Insight
Levchin: Startups need professional respect over collegiality during market downturns
“I over-indexed on this idea of, hey, we really have to have just a lot more collegiality, and that works really well if you are doing great as a company. But inevitably, every company goes through ups and downs, and sometimes downs take a long time, and, you k…”
Opinion
PayPal sold to eBay primarily because the team was completely exhausted
“The reason ultimately eBay was able to acquire us is because the team was so overloaded over the four years of previous life.”
Disclosure
Levchin took out startup frustration by ripping into founders' pitches at Sequoia
“And then I started noticing that I was really good at ripping into people's ideas. They would bring in this really cool concept. And of course it was half baked. It was just, you know, some bright eyed kid Freshly out of college thinking about here's what they…”
Opinion
Levchin: PointCast did nothing wrong in product strategy, just launched early
“Eventually I decided they did nothing wrong. They were just too early.”
Insight
Levchin: Social web behavior is driven by the seven deadly sins
“If the world of the internet becomes suddenly very social, there are all these humans that are emotional. What will they do? What will they need? They're all going to just follow the seven deadly sins because that's what humans do. We're all wired to transgres…”
Insight
Levchin: Valuable things are hard, but hard things aren't always valuable
“Hard is not always valuable. Valuable is typically hard, but the inference doesn't work the other direction all the time.”
Insight
Levchin: Traditional credit companies treat solvent late payers as revenue opportunities
“If you are, what's in the industry is evocatively called a sloppy payer, which is someone who generally pays their bills, but are almost never on time. The normal financial industry behaviors say, great, you're a fantastic revenue opportunity. You have the mon…”
Insight
Levchin: Capitalizing on luck requires relentless grinding and compromising work-life balance
“And what do you do after, once you see one of those, have one of those, it does come down to work ethic and just willingness to grind and, you know, sleep less and Compromise things like work-life balance, which have their own consequences. It's not free, and …”
Assertion Not checkable as stated
Reid Hoffman's advice on securing assets sparked PayPal's electronic wallet pivot
“Reid was one of the more prescient
Grains who was sort of like, hey, you can secure other things. Maybe you can like secure invoices or secure IOUs or, you know, secure something that kind of is valuable in and of itself. And that kind of pushed us close enou…”
Insight
A 50/50 equity split caused the bitter internal battles at PayPal
“And then you merge, and it's a fifty-fifty merger, which means just no one knows who won. And that's, by the way, sort of the root of all complexity at paypalx.com story is that because we sort of settled on this, well, there's not really a senior partner. Equ…”
Assertion Not checkable as stated
Early PayPal screened against frat culture in favor of rigorous intellectual debate
“One of the interesting accusations that sometimes is leveled against the early PayPal crew is that it was this idea of a frat culture. It's actually quite the opposite. You know, if anything, we were screening against this idea of sort of a self-righteous, pri…”
Assertion Not checkable as stated
Levchin: PayPal had an intensely combative, truth-seeking culture
“PayPal was this unbelievably combative Kind of a truth-seeking, by any means necessary, almost, culture.”
Insight
Levchin: Entrepreneurs realize their true nature when following others' rules
“For an entrepreneur, you get reminded you're an entrepreneur when you're not trying to run a company the most. You start realizing that sort of rules are written and you kind of have to follow them because you're in, in someone else's backyard.”
Assertion Supported
Levchin: Reid Hoffman was running failing SocialNet while on Confinity's board
“He was a board member of ours, and he was running this company called Social Net, I think it was called, and it was failing.”
Insight
Levchin: Mobile payments must be easier and faster than cash and cards
“And if it's not easy, it's just not going to work with money. Money works pretty well when it's in paper form and it works Really well when it's a card form. So if you're trying to push it into an application or into a mobile device, it better be easier and qu…”
Assertion Contradicted
PayPal lost tens of millions per quarter to fraud in mid-2000
“And so by mid June, I think I was starting to sort of become aware of the fact that we're probably losing tens of millions of dollars to these fraudulent activities per quarter.”
Opinion
Levchin: Elon Musk is great to debate because he is always rational
“He has an engineer's mindset. So for an engineer, which I certainly am, it's a great person to agree or disagree with because it's always rational.”
Opinion
Levchin: Peter Thiel has an unbelievable ability to predict market crashes
“Peter has this unbelievable ability to sniff market crashes in the air as they approach.”
What-if
Levchin: eBay Should Have Won Payments Race Against PayPal With Billpoint
“And so it was kind of a race, which they should have absolutely won because they had a Product that was supposed to do what we did that they owned, that could be built in, that, you know, could be promoted much, much, much better than we could.”
Insight
Levchin: Founders Only Get Scared Once They Have Something to Lose
“Once you get some barnacles of good life on you, that's when you start getting scared until you have something to lose. It's not that scary to be in this permanent concern state.”
Assertion Supported
Levchin: eBay Offered to Buy PayPal to Stop Its 2002 IPO
“Right as we filed to go public, they came in and said, Hey we'll we'll buy you. Don't go public. And we said no.”
Disclosure
Levchin offered $1M on a whim to fund Yelp at inception
“And entirely on a whim, I basically said, I will buy as much of this company as you'll sell me for a million dollars.”
Assertion Supported
Levchin held 11% of Yelp at IPO and significantly more initially
“By the time of the IPO, yes, but in the moment it was much more since there was really nothing.”
Assertion Supported
Levchin: Slide was the seventh largest web property at its peak
“That's right. I remember noticing that we were something like the seventh largest property on the web.”
Max Levchin