Today on Radical Personal Finance, we're going to kick off another sponsor. Sponsor of the day today is SoFi. On today's show, we're going to hear an extensive interview with Dan Macklin, one of the co-founders of SoFi. I think you're really going to enjoy this. SoFi is a unique new company that's trying to modernize the world of lending and they might be able to save you some money.

Welcome to the Radical Personal Finance podcast. My name is Joshua Sheets and I'm your host. Thank you for being with me today. Today, I'm going to work to help you save some money. Saving money is important. Lowering costs is always a good thing. And SoFi, I think, might be a way for some of you to do that.

Might be useful to those of you with student loans, might be useful to those of you with personal loans and maybe even to some of you who are taking out mortgages. I first heard of SoFi, I was about to call it social finance, I think that's where the name comes from.

I first heard of SoFi quite a while ago. I pay attention a little bit to the world of online finance and started seeing this name SoFi crop up and the way that these things are usually launched as far as the world of online media and online financial blogging and things like that is it'll launch in the form of a review and usually that review leads to an advertisement or to an affiliate relationship, things like that.

And so I started reading them and I started checking out the reviews and checking out the story and I was favorably impressed with a lot of the things that I saw. And then a couple of months ago and I was up in Charlotte for FinCon 2015, I was able to connect with the guys there, meet them there face to face, talk with them and we struck up a deal where I decided that they would make a good fit for supportive radical personal finance.

If you're not familiar with SoFi, SoFi is a really interesting story. I'm not going to spoil it here in the intro because you're going to hear the entire story right now in the interview that I'm about to play for you. But SoFi might be a really good fit for some of you to be able to refinance your student loans and gain the ability to cut your costs.

And as those of you who have seen the Building a Framework for Wealth presentation, which by the way, I often refer to these five points, ten words. I haven't talked a lot about that on the show. You can see it on the website or if you want the comprehensive overview, it's the presentation that I put out for all the patrons to see.

So if you're a patron of the show, one of your benefits is you get access to that presentation where I lay out the five-part framework for wealth. But part number two is decrease expenses. Anytime you can decrease expenses, that's always a good move, period. And so especially when it comes to things like debt refinance, that can be really useful.

If you can decrease your expenses, that can be a good move. So if you can cut interest rates, it's going to help you financially. So sit back, relax, enjoy this interview with Dan Macklin, one of the co-founders of SoFi. I think you're really going to enjoy it and it should provide some useful insight and I'll be back at the end to answer a couple of additional questions.

Dan, welcome to Radical Personal Finance. Joshua, great to be here. So we're here today to introduce SoFi as a brand new sponsor of Radical Personal Finance and I'm excited about talking with you because you guys are making quite the press. You've got quite the story and I think this will be a fun discussion.

I'd like you to start by sharing a little bit of your personal story as it relates to SoFi. Walk us through your personal career journey and how that eventually led to your being involved with the founding of SoFi as a company. Okay. So as you may be able to detect from my accent, I'm not from around these parts.

I'm from the UK. You're from Alabama, right? I hear that Southern drawl. Just east of Alabama somewhere. And I worked for a big international bank, Standard Chartered Bank in the UK, Singapore and China for about 12 or 13 years. That was great. And then I thought I'd like to get the US experience and do what effectively is a one-year MBA.

There's a course at Stanford that do full-time one-year MBAs for people with slightly more gray hair than the younger people doing the regular MBA. So I fitted into the gray hair category, did that. This is back in 2010 with the intention of having a nice year in California and then probably going back to Asia somewhere.

I was sponsored by my old bank. But really fell in love with the place, Silicon Valley and the country at large and the opportunities that existed here and tried to come up with an excuse to stay. By this time, I have a wife and two kids and we thought this is a nice place to bring up a family.

And fortunately, I got into a group with some of my classmates, including Mike Cagney, who is the CEO of SoFi. And four of us, we came together and had some ideas for how we thought personal finance could be done a little bit differently. And we had some ideas and then we thought, OK, why don't we make this into a company?

So I resigned from my old bank back in April of 2011. We graduated in late May, I think it was, on the Saturday and we started the company on the Monday. So that was just a shade over four years ago and then it's been a fun ride since then.

