Michael Linford, the COO and CFO of Affirm joins CJ to delve into the Buy Now, Pay Later (BNPL) business model and its rise to mainstream popularity. They discuss the importance of transparent, consumer-friendly financial products and how Affirm differentiates itself by avoiding the predatory practices common in traditional credit models. Michael explains how Affirm structures its fees and generates revenue. He sheds light on the company’s approach to credit underwriting and the significance of short loan durations. The conversation also covers key metrics like customer acquisition and lifetime value, whether the merchant or end consumer should be the focus, and why Affirm doesn't rely on a North Star metric. Michael also shares his thoughts on the company’s approach to managing economic swings, before sharing advice on balancing patience with ambition in one's career and the value of an engineering-based approach to problem-solving.

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Mercury is a financial technology company, not a bank. Banking services provided by Choice Financial Group and Evolve Bank & Trust®; Members FDIC.

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TIMESTAMPS:

(00:00) Preview and Intro(02:37) Sponsor – Mercury | NetSuite(04:17) The History of the Pay-Over-Time Business Model(07:57) The Middle of America and Paying Manually(11:17) The Need for Honest and Transparent Credit(16:06) Sponsor – Maxio | Leapfin(18:27) How Affirm Makes Money(23:03) Affirm’s Credit Underwriting Process(26:00) Affirm’s No-Consumer CAC Model(29:43) Why Affirm Has No North Star Metric(34:15) Managing Economic Swings and Consumer Sentiment(39:52) The Impact of Purchase Size(44:13) Why Deferred Interest Products Are Immoral(48:56) An Engineer’s Approach to Being a CFO(53:40) Balancing Patience with Ambition in Your Career(56:11) Long-Ass Lightning Round: Taking Feedback(1:00:01) Craziest Expense Story