally like it was a, I remember building this little icon of a magnifying glass and it would just zoom around a map every time you spent somewhere. And it would like tally up all of the money that you spent over like a six month period. It was like a pretty cool thing. Including GPS and doing an API call. Yeah, that's good catnip for a hackathon.

Yeah, for the judges. Yeah. Especially like anything that had a GPS or a map in that time period, you know, when the iPhone started supporting maps and GPS became a thing were, yeah, really exciting for everybody to use. Yeah. So that was clever. Yeah, early 2013.

We were like Google Maps APIs. It was a fun thing. Yeah, hackathons are undervalued. in terms of tools to find customers, to find investors. We used to throw a lot of them. And the only problem with throwing hackathons was you'd have like a thousand people for 72 hours in one location. And then we would buy them burritos and pizza and every type of food.

And they wouldn't stop eating. They would just be like, bring us more food. And it would cost us like $50,000 in food just to keep people fed constantly. How funny. It's a terrible business, but a great fun thing to do. And so highly recommend those hackathons just as a way to meet people. You know, like you can meet people who are actual builders. And it's nice to see them coming back now, right?

Like after these like two or three years off. So when do you get to market pull? Is it just waiting around for more people to start building startups and apps and for you to have more support in the system for a greater, you know, number of banks and financial services? Is those two things kind of built up over time slowly? Yeah, so there were two things that needed to happen. So this was 2012, 2016, and, like, if you talk to any VC in that time frame, they would say, we don't invest in financial services.

Like, we don't invest in fintech, or they didn't say fintech. What was your reason to not do that? 2016. Because they said the banks, so a few things. They said the banks are too big. They're going to do everything. They said that financial services is too highly regulated. You can't build anything in a regulated space.

And they said, no one's doing it. I can't think of any good ideas that the banks aren't just going to do. And that was the common thing that all of the investors that we talked to were saying. And we knew there were a few people that were trying to build these things. There was an expense management tool. Obviously, you'd seen Mint and PayPal before. But if you thought of what FinTech was, you literally just thought it's mint, it's PayPal. That's it.

There's really not much else. There were some payments companies that were starting to exist. But even that wasn't quite core fintech. And so for us, it was slow. It was about building community. We would do this thing where early on we would, we had this little tiny office. We would invite everyone that we knew into our office.

And it would be like totally packed. Point of privilege, my first office was right off of the theater on 15th and Union Square on the east side. That was literally my first office, well, my second office for Silicon Island Reporter. Where was your office on Union Square? We were just a little bit south,

just like north of Astor Place. Yep. Sure. So like southeast, southeast corner. Yep. Amazing. Yeah. Yeah, it was a great area.

We were there for a... That park got better and better over time, but that was crazy. You didn't remember Operation Wall Street. It's a very interesting moment of time that is kind of forgotten to history where people after the great recession, the great financial crisis, rather, they were fed up with the banks and a bunch of young people, I think it was mostly Gen Xers in their 30s, maybe, late 20s, decided we're going to protest in a park. and we're not leaving, going to bang drums

to protest Wall Street. And they were down in that park where they played chess like you're saying, and then they moved them up to Union Square. But it was like, yeah, maybe your recollections on that. That went off for a year, I think. It was a long time. I think it might have been more than a year. It was a very long time. And it

really captured the public consciousness at the time because people were looking for, it was post-2008. Occupied Wall Street, not Operation Wall Street. Occupied Wall Street. people were mad, people were frustrated with the banks, they wanted to find a way to vent and kind of express that. And this is one of the things that people gravitated towards. And the media picked up on it in a big way. Yeah. And it was out here in Oakland, too. They had a version of it here. Zuccotti Park. My God, that was 2011. So, so interesting that that happened.

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That shows them that you're listening to this week in startups. So we love in broker. They've been amazing in terms of supporting our founders for years. And of course, this very podcast. Great job in broker. So you support more platforms. You build community. What worked in building a community?

If you look back on how you get the community jumpstart, a cold start problem, as we say, in the business, you're trying to start the car. I mean, once the car's running, you're in good shape. But how do you get the car running? How do you turn that engine over? What did you learn about community building and tech? I think the honest answer is there is no trick. You have to do the hard work.

And the hard work is whatever you can figure out. So for us, what worked was we started in New York. We eventually moved to San Francisco because, There were more people. There were more developers there. We thought there'd be more customers there. And in both places, kind of before and after he moved, we would just literally talk to everybody.