So this is the quintessential Silicon Valley entrepreneur story. What a cool background. What was the market opportunity that you saw at that time that you guys wanted to exploit? OK, so I'll answer this in two ways. I think at a very high level, we saw the financial services industry and all of us had come from that industry prior to going to Stanford.

We saw an industry that hadn't really changed, we didn't think, that much given the new technology that was available. We were in a place surrounded by very cool companies doing very cool things. And if you just think about what Apple and iTunes have done to music and Amazon has done to retail, the world of print media has been turned on its head.

All of these industries have been turned upside down and disrupted, whatever the word is you want to use. But finance was still being done generally in much the same way. Lots of intermediaries, lots of-- or a lack of transparency. And at the end of it, you have people investing and not necessarily earning a great return or depositing money and not earning a great return.

And then banks lending that money at a much higher rate. So we thought, why couldn't you put the users and the people that need the money closer together? And this was in the infancy of the peer-to-peer world. So that was our kind of high-level vision. But at a more ground-level view, we were at a place, one of the best schools in the country, depending on which ranking table you care to believe in.

And we saw that people were borrowing huge amounts of money to go to school. And these were creditworthy people. These were people that had great jobs prior to going to business school and the chances are would have great jobs after leaving business school. Yet they were still borrowing at 7% or 8%.

So as we dug into it, because student lending was not an area that any of us had any expertise in prior to SoFi, but as we dug in, we realized that student loans and student lending in general was a huge industry, if you can call it that, over a trillion dollars second only behind mortgages in terms of debt in the US.

And even despite this huge size of it, there were very few options for people to borrow. Everyone was borrowing at the same rate, generally very bad levels of service. And we just didn't understand why. So that was the origins for the business. And that's why we started SoFi and why our first product was in the student lending area.

Did it begin as a peer-to-peer product? It did. It did. So at the time, I'm sure some of your listeners are familiar with Prosper and Lending Club and these companies have gone on to grow very quickly in recent years. But back then in 2010, they were still at their infancy.

But there was this beginning of a peer-to-peer movement. So our first fund, our pilot fund, if you like, we had 40 people, alumni from Stanford invest about $50,000 each. So that created a $2 million pool. And we then lent that money out to about 100 students at Stanford. So there was that peer-to-peer element.

Since then, we've moved, we've evolved a bit. We take in institutional money as well as individuals, really just to allow us to scale, to keep up with the demand for the loans. But back then, it was a little bit more of a pure peer-to-peer model. So now, do you still allow individual investors to send money or has the peer-to-peer aspect gone away?

No, we do. So now, it's limited to accredited investors. So it's not necessarily for everybody. But for accredited investors, they can invest in the loans that we're making. And there are details on our website. It is, I'd be honest, the bulk of the money is coming from institutions. But it's a mixture.

It's a mixture of money coming from big banks and pension funds and small banks and hedge funds, not-for-profits, as well as individuals. So the actual loan products, now who are you targeting currently in 2015? So now, in 2015, we've expanded from just being a student loan company to offering mortgages and personal loans as well.

So our customers now, we call them members. We are adding about close to 10,000 customers, members, every month now. And that's split across three primary products-- student loan refinancing, mortgages, including new purchase and refinancing, and personal loans. So across those three products, we're bringing close to 10,000 people every month who are enjoying significant savings and getting great service.

Still those student loans are the biggest percentage of your business? What's the makeup of the loans that you're writing in terms of different channels? Yeah, they are. So at the beginning of the year, it was almost 100% student lending. And now, recording this, we're in October. And we just finished September.

In September, about 60% of our loan volume, which was close to $500 million just in the month of September, about 60% was student loan refinancing in its various forms. 40% was mortgages and personal loans combined. But they're fast catching up. So by the end of the year, we think student lending will be dipping below 50%.

One of the challenges is there seems to be various places that you can get money. What in your mind or in your business plan documents, what's the competitive differentiator? What makes you different from other lending institutions? Good question. There's a few things. I think at the heart of lending money, you have to have great rates.

So you can have the best service in the world and the slickest website, but ultimately, you got to have competitive rates. So I think that's very important. And if we talk about student loan refinancing, our customers are coming to us paying about 7% or 8% on average. And they're bringing those rates down to 3%, 4%, or 5%.

