Valon's CEO Sold $100M Without a Sales Team. Now They're Building a Multi-Billion Mortgage Platform

Summary

Podcast Summary: Fintech Leaders

Host: Miguel Armaza
Guests: Andrew Wang (CEO) & Linda Du Cindy (COO), Valon
Episode Title: Valon's CEO Sold $100M Without a Sales Team. Now They're Building a Multi-Billion Mortgage Platform
Date: October 28, 2025

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Episode Overview

This episode dives into the journey of Valon, a fintech company transforming U.S. mortgage servicing through founder-led sales, infrastructure innovation, and pragmatic adoption of AI—without any formal sales or marketing team. CEO Andrew Wang and COO Linda Du Cindy unpack their unconventional strategy, share war stories from building an operationally intensive fintech startup, and reflect on broader lessons for company building in a changing economy and technological landscape.

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Key Discussion Points & Insights

1. Founder-Led Sales & Breaking Conventional Wisdom

• No Sales or Marketing Team:
  • Valon reached over $100M in annualized revenue exclusively through founder-led sales.
  • "Our largest enterprise software contracts will be 100 million plus in ACV and we have no sales team, no marketing team." (Linda Du Cindy, 00:00)
  • Andrew personally led all sales for years: "We did founder-led sales from the beginning to the end and we're going to build a billion dollar annual revenue business doing founder led sales." (Andrew Wang, 00:23)
• Pipeline without Branding:
  • Even before naming their product (now Valenos), they had massive inbound interest.

2. Building in a Heavily Regulated, Tough-to-Enter Industry

• Manual, Gritty Early Days:

  • The founders did the kind of non-scalable work that builds deep organizational knowledge and regulatory moats—personally servicing thousands of loans, navigating arcane licensing hurdles, and hustling to get their application packages delivered in person to regulators.
  • "We have serviced thousands of loans by hand and we know exactly how to do it." (Andrew Wang & Linda Du Cindy, 13:11-13:28)

• Catch-22s and Moats:

  • Early regulatory requirements created a daunting but defensible entry barrier.
  • "All of these catch 22s are just why mortgage hasn't been disrupted or innovated in the last couple of decades." (Linda Du Cindy, 10:42)

3. The Decision to Run Two Businesses in One

• Operating Company + Software Company:
  • Valon realized pure software wouldn't sell in an industry plagued with legacy problems and skepticism; they had to become a world-class operator first to prove their system.
  • "We've somehow decided to build two companies instead of one company." (Andrew Wang, 15:46)
  • Only later could they focus on licensing their software to others, including competitors.

4. Turning Crisis into Profitability

• Changing with the Funding Climate (VC Winter):
  • When venture funding dried up end of 2022, Andrew and Linda pivoted to radical efficiency, cut hiring, monetized all possible flows, and prioritized profitability over endless growth.
  • "Andrew and I looked at each other... we will die as a business if we keep going down this path." (Linda Du Cindy, 24:44)
  • The business transformed from high burn to "printing money," leveraging LLMs and process refinements (27:41-27:58).

5. AI, LLMs, and a Technological Pivot

• ‘Six Year Overnight Success’:

  • They credit a six-year grind for what now looks like ‘overnight’ success.
  • "Internally we say we're the six year overnight success." (Linda Du Cindy, 17:40)

• AI/Navigating the Future:

  • December 25, 2024 ("when O3 came out") became a pivotal moment for embracing LLMs at scale.
  • "When O3 became a thing, it was clear we were going into hyper growth and scale mode with respect to LLMs... We needed to make the decision of how fast we were going to become a software company." (Andrew Wang, 29:18-30:54)
  • Embedded AI thinking throughout infrastructure: “All of our infrastructure... was done with AI in mind and really thinking about what would a LLM native operating system look like.” (Andrew Wang, 32:28-34:23)

6. Org Design in the Age of AI

• Lean, High-Agency Team:
  • Productive teams are smaller; orgs will focus energy and incentives on high-agency, LLM-skilled talent.
  • “High agency, context, and skill with LLMs are going to be 10, 20... X more productive.” (Andrew Wang, 38:19)
  • AI skills are codified in performance reviews. (Linda Du Cindy, 37:28)

7. Choosing New York Over San Francisco

• NY proximity to clients trumped West Coast tech ‘power law’ logic.
• “We've always kind of zigged where others have zagged... I’m really happy that we chose New York.” (Linda Du Cindy, 44:02)

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Notable Quotes & Memorable Moments

• On Moats and Pain:
  • “All of this is just you’re creating moats for yourself... Anyone who wants to do this after us would have to go through the exact same pain and suffering.” (Linda Du Cindy, 13:35)
• On Company Naming:
  • “We were just coming up with different words... Eventually I just decided I'm going to go look up a random book... Wheel of Time... there's a location... Tar Vallon... and so that's why we picked the name Valon.” (Andrew Wang, 06:12)
• On Efficiency:
  • “Our job is to make the hard decisions and basically recognize, hey, we need to do something very extreme here. And so number one focus at that point became profitability, efficiency.” (Linda Du Cindy, 24:44)
• On the Founder Operating Dynamic:
  • “If you look at my career, it will actually look like I spent my entire career following this man around... He was kind of, as a side project, making sure I had exactly the right skill set to partner with him on building this company.” (Linda Du Cindy, 02:45)
• On Venture Capital & Company Building:
  • “Most founders don't realize that when they enter the business of venture that they're making a very clear decision of whether they're building a business or they're building effectively a lottery machine.” (Andrew Wang, 45:05)
• Sounds Like a Lie:
  • “Our largest enterprise software contracts will be 100 million plus in ACV. And we have no sales team, no marketing team.” (Linda Du Cindy, 46:11)
• On Not Reinventing the Wheel:
  • “We decided to innovate on compensation... and it was horrible... Be really thoughtful about where you innovate.” (Linda Du Cindy, 47:03)
• On Impact:
  • “Mortgages impact, I think, 80 million plus homes in the U.S.... and today they still run on technology invented before the internet was created.” (Linda Du Cindy, 19:33)

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Timestamps for Important Segments

