[I_Am_Experienced] From Zero to Hero!

MAX LEVCHIN and PAYPAL

    Why did Max Levchin draw my attention to PayPal’s success? Mostly accidentally, he and I have the same patience to standardize innovatively the world. Probably I give prominence to myself over-self-confidently, but at least that is my emotion after doing careful analysis. I am thinking of online marketing, whereas he thought of financial security. I wish to standardize the world of online advertising by formalizing the method of communication among advertising participants, while he did change the world by safe online payment. He was of sustainable success, and I have not been so far. Consequently, discovering Max Levchin’s work is of great importance due to the fact that it is going to inspire me sooner or later. It is extremely the countless number of interviews with Max Levchin, but I would like to look at him into the slices of an entrepreneur’s principles.

    The sentence, “PayPal went to public in early 2002 and was acquired later that year by eBay for $1.5 billion”, has become well known because of being not only the most meaningful event but also the telling period of PayPal. Nevertheless, traveling back 1998 to observe the very first day of PayPal, Max Levchin illuminated strongly the first principle of entrepreneurship: starting with our means.

    Is Max Levchin a successful entrepreneur? This is absolutely right but not sufficiently because a security person is who he was. Max Levchin received the bachelor’s degree in computer science at the University of Illinois at Urbana-Champaign in 1997 and what he wanted to do was crypto and security [1, p.8] upon which PayPal was born relying. In the other side, creating the first security software on Palm Pilot [1, p.9] and finding out his destiny to implement crypto on handheld device [1, p.9] demonstrates that Max Levchin started with what he knew the most: crypto algorithm. Additionally, Max Levchin did know that Peter Thiel, who was the one of the most influential co-founder of PayPal, was a hedge fund manager [1, p.8]. By the undeniably victorious career, Max Levchin made the principle, being means-driven rather than goal-driven, more transparent.

    Developing product is the most desirable curiosity in PayPal history, in the sense that the principle of transformation, which is adopting a unique set of decision-marking strategies, is expressed wonderfully. The very first product on which Max Levchin concentrated initially was a crypt library that he early realized its lack of demand. Afterwards, Max Levchin continued to do exaptation, a type of transformation, in the means of which the product was transformed to a wallet application for new customers who used handheld devices instead of software developers before [1, p.10]. The next iteration, cryptographically secure IOU note [1, p.10], was initially and enormously meaningful to PayPal’s success, which Max Levchin did reweighting type of transformation. Furthermore, deleting/supplementing type of transformation was demonstrated in the challengeable decisions, which was to kill handheld version and go with web version, forming PayPal today.

    Starting with our means and transforming our product is wasteful without people opening the opportunities, creating the products, and maintain business organization inasmuch as the principle of forming partnership is a necessary and inevitable step to go up victory ladder. PayPal is a striking example. Peter Thiel and Max Levchin not only worked together for the very first idea, but also made a commitment that Peter was CEO and Max was CTO [1, p.9]. Attempting to have a good cofounder was Max Levchin’s advice for young programmer [1, p.18]. Moreover, he definitely affirmed that Peter Thiel was the reason of PayPal’s success [1, p.18]. In addition, in order of fixing fraud problem, the most competitive feature of PayPal, Max Levchin convinced a student, Bob, to drop out of Stanford for a year and work with him [1, p.13]. As Max Levchin said: “Different people taught me different things” [1, p.18], building partnership is to drive the future.

    From the point of view of an computer-science researcher, I unavoidably love Max Levchin’s argument that security is not in any sort of a sense of anti-hacking defensive but just security in a wider sense: risk assessment. From the perspective of entrepreneurs, starting with means, transforming product, and forming partnership are essential to build up an outstanding business. Are these always-powerful foundations? The answer is “Who knows?”. Nonetheless, at least and for the most part, the case of PayPal and Max Levchin demonstrated them strongly. Experience is substantive but not enough. Therefore, let’s discover by ourselves based on these principles in order that when to be asked “Looking back, is there anything you would have done differently?”, then like Max Levchin, we will answer “No”.

[From the final assignment of Entreprenuership course] 

(The image is from venturebeat.files.wordpress.com)

Reference

[1] Founder at Work: Stories of Startups’ Early Days, Apress Media LLC, 2007