They're refinancing around $75,000, which means they're saving around $14,000 on average. Many are saving $20,000 or $30,000 or even more. So that's probably the primary reason why somebody is coming to us, because of those savings. I think that that's not the only thing. You have to have an easy and intuitive experience, application experience, to allow people to get through.

People are busy. Even if you dangle a carat of $20,000 of savings, they still have to get there. They still have to get through your process. So we've put a lot of work into making our online application as quick and simple as we can. So you don't have to speak to a soul if you don't want to.

You can do everything online. You can take photos of your ID and upload that. You don't have to fax or Xerox or physically mail us anything. But alongside that technology exists real human beings sitting here in California, actually in the wine country. We think happy people make for happy customers.

And it's bearing fruit, no pun intended. So we have people at the end of the phone who can help you through if you have any questions. So it's that mixture of technology but also real people on the end of the phone. Why are you willing and able to lend money at 3 to 5% if the market rate is 7 to 8%?

Well the truth is the market rate isn't 7 to 8%. I guess it depends what you call market rate. The existing rate they're paying is 7 to 8% because that was pretty much the only option they had when they took those loans. But the market rate for this individual now is the rate that we're charging them, the 3 to 5%.

Because these people have graduated, they have a job, they have an income, they have some kind of credit history. They shouldn't be paying 8%. So that is why we are able to charge them a lower rate. So then where's the profit incentive for the investor? If the maximum rate, I don't know what the maximum rates are that you're charging, is 3 to 5%, why would I, if I were an accredited investor, why would I be interested in investing through SoFi when there's not so much profit there at that 3 to 5% rate?

So sure, the rates are lower than they could be. But the truth is the credit quality of our customer base is extremely strong. So now I think we've just gone above 60,000 customers and of those customers only 5 of them have defaulted on their loans. And of those 5, 4 of them unfortunately passed away and we have a provision in our loan agreement that says if you pass away we'll wipe the debt.

So if you exclude those people there's only really one person who's willfully defaulted if that's the right expression. So it's a very strong book credit wise, financially speaking, of customers. And therefore that, obviously we have to do a good job and continue to underwrite and approve people in that same manner.

And let's hope the economy – we're doing well. The number of people that have defaulted is extremely low. So even though the rates they're paying are relatively low, investors can still get a return given those very low levels of default. How do you screen for applicants? Is it based on which school and you're a Stanford graduate and you've got an MBA so therefore in theory you have better job prospects than Joe Sixpack who just got a basic degree at the local community college or is it based on something different?

How do you actually maintain those high levels of repayment? It's based on many different factors but the most important one is what we call free cash flow. And what that boils down to is do you have enough money at the end of the month to pay your obligations including this loan?

So that is driven by a combination of your salary or different forms of income that you have and then some sense for your general cost of living. If you have different mortgage payments or whatever you have that have to go out, then we'll look at that. So it's not driven from your credit score.

We do look at your credit history to see that you've been paying your bills on time and you haven't been bankrupt in the last couple of years for example. But the actual score itself is an extremely low determinant in working out whether we approve you. And then we do look at your school but more importantly really is your occupation.

So if you're in an industry that has very low levels of unemployment then that counts in your favor. Nurses for example, there's a shortage of nurses in many cities in the US. So if you're a nurse and you live in whatever city you do, then it's very difficult for you to be unemployed.

You have to be really bad at your job to be unemployed. So we look at those kinds of things. Obviously some industries fare better than others and all of those things combined allow us to make the decision as to whether we can approve you. But we do approve more than 50% of the people that apply to us.

So it's a high bar but it's not unobtainable. Who are your major competitors in this space? So this is a great question and I always struggle on how to answer it because we were the first company to refinance federal and private loans together. So before we were doing it, there was no one doing it.

So in that sense, there wasn't any competition. And since then, there have been some other companies coming in having similar business models and there are earlier stages but they're still doing something similar. Obviously in mortgages, there's a lot more competition. It's a very crowded market and personal lending as well.

It's a much more crowded market. But I still believe and the answer I give to this question is that our biggest competition is lack of awareness. I don't mean that to be glib but I say it because there are millions of people out there with debt of one form or another who could save money and could save money by coming to SoFi.

And it isn't that they're necessarily being competed for or we're not competing with lots of people to find them. We just need to do a better job to make them aware. So there are other players in the industry but more than anything, student loan refinancing, there's 40 million plus people with student debt.