• Founders’ Non-Linear Career/Recruitment Story: 02:31–05:36
• Origin of the Name ‘Valon’: 06:10–07:13
• Manual/gritty workarounds in the early days: 07:28–13:35
• On regulatory moats/catch-22s: 09:54–13:11
• Strategic pivot: Operating company + software company: 14:48–18:20
• Profitability shift post-VC winter: 24:44–28:23
• AI and O3 as an inflection point: 29:18–31:58
• How to retrofit AI into a company: 32:28–34:23
• Org design and the impact of AI: 38:19–40:15
• Building in New York vs. SF: 43:33–44:48
• Rapid fire advice/lies/genius missteps: 45:05–47:45

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Rapid Fire Advice & Lessons

• Unpopular Advice for Founders:
  • Be clear if you want to build a business or play the VC ‘lottery’—they require different approaches. (45:05)
• On Edges:
  • “You just have to know what your edge is and then double down on that.” (Linda Du Cindy, 45:45)
• On Mistakes:
  • Innovate where it matters; proven solutions often trump theoretical ones for general problems like compensation or CRMs. (Linda Du Cindy, 47:03)
• Leaders they admire:
  • Ali at Databricks (clarity, principle-led decision-making).

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Takeaways for Builders & Operators

• Founder-led sales can disrupt conventional wisdom—deep domain knowledge and authentic credibility matter in regulated industries.
• Don’t underestimate the value of building operational (and regulatory) moats through painful early work.
• Changing funding climates demand fast, decisive pivots—profitability and control are sometimes more important than growth at all costs.
• Embedding modern AI capabilities isn’t just about tooling; it’s about rethinking org design, expectations, and performance management.
• Build where your customers are, not just where the playbook says you should.
• Surrounding yourself with experienced, trusted advisors and operators is critical, especially in sectors like fintech.

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Hiring note: Valon is hiring!
Episode tone: Pragmatic, candid, and bracingly first-principles in both the technical and organizational domains—mixing industry-specific grit with a clear-eyed, modern approach to business.

Transcript

[Linda Du Cindy]

Our largest enterprise software contracts will be 100 million plus in ACV and we have no sales team, no marketing team.

[Andrew Wang]

December 25, 2024, which is when O3 came out, it was clear that we were going into hyper growth and scale mode.

[Linda Du Cindy]

With respect to LLMs internally we say we're the six year overnight success.

[Andrew Wang]

We sold over 100 million of recurring revenue in contracts for the original operating business with basically just me as the key salesperson. We did founders led sales from the beginning to the end and we're going to build a billion dollar annual revenue business doing founder led sales.

[Linda Du Cindy]

We had gotten all of this advice, you hire people to do more work. We did that. By end of 2022 it was basically VC winter. Andrew and I looked at each other and we were like no way. This is actually very not okay. We will die as a business if we keep going down this path.

[Andrew Wang]

When we APPL our license, it was just before COVID happened, I realized if I don't make sure that they have all the materials, nobody's going to accept materials anymore. I ran down to the mailroom and I actually went to go find the package for them because they told me they couldn't find it.

[Miguel Armasa]

You know one joke I heard is Fintech's biggest success has been rebranding back office to fintech. Welcome to Fintech Leaders. I'm Miguel Almasa and I'm fascinated by the company's reshaping financial services which is why I co founded Gilgamesh Ventures, a fintech fund where we have backed almost 50 fintech companies worldwide. And over the last five years I've recorded over 350 conversations with the top leaders in Fintech to extract how they think, what they've learned and insights that can be helpful to builders in fintech. Today I sit down with Andrew Wang, CEO and Linda Du Cindy, COO of the infrastructure platform Transforming mortgage servicing in America. Valen now operates almost a million mortgages and has crossed over 100 million in annualized revenue. They are backed by Andreessen Horowitz, Jefferies, Westcap, Ali Corp and many more. It's official. Andrew, Linda, thank you for joining Fintech Leaders. And it's always extra special when we do it in person as opposed to remotely that we canceled remotely last week. So thank you for spearheading that.

[Linda Du Cindy]

We're excited to be here.

[Andrew Wang]

Yeah, thank you for joining us.

[Miguel Armasa]

Linda, tell us, how did Andrew convince you to leave a bunch of really good places? Tell me if I'm wrong. Google, Goldman to Sigma. I've heard of those Places, Yes.

[Linda Du Cindy]

So I'll. I'll tell you the funny story, and then I'll preface it by saying that in our group chats, we actually call Andrew Nostradamus because he's always 10 steps ahead of everyone else. And so we were actually friends in college. We both studied computer science, and Andrew was one year ahead of me. So he basically did everything first. And if you look at my career, it will actually look like I spent my entire career following this man around. And so he interned at Google as a software engineer. Next summer, I interned at Google. He went to Goldman Sachs. Next year, I went to Goldman Sachs, he went to a fund. Next year, I went to a hedge fund. And basically, it was always the same pattern. So he would call me out of the blue and he would say a bunch of words that were very convincing, sounded incredibly smart about, hey, this is very obviously the only next career move that you can make. And then I would go and make it. And then finally, when I was at my last fund, he called and he was like, hey, I have this great idea. It's time for us to build a company. And the rest has been history since. But back to the 10 steps ahead, basically. He's never actually confirmed my suspicion here, but I suspect that 10 years ago he knew he wanted to start a company someday, and then he just was kind of like, as a side project, making sure that I had exactly the right skill set to partner with him on building this company.

[Andrew Wang]

I cannot deny or confirm.

[Miguel Armasa]

Why Linda?

[Andrew Wang]

Why Linda? That's a really great question.

[Linda Du Cindy]

Thank you, Preston.

[Andrew Wang]

I think when you think about who you want by your side, the most important thing, and there's a couple of phrases that people have used over the years. The most recent one is David Haber says something called Safe hands. Effectively, the concept is you can trust a person with, you know, whatever you entrust them with, Right? And usually there is, you know, at least a couple of categories of things that you can trust someone with. But the hardest thing to find and the thing that you're really looking for when you're trying to build a company is someone who you can trust anything and everything to, number one. And then number two, what you're also looking for is someone who can continue to grow alongside you, right? Because someone who can do those two things will be able to grow with company and grow with you as you mature as a leader and being able to have that person alongside. So you can talk about what happened in the past, how you are thinking about it in the future. Those things are so so important in terms of the development of a company and even more so for the type of company that we run today because of the fact that we are so long term thinking minded. If you're running a company that's so much short in terms of its horizon, you're like, I'm just going to build this thing for two years, it might be okay. But if you're thinking the way we think, which is 10 years, 15 years, 20 years, well, you have to find the people who are able to go along with you in that journey.