So I'd go to every meetup. My co-founder and I were basically building this company. It was two of us for the first like two and a half years. We had an intern along the way. He was an amazing intern. There was two of us for the first like two and a half years. And pretty quickly it became obvious that, you know, I needed to spend my time on getting customers and my co-founder was a much better engineer than me.

So he would kind of like hold things together. And I would go to every single meetup that I could. I would talk to every single customer that I could. I would fly all over the country to find people where they are. So we had people that were building in Chicago. Why people were interested in FinTech in Chicago, I don't know. But it was a thing. So we went there and spent time there.

Chicago's got a big financial industry there. That's probably their top industry, right? Real estate and finance. So yeah. Exactly. Yeah. So then we started doing these things. We called them plot outs.

It was a terrible name because it was actually a plat in. So in our office, we'd just invite everyone we knew in financial services just to come, hey, have a beer on Friday. And it would do this like week in, week out. And people would just swing by. And like, you know, all of our friends and our team didn't really drink very much. So it wasn't the most social of environments, but we would talk to people about the company. We talked to people about what we do.

And, you know, we'd invite all the people that we were trying to recruit and to work for us there. And little by little, the community grows. One of the best things that we did, though, was we gave everybody our personal cell phone number. And we said, hey, if you have feedback on, on the product, we want you to text us. And I also want your phone number because I'm going to text you and ask for feedback on the product all the time. Yeah. And the fascinating thing is through this, we became like close personal friends with a lot of our early customers. Even to the point that now many of my good friends were early applied customers or are still applied customers.

And this this kind of genuine relationship to the community, it's something that we still deeply, deeply value at Plaid and something that, you know, when we think about the brand we want to build with their customers, it is this like, hey, you have a problem. Call me. Like, I'm going to be there to help you solve it. It is that kind of thing. people really underestimate the personal touch and making a business personal. When I started the magazine Silicon Allie Reporter in New York, at the same location you are, Union Square, I, too, would host small pizza and beer and just invite anybody in the industry. And my friend Nicholas Butterworth had a website called SonicNet, which is the first music website on the internet. And we would just go to the ATM.

We'd each take out the max, which was two or three hundred bucks at the time. We'd go to the deli. We'd order some pizza. and we just invited, hey, anybody working in tech, come by. And then I give him a copy of the magazine, and he'd show them what's on the website and do a little demo on his projector, and that's it. And then all of a sudden, momentum, momentum, momentum.

And everybody brings a friend, and, you know, if every 10th friend winds up consuming your product, you know, that builds like really strong embers, really hot coals, those personal relationships, right? So then when you put on bigger marketing efforts, you got this really hot coals in the bottom of your grill, right? And that's how I always envisioned that one-to-one, one-to-few marketing kind of efforts. And they pay off.

How did going from New York to San Francisco change things? Because at that time, New York, Silicon Alley, you know, it's always had a really strong presence, but nothing like San Francisco in terms of developers. Yeah, I think the move to San Francisco was a really good one for the company. It was, you know, a bomber personally. I love New York. And we're fortunate to have opened an office in New York and still get to go there a good amount these days. But we ended up in San Francisco where it was just, you know, the mecca of

developers obviously at the time. Good for two things. First is we were, I think at the time, maybe 23 and 24. And our entire professional network was on the East Coast. And we needed to figure out how to hire people because there was just two of us at the time. So we had to get really, really good at just cold outreach, cold recruiting. Second is, in doing that in this market like San Francisco is way better than a market like New York. In New York, there were, you know, not very many big tech companies in San Francisco. There were a ton to recruit from. So that made a big difference for us. The second big thing is that many of our customers were in San Francisco. So, you know, you could go down and sit with them at the time.

Wellfront was getting started. So we could go spend a bunch of time with Wellfront. We could go spend a bunch of time with Robin Hood, which is, I think we started working with Robin Hood. Great company. Investors in both of those companies. There you go. Yeah.

I think we started working with Robin Hood when there were five people. And that way we could go sit down in their office. You're really early. We can talk about the pros and cons. Your team has a problem. We can come sit there and bug fix with you. we can do your integration for you for some customers. Not Robin Hood, they didn't need that.

But some other customers needed some more help. And so just being really close to your customers in physical proximity mattered a lot. And the fintech community in New York is really big now. But it didn't grow as fast. It took a lot longer. And so the move to San Francisco was a good one for us. Funny enough, we were also in the middle of our seed fundraise, which, I mean, our seed fundraise was like a horrible process.