I don't know how many million of them could refinance but it is millions of them and we only have a tiny fraction of that today. Well done. That's an elegant answer to respond to an interview question. What are your major weaknesses? Well, let me tell you a story about a weakness that's a strength.

Well done, Dan. I like the answer. Thank you. On the mortgage market, do you offer – so clearly, the rates that we're talking about would relate to student loans. What is your drive or your competitive differentiation from the perspective of mortgages? A couple of things here. We started the mortgage product because our member base was telling us that they needed help with mortgages.

So these were lots of people that had recently come out of graduate school, undergraduate school, trending in their late 20s, early 30s, looking to buy their first home. And they were creditworthy people because that's who SoFi customers are but the reason they hadn't been able to buy their first home was because they couldn't find a down payment.

Typically, most lenders are requiring 20%. And if they can get away with less than 20%, they'd be stuck with huge mortgage insurance, PMI. So we looked at it and we didn't think that that needed to be the case. So we came up with a mortgage where you only have to put 10% down.

The minimum is a 10% down payment. And importantly, there's no mortgage insurance on top of that. So what we've allowed is many people that have otherwise been priced out of the market who otherwise would have to wait three or four years to save up that down payment, they've been able to come in and take a mortgage and buy a home sooner than they otherwise would.

So that's one of the big differentiators that we have versus the competition. So it sounds like you're competing more based upon product design and appealing to a certain set of borrowers versus necessarily a real advantage in interest rates or a real advantage in an even process. Although, I'm sure your process is much more elegant coming from Silicon Valley rather than Indiana.

But it sounds like you're primarily just focusing on a different segment. I mean, there's not a real huge saving. I'm sure your mortgage rates are simply competitive. Is that accurate? No, they are. So what I mentioned was for a certain demographic of people, but you hit it on the nail there, Joshua, in terms of the service.

Many people at SoFi had been through the mortgage experience ourselves with other lenders. And I don't think any of us were willing to tell our friends about it because it was very painful and long. And what we're trying to do at SoFi is shorten that and make it easier.

And a real example of that is you can take out your phone now. You can apply for a SoFi mortgage in 90 seconds and be approved with a customized rate for you. And you can dial up using your finger on your phone the amount of down payment and see how that affects your rate.

Obviously, as the down payment goes up, the rate can go down. But that kind of instantaneous decisioning is just not provided elsewhere. People have to apply and wait in many cases weeks for a bank to come back and say you've been approved. So the process is extremely important to us.

The number of days that people are in the process is very important to us. And that's, again, another big differentiator. And on the pricing, obviously, we have to be extremely competitive. But we're particularly competitive for the people that have only 10% to put down because there's a real lack of options out there.

But also on the refinancing side, if you have a decent amount of equity in your home already, then we're extremely, extremely competitive. I have a so-fi mortgage, so I can speak from the heart on this one. Nice. Now, it's definitely the mortgage industry in many ways does seem to be-- it seems to be slow to have accepted and brought in innovation.

When you think back and look at the background of it, me going through the process a few years ago, it's really frustrating. And the challenge is when you're working with an individual, how do you assure that you're getting the best scenario, the best product? I still see-- I know some companies are offering competitive illustrations, but I still see the value of somebody bringing more transparency to the market so people can be confident that they're getting the best choice.

It's a challenging market, so I'm glad to see you bringing some competition there. I'm interested, Dan, in what you've learned as far as your entrepreneurial story over the last five years. What's been the growth rate as far as employees and what's been the experience like in five years of running a Silicon Valley startup?

It's been great. It's the first startup I've been involved with. My previous company had 80,000 people, so a very different type of company. And obviously, there are challenges that come with that. There's a lot of uncertainty at the beginning. When you start, you don't really know where your customers are going to come from.

You don't know where the funding is going to come from. You're not quite sure if the business model is good enough and works. So that's a challenge, but that's what you get when you start a new company. And we've been fortunate enough to grow pretty quickly. So in terms of people, we're now up to over 400 people.

I think we'll be at 500 by the end of the year and probably by the end of next year, something like 1,500. And I think the loan growth that we've experienced so far gives you an idea of the growth. So if you just indulge me for a second, it took us, I think, three years to lend our first billion dollars.