[Miguel Armasa]

I think it also extends in your personal relations. Right. I think that one of you might have introduced the other to.

[Linda Du Cindy]

Yeah. Andrew's now fiance, soon to be wife was actually my year in school as well.

[Miguel Armasa]

Okay.

[Linda Du Cindy]

And so we've got all sorts of fun connections.

[Miguel Armasa]

Let's, let's talk about Vallon. Is that how you pronounce the name of the company?

[Andrew Wang]

That is correct.

[Miguel Armasa]

All right.

[Andrew Wang]

Often confused.

[Linda Du Cindy]

That was good. We've gotten a lot of balloon.

[Miguel Armasa]

The balloon's actually pretty fun. Well, you want it to fly high.

[Andrew Wang]

Yeah, exactly.

[Miguel Armasa]

Exactly.

[Linda Du Cindy]

That's right. That would have been a good origin story.

[Miguel Armasa]

Yeah. Where does the name come from?

[Andrew Wang]

So the story in a very valent way is we originally wanted a name that one, we can find the.com domain for two, it had at most two syllables. Three, it was something that didn't have any prior association with anything. So you can know that it's a clean new brand. And so we were just coming up with different words and whatever else. The company was hotly debating what we should use as a name or not. Eventually I just decided I'm going to go look up a random book that I read as a kid. The book in the series is called the Wheel of Time. I don't know if you've heard of it, it's on Amazon as a TV series these days. But there's a location that's very central to the book which is basically the center of the world where the all truth seeking members of the society are. And that location is called Tar Vallon. And so that is why we picked the name Valen. Because not only was that domain available, nobody else had a counterpoint as to why we shouldn't pick it. And thus we were able to get people to decide.

[Miguel Armasa]

And now you're trying to build the center of your world.

[Andrew Wang]

Exactly. That was actually the idea which is like, oh, this is kind of cool because it's like we are the center of the world. We're the center of the information. This is where everything passes through and

[Linda Du Cindy]

the trademark was available.

[Andrew Wang]

Yes, very important.

[Linda Du Cindy]

Very important.

[Miguel Armasa]

So you hear the stories of founders doing things that do not scale. We talked a few weeks ago and you told me a story how you were very hands on doing a lot of manual work the first year or two. Right. Especially well into the night. You had a lot of late nights for months or maybe years share those initial days. The stories of doing things that do not scale.

[Andrew Wang]

So I'll start. But Linda has plenty and we often had to split the work between the two of us. But there's the category of things where you're doing things that you just could not normally imagine. Right. So I'll give you a couple examples here. The first is when we first started the business, we needed to get some licensing and some approvals. And the only way to get a California approval was you needed to have an existing license with the Federal Home Loan Association. And that's quite difficult to get when you have no loans and you have no history and you have no track record. There was a carve out or another way to run around that regulation by saying, I'm going to go get a department of Real Estate broker license which does allow you to still make mortgage loans and service loans in California. And so we then scrambled around looking for who do we know who's a family friend who actually is available as a real estate broker. So we could use them as our license and basically they'd have to join as a company employee. And it turned out after looking through as many people as possible, one of my co founders at the time, his long lost cousin who was estranged, was a real estate broker. And the weird part was my parents were friends with them, but his parents and his family was no longer really close with his cousin. And so we reunited them and said, do a solid for your cousin. Please be our registered individual. And so that's actually how we got that license. So there's a lot of these type of stories. But I'll give you another fun one, which is you are required when you report to the credit agencies to have a track record. They want to know that you have made some loans. Well, we're in the business of making mortgage loans. They want at least 50 to 100 sample set numbers to basically look at. That's a lot of money because the average mortgage loan is a couple hundred thousand dollars. We're not going to make 100 mortgage loans before we can report to the credit reporting agencies.

[Linda Du Cindy]

And nobody will give you 100 loans to service if you can't report to the credit agencies.

[Miguel Armasa]

It's a cash 22.

[Linda Du Cindy]

Yes, exactly.

[Andrew Wang]

All of this is. All of this is a cash 22. And what we ended up doing was we then said, okay, well what should we do in order to be able to have 100 loans service? Well, we're going to have to originate our own loans. Well, it turns out you also need licenses to originate these loans, which we did not have. We found which states actually had exemptions for small loans and then went out and gave loans to a bunch of friends in order for us to be able to report 100 loans and show we had 100 loans. And so we went around all of this exercise and all of this effort in order to be able to report to the credit reporting agencies, which then in fact would allow us to actually go and get licensed and work with different large counterparties who then finally said, okay, fine, you have the minimum bare set of requirements for us to work with you.

[Linda Du Cindy]

And I would say all of these catch 22s are just why mortgage hasn't been disrupted or innovated in in the last couple of years or last couple of decades. I should say. Even just getting licensed was such a journey, I think. Andrew, you had to literally rescue our DFS application.

[Andrew Wang]

Yes, this was another fun one, which is. So the New York dfs, who is a very regulated institution, actually is known to take probably two to three years in order to approve an application. And one of the things that one of our big clients required us to do was go get New York approval within a certain time frame. And so when we started the company, we were rushing to get that application in. And they're extraordinarily detailed and meticulous about having all of the requirements. And if you file all the information but you don't meet the deadline, they reset your clock and they reset how your application works. Well, when we applied for our license, it was just before COVID happened. And so we had sent in the application, but because Covid had happened, I realized if I don't make sure that they have all the materials, that nobody's going to accept materials anymore. And so what we ended up doing is we. I ran down to the mail room where the DFS was located, so 1 State street down in Phi Di, and I actually went to go find the package for them because they told me they couldn't find it. And I was like, I'm going to make sure one way or another, because

[Linda Du Cindy]

I have physically they will receive.

[Andrew Wang]

They must get this.

[Miguel Armasa]

How do they let you in?

[Andrew Wang]

Oh, no, I Like, just sat there for, like, two hours in front of the lobby and said, hey, I need to do this, I need to do this. I'll call, like, let me show you the information. Eventually they, like, actually sent someone back to go look for it. And then they were like, oh, we found it. We just, like, misplaced it. And I was like, thank God. I mean, also, what the heck? But I literally sat for two hours in the lobby, constantly harassing the front desk because I was like, I need this application in because I don't know if I'm coming back in the near future.