We pitched more than 100 investors. And finally, we got a yes after that. But when we moved from the East Coast to the West. goes everybody, all the investors, no matter where they were, they took us more seriously because we were in San Francisco. Fascinating. Yeah. And so, yeah. You went to the NBA, right? You went to the NBA, right? I mean, listen, I got love for New York to my hometown, but I do advise people, you know, if it's your first company and you're here in the Bay area, yes, you will get taken a little seriously. And if you throw a rock, you're going to hit like three VCs before the rock hits the ground.

It's just going to bang, bang, bang. And it's just the loft. numbers are so many of them here. But how fortuitous is that, that Robin Hood and Wealthfront, Vlad and Andy Ratcliffe, were both building a service that needs you at that time. And both of those services got incredibly well funded and had unbelievable product market fit. So now you're the infrastructure, you're the AWS in the minds of the investment community, incorrectly so that's helping them build these very large businesses. That must have been a great pitch. So we got, we got, incredibly lucky to be at the earliest formation of this market. So we were working with, I mean, Venmo is another one that they were even before those two.

That was the first emergent digital finance company, aside from, as I said, PayPal and Mint, that really captured consumer attention. And we were fortunate to start working with them when they were very, very small. And that was, you know, that was the big logo for us. The interesting thing is one of the early ways that we grew is that people would use Venmo, they would say, hey, that bank connection experience, I've never seen that before. How did you do it? And they would literally email the engineers of Venmo.

And then we'd, because again, we make good friends, we give people our phone numbers. We try to be as close as we possibly can to our customers. The engineers of Benmo would just say, hey, it's my friend, Zach, like, here's his number. Or like, here's an intro, yeah. You can go do it. And that led to basically, like, that was when we really started feeling the market pull is you get the one big look, when big is relative term. Venmo was 20 people at the time.

Yeah. But people start seeing it. They start emailing Venmo. engineers and engineers started sending them to us. And then that started to compound. Fascinating how that all came out. And this is where catching a wave, right, and being part of a movement really can drive scale and product market fit. You were part of something very big and you were enabling a whole group of people to do these things. But a lot's changed since then. And the financial giants, I think, did they see you? When did they start to see you as competitors?

because I think a lot of them have APIs. Maybe they want to provide the APIs directly to people. And maybe they don't want them going through Plaid or am I wrong? When they start to see you power so many things, are they stoked? Or are they like, huh, who's this intermediary here starting to get big and mitigate people's use of our service? It's a good question. We're fortunate to have exceedingly few competitors. We have a couple of direct competitors that do very similar things to what we do.

But we've been able to make almost everyone in the ecosystem into our customer or our partner. And we like that. We really want to be focused on creating an ecosystem of companies, of banks, of digital finance products. Because that's what's good for consumers. So the way that we do all this is first and foremost, we say that we start with our mission. So our mission is unlock financial freedom for everyone. We're focused on helping consumers, the better financial lives. We're a B2B company that talks about consumers in our mission because it's incontrovertible.

All of our customers, they want to help consumers live better financial lives. The banks, they want to help consumers live better financial lives. And that deeply resonates with us. And so, yeah, we work with the banks. We've integrated now with 12,000 financial institutions, maybe more than that by now. Those integrations are hard, complex, and that's a whole lot of legwork to get there. But those integrations. A moat over time, yeah.

And a moat. Yeah, that's very true. those regulations allow us to let our customers, which are 7 or 8,000 digital finance companies, connect bank accounts in. The interesting thing is that a lot of the banks, most of the biggest banks, are our customers as well. So they build fintech products themselves. Let's take Citibank.

For example, Citibank has an online account opening process. We help them open accounts online. So when you open a new Citibank account, you need to fund it with your existing bank account, so you have to connect the two together. So City is a customer there. Likewise, many of the fintechs are data sources. they become large enough that they become banks themselves. Or they, for us, and they're not technically banks, for us, they become data sources.

So you might want to understand, you know, how many dollars are in your Chime account in your budgeting app. So we connect Chime to the budgeting app. So it's become this multi-sided ecosystem, which is really great. And they're betting in on the game too, right? Like, I know it's a Bank of America or something has Zell and then other people are making quick pay. Like, they're all trying to make their own Venmo kind of product. Exactly.