So we got to a billion dollars after three years. And then each subsequent billion dollars has taken a much quicker amount of time to get to. So we got to two billion. I think it took another five months. Three billion, it took another four months. Four billion, it took another three months.

And we're just about to hit five billion, which will be that last billion will be in just over two months. So it's a real rapid growth. Most of that growth has come during this calendar year, 2015. And I think that's the really fun thing about building a business. It's tough at the beginning, but you get to some level, some level of scale.

And then I wouldn't say it just happens because it doesn't just happen, but you got the infrastructure set up and you can just do a lot more and help a lot more people. Would I be correct in guessing that your equity stake in SoFi would be the largest value asset on your personal balance sheet at this point?

Yes. Yes, by a considerable way. So feel free to be circumspect about numbers. And I know you're in a difficult situation running a company. I'm not asking for any particulars, but I would like you to comment on this theme. On radical personal finance, I talk a lot about entrepreneurship as simply being flat out the best potential investment for any person who's interested in building wealth.

And you come from the finance background, the banking background, depending on what aspect of the finance world you're in, you're accustomed at some level looking for good investments. You chose to get an MBA at Stanford, which has a unique educational program there, has a unique culture with being there in Silicon Valley, and you've chosen to live in a unique part of the world.

And it seems like it's in the process of working out well for you. From a risk-reward standpoint, it would seem like your risk, your personal risk – and I don't know how much money you put in, and again, feel free to say or not to say, but your personal risk was relatively low.

You were investing a lot of energy and hard work in an idea, and your personal return at this point seems like it's on track to be pretty substantial. Talk about the process of wealth creation through entrepreneurship and what you've learned by pursuing this path. Sure. So, I mean, a couple of points.

We're just starting here, so we're doing well, but we have a long way to go. So I don't want anybody to think that we've done it and we've succeeded because we're doing well, but we have a lot more to do. There's a lot more people out there that need our help.

But coming back to your question, it was a very tough decision because I was being sponsored by my old company and I had a job to go back to. I was living a nice expatriate life in Asia with my home paid for, my kids schooling, and health care and all that stuff.

So to give that up for what was essentially just an idea, a PowerPoint deck, was a really tough thing. And as soon as I tell this story to lots of people, but that resignation email was the most expensive email I sent because as soon as I resigned from my previous employer, I had to pay them back for the education that they were paying for.

And I was giving up all kinds of equity and bonuses and stuff that I was no longer eligible for as a non-employee. So that was a very expensive decision. So looking back on it, in some ways I'm surprised that I made it because the chances of a new company succeeding are very low.

Most startups fail. That's just the way it works. So I'm looking back, I'm pleased I made the decision, but I wouldn't necessarily say it was obviously the right decision for anybody at that time. But it was the right thing for me and I'm very happy with that decision. - Did you and your initial founding partners, did you guys fund the enterprise yourself or did you, as far as in the initial stages, or did you work to bring in investors from the early stages?

- We did work to bring in investors fairly quickly. So there were a few months where we weren't really being paid anything, but we weren't necessarily putting our own money into it. It was more equity. But that was a relatively short period. We had the advantage of coming out of Stanford where we incubated the company effectively that we got to interact with lots of potential investors.

So fairly quickly after we graduated, we raised a round of financing. It took a few months, but it wasn't a lifetime. And then with that, we had some funding. Even though we weren't paying ourselves salaries that we would otherwise be earning, we weren't going too far into the red every month.

- Could you have started SoFi or a similar type of company if you hadn't been involved in the Stanford program or if you hadn't been in Silicon Valley? - So hypothetically, yes. It wasn't that the only people that could start a student loan refinancing business had to be in Silicon Valley or Stanford.

But practically, I wasn't in the US. I was in China. I wouldn't have come up with an idea for a US company and been able to move here and do it. And I think the university environment, certainly Stanford Business School, fosters that collaboration and people coming up with ideas.

And we had a year really to work on something. I think that's tough if you're doing a nine to five job and you have demands on your time through your family or whatever else you have in your life. It's really tough then to get a few people to sit together and create a business.

And I think business school gives you that opportunity. So it's not the only place it could have happened. But for me, it wouldn't have happened unless I'd gone there. I wouldn't have met my co-founders for one thing. So that's, Stanford was instrumental in SoFi taking off. - What was the most valuable aspect of the MBA?