[Miguel Armasa]

And how about. I mean, you didn't have a system to process all of this.

[Linda Du Cindy]

Yeah. So so much of it is building the plane while flying it. And so I remember when we boarded our very first loan onto the system, Andrew and I sat there, I think, for three hours, and we literally mapped every loan field, every document in a spreadsheet so that we could manually load it into the system. And the only way to build something like this is if you do it yourself for a while, because there's so much detail, so much nuance, so many edge cases. And so really, Andrew and I, I think, have manually, personally, by hand, serviced, I think, hundreds and hundreds and hundreds, perhaps thousands of loans.

[Andrew Wang]

Thousands of loans, actually, which is a very, like, scary thing. And it's actually today, funnily enough, a selling point, because when we tell our clients, you should use our software and, you know, you should go work with us in these different ways, we can actually tell them if it goes wrong. We have serviced thousands of loans by

[Linda Du Cindy]

hand and we know exactly how to do it.

[Andrew Wang]

So, you know, we are going to be able to get this done. You build the credibility 100%.

[Linda Du Cindy]

And also what we always tell the team and honestly, what I tell myself at midnight when this is happening is all of this. It's just you're creating moats for yourself. Right. It's like anyone who wanted. Wants to do this after us would have to go through the exact same pain and suffering.

[Miguel Armasa]

Yeah, yeah, exactly. The regulation, the regulatory moat, the knowledge.

[Linda Du Cindy]

The knowledge.

[Andrew Wang]

The different, like, things that you have to go through just in order to get started as a business.

[Linda Du Cindy]

I repeat, the pain and suffering.

[Andrew Wang]

Yeah, that part's really, really not everyone's. It's actually one of the things that I jokingly do whenever I talk to both investors and counterparties is say, hey, we can sign the NDA. But I honestly don't mind that much because I know there's no way you're going to be able to do this, it's pain and suffering. It's just time. Pain and suffering. Are you going to go through it? Probably not. So I think I'm going to be okay. It's not a singular idea. It is the manifestation of all of this work and effort and planning and really, really thoughtful work by us and the company and the team.

[Miguel Armasa]

Speaking of pain and suffering, didn't you have two year buildup and then kind of switched a little bit the focus from what it was at the beginning? Or were you kind of dead set on what the product eventually became from day zero?

[Andrew Wang]

Yeah. So the interesting thing is people don't realize this from the outside in. And this is a constant question from candidates who interview with the company. But we've always been under the philosophy and really mission of building software for this space. Our original C decks, the original company name was actually not Valen, it was Go Service 1. It was a joke on Ready Player One. But the idea was it was a system for servicing. The problem with this because we started the business where we said, okay, great, we're going to build the system. We have a vision on how we're gonna get this done and what it's gonna look like. Well, nobody's gonna use your system, right? You have this super regulated, highly complex just came out. The great financial crisis industry who looks at all these guys trying to build this system and says, okay, not only do I have zero trust in you, like what do you know about this industry and what you're doing? Sure, you look like you're smart guys, but you need proof also. We've also spent hundreds of millions of dollars trying to improve these systems and we've fantastically failed. So we not only do not have trust in you, we don't have trust in ourselves. So how are we going to get comfortable with all of this? And so pretty quickly, I'd say three months to six months within the journey, we realized we're not going to be able to just sell software to these guys right off the bat. We're going to have to do it the hard way. We're going to have to do it in a way that it's undeniable the value that we're creating. And it's undeniable to them that we know what we're doing. What that meant was the, and the obvious answer we came to was we needed to build our own operating system and operating servicer alongside that to demonstrate to everybody that that software system not only works, but is so much better than everything else out there that they have to pay attention to us. Now when you, you have to think about this for a moment. You've decided to sell a software system or that's your goal, but you now are deciding to pivot into building an entirely separate company and saying, this company's sole purpose is to show that my software system works so that I can do my other company. And so think about it as saying we've somehow decided to build two companies instead of one company. And building one company is hard enough, but you're going to do two companies. And by the way, two companies in very different domains. It's the same subject matter, but it's a very different expertise. Right One's an operating company, it's about running operations, it's about processing, it's about, it's about performance management. So all these different things, the other one is a true software company and we needed to somehow be good at both. But the reality for us was we knew there was no other way we were going to get this done. We needed to learn, we needed to build the systems, we need to go through all of that. And so we were going to do both of these things and we were going to figure it out and we're going to do it in a best in class way. And so that's what we set out to do six years ago at this point. And we've slowly but surely gone along that journey and we're now, I think back to phase one.

[Linda Du Cindy]

In some sense the joke is internally we say we're the six year overnight success.

[Miguel Armasa]

Did you ever consider just focusing on being the servicer and just forget about the software?

[Andrew Wang]

Definitely. We thought about that.

[Linda Du Cindy]

Every year we would revisit this conversation.

[Andrew Wang]

I mean, in the beginning it was not as much of a conversation because both seem hard and nothing was not obvious. But as we became a much more successful and more efficient and proven servicer, where, and if you look at where we are today, we are, you know, industry leading, best in class, almost a slight incumbent in some senses now, right?

[Linda Du Cindy]

In terms of officially top 10, top

[Andrew Wang]

10 in the country, serve a million ish homeowners, you're at that size and scale where everybody knows you, you're not, you don't have to fight the hard battle. But whenever we look at that and we ask ourselves, well, what do we set out to do? We have to be true to ourselves. We set out to build, servicing and we are here to solve this problem for the industry. If we do a servicer, we will make a very profitable and very interesting business. But we won't actually go solve the underlying problem. And that was the philosophy. At the end of the day, what also turns out to be true, that we then recognize later on, is that two things actually. One, if you're going to do it and it's going to be that hard, you might as well shoot for the moon. You might as well do the biggest 10, biggest enterprise value creation thing possible and the greatest impact possible. But separately and secondarily, but also just as importantly, if you build a company and you are aiming for not such a great goal, people don't really want to work with you, people are not as interested. And so in some senses it's actually, it's just as hard, but it's easier. And you can bring on and convince and really galvanize your company going for the hardest things versus a answer in between.

