William Hockey - Building the Operating System for the Dollar and Silicon Valley Heresy - [Invest Like the Best, EP.463]

Episode Summary

Executive Summary: Patrick O’Shaughnessy interviews William Hockey, founder of Column and co-founder of Plaid, about building a software company that also owns a bank, serving fintechs and global dollar use cases. The conversation centers on why Column is self-funded, why Hockey studies obscure financial history, and how AI, national security, and long-term thinking reshape financial services.

Main Topics: What Column is (Priority: 5/5): Column is software plus a bank, exposing APIs for payments, deposits, and credit. Serving fintech and global dollar rails (Priority: 5/5): It powers products like Built and other fintechs that need regulated dollar infrastructure. Travel and emerging markets as a strategy (Priority: 4/5): Hockey seeks ideas outside Silicon Valley to avoid consensus thinking and find new constraints. Bootstrapped ambition (Priority: 5/5): Column is built without venture capital so the company can stay profitable and long-term. Founder risk and incentives (Priority: 5/5): He argues founders should bear more risk and employees need clearer liquidity and fairness. Deep specialization and historical study (Priority: 4/5): He believes winning comes from mastering a boring niche and mining obscure history for edge. Dollar, AI, and national security (Priority: 5/5): He sees the dollar as strategic infrastructure and AI as a force that will reshape banks.

Key Arguments: Column wins by pairing software with bank ownership, which non-banks cannot replicate. Most of Column's revenue comes from software, even though it is technically a bank. Emerging markets create better ideas because constraints force creativity and leapfrogging. Bootstrapping lets Column make 10-year bets without VC pressure or trend-chasing. Founder risk is too low today; early employees often take more downside than founders. Deep expertise in a boring niche beats broad interest in hot themes like AI. The dollar is a national-security asset because it underpins global trade and sanctions.

Data Points: Expense reviews automated: 85% - Ramp ad copy cited at the top of the transcript Expense review accuracy: 99% - Ramp ad copy cited at the top of the transcript Company savings: 5% - Ramp ad copy cited at the top of the transcript Major customers on Ramp: Shopify, Stripe - Ramp ad copy cited at the top of the transcript WorkOS enterprise capabilities: SSO, SCIM, RBAC, audit logs - WorkOS sponsor description Products supported by Rogo: sourcing, diligence, modeling, memos, decks - Rogo sponsor description Money from software: 90 plus percent - Column makes most of its money from software, not banking spread Funding size: $70 million - Hockey says he bought the bank with roughly $70 million Stock pledged: over a billion dollars - He pledged Plaid stock to secure financing Loan terms: sofa plus 10% loan at 5% LTV - How he financed Column with debt Housing stipend: $2,000 a month - Column pays employees near the office to subsidize housing Tender/buyback share: 25% of earnings - Column uses annual earnings to buy back employee shares Employee ownership: 100% of employees and myself own the company - Hockey says Column remains owner-financed Mobile phone penetration in DRC: less than 25% - Used to illustrate emerging-market constraints Banking penetration in DRC: less than 5% - Used to illustrate emerging-market constraints Global trade in dollars: 75% - Hockey cites dollar dominance in global trade Typical VC growth threshold: above 30% off of a billion-dollar revenue base - He argues the venture model only works at massive scale Founder attrition metric: almost close to no regretted attrition - He says retention is strong at Column Large initial fundraising count: 80 and 90 investors - Plaid fundraising rejection period Aspirational capital intensity: $3 million seed round - He describes the modern startup safety net in Silicon Valley

Pivotal Quotes: "Silicon Valley is not a popular place." — William Hockey: He argues the region is elite-driven and disconnected from everyday users "VC money is kind of like heroin." — William Hockey: He explains how venture funding can become addictive and distort strategy "If you go to places that don't have that same bias, you find a different type of creativity." — William Hockey: He describes why he travels to emerging markets

Implications: Column’s model tests whether regulated infrastructure can scale profitably without VC, and listeners should watch whether its long-duration bet becomes a template for future fintech builders.