- I think it really is, for me, it was coming to a place and learning about a completely different world that I had been exposed to. So I'd been more of a corporate nine to five kind of job, not nine to five hours, but salary, you get what I mean.

Whereas you come to Silicon Valley and San Francisco and everywhere around here, and almost everybody's involved in a new company. So I think it just spreads that can-do attitude. We used to have people coming into classes, talking about their experience and how they'd built companies. Many had succeeded, some hadn't succeeded.

But there was definitely an element of me thinking, well, if they can do it, why can't I? And there's an infrastructure to raise money. There's an infrastructure to find employees. People don't look at you as a brand new company that isn't making money and say, well, that's a bit strange.

That's a bit weird. Because that's the norm here. So I think just being in that environment was hugely beneficial for me. Do you consider moving out of Silicon Valley or taking your company out of Silicon Valley? So we have offices, SoFi has offices now in five or six cities around the US.

So we only have about a quarter of our employees now actually in Silicon Valley or in San Francisco. Everybody else is in different places around the US. So the heart of the company is still here, but we're spreading our tentacles around the country. What's the strategy behind that decision?

I mean, a few things. There are great employees in many places around the US and we don't necessarily just need to be hiring here. From an operations perspective, there are advantages in having different operations units in different places in case of catastrophe or power outages or something. You don't want to have all your eggs in one basket.

We have our legal team out in DC where they're closer to some of the regulatory stuff that's happening. So we have engineers in Montana, which is slightly less competitive than hiring engineers in San Francisco. So there are lots of reasons why we're in different cities around the US. Do you think being involved as a founder, and I know I'm asking you personal questions, feel free again to evade the question if you need to.

The journey of the entrepreneur, the journey of the last five years, have you enjoyed the journey? Are you enjoying it because of the goal? Is it more about the process of creation? Is it more about the money? What are you finding being involved kind of at the tip of the tiger, whatever the appropriate metaphor is, with just a massively growing company?

What's been the real joy and what's been the real challenges as a founding member? So it's been really great. I've been extremely fortunate that I think we came up with an idea that was at exactly the right time. We were in the right place at the right time. And there's a lot of luck involved in that.

There's a lot of hard work and sweat and everything else, but there is an element of luck. We formed the company at a time that we were probably two years, two, three years out of the worst element of the Great Recession. So people had started to invest again, but there still wasn't that much going on.

Banks were still relatively reticent to get back into lending, and they continue to be really even today. So we've had this four-year period where I don't think you could have picked a better time to launch this business. So that's been in our favor, but obviously there's a lot of hard work that goes along with that.

So I'm extremely pleased with the decision we made. It's a tough ride. There are ups and downs. As long as you're trending upwards, eventually that's the main thing. But within that, that kind of disguises lots of daily ups and downs. So it's not for everybody. I tell this to people who are considering it.

It's not for everybody because if you don't like uncertainty, then you shouldn't join a new company. You shouldn't start a new company because it's uncertain. And some people thrive on that and some people don't. And it's tough to know until you do it, but you have to go with your gut instinct, I think.

It's funny. I feel sometimes when talking about entrepreneurship, I've got my own tiny little startup and I'm not trying to duplicate any kind of the scale of a technology company the way that you guys are. But I generally discourage people from doing what I'm doing. And one of the reasons that I discourage people is, number one, it's so difficult that if you don't really want it or you don't really have a clear vision, you're not going to follow through.

And I basically assume that the ones who should follow my advice to walk away and not do what I'm doing or not follow entrepreneurship, they'll get discouraged. And the ones who have the tenacity to follow through will just simply ignore the advice. And it seems even in what you're saying, I hear the same thing.

And I hear it as a constant theme with entrepreneurs. It seems like most entrepreneurs discourage other people from doing what they're doing, knowing that the ones who probably should do what they're doing will just simply ignore their advice and do it anyway. Yeah. I think there's a lot of truth in that.

It's difficult. So unless you really, really want to do it, it's probably not the thing for you because there are obstacles along the way. And unless you have a real passion for it, then it's going to be tough. But just going back to your question, Joshua, I think one of the things I'm really enjoying now is we're getting to the scale and my role at the company now, I'm getting to meet face to face a lot of our members.