[Linda Du Cindy]

And it's honestly a pretty crazy thought, which is mortgages impact, I think it's 80 million plus homes in the U.S. they underpin 13 trillion of consumer debt and today they still run on technology that was invented before the Internet was created. That is a crazy thought. And then something that we always tell the company is actually if we weren't working on this problem, literally nobody else is. There's actually nobody else out there trying to do this.

[Miguel Armasa]

And so talk about the different muscles, you kind of alluded to that. But one is a servicing company. You're selling to a very different client and then you go and you start selling software to your competitors.

[Andrew Wang]

Yes.

[Miguel Armasa]

Are you now trying to grow both or are you mostly focused on the software and you want to kind of keep the servicing bau, not hyper growth? Yep, sure about it. Because it's very interesting, you essentially have two businesses in one.

[Andrew Wang]

So we are definitely today focused on the software side and that is by far and large 100% of both. Linda, my focus in terms of what we do day to day as well as the majority of the company, we do have a, like Linda said, Top 10 large servicer in the country. We can't just like drop the ball on the homeowner. So you know, there is a team that continues to run it and operate it, but it's not something to your point that we're looking to go through the hyper growth that we did in the past. The software part is definitely the biggest focus.

[Miguel Armasa]

So I was actually talking to a couple of your board members about this interview and Brian McGrath, who actually introduced us, suggested that we talk about your approach to branding and naming your products. I think there's a story there Brian names our products.

[Andrew Wang]

I was about to say this is why I suggested you ask her because

[Linda Du Cindy]

I am but I think what he has been very astonished by. So Brian was on our board from the very beginning, recently joined us full time, has been so great, so excited about the business that we're building. He has been astonished that we have no sales team, no marketing, no branding. We actually did not have a name for the product until he mandated, you guys need to name the product. And with all of this right now, if you look at our software sales pipeline, I think it's like what million in ACV of people who want to sign up for the software and all of that with no marketing, no sales, no branding and we just named the product. The product's name is Valenos.

[Miguel Armasa]

Really innovative idea or naming OS is operating system.

[Linda Du Cindy]

Yes, exactly.

[Miguel Armasa]

How did you think about marketing and branding say pre Bryant I would say

[Linda Du Cindy]

the mortgage industry is a very practical, functional industry. It's not an industry where they really care about how cool the product is. It's really about economic value that you can generate. And so the best marketing for our software is actually our operating business because we can show that we basically took something that's usually a low single digit break, even sometimes net losing money business and turn it into something that is 70% plus operating margins. And that is the number one thing where a servicer looks at that and says hey, whatever they have, I think existentially I need to have as well.

[Miguel Armasa]

Yeah, forget about the name. I just forget about the name. I need the product.

[Linda Du Cindy]

Exactly.

[Miguel Armasa]

I guess that's interesting because it's just about knowing who you're selling to.

[Andrew Wang]

Right.

[Miguel Armasa]

I mean direct to consumer products. Obviously naming important, branding important here, very, very different. Can you kind of share a little bit of your go to market motion? What did you learn in the process? How does that team look like?

[Linda Du Cindy]

Yeah, so I think this is part of what Andrew was referring to, which is building these two companies has actually been two totally different sets of muscles. And when we finished building, not finished, but once we had kind of figured out the operating business and we started figuring out how do we go to market as a software company. I think there's a moment where Andrew and I looked at each other and we realized we have no go to market motion at this company. Actually the entire way that we scaled the operating company is Andrew and I would fly around the country looking for loans to go get and so nobody, not, not a single other person at the company had to think about go to market. And so when we Started on the software side. Honestly, we kind of took the same approach. Andrew and I and now Brian fly around the country and we talk to the biggest to mortgage companies and we basically tell them, hey, these are the results that we've achieved with our own operating business. This is the value that we think we can deliver to you guys. Do you want to do this with us or not? And then we've started building really a deployment organization. So it's about delivering the software more than it is about selling the software.

[Miguel Armasa]

Something that obviously has become very important the last three years is not just profitability but efficiency. And you had a turnaround there, right? You went from high burn to a very different story. Was there a wake up call?

[Linda Du Cindy]

So if I take you back to 2022, what was happening is our operating business was growing a lot. I think it was 100xing, 10xing basically year over year. We had gotten all of this advice from all of these really great people saying, hey, you've now hit what's called growth stage. And in growth stage you hire people, you hire people to do more work. You hire senior people who have scaled companies before. You just hire, hire, hire, and then the growth kind of continues, follows. This is like the classic venture playbook. And so we did that. We're first time builders. And so we were like, okay, all of these really smart people are telling us that we should do this, let's go do this. If you remember, in 2022. So we had raised, I think around mid 2022. And then by end of 2022 it was basically VC winter. No more funding, harder to raise money. The bar had been raised in all of these different ways. And all of a sudden cash was king. And so all of the really great senior people that we had hired into the business, they were all like, this is fine, we're in growth mode. This is what you're supposed to do. This burn is a. Okay actually to be expected. If you're not burning money, it means that you're not investing in growth. Andrew and I looked at each other, we looked at the numbers, we looked at the funding markets and we were like, no way. This is actually very not okay. We will die as a business if we keep going down this path. And so, you know, it's one of those moments where our job is to make the hard decisions and basically recognize, hey, we need to do something very extreme here. And so number one focus at that point became profitability, efficiency. How do we take this operating business that we've scaled and actually Turn it into a cash printing machine. And how do we do it in a way where we basically have as much control as possible over the outcome? Because if you are in sort of do or die mode, you always want to bet on something that you can control and execute against versus, like, you know, we could have decided that we're going to be a lending company because lenders make money, but then we'd be making a bet on rates. And so we looked at basically every facet of the business and we, we saw one. We're moving billions of dollars a day. People have made money moving money. And so we figured out how to monetize, float. We figured out how to monetize all of the disbursements and transactions that we were doing. We looked at our lending business and we knew, hey, people have, you know, an originations. Business makes money. Like in its simplest form, it makes money. Our team was working on all sorts of fancy projects that were very, you know, great for the long term. And we basically looked at them and we said, no, your number one job is to turn this into something that prints money, money. And so everything else we don't care about, just get more efficient at targeting, just get more efficient at conversions. And then the final thing is when LLM started becoming a thing, we looked at all of the labor costs that we were running and we basically, one by one, just started llming them away.