Everybody's building everything. Zell is a bank consortium. But Bank of America is a part owner of it. But in my opinion, that's great. Like more innovation equals more options for consumers, more option consumers for consumers means that consumers get to pick and choose the best one and they get better financial outcomes. And so from our perspective, we want all of this to exist.

We want it to be a big, vibrant ecosystem. Now, we put a huge burden of trust, of security, of privacy on top of it. We have to be very careful about who we let use our platform, who we let connect on the other side. And we partner really deeply with the banks and with the regulators to make sure that, you know, the applications that are using Plaid, the applications we enable, the use cases we enable are are good. But once we get through that burden, and that's why we do so much of this partnership with the banks. And once we get through that, then it tends to be a fairly open ecosystem. And there's a lot of really amazing new companies that are being built. And I think we're,

as I said, we're still in the early innings of financial services. I think one of the things I have is that every company is a fintech company. It's a question if they just know it yet. So anyone that accepts a payment, they have a fintech team internally. Whether they call that a fintech team or not, I don't know. You see these blue light glasses I'm wearing, I'm not wearing for style, although they are very stylish. They've totally changed my life. Why? I started having headaches, right, and had eye strain.

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We have Fed now, right? And India's got their UPI. People seem to be trying to make faster payments and transfers and everything like that. What's the state of these next generation? I don't know if they're next generation, ACH or Rails. How is the industry doing in speeding things up? The fact that here in America you send a wire transfer, it feels like you're trying to get to the international space station

and the number of, you know, the complexity and the time and the phone calls is just absurd. And of course we have crazy, insane fraud going on and cybersecurity has become super important. So maybe those two things. Like how is the industry evolving here to get faster and tighter in the United States and the Western world? Well, one of the most interesting examples in your listeners may know this, but there are most of the bank payments that are made in the United States run on this system called the

ACH system. It's the automated clearinghouse system. And it started out as a way to process checks. So I write you a check. Then you take to the bank. The bank then sends all those physical checks in a bag to the central place and they process them. Now, it's, of course, electronic and it allows you to do bank-to-bank transfers.

But this bank-to-bank transfer system, it generally takes three days. It only runs, I think it's, I don't remember the exact hours, but it used to run something like 8 a.m. to 6 p.m. It didn't run overnight. And it was just very, very slow. Now, the ACH system has done some things to modernize, but it's still not fast. And what happened, you know, ACH in the U.S. was early to being this automated digital system. It was great. So we did a bunch of innovation at front. But then the rest of the world innovated and got a lot faster than us.

So in India, they've created a system called UPI. And UPI allows for instant bank-to-bank transfer. So if I want to move money from my bank account to your bank account, let's say that we're in a bookstore and I'm buying a book from you. If I want to move money from my bank account to your bank account, I can do it instantly with UPI. And a lot of commerce started going over UPI in India. I think it's something like 73% of payments in India are now on UPI.

The rest are on cards and other types. And that's pretty amazing. In Europe, they have a bunch of these bank-to-bank payments in the U.S. we do have a lot of bank-to-bank payments. They're for things like invoices or utility bill payments or a lot of B-to-B payments are bank-to-bank, but they're still really slow. And that leads to a lot of counterparty risk on both sides. I might pay you for that book.

Those funds will be in limbo. Are you going to give me that book? or are you going to wait until the funds land? What's going to happen there? There's a lot of these questions. And so in the U.S., the Federal Reserve launched a new system called Fed Now, which allows for instant bank-to-bank payments. Now, only between the banks that are a part of Fed Now,

and it's very few banks so far. And then another bank consortium, we're talking about bank consortions, the bank consortium launched a standard called real-time payments, RTP. And that's the big banks. And so little by little, we're going to start to see a real-time very fast bank-to-bank payment mechanism in the U.S. And for me, it's a fascinating question because, you know, this could be something that, you know, it modernizes wire transfers.