We go around the country and host events and just get to interact. And there's not really an agenda there. There's no sales pitch. We just want to get to know them better and have a chance to say thank you. And it's really powerful once you meet people and see how you're changing their lives.

We have the benefit of dealing with financial products that have a huge role in people's lives. If you can refinance their student debt and save them $20,000, that's big. And there's great stories. Just last week, I was at a dinner and there was a couple there who didn't feel like they could start a family because they didn't feel like they had their personal finances in order.

They refinanced with SoFi, saved lots of money, got their finances in order, and now they're going through the adoption process because they believe that they've got things under control at home. And I think when you meet people like that and you hear stories like that, it's great. It's moving because you're now changing people's lives in a very meaningful way.

So that was always the intention and it takes a while to get there. But now we're doing that each and every day and that means a lot to us. That's really special. Two final questions, Dan, and we're done. Number one, I'm interested in your perspective from an insider's view, coming from an outsider from the UK, from Asia, coming in and then trying to understand and deal within the US financial regulatory environment.

You have different state laws. You're working with different products. Some are regulated at the national level, some at the local level. What's your overall perspective on the US financial regulatory framework? What's been your experience working within it? Okay, so first of all, disclaimer, I'm no expert on this. We have very well qualified and well paid legal experts in the SoFi team that handle most of this stuff.

But what I would say is the – I mean, there has to be regulation. There has to be regulation in finance because it's such an important industry and you can't have people just investing in anything and losing all their money because the economy and people's lives are at stake.

I think sometimes that regulation can get in the way of innovation. We are trying to – we are not a bank. We are a non-bank lender. So we have licenses in each state in which we lend and we have to obtain those licenses for every lending product that we wish to offer.

And mortgages, for example, is a tougher license to get in some of the states. So it just takes longer to get them. And while we understand that, it's frustrating when you have people that want to use your product but they happen to live in the wrong state and can't use your product.

So we work very closely with the regulators to make sure that we're obviously fully compliant. But just that, those differences across states, it makes it a little bit wonky in your offering because you can't offer the same things to all people on your website. Do you find the regulatory environment to be tilted at all in favor of the big dogs, the large financial institutions that are already covering the market?

That's a tough one. I think if you look at the number of new companies that have started in the finance area, particularly in the last five years, SoFi included, it's really heating up now. There are lots of new players coming in. And in general, we have very supportive and great relationships with the regulators.

So no, I wouldn't be able to say that. I think there's a lot of thirst for innovation and new ideas and competition, which I think is great. Last question. You've talked, here's your softball. Go through, and in a moment after the interview, I'll go through the Radical Personal Finance, SoFi relationship in detail, all the terms of the offers that we'll be making.

But talk through who would you like to see research SoFi to see if SoFi can help them save money and who would you want to steer away as far as we're going to guess that if you're in this situation, we probably wouldn't be able to serve you the best.

So in general, it's creditworthy people, which is a fairly vague statement. But if you have, looking at student loans, if you have student loan debt and you're paying north of 5% on it, then there's a very real chance that we can save you money by refinancing that debt. Mortgages, if you're looking to buy a home for the first time, particularly if you don't have 20% down payment, we offer great rates and offer the ability for that 10% down payment option.

And then personal loans, we haven't spoken too much about that. But if you have any kind of credit card debt that's north of 10%, then our personal loan rates are in the 5% to 10% range. There's no reason to be paying 15% interest on a credit card if you can pay 7% through a personal loan.

So creditworthy people, people who are employed, people that have good credit histories, you should check us out. And there are no commitments for any of our products. There's no origination fees or funny fees lurking in the background. And when you apply, you're not committing yourself to anything. So have a look.

Have a look. See what you think. But many, many thousands of people are applying every day. And we've funded now over close to $5 billion in most of that this year. So the word is spreading. But I'm always eager to make sure that there are more people out there that get a good deal when they can get one.

Dan, thanks for coming on. Where do you want people if they want to connect with you personally? Do you keep a blog, a company blog, Twitter? Where would you like people to connect with you? We do have a company blog and I write on that. So Twitter, the handle is @macklindan.

