In this episode, CJ interviews Alex Song, the VP of Finance and Capital Markets at Ramp who has also had a fascinating career in the world of investment. He explains how Ramp’s business model impacts liquidity, the unique balance sheet considerations of a payments company, and how credit card issuers approach risk management. He talks about the finance function as a trade-off between risk and return, and its job in brokering risk. He discusses how being in the payments flow lends itself to value creation and the value of owning the customer relationship. From seismic shipping vessels to rough diamonds, rail cars, and Colombian litigation finance claims, Alex also shares a number of fascinating stories about investments he has been involved in.
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TIMESTAMPS:(00:00) Preview and Intro
(02:04) Sponsor - Maxio | Planful
(04:09) How Ramp’s Business Model Impacts Liquidity
(07:17) Risk Management as a Credit Card Issuer
(09:47) What Duration Mismatch is
(14:00) The Finance Function as a Trade-off Between Risk and Return
(18:18) The Value of Owning the Customer Relationship
(22:16) Sponsor - Leapfin | Mercury | Netsuite
(25:28) The Role of a Finance Person to Be Risk-off
(26:32) Trading Mortgage-backed Securities After the 2009 Banking Collapse
(31:26) Storytime With Alex: Seismic Shipping
(33:17) The Story of Securitizing Rough Diamonds
(36:26) Colombian Litigation Finance Claims
(38:33) Alex’s Biggest Investment: Land Lots
(40:13) Investing in Rail Cars
(41:49) A Spicy Take on the Securitizations of Artists’ Back Catalogs
(45:05) Long-ass Lightning Round: Fat Fingering a Trade
(48:35) How Alex Has Changed as a Negotiator
(51:18) Craziest Expense Story
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