And if we modernize wire transfers, that's nice. That'll be a win and people will be a little happier. But it could be something that's much bigger than that. It could be something that, you know, maybe you compete with the card networks in terms of payment volume. This would be crazy when you think about it, Fed now and obviously in India, am I correct that people will use the Indian system to translate? transact my bank account to the bookstore's bank account or the restaurant's bank account. So it's a

mobile phone app in most iterations. And so that means you're not having a credit card company in the middle of it, which means no fees or less fees. How does that all sort itself out? You think? The biggest advantages are speed and then kind of ensuring the funds actually get there on the other side. So safety of funds. But then fees, that's a huge one. In India, UPI, is very cheap. I think the standard itself is free, and the banks charge just a little bit to do it. And then there's, of course, like, processors in top of it,

that charge a little bit, but it's, it's, you know, basis points to pay. In the U.S., the RTP and FedNow standards are very cheap. They're cents to pay for a transaction. And that means that, you know, we could start to see a massive reduction in the price of, of sending money. We actually have bank-link payments that we've enabled with a small handful of early customers. Now, this is still traditional ACH, and it's the faster versions of ACH. But for example,

if you buy a Rivian or a Tesla, there's a good chance that you'll see Plaid actually executing that bank-to-bank transfer. And eventually, we hope that this will go from the really expensive high-value items down to many more of time. Fed Now is not a digital currency. It's not a federal, you know, version of Bitcoin, but it is run by the Federal Reserve, correct? Am I correct? And it just launched in July this year. So we're in month two of it. Is that right? Something like that. Yeah. Yeah. It's very early. It's very early. It's one of those things that I suspect it's going to have a long tail. How so? You just going to be a slow rollout, you mean? Slow rollout, yeah, but it'll it'll inch by inch and I think you'll start to see more and more and more

usage over time. And the fact that the bank consortium that's built RTP is the top banks, I think we'll start to see these two compete for volume over time, which means that you'll likely see faster implementation. People seem to believe incorrectly. There's like a conspiracy theory that Fed now is like this is going to be the central bank digital currency like China's pursuing and that this is part of the Illuminati, you know, New World Order's way of controlling you because they can beep, press a button. And if they don't like what you said on Twitter or they X,

or they don't like who you are, they can just freeze your funds, you know, like we do with Russia or, you know, other people who invade other countries. Uh, we can do kind of sanctions,

but this would create a level of control. Do you, and that's not the case, right? There's no indication that there's a, this is going to be a, a digital reserve currency. But do you worry that the government's going to have too much control and then eventually paper money goes away and, you know, every transaction is stored?

Does the, I'm assuming you have some libertarian, like most of us folks in tech and some privacy concerns about this stuff. And so just maybe your thoughts on that writ large, take it wherever you want to take it. Look, we have no indication that this is an attempt to create more government control. Frankly, the Federal Reserve, there's two entities that run the ACH system, the way that all the bank to bank and your invoices move as it is. The Federal Reserve controls one of those, so they control half of the ACH system. So, you know, the reality is this is not a lot different. It's accelerating. It's making faster a thing that already exists as opposed to, you know, creating a huge amount more control. And, you know, I think the concept of the CBDC is, you know,

is fascinating. I have to admit, I won't be able to go all the way down that rabbit hole with you. I'm probably not that smart on that area. But what I will say is we're very far from doing that in the U.S. The promise of crypto, though, is that you have fast, instant, easy, verifiable transactions. In a lot of senses, that can be accomplished by instant bank-to-make transfers, or it could be accomplished by instant debit card transfers or whatever it is. So we would be better served to do that with a central authority because you could have insurance, you could reverse transactions, you can have more protections. So arguably, consumers probably don't want it decentralized. It sounds like a feature decentralized, but, you know, anybody who's ever had money stolen from

them really does like their FDIC insurance or the fact that the credit card company is like, don't worry about the fact that somebody ordered tires with your credit card, which happened to me. I'm a crypto optimist, so my answer is yes, and let's do both. Let's make both work. Yeah. But my general take is, you know, I think I think Fed now is a step forward in terms of speed. I don't think it's a step back in terms of a lot of things. And CBDCs, in my opinion, are pretty far away, at least for the U.S. Yeah. I think it's going to become like one of the major present. I think it's good. I think the the CBDC movement is going to become like the Second Amendment and the right to bear arms. I think we're going to see a large number of Americans. It's going to. It's going to. going to just make them feel really concerned about government overreach when they're asked to, you know, be or if God forbid they were forced to use a CBDC and the government was watching every transaction and then like, you know, putting it onto your tax return. There's something about, you know, I report my taxes. I, you know, have cash if I want to and I don't want to be tracked

through Manhattan. I can buy a cup of coffee for five bucks and, you know, just use a good old piece of paper. And so I'm fascinated with how that's going, it's so science fiction, right? It's like some crazy dystopian possibility that the government could control every transaction. It'll be fascinating to watch. And like, I'm right there with you. I prefer more privacy. But we'll see how it all plays out. Talk just briefly about what happened with Silicon Valley Bank, the banking crisis, and how maybe that 60 days was for you, because SVB, I'm certain, was, you know, hooked into Plaid and you must have had people who were checking their balances, you know, through services that were enabled by Plaid. What was that fire drill like that weekend?