[Miguel Armasa]

How has that worked out?

[Linda Du Cindy]

Great. We are printing money now.

[Andrew Wang]

It's like we've grown our engineering team. I think the number of hires we made this year is equal to the last two to three years combined. It was some crazy number.

[Miguel Armasa]

And you're much bigger and we're much bigger.

[Andrew Wang]

But when it comes to the actual expenditure versus the revenues that we're bringing in, it basically hasn't moved. And that's just because the company and the operating company grows. And that is just as a function of the fact that, you know, we've grown to a certain size. We have great partners, they're very supportive of us, but it just makes so much money that it covers all these costs and lets us pursue relentlessly the goal of building the software company in this space.

[Miguel Armasa]

I think it's very interesting and I hear this story right from many companies. There are some companies, let's say late 22 or early 23, that made the hard decisions, made the cuts wherever they were necessary. And the best ones, fast forward now we have data. Three years later, many of them are thriving. Not all, of course, but many. And then I saw this Firsthand with a bunch of founders that I know they didn't make the hard decisions, which later turned into multiple rounds of restructuring and now they're not around. You kind of are in control of your destiny sometimes. And there are those points. What other decision points kind of can you recall that have been crucial right when it comes to Bill in the company? What are those moments that you think back, you're like, damn, that was an important decision.

[Andrew Wang]

This is something people probably don't immediately suspect. But December 25, 2024, which is when

[Linda Du Cindy]

O3 came out, also Christmas, I would just like to say for the point

[Andrew Wang]

of the story, that was a pivotal moment where it was just so, so clear to the company. Like, I had already been interested in looking at LLMs and, you know, writing different sort of case studies of how we can use the technology. You know, there's obviously optical recognition and using alarms to do it instead. But when O3 became a thing, it was clear that we were going into hyper growth and scale mode with respect to LLMs, which if you just plotted the graph one way or another, would result in the world looking like one of two things. But both versions were clear in terms of what we need to do. You could look at the world in terms of there's going to be all this investment. You're going to have these models that are very powerful. They might not become AGI, but they're still very, very powerful. And people debate what AGI is. And in that version of the world, they are very important. The operating system layer of the world is really important. Those are the two worlds important. The other version of the world is AGI solves all world hunger and problems, whatever else, in which case our business questionable what you should be doing. But in both cases it was just obvious one way or another, given how test time compute and how the scaling factors were working and reinforcement, learning and all these different aspects were clearly showing results and didn't have any clear degradation that was going to prevent it from getting to at least that scale. We needed to make the decision of how fast we were going to become a software company. Because if we waited, and I think people believe this, if you waited five years, well, it's quite possible that a lot of the work in this space, not just our space, all work would be automated away. And so if you are building a type of business like we are, if you're not fully the operating system layer for all of these LLMs, you will get squeezed in between the operating system and the foundational model companies. So you have to very quickly decide, am I going to be one or the other? We're clearly not going to be a foundational model company. We were starting to enter our journey of becoming a OS company, but we need to get there now. Not in five years, not in 10 years. You need to get there in one to two years because that's the only way you get ahead of that curve. And so that became a massive, massive pivot for the company because we just said, all hands on deck, this is what's going to happen. The first thing when we came back from Christmas and New Year's was AGI is coming. We had a presentation about it first thing after New Year's, AJ is coming. This is where we need to be. We're either going to get on board or we're going to get destroyed. We have to do this tomorrow.

[Miguel Armasa]

Related to this topic, something that has been discussed in a lot of boards and it's come up on, on this podcast a couple times, is it's easy to do that if you are getting started now because you're AI first, right? But even if you have three to five years of infrastructure there, inevitably there's going to be some retrofitting, some more than others, depending on your infrastructure. How did you approach this retrofitting?

[Andrew Wang]

We got somewhat lucky in this exercise. Part of it was because, as I sort of mentioned, our goal was always to build a software company. And when you're trying to build a software company in this space, there's a variety of different strategies. But the strategy we decided to produce Pursuit from the beginning was we were going to be very, very focused on the core infrastructure, that is money movements, ledgers, underlying system of record representations. And these are things that will not get outl meaning, yes, Stripe is today working with, I believe, chat, GPT and powering different applications. But the fact that they're moving money like code that literally calls the money movement, the ledger, transactions, whatever else, that is not going to be an AI piece of code, that's not going to be an agentic piece of software, that is going to be a deterministic call based off of a LLM calling it. And so because we were so focused this entire time on building this hardcore infrastructure to represent the world correctly and get the single source of truth representation done in the right way, when we started focusing on software, we had to go build all the infrastructure which would be the way that these APIs would be called. That is the way that LLMs would call this API. So all of our infrastructure, when it comes to Actually powering how all this work gets stitched together. That is calling the APIs. All that was done with AI in mind and really thinking about what would a LLM native operating system look like. And so for us, it's actually quite easy today. And we actually do this internally today of saying, hey, we're going to build all of our infrastructure in a way where it's very easy to slot in not just the usage of LLMs, but the eval set creation, the monitoring of it, the changing of how much you want humans to do versus how much you want LLMs to do. All of these things are things that we built honestly in the last 10 months. And so it's very easy for us to say, well, that's something we built with AI in mind.

[Miguel Armasa]

How should the modern. I know neither of you are CTOs, but still, how should the modern CTO be thinking about their org structure?

[Andrew Wang]

So the joke at the company is I'm not the cto, but I am jokingly called at the company the best, the most high business context Suite two because I joined different teams and I basically work as a junior engineer on each of our teams.

[Linda Du Cindy]

He started off as a suite zero and has been.