I'm just starting. I'm a newbie at Twitter but I'm making decent progress. Dan, thanks for coming on. Joshua, thank you. If you would like to try out SoFi, I have a tracking link. And the way that you can use my tracking link so that I get credit for your actions is to go to RadicalPersonalFinance.com/SoFi.

That's S-O-F-I, short for social finance. RadicalPersonalFinance.com/SoFi. The benefit of using that link is if you use that referral code, which automatically works if you go through that link, you will save $200 on the refinance of your student loans and $100 on the refinance of any personal loans. So if you execute a personal loan with them, they'll give you $100 in your account and $200 on your student loans.

Then I also receive a commission if you use that tracking link, which I would say thank you for. That's very useful and helpful to me and to the show. So you can find that link at RadicalPersonalFinance.com/SoFi. I'm not going to belabor with details here, although of course if you have additional details I'd be happy to answer them.

The one thing I want to mention to you is those of you who are familiar with some of the other sponsors of the show know that we have a sponsor named Jay Fleischman. Jay is a student loan attorney, and I have recommended that if you have student loans that you meet with Jay.

Just because SoFi is on here doesn't mean that I've changed that recommendation. I mean it. I sincerely recommend that you meet with Jay. I was on the phone with somebody earlier today and I told him, "You need to call Jay Fleischman. You have student loans. Why haven't you called Jay yet?

Do you not do what I tell you on the show?" I said it nicely, but that was the point. I said call Jay. The point is that refinancing student loans can be a very good thing to do. However, there are some reasons why you shouldn't, and how are you going to know whether you should just refinance directly or not?

Well, you're going to get advice. Call Jay. So that is the key. Call Jay, and then if the best thing for you to do is just to refinance your student loans and you can do that and cut back your interest rates and improve your terms, then Jay will be the one to tell you that and he will recommend that.

He is a fan of SoFi and he will recommend that you do that if that is right for you. So your best method of procedure here is call Jay or better – sorry, not call. Go to studentloanshow.com/radical. Studentloanshow.com/radical. That will take you through to Jay Fleischman who is a sponsor of the show.

And then after reviewing your situation with Jay, then check into refinancing your student loans with SoFi or again if you have personal debt or perhaps some of you might be able to use their mortgage services as well. And if you'd like to do that, go to radicalpersonalfinance.com/sofi. That's it.

That's all I wanted to cover for today's show. Sorry if my timing in these intros and outros is a little bit off, feeling a little bit under the weather today, but I wanted to make sure to get the show out for you. I thank each and every one of you who listens.

If you are listening to this in the current week, it is Thanksgiving week in the United States. The show is going out on November 23, 2015. So here on Thanksgiving week, happy Thanksgiving. I'll be releasing a number of shows for you and then we'll have a little break at the end of the week for Thanksgiving as we wind into the holiday season.

I hope that 2015 has treated you well. 2015 has definitely treated me well. But I'm even more excited about 2016 than I am about 2015. Lots of big changes coming. So I hope the content has been useful. I hope that it has gotten increasingly better and more useful for you.

Thank each and every one of you who listens. Special thanks to those of you who support the show on Patreon. That is the system where if you want to support the show directly, you can do so by patronizing our advertisers. That's helpful. Or if you want to skip the advertiser route or if you just find value in the content and you'd like to tell me that, then send me some money on Patreon.

The way you do that is go to RadicalPersonalFinance.com/patron. Sign up to support the show. RadicalPersonalFinance.com/patron can be as little as a buck a month, as much as a couple hundred bucks a month. Various benefits there. One of the benefits that you may enjoy is there is a presentation there.

It's about a 25-minute video presentation. At any level of support, even at a buck a month, you will gain access to that presentation. And that will lay out for you the framework for wealth, which is basically in some ways is the broad outline of the book that I'm working on and this broad outline of everything I know about finance fits into that outline.

And so you can see that's one of the benefits of becoming a patron. Go to RadicalPersonalFinance.com/patron and you will find all of those details. Until tomorrow, thank you all so much for being here. Appreciate each and every one of you. Let's see what AI knows about football. Hey, chatbot, should I bet on my team to win the big game this year?

Bet on Valley High Toyota to get you a great deal on a new 2023 Toyota. What? I'm talking about football, not a new car. Well, your team is trash and will never make it. Save your money and spend it on the car you need. Ouch. Score big on a new 2023 Toyota this season at Valley High Toyota.

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