Well, that was a, it was another sleepless weekend. More than a weekend, it was a few days in the week before. But, you know, I think the interesting thing is it, it, it was this huge potential fire that ended smoothly, as smoothly as you could imagine. I mean, given all of the inputs, the, the outcome was was pretty good. I agree. And I think for us, like initially as things were starting to happen, I mean, you know, you go through the, the checklist of things you need to do. Number one for us is ensure the plans cash is safe. So, you know, we looked where our bank accounts were we felt like cash is safe. We ended up moving past that.

Second is start to talk to our customers to figure out what they need. And the number one thing that all our customers needed was connections to all the new bank accounts that people were moving money into. So what happened is a bunch of banks popped up and said, hey, I'll open. open a bank account for you over the weekend. I'll let you do a wire transfer. And these were good banks, but we didn't always have connections in the way that they needed to. So maybe your connections weren't scalable enough to that new bank. Or we actually saw a bunch of neo banks starting to pop up saying, hey, you know, I mostly did consumer accounts, but I can turn on business accounts for all these businesses that need them over the weekend. And so we said, all right, great, well, now we've got to

integrate to your business side. So basically what happened is our team stayed up for, you know, most of the weekend integrating to something like 20, 30 new banks. And by Monday, and we were able to reset everything. The most important of that was all of the employees of, basically all of the people that had checking accounts at Silicon Valley Bank, where they were getting their primary checks deposited into that. They all needed to switch their payroll immediately. So we needed to be ready for Monday when they all switch their payroll over. And so that they can end up getting their checks on time, not having any delays with it. And great, a lot of these were tech employees.

So it was like kind of easier for us to work with them. And they gave us good feedback and so forth. But that was definitely a very busy time. Yeah. Also scary. You know, you just think about it like as an entrepreneur. You never thought you need $10 million or your $3 million or seed round or your whatever you did series D. Whatever, you got $100 million at a bank.

You're like, oh, I can't access it. Like that didn't cross anybody's mind. Now, I had a lunatic, Elliot Cook, who worked for me. still does back in the day. And he would always put our money into four bank accounts and, you know, two accounts, you know, three or four accounts at four or five institutions, whatever, and had it split up all over the place. And he's like, why? And I said, why are you doing this? So much work. He's like, well, if anything ever happens, you know, we have a bankground or whatever. And I'm like, are you living in the 20s or 30s, a bank run? And then here we are, you know,

things that you don't think can happen can happen, right? Speaking of that, uh, 2022. What a disastrous year, brutal. You too had to go through the layoffs. Maybe you talk a little bit about how you responded to the market conditions. And you let go of 20% of people. That's one in five. That's got to be pretty difficult as a founder. And then what's happened since?

Because we're six quarters. We're in the seventh quarter of this down market. I always thought six quarters plus or minus two would be the range of this chaos. And it seems like it's directionally correct. maybe on the longer side of chaos in our industry. Green shoots in 2023 and then remembrances of your very difficult 2022. Yeah.

2020 was a hard year. I think a hard year for a lot of startups. And I said before that the hardest decision ever made was to sell the company right up there with that decision was to do the RIF and the reduction for us to let go of a handful of people at Plaid, more than a handful of people at Plaid. And, you know, I think the reality is the decisions that we made in kind of 2021, in early 2022 ended up changing directions pretty quickly. So the biggest thing for us was our customers came to us in 2021 and 22 and said,

we need to go international right now. International expansions are number one priority and get us into all these new countries. And so we did. We scaled up. We built a team to go do it. We started working on a bunch of new countries. We first heavily in Europe and we're looking at a bunch of other places. And then as 2020 to turned, our customers,

came back to us and said, hey, our number one priority is cash preservation. We are not going international anymore. And we ended up with a really large international team that was built relative to the feedback that we'd heard from customers, but it was not built in a way that, you know, we needed to maintain going forward. Now, we are still international, but we didn't need to bring as many customers as fast, which just means we didn't need to build for as much scale as fast as we thought. And so we had to take a turn. We made the decision to reduce the size of that team. We still deeply value our European expansion, our UK expansion. We have a great team is still there, but it's much smaller than it was before. You know, we did everything we

could to make sure that we were clear with the team in messaging. We were taking care of the people that were leaving, doing everything we could to help them find the next role. And we got a lot of great feedback, both inside and from people that, um, that we unfortunately had to let go, um, that they appreciated the effort that we'd made. No one's happy about it to be really clear. And it'll be a thing that I, I look back on and I'm frustrated with and regret for a very long time, but we tried to do everything that we could. It's not easy to be the leader, right? And, you know, doing what is necessary is hard, you know, and it's people that you hired and that you're part of the team. It sucks. I mean, this is no other way to say it. It sucks for everybody. The good news is, hey, you know,

tech workers, these are elite workers. They got the best chance of anyone of finding the next gig. So let's fast forward now. We're sitting here, September 2023. Some green shoots. We're taping this right after the ARM IPO and before the Instacard IPO arm had a big booming IPO earlier this week. And Instagram is looking pretty good, maybe going to price above that. And stock market doing relatively well. Looks like inflation is not out of control. It feels like it's in control, but still some work to be done. What are you seeing, given your unique perspective? And how are you looking towards 2024 and 2025, just in terms of strategy as somebody who has a very unique insight into financial markets. Yeah. So this year has been a surprisingly predictable year.

And it comes from us at Plaid. It comes from our customers that we talk to. It comes from what we're seeing in a lot of the data. But despite a high degree of uncertainty when you enter the year, what's the the Fed going to do? Everybody's going to go up or they're going to go down. Is the market going to do? our market going to go up, we're still going to go down. Surprisingly, a lot of companies are right on plan, us included. And that is, I think, a very good thing. Now, I can't speak for everyone. I understand my industry fairly well.

I understand all of them. And to your point, I like to say, I'm not a macroeconomist. My job is not to predict the future, but to react very quickly when the situation changes. And I think our team has been really resilient in that process. So I'll say that to our team. Our team has been very quick to react to things that need to happen. We're starting to see a lot more stabilization of our FinTech customers and financial services customers.

We're starting to see, I can't tell if it's confidence picking up within them, but it's certainly a recognition that the world has not fallen apart, which is a very good thing. Interestingly, we saw a lot of financial services retool for a higher interest rate environment. So what you saw was a lot of the fintic companies were only focused on deposits. So how do I get deposits into my system? How do I issue cards? How do we make money on debit interchange or whatever?

it is. Over the past year and a half, we've seen people really shift to, oh, my gosh, I need to figure out how to make loans. You know, I need, my customers are asking you for loans. That's the thing that I need to do. And so you're starting to see a lot of retooling in terms of the types of products that are being offered to consumers. I don't think we're seeing massive consumer adoption on the back of this. I think people are looking at the loans and saying, oh, this rates are really high. But that is preparing all of the fintech very, very well for a decreasing interest rate environment where all of a sudden they build this mousetrap and this mousetrap is going to be very effective as rates start to come down. And so that's been, that's been great

to watch and it's a good evolution for the FinTech ecosystem. The second major change that we've seen is people are super laser focused on fraud. In 2020, when money is, I won't say free, but cheap. ZERP. Yeah, we were in the SERP. Exactly. People were just focused on top line. And, you know, a dollar of fraud against your top line, you were just focused on your growth. Yeah, we throw out of it. Yeah. Exactly. You try to minimize the fraud, but it's not your top priority.

These days, when you're focused on profit, the dollar of fraud, that's a dollar less of profit that you have. So people are getting laser focused on it. I think that's amazing for consumers because the fraud tools are getting better. The focus on is getting better. And I think we're starting to evolve a lot as an industry. Yeah, it certainly feels like your experience parallels mine across a number of different verticals where people are running their companies at a much higher operational level and looking

at their margins, looking at fraud, just looking at efficiencies. And as Brad Gersoner, you know, who led your last round, says, you know, just being fit, right? And just, hey, do we have the right number of people for the opportunity? And do we have the right products for the customers? I feel like it's another year sideways. But I liked your metaphor. Our job isn't to like create the weather. And we have to be humble that we even as smart as we are can't predict perfectly. the weather. Therefore, we must focus on reacting to the weather and flying the plane as safely and efficiently as possible. Zach, it's a great hour. Thanks for coming on the pot. I really appreciate it. Thank you so much for having me. This is great. All right, and we'll see you all next time

and this week and start us. Bye-bye.