[Andrew Wang]

I've been promoted as I've focused on my skills and gone senior managers to critique me. Which is, by the way, just like a funny thing because I just love the dynamical set of the company where, you know, someone who's a senior engineer is like, the CEO is writing code and asking me to comment on it and tell me, tell, asking me, can you help me improve our code? It's a great culture and I love the fact that we can be so open with each other. But when it comes to your question around how should modern CTOs be thinking about the infrastructure? I think there's a couple of dimensions, right? There's a question of like one, what business are you in? Right? If you're not, again, in my mind, the foundational model business or the OS business, you should be very thoughtful about what part of your infrastructure is truly defensible, what part of your infrastructure and what part of your product suite is so difficult or painful to build that they're not just going to work around you at the end of the day and thus smush you as a piece of software. So there's like the business strategy component of IT and product component of it. From a personnel and talent perspective, I think there's a honest truth of how engaged are your teams and your people with the active development of LLMs. One thing that we had to do. And really what I spent a bunch of time initially doing earlier this year is sitting down with all of our engineers and showing them how you could use LLM coding, whether it be cursor initially, and then it became Codex and it became cloud code and all these like different, you know, LLM coding products. But it's a very active effort and it's a question of how fast you need to move. I think most people need to move really fast, but you need to spend that active time and effort really pushing the product and usage to your team and coming up with a ultimate long term strategy of how you're going to get everybody to use it and understand it the right way. Because the way you think about LLMs and the way you utilize it is very different than traditional ways of working. One of the things I talk a lot about internally is initially the way that people thought about LLMs is hey, it's a replacement for our ability to code and whatnot. Well, what they didn't consider is that usually the way people work is they actually think about the solution and then they write the code. And a lot of the thought process of what am I going to figure out is in the code writing. Well, if alums are writing all this code, then you don't really have that interim step of actually thinking about it. And so you do a lot more of the planning part upfront. And so it changes your work behavior, that changes how you actually go about things and you have to sequence it differently. And so these different ways of changing which are also changing on themselves. Well, you have to get your teams and your people to think this way because this will be a rapidly and constantly evolving equation.

[Linda Du Cindy]

And when you have a large organization already, so it's, it's, you know, we didn't start the company this year, so it's not that we could hire people in who are, you know, XYZ. We started with a team of already 100 engineers. And when you need to drive change and adoption, you really also have to figure out how to systematize it at scale. And so as an example, we've actually codified AI usage and skill as part of our performance reviews. And this is just something where you just constantly have to tweak the machine and how your company is operating.

[Miguel Armasa]

Super interesting stepping one level up. Not just the CTO organization, but an organization itself, a company. Do you think it's all that's also going to change how you think about organizational design or a lot of the kind of tried and tested models are still relevant.

[Andrew Wang]

There's a constant debate about what's going to really change when it comes to more powerful alums. I can do more work. There's a variety of different things, right. Because it's a, like I said, evolving space. But I think people are generally aligned with the fact that at the minimum, what's going to happen is people who are very. Have high agency, have a lot of context and have skill with LLMs are going to be, you know, 10, 20, whatever, X more productive than before. Right. And that changes the model, I think, for companies when it comes to who are you really prioritizing? Because historically, and this is a constant point of discussion, historically companies have focused on not just the, you know, as they used to call it, the 10x engineer, which is now much more common, but they would focus on the 10x engineers. But they would also be actively aware of the fact that they needed the 2x engineer, they needed the 1x engineer, because there's a lot of work to get done and you need to have all these people actually work on the product. That is also something that comes, by the way, because of the number of people you're hiring with the organizational attacks of management, all these different things. And so you have these pretty lack of a better way to put it, bloated organizations. And that's classic tech. What happens when you scale all those different things? Under this new paradigm, the number of people you need drastically reduces because of the fact that they can do more. Obviously, you can continue to grow that organization, but the rate at which you need to grow the number of people decreases dramatically. But that also means that your philosophies around the type of people you want, the longevity you need, all those different things, that in of itself also changes as well. And so we're talking about coding in this specific example. But that's not just coding. That's legal. Right. We historically have had a number of lawyers in the company. We basically have three today. And we've stayed with the three because as we have increased the workload dramatically, you're just going to see more and more of this, which means you're just paying more and really compensating people to be very good at this skill set in order to get the same amount of work done.

[Miguel Armasa]

As it relates to. Let's talk about kind of surrounding yourself with the right people, because I think we've talked how this is important for you. The composition of your board and your teams is never random. How do you think about the power of surrounding yourself with the right People,

[Linda Du Cindy]

I think maybe one of the best early examples is Tim Myopoulos, who's on our board. He actually used to be the CEO of Fannie Mae. And when we were first, you know, what we were talking about earlier with the chicken and egg. Chicken and egg. Fannie is, you know, one of the biggest, most important loan segments in the US and so being able to be approved by them is something where without Tim's high level guidance would have been really, really hard.

[Miguel Armasa]

How did you convince them to join?

[Andrew Wang]

The funny story is when I first met Tim, I did not know who Tim was. I got set up by a friend who had only just met Tim at a party, randomly on a lunch date. And I had not spent the time looking up who Tim was. And so I showed up, he's like, hi, I'm Tim. I'm like, I'm, hi, I'm Andrew. Just keep in mind he was a very well regarded, very like, you know, a thought leader, not just in mortgages, but in the financial ecosystem. People know who Tim is. Me, being clueless, didn't really spend the time thinking about this and I obviously should have, but Tim and I joke about this a lot. But we just spent an hour just talking about different things that we found interesting, things that we found remarkable and things that we're looking forward to. And that conversation became a quick detour into, by the way, if you didn't know. What I used to do was I was the CEO of Fannie Mae. And then that moment clicked in my mind of, oh, this is why my friend set us up. I get it now. But, you know, it was very, again, fun and we were having a great time. So that relationship then became him advising us and giving me, you know, mentorship guidance and whatnot. And eventually he said, hey, when I asked, would you be willing to help us build this company and really guide us along this journey, he said, hey, would love to, love, enjoy, have enjoyed working with you all this time and really look forward to how you can change this space.

[Miguel Armasa]

It was probably better than you didn't know.

[Andrew Wang]

Yeah. And there's actually another funny part, which is his son was actually my year in school and the class president.

[Miguel Armasa]

And the class president, yes.

[Linda Du Cindy]

He ran a great campaign, which I

[Andrew Wang]

didn't learn about until again, five years after he had been on our board and I was hanging out with him and he said, oh, do you happen to know my son Gus? And we realized, which honestly, I should

[Linda Du Cindy]

have realized sooner because Myopolis is not a common last name that I've encountered But just the dots were not connected.

[Andrew Wang]

Tim is a very serious man. Gus is a comedian.

[Miguel Armasa]

Oh, there you go.

[Andrew Wang]

So there was

[Miguel Armasa]

building in New York, right? That's, that's something you, you've done. There's always the debate whether you build in SF or elsewhere. New York is, I think for fintech, extremely important. At times I think it's more important than sf. But sf of course has the tech angle that's undeniably strong for you. Tell me about your experience building a New York based company.

[Linda Du Cindy]

Yeah, I would say so. Andrew and I were both in New York when we decided to actually start the company. But we actually had this conversation. One of our friends had called us early on and basically said, if you're building a tech company, you have to build it in SF. Power law, something, something, insert much logic.

[Andrew Wang]

No 10 billion dollar company or really at the time it was funny because it was early on. No unicorn that has really been successful in New York. Not a true statement anymore, but that was a thesis or idea.

[Linda Du Cindy]

Yeah, that's right. But for us it's one, our clients are closer to New York and so that's obviously a great reason. But two, I would say from a talent strategy standpoint, we've always kind of zigged where others have zagged. The nice thing about SF is you've got great tech talent, but the flip side of that coin is that You've also got 1,000 tech startups who are all trying to do the same thing, competing for that exact same talent. And so we found a lot of success in just finding really, really good people who want to be with us for a really, really long time to build this company with us. And a lot of them are in New York, some of them are remote. And then we did just open an SF office. Given AI has kind of snapped the power law back into Silicon Valley, I would say I'm really happy that we chose New York.

[Miguel Armasa]

So we have some, before we wrap up, some rapid fire questions. I don't do this a lot, but let's try it.

[Andrew Wang]

We can go for it.

[Miguel Armasa]

So in 60 seconds or less, do you have any unpopular advice for founders? And each one of you can go independently.

[Andrew Wang]

Most founders don't realize that when they enter the business of venture that they're making a very clear decision of whether they're building a business or they're building effectively a lottery machine. And those are very different things. One is you're playing the game that the VCs want you to play, because I think it is a model that Works for them and thus they're very willing to perpetuate it. And then there's building a business, which is what we think about because it's the simpler concept to think about. And it's what we're used to and what we sort of normally think about. Those are again, like I said, very different businesses. But I think it's super important that when entrepreneurs decide to build something that they're conscious about. Am I trying to build a business or am I trying to build a venture lottery ticket?

[Linda Du Cindy]

I don't know if this is unpopular, but I would say the number one most important thing is being really clear on what it is that you're betting on. You just have to know what your edge is because there are so many people trying to create value in the world and knowing exactly what that thing is and then doubling down on that. And it's a decision that only you can make because at the end of the day, you have to own it.

[Miguel Armasa]

What's something true about your business that sounds like a lie when you say it out loud?

[Linda Du Cindy]

Our largest enterprise software contracts will be 100 million plus in ACV. And we have no sales team, no marketing team.

[Andrew Wang]

That's wild. Another fun stat that to this day the board still makes fun of us for is we sold over 100 million of recurring revenue and contracts for the original operating business with basically just me as the key salesperson. We did founders led sales from the beginning to the end for the operating business. And we are effectively doing it. We're still doing it right now. And we're gonna build a billion dollar revenue, annual revenue business doing founder led sales.

[Miguel Armasa]

You're destroying all the advice. I love those. Name a decision you made that felt genius at the time but turned out to be completely wrong.

[Linda Du Cindy]

I have a good one. So I think people who are very first principles driven cannot help themselves. We in the beginning. Do you remember this? I think two years in we decided to innovate on compensation. And so we came up with this really complicated, very theoretically correct, I would like to say very theoretically correct compensation formula. And it was horrible. So maybe my advice would be be really thoughtful about where you innovate. It should be something that actually matters for your business. And by the way, there are some generalized problems that a lot of smart people building companies have spent a lot of time thinking about. You do not need to try to reinvent that wheel.

[Miguel Armasa]

It's like software, don't build your own CRM.

[Linda Du Cindy]

Exactly. Just go with it.

[Miguel Armasa]

Name a founder or CEO that you

[Andrew Wang]

admire and why Ali at Databricks. I correspond with him once in a while because he's an Andreessen founder and he offers his advice on the Andreessen threads. The reason why I think of him really highly is because when you think about how we operate and what we pride ourselves on, it's being extraordinarily thoughtful and principled about really every decision we make to a fault. Often there's sometimes where it doesn't really work that well, but for the most part, it's a good strategy, and it has led us to be very successful in a space that is very unconventional. And so being first principled about it is a better strategy than just using conventional wisdom. Ali is someone who one is super helpful and super thoughtful in every response that he gives to founders whenever they ask questions. But more so than anything, I'm just so impressed by the precision and clarity. It's something that we try to do a lot of work on and try to push internally, strongly, which is just having precision, clarity of thought. Because really understanding why and what you're doing allows you to understand how to do it best and why it matters and thus effectuate the right strategy.

[Linda Du Cindy]

Is it too cheesy if I say Andrew Wang?

[Miguel Armasa]

No. Completely acceptable. Andrew. Linda, really honored that you took the time. I also enjoy your company, the good vibes. You know, this has actually been fun. I'm impressed by what you are building. And, you know, I think it's 1% at least. You make it sound like there's still a lot to build.

[Linda Du Cindy]

So much to build. We're hiring a lot.

[Andrew Wang]

World's largest challenges. And honestly, it's also work that's really, really meaningful. We're able to do it in a way that we are really crafting the outcome ourselves. And I think that's really unique. You're not riding the same wave as everybody else. There's good and bads about that. It's good in the sense that you can control your destiny. It is bad because no one's pushing you so that you have a free ride. But it's still awesome at the end of day because when you know you get it done and you show the work and you show the results, you know it's because of you.

[Miguel Armasa]

Amazing. Thanks.

[Andrew Wang]

Thank you.

[Linda Du Cindy]

Thank you.

[Miguel Armasa]

You know, one joke I heard is FinTech's biggest success has been rebranding BackOffice to FinTech.

[Linda Du Cindy]

That's actually so true.

[Miguel Armasa]

Thanks for tuning in. I hope you enjoyed this great episode. If you want more interviews, make sure to subscribe, follow and leave a review on Apple, Spotify, YouTube or wherever you get your shows. It helps and means a lot. And if you have any suggestions or thoughts about the show, just drop me a line on LinkedIn or Twitter. Signing off till next week. I'm your host, Miguel